Judge Limits Bankrupt Ala. County's Use Of Sewer Revenues

Law360, Wilmington (June 29, 2012, 7:11 PM EDT) -- A federal judge on Friday barred bankrupt Jefferson County, Ala., from using revenues generated by its troubled sewer system to pay legal fees and cover capital expenditures, ruling that the money must be put toward paying down debt instead.

The decision resolves an adversary proceeding brought by Bank of New York Mellon — the indenture trustee for the county's more than $3 billion of sewer-related debt — and lenders including JPMorgan Chase Bank NA and Bank of America NA, who said that diverting the sewer revenues...
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