Bond Insurers Sue Detroit After $9M In Missed Payments

Law360, New York (November 8, 2013, 2:14 PM EST) -- Three bond insurers sued Detroit in Michigan bankruptcy court on Friday, a week after the city missed a deadline for $9.4 million in interest payments, saying it is legally obligated to use tax proceeds to pay back the debt it incurred for capital improvements.

Ambac Assurance Corp., National Public Finance Guarantee Corp. and Assured Guaranty Municipal Corp. are asking the bankruptcy judge overseeing Detroit’s unprecedented Chapter 9 case to issue a declaratory judgment finding that the city has violated state law by failing to make payments...
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