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Bankruptcy Law Blog

Wednesday, June 10, 2015

Jefferson County Files an Appeal in its Bankruptcy Claim

What is going on with Jefferson County’s Bankruptcy?

When Jefferson County filed for protection under Chapter 9 of the Bankruptcy Code in 2011, they hardly expected the legal challenges would continue as long as they have.  The county owned sewer system that contributed greatly to the county’s financial trouble is the subject of a lawsuit from several customers attempting to block Jefferson County’s exit from bankruptcy.  The county’s bankruptcy plan includes rate hikes for sewer customers each year for the next forty years.

The customers claim that, because the reason for the bankruptcy was the corruption of public officials who have been tried and convicted, the sewer customers should not be required to bear the brunt of the cost.  Instead, they argue that the county’s debt should be reduced by $300 million to eliminate the need for rate increases. 
The county feels that the issue is irrelevant because they have already sold the warrants to refinance the debt in question.  The federal District Court Judge disagreed with them, indicating that the customers can still petition the rate increases.  The judge did not rule on whether the rate increases would be permitted, only that the lawsuit could go forward.  Jefferson County appealed this decision.

Jefferson County will be required to file their briefs by June 1, 2015.  The sewer customers will have an opportunity to file their response.  The 11th Circuit Court of Appeals will likely hear arguments by the end of 2015.

Not every bankruptcy case is as complex as the one involving Jefferson County.  Some can be even more complicated. Before getting started, it is important to hire an attorney you know you can trust to explain any potential complications.  The Mobile and Baldwin County bankruptcy lawyers at Padgett & Robertson have the knowledge and experience to best protect you and your assets in a bankruptcy action.  Call (251) 342-0264 today to schedule an appointment.

 


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Padgett and Robertson assist clients with Bankruptcy, Personal Bankruptcy, Consumer Bankruptcy, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy and The New Bankruptcy Law in Mobile, Alabama and throughout southern Alabama. Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”



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