BRADENTON, Fla. - The appellants seeking to overturn Jefferson County's bankruptcy plan are objecting to friend of the court briefs submitted by two major municipal bond groups.
Attorney Calvin Grigsby, who represents local sewer system ratepayers, filed documents Monday and late last week opposing requests to file briefs by the National Association of Bond Lawyers and Securities Industry and Financial Markets Association.
On Dec. 18, both NABL and SIFMA asked the 11th Circuit Court of Appeals in Atlanta to provide guidance to municipal issuers by taking up the question of whether the ratepayers' appeal of the county's bankruptcy plan is moot because the plan is largely consummated.
Grigsby said in separate filings that the friend of the court briefs submitted by NABLE and SIFMA fail to meet the implicit standards required for the appellate court to accept.
Both briefs fail to reflect an adequate interest on the part of each organization; the documents fail to discuss anything that is missing from Jefferson County's petition; and they are not relevant to the issues before the court, Grigsby said.
"With regard to relevance the [NABL] brief is a disservice to the court because its main purpose is to materially advance the end of this litigation," Grigsby wrote, referring to the fact that some attorneys involved in writing the brief previously represented clients in the county's bankruptcy case.
The 11th Circuit Court has yet to rule whether it will take up the case, which is being sought by Jefferson County to appeal a Sept. 30 ruling by U.S. District Judge Sharon Blackburn, who is overseeing the ratepayers' bankruptcy appeal.
In the September ruling, Blackburn rejected an argument by the county that the ratepayers' appeal is moot because the plan was confirmed by the bankruptcy court and largely implemented with the sale of $1.8 billion of sewer refunding warrants in December 2013. The sale enabled the county to exit bankruptcy but the ratepayers' filed an appeal.
In its friend of the court brief, SIFMA told the 11th Circuit Court that it should act now to take up the county's petition because the lower court order allowing the ratepayers' appeal threatens to undermine market stability.
"The disruption created by the order for all issuers must be resolved now," SIFMA said. "The market cost of awaiting full district court proceedings is simply too high."
NABL urged the appellate court to take up the case because it raises serious questions for other municipalities that may contemplate Chapter 9 proceedings, and could make a difference in the marketability of the new sewer warrants the county has issued to settle existing debts as part of its bankruptcy exit plan.
