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In re City of Stockton, California

United States Bankruptcy Court for the Eastern District of California

478 B.R. 8 (2012)

Facts

The City of Stockton (defendant) filed for chapter 9 bankruptcy on June 28, 2012. Stockton adopted a budget that, by state law, had to be balanced. Stockton unilaterally reduced retiree health benefits to balance the budget. Retired Stockton employees (plaintiffs) filed a motion for an injunction prohibiting Stockton from implementing the reduction, a declaration that the reduction was unlawful, and an order compelling Stockton to pay for all retiree health benefits and attorney’s fees.

Rule of Law

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Issue

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Holding and Reasoning (Klein, J.)

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A "yes" or "no" answer to the question framed in the issue section;
A summary of the majority or plurality opinion, using the CREAC method; and
The procedural disposition (e.g., reversed and remanded, affirmed, etc.).

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