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Last Chrysler-Fiat Opponents, Take Two

Even if the deal between the former bankrupt American manufacturer Chrysler and Italian group Fiat has been sealed for quite some time, those opposing the asset sale still have a chance at overturning the outcome.

The US Supreme Court declined to speak on the matter on Monday and sent the case filed by a group of Indiana state pension funds which hold a debt in the old Chrysler back to the 2nd US Circuit Court of Appeals in New York.

In the entangled US judicial system, this means the Supreme Court vacated the 2nd Circuit's June ruling which affirmed the manner in which Chrysler's assets were sold. The June ruling no longer has the force of legal precedent.

"If the appeals court's decision had stayed on the books, it would have been very difficult for people to challenge these kinds of asset sales," Richard Samp of the Washington Legal Foundation, the group which represents the Indiana sale, was quoted as saying by Dow Jones.

The sale of Chrysler's assets to Fiat was approved in June, after a series of delays caused by opposing groups.

The Indiana group which still battles the sale hold $42 million of Chrysler's secured loans. That's less than 1 percent of a US$6.9bn secured lien on Chrysler's assets They challenged the sale due to the unlawful way the unsecured creditors were awarded.

The group argued that the plan to sell 29 cents on the dollar, according to Chrysler's plan to distribute stock, is an illegal "sub rosa" reorganization plan (secret plan), not allowed under bankruptcy law.
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About the author: Daniel Patrascu
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Daniel loves writing (or so he claims), and he uses this skill to offer readers a "behind the scenes" look at the automotive industry. He also enjoys talking about space exploration and robots, because in his view the only way forward for humanity is away from this planet, in metal bodies.
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