Updated June 08, 2009
Supreme Court Halts Chrysler Sale to Fiat
FOXNews.com
The Supreme Court on Monday granted an emergency appeal asking it to halt the impending government-backed sale of Chrysler to Italian automaker Fiat.
The Supreme Court on Monday granted an emergency appeal asking it to halt the impending government-backed sale of Chrysler to Italian automaker Fiat.
The order stops for now Chrysler's sale, which the company claims could scuttle the deal.
Justice Ruth Bader Ginsburg signed the order, but it may be only temporary.
A federal appeals court in New York had earlier approved the sale, but gave opponents until 4 p.m. ET Monday to try to get the Supreme Court to intervene. Ginsburg issued her order just before 4 p.m.
Indiana Treasurer Richard Mourdock said the ruling was a small victory for Indiana pensioners, who brought the request for an injunction for fear of losing their stake.
"The ... thing I hear is, 'Oh, if this doesn't happen, the sale won't take place.' Let's not forget Fiat is not paying one penny for 20 percent of this deal. If I am going to receive $400 million worth of assets on day one and I don't have to make an investment, I don't care so much if it happen Monday, Tuesday or next week, I am going to be there in the end."
The court needs more time to figure out what it wants to do. In order for the stay to have a more lasting effect, five justices need to sign on it. That has not happened, or at least not yet. The court may yet deny the emergency request or grant it and await arguments about why it should actually hear an appeal.
Ginsburg could decide on her own whether to extend the delay or ask the full court to decide. It is unclear when she or the court will act.
Rep. Gary Peters, D-Mich., whose congressional district is home to Chrysler world headquarters, said the state of Indiana pension funds' attempt to stop the sale is an effort to prevent a swift emergence from bankruptcy in the name of a small sum.
Indiana's pension funds would lose $4.8 million if Chrysler is allowed to emerge from bankruptcy, Peters said, while the state will lose more than $20.7 million in tax revenue if Chrysler is liquidated, as well as incur tens of millions in lost revenue, expenses and new unemployment claims.
"Other stakeholders, including other secured lenders and Chrysler's autoworkers, accepted shared sacrifice because they recognized their interest was better served keeping Chrysler alive rather than forcing liquidation. Why the officials who decided to take their objections all the way to the Supreme Court can't recognize this is beyond me," Peters said.
Greg Signore, a Dodge dealer whose company is closing down as a result of the Chrysler sell-off, told FOX News he'd be in a better position starting from scratch than allowing the sale to go through.
"We're small dealers, we're getting crushed in all this. Why should we have to pay?" Signore asked. "If they liquidate the company, that's fine with me. But then everybody is on the same playing field. Then the big dealers are crushed too. Why should the small dealer have to get hit on this? Why should it cost me a half million dollars? I'd be in better shape."
FOX News' Lee Ross and The Associated Press contributed to this report.
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