Judge denies motion to fast-track GM sale appeal
NEW YORK -- The sale of most of General Motors' assets is moving closer to completion, after a bankruptcy judge denied motions by groups with asbestos and injury-related claims seeking to halt the sale and appeal directly to the 2nd Circuit Court of Appeals.
The sale remains scheduled to close by July 10.
On Tuesday, a group representing people with product-liability claims filed a motion asking that their appeal of U.S. Judge Robert Gerber's approval of GM's asset sale plan be fast-tracked to the 2nd Circuit Court of Appeals, skipping district court.
In addition, a group representing people with asbestos-related claims against the automaker filed a motion asking that GM's sale be put on hold until their appeal can be heard by a federal district court judge.
Gerber denied both motions Tuesday evening. In a detailed written ruling, Gerber said he denied the request for a stay of the sale because he saw no "substantial possibility" that the groups would prevail at the 2nd Circuit, given how that court previously ruled on Chrysler's similar sale.
Gerber also pointed to the government's pledge to cut off funding to GM if the sale isn't approved by Friday, which would force GM to liquidate. The Treasury Department is expected to provide about $50 billion in aid to the automaker.
"We simply don't have the luxury of letting GM languish in bankruptcy while an appellate court considers the issues the Tort Litigants and Asbestos Litigants want to raise," Gerber wrote.
Objectors to GM's sale still have until noon Thursday to file appeals. After that, the sale will be free to close at midnight.
Late Sunday, Gerber approved Detroit-based GM's plan to sell the bulk of its assets to a new government-controlled company as part of its plan to quickly emerge from Chapter 11 bankruptcy protection. The product liability and asbestos groups filed their appeals the next day.
Gerber's Sunday ruling followed a three-day hearing that wrapped up last Thursday. GM and government officials had urged a quick approval of the sale, saying it was needed to keep the automaker from selling itself off piece by piece.
