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City of Detroit Files Chapter 9 Bankruptcy

The first step in the bankruptcy process requires the City to prove that it is eligible for Chapter 9 protection. Eligibility requirements include the City of Detroit proving that it is insolvent and that it has negotiated in good faith with creditors but failed to obtain an agreement to effect a plan of adjustment. If Detroit is found ineligible to have filed a Chapter 9 bankruptcy, the bankruptcy court must dismiss the case.

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