Maureen Hayden, writing for Community Newspaper Holdings Inc., has a story about State Treasurer Richard Mourdock’s never ending battle with Indiana’s money in the Chrysler bankruptcy. (h/t to reader RG).
In a court filing that has received little public attention, attorneys for the Indiana state worker pension funds are asking a federal appeals court to vacate a bankruptcy court’s order that cleared the way for Chrysler to sell its assets to a purchasing group lead by Italian car maker Fiat, the U.S. government and the automakers union.
I’ll be getting a little out of my depth here, but they seem to be hanging their hat on the thin reed of a Munsingwearorder from the United States Supreme Court. Generally speaking, a Munsingwear order is issued when a case becomes moot before it can be subjected to appellate review. The idea is that the case is over, so the appellate courts aren’t allowed to review it, but you don’t want to have potentially bad law remain on the books simply because an appellate court doesn’t have a chance to offer correction to the lower court.
On December 14, 2009, the United States Supreme Court issued a brief order, stating:
On petition for writ of certiorari to the United States Court of Appeals for the Second Circuit. Motion of Washington Legal Foundation, et al. for leave to file a brief as amici curiae granted. Petition for writ of certiorari granted. Judgment vacated, and case remanded to the United States Court of Appeals for the Second Circuit with instructions to dismiss the appeal as moot. See United States v. Munsingwear, Inc., 340 U.S. 36, 71 S.Ct. 104, 95 L.Ed. 36 (1950).
I haven’t gone over the Supreme Court briefs with any thoroughness, but the mootness argument seems to have been one made by the respondents and fought against by the petitioners (i.e. Indiana Pension Fund). In declaring the case moot, the Supreme Court seems to have found against Mourdock, but there was the additional factor of the Munsingwear rule.
With the Second Circuit appellate order cleared, the Indiana Pension Funds seem to have taken this as an opening to try to wade into the original bankruptcy order again. On March 8, 2010, the Indiana pensioners filed a petition for rehearing. An answer to that Petition was filed on April 9. I have not been able to locate a copy of the petition for rehearing. If the prior Second Circuit opinion was vacated by the Supreme Court, not because it was wrong, necessarily, but because the case was moot – no live issues were left to be resolved – then it strikes me as extraordinary to think that the Second Circuit would even have jurisdiction to rehear the case. Article III, sec. 2 of the United States Constitution limits the jurisdiction of federal courts to “cases or controversies.” The Supreme Court’s declaration that the case was moot seems to be a declaration that the case is dead – at least as to the issues covered by the Second Circuit’s ruling.
And, of course, there is the fundamental issue I’ve asked all along: there is no scenario under which the Indiana Pension funds would have recovered more money than they actually did. So why is the state treasurer pursuing this with such vigor and at such expense?
Prior blog entries on the issue: