After Justice Ruth Bader Ginsburg issued a stay on the sale of Chrysler's assets to Fiat in order to give the Supreme Court time to review an appeal to stop the sale altogether, the Court rejected the request and cleared the way for Chrysler to forge ahead.
Speculation that Ginsberg's stay would result in the Court taking the case and jeopardizing the sale was rampant yesterday, but the highest court in the U.S. has declined to review the case. The Court said in its order late Tuesday that it had not made a decision on the merits of the appeal, but found that the Indiana pension funds that brought the case had not proven the Supreme Court needed to intervene.
The pension funds claim that Chrysler's sale turns bankruptcy law on its head, jilting secured debt holders (usually the first to be repaid) and favoring unsecured debt holders (like the United Auto Workers). Two courts have already ruled in favor of Chrysler on the matter.
With the Supreme Court stepping aside, the U.S. and Canadian governments are expected to wire $2 billion to Fiat Wednesday morning to complete the sale.
Source: Bloomberg, The New York Times