Stories I’d like to see

Regrouping for Detroit, GM's bankruptcy evasion and Chinese corporate records

This column, a regular feature, was originally published on

1. Kevyn Orr and a Detroit rebound?

Last Friday, I happened onto a C-Span broadcast of a speech to a national group of bankruptcy lawyers given by Kevyn Orr — the emergency manager who Michigan Governor Rick Snyder appointed to take over Detroit’s finances and guide the fallen city through bankruptcy. Since I couldn’t stand watching the Yankees get slaughtered by the Los Angeles Angels of Anaheim, I stopped on the Orr speech for a minute. I stayed 45.

I had never seen Orr speak or paid much attention to Detroit’s troubles and his efforts to dig the city out from under. But if his talk — riveting, funny, emotional, self-effacing, forceful, fact-filled, wholly convincing and seemingly off the cuff — is any indication, both Orr and Detroit 2014 are big national stories.

They are worthy of coverage beyond the good work that’s been done by, among other local outlets, the Detroit Free Press, which ran this comprehensive story last month, on the one-year anniversary of Orr leaving a lucrative partnership at the Jones, Day law firm to take on the rescue job.

It’s a job that involves balancing the needs of retired police officers and fire fighters, who had every moral right (and probably an impregnable right under the state constitution) to expect to be paid the pensions (averaging about $30,000 a year) they were promised against the need to relight the city’s street lamps and provide funds for ambulances and fire trucks to improve horrifying response times.

Orr negotiated a pension deal two weeks ago. He has had to figure out how to make sure the city’s stellar collection in its Detroit Institute of Arts doesn’t have to be auctioned to pay off bond-holders, while also creating incentives for investors to come back to Detroit. It’s all being done against the backdrop of a decades-long legacy of local government so incompetent and corrupt that there’s a stench associated with making good on any debts or union contracts it negotiated — even if the people, particularly the pensioners, relying on those promises are not to blame.

Orr’s speech on C-Span describes his work a lot better than that. Take a look and you’ll see that he — and what’s he facing and doing in Detroit — are great stories. Pay particular attention to his description of the six year-old girl with the pink backpack waiting at the bus stop.

2. GM’s bankruptcy dodge: Where were the lawyers and the judge in 2009?

As this New York Times story reports, General Motors is aggressively trying to get lawsuits over its faulty ignition suits dismissed because most of the damage from the dangerous product occurred before July 10, 2009 — when a bankruptcy judge allowed General Motors in effect to become a new company and leave behind any liabilities resulting from acts of the old company.

That’s a standard and clear legal argument. But here’s my question: Did the bankruptcy judge grill GM lawyers — and GM corporate officers — during those 2009 hearings to find out if they knew of any possible over-hanging liabilities to consumers resulting from product defects that might become ripe litigation issues going forward?

Parties seeking bankruptcy protection are supposed to list all their liabilities, so that the judge knows what he or she is dealing with (and who is potentially being shortchanged) by allowing a bankruptcy restructuring.

How is the law supposed to apply in the case of potential and foreseeable product liabilities? How did the judge try to apply it in this case? How, if at all, did GM and its lawyers respond to any such queries? Did any product liability lawyers who might have been investigating the ignition switch problem at the time come forward?

Maybe I’ve missed it, but I haven’t seen any reporting yet on these obvious questions.

3. China’s open corporate records:

This story about the investigation of the business success of relatives of another former high-ranking Chinese official in The New York Times 10 days ago (co-reported by Michael Forsythe, the former Bloomberg reporter who resigned allegedly because Bloomberg spiked his story about the business connections of the Chinese elite) was yet another coup for the Times.

But it was this sentence that interested me the most, because I’ve seen variations on it in most of these great scoops about Chinese officials’ business dealings:

Three of Mr. Zhou’s relatives — a sister-in-law, a son and Ms. Zhan, the son’s mother-in-law — hold or have controlled stakes in at least 37 companies scattered across a dozen provinces, from Audi dealerships to property firms, according to corporate documents filed with the government.

Those italics are mine. It seems from reading these and other stories that somehow clear records of the ownership of Chinese corporate assets are more accessible in China than they are in the United States or other countries.

How did that happen? If top Chinese officials are so concerned about this kind of reporting that they won’t hesitate to harass the news organizations doing it by holding up their visas (or, in the case of Bloomberg, limiting the purchase of Bloomberg data terminals), why haven’t they shut down access to these records?

Has America ever needed a media watchdog more than now? Help us by joining CJR today.

Steven Brill , the author of Class Warfare: Inside the Fight To Fix America’s Schools, has written for magazines including New York, The New Yorker, Time, Harper's, and The New York Times Magazine. He founded and ran Court TV, The American Lawyer magazine, ten regional legal newspapers, and Brill's Content magazine. He also teaches journalism at Yale, where he founded the Yale Journalism Initiative.