By Diane Bukowski
November 7, 2013
(Editor’s note: up-to-date coverage of bankruptcy trial proceedings including former State Treasurer Andy Dillon’s testimony will be forthcoming shortly. Meanwhile, the following.)
DETROIT—U.S. Bankruptcy Judge Steven Rhodes has stricken from the record a request for a hearing on his recusal in the Detroit bankruptcy case which Mary Diane Bukowski, a city retiree creditor and official eligibility objector, as well as editor of Voice of Detroit, filed Nov. 6.
The request cites Rhodes’ participation as chair, without subsequent disclosure during the bankruptcy trial, in an Oct. 10, 2012 forum on Chapter 9 bankruptcy filings and Emergency Managers.
Five of six speakers were pro-EM, including accountant Charles Moore of Conway McKenzie, a major witness in the current trial. Others included a co-author of Public Act 4, the predecessor to the current EM law PA 436, and emergency manager trainers. Discussion about Detroit’s situation was held according to various news articles, with speakers stating that outside managers needed to take over from elected officials.
No speakers represented city retirees, workers, union leaders, or retirement system officials.
(See earlier VOD story at http://voiceofdetroit.net/2013/10/27/a-thousand-take-streets-to-stop-detroit-bankruptcy-repeat-action-mon-oct-29-12-n-as-snyder-testifies-rhodes-should-recuse-self-led-pro-em-forum/.)
Bukowski’s filing stated that Rhodes violated Canons 2 and 4 of the U.S. Orders of Conduct for federal judges by allowing the appearance of impropriety as well as raising questions regarding his impartiality in the matter.
Bukowski’s filing can be accessed at MDB request for hearing on Rhodes recusal.
Judge Rhodes replaced it with a six-page order denying the motion (click on DB Rhodes order MDB motion.
Judge Rhodes states in part, “The Supreme Court has held that in evaluating whether a judge’s impartiality might reasonably be questioned, the inquiry is from the perspective of a reasonable observer who is informed of all the surrounding facts and circumstances.”
He stated additionally, The United States Court of Appeals for the Sixth Circuit has held, “A district court judge must recuse himself where a reasonable person with knowledge of all the facts would conclude that the judge’s impartiality might reasonably be questioned. This is an objective standard.”
He went on, “In characterizing a “reasonable person,” the Seventh Circuit observed: “In addition to being well-informed about the surrounding facts and circumstances, for purposes of our analysis, a reasonable person is a “thoughtful observer rather than … a hypersensitive or unduly suspicious person. . . Finally, a reasonable person is able to appreciate the significance of the facts in light of relevant legal standards and judicial practice and can discern whether any appearance of impropriety is merely an illusion.”
As editor of the Voice of Detroit, and as an investigative reporter for the weekly Michigan Citizen from 2000 to 2010, Bukowski has extensively researched and covered issues relating to the Detroit bankruptcy filing for 13 years, including the predatory and likely fraudulent $1.5 billion Pension Obligation Certificates loan pressed on the City by criminal bank UBS AG and its minority partner Siebert, Brandford and Shank.
Rhodes further cites Canon 4 of the Code of Conduct, which Bukowski also cited, including the following: “Complete separation of a judge from extrajudicial activities is neither possible nor wise; a judge should not become isolated from the society in which the judge lives. As a judicial officer and a person specially learned in the law, a judge is in a unique position to contribute to the law, the legal system, and the administration of justice, including revising substantive and procedural law and improving criminal and juvenile justice. To the extent that the judge’s time permits and impartiality is not compromised, the judge is encouraged to do so, either independently or through a bar association, judicial conference, or other organization dedicated to the law.”
Rhodes continues, “In this case, a reasonable person with knowledge of all of the facts would know that I was only the moderator of the program and made no presentation at all. Instead, my role was limited to introducing the speakers and asking occasional questions to keep the presentations moving, focused and concise. Certainly, I heard the speakers’ presentations and found them informative, but this proves nothing more than my interest in the law and in my community.”
Bukowski requested in her filing that Rhodes disclose his comments at the forum, which was not video or audiotaped, as well as his connections with the speakers (e.g. who selected them among other factors). She cited a news article which indicated “broad-ranging discussion” of the issues was held after the panel presentation, and included a photo of Judge Rhodes evidently making a strong point.
Rhodes concludes, “The motion to disqualify is denied. Not for Publication.”
Rhodes also struck from the record a motion filed by the Official Retirees Committee for additional representation by Dentons. EM Kevyn Orr asked for the formation of that committee, which Rhodes referred to the U.S. Trustee to appoint. Although it was suspected that the Committee would be biased toward Orr as a result, in fact it has strongly opposed Orr/Jones Day positions on the bankruptcy and conducted blistering cross-examinations of Orr and Governor Rick Snyder.
Inquiries have been made to the Retirees Committee regarding this matter and will be reported upon receipt.