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Supreme Court Blocks Chrysler Sale

Deal with Fiat postponed at last second

June 8, 2009

• GM Offers Money-Back Guarantee • GM's Newest California Showroom: eBay • GM, Chrysler Personal Injury Victims Left Stranded • 'New GM" Exits Bankruptcy • Judge Greenlights GM Bankruptcy Plan • Obama Set to Sign 'Cash for Clunkers' Bill • States Challenge GM Sale • Supreme Court Okays Sale of Chrysler to Fiat • Supreme Court Blocks Chrysler Sale • GM To Scrap Medium-Duty Trucks • Penske Hopes to Drive Saturn Off GM's Lot • New Chrysler Agrees To Honor Old Lemon Law • Consumer Groups Appeal Chrysler's Lemon Law Reprieve • Dumped GM, Chrysler Dealers Not Going Away Quietly • The Hummer Lives to Fight Another Day • GM Files for Bankruptcy; Chrysler Gets Court Approval • Chrysler Sours on Lemon Law Obligations • UAW, GM Agree On New Contract • Consumer Groups Challenge Chrysler Bankruptcy • GM Notifying 1,100 Dealers They're Being Dumped • GM, Chrysler May Close 3,000 Dealers • GM Moves Up Saturn Execution, Plans to Drop 2,600 Dealers • GM Prepares to Scrap Pontiac • U.S. Carmakers Getting More Federal Aid • GM Cuts More Jobs, Eyes China --- • Consumer Complaints about GM • Consumer Complaints about Chrysler

Chrysler's sale to Fiat under a bankruptcy court deal has hit a major speed bump. U.S. Supreme Court Judge Ruther Bader Ginsburg has granted a temporary stay, blocking the deal from proceeding.

The two sides had hoped to close on their agreement this week. However, a group of Indiana pension funds that hold Chrysler bonds sought to block the deal. Ginsburg issued a stay on their behalf that delays the deal "pending further order."

While the stay is only temporary, Chrysler warns it could be permanent. The bankrupt carmaker said a delay could mean that Fiat walks away and the deal to deliver it from bankruptcy will collapse.

Earlier in the day the deal got a green light from the U.S. Court of Appeals in New York, but the panel gave plaintiffs until 4 p.m. today to appeal to the Supreme Court. Ginsburg's stay was issued just under the wire, right before 4 p.m.

The Chrysler deal was orchestrated by the White House and drew fire from Wall Street because Chrysler's senior debt holders received less of the company than the United Auto Workers Union health fund.

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