Bankrupt California city takes exit plan to court

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Updated: 5/12/2014 10:29 am

SACRAMENTO, Calif. (AP) — The largest city in California to file for bankruptcy protection is asking a judge to approve its plan for reorganizing more than $900 million in long-term debt to rescue the city from two years of financial uncertainty.

Franklin Templeton Investments, which lent the city money, says Stockton is treating it unfairly. The case goes to trial Monday in a Sacramento courtroom.

In 2009, Templeton loaned Stockton $35 million to build firehouses and parks, as well as move its police dispatch center. Franklin says the city today is offering it $350,000.

The city has reached deals with all of its major creditors, except for Franklin.

Stockton's bankruptcy attorney Marc Levinson says he knows Franklin is not happy, but he adds that he's choosing his battles and making deals where possible.

©2014 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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