GM waits for judge's ruling on sale plan

NEW YORK — An attorney for General Motors urged a bankruptcy judge Thursday to approve the automaker's sale plan, saying that the only other alternative would be a liquidation of the company's assets that would have "horrific" consequences for everyone.

Attorney Harvey Miller said the government appears committed to cutting off funding to GM if the sale is not approved by July 10. Some parties objecting to the sale argued in court that the Obama Administration won't allow GM to fail.

"Essentially the objectors are asking you to play Russian roulette," Miller said, adding that ignoring the deadline would put the futures of GM's employees, retirees, and creditors all at risk.

Closing arguments in the three-day hearing ended early Thursday afternoon. Court was set to resume after a lunch break. It's not known when Judge Gerber will rule.

GM's government-backed plan for a quick exit from Chapter 11 protection hinges on the sale of most of its assets to a new entity, allowing the automaker to leave behind many of the costs and liabilities that have made it unprofitable. The Detroit car maker's June 1 filing for bankruptcy protection was the fourth-largest in U.S. history.

Harry Wilson, a member of President Barack Obama's automotive task force, testified Wednesday that the government has no plans to continue funding GM past July 10 if the sale is not approved by then. Wilson said a quick sale is needed, because the government cannot keep sinking billions in tax dollars into the company for an open-ended period of time with no guarantee of success.

As part of a deal brokered with the auto task force, the U.S. government will get a 60 percent stake in the new company in exchange for what's expected to eventually total nearly $50 billion in aid.

Earlier, Michael Richman, an attorney for a trio of bondholders opposed to GM's plan told U.S. Judge Robert Gerber to "call the government's bluff" and require GM to restructure itself through a more traditional Chapter 11 process instead of through the quick sale of its assets.

Richman said that while the company may be powerless to fight the government's demands, the court can "push back" to protect the interests of all the company's stakeholders.

"The court should draw the line and say that this transaction goes to far," Richman said. "This sends a powerful message that even in the bankruptcy courts of the country's commercial capital there are limits and that rights and due process are not to be sacrificed."