Rhodes also denied the creditors' motion seeking access to up to a million additional pages of historic documents about the art housed at the city-owned museum. However, Rhodes said he would allow creditors to work with DIA officials to gain access to artwork in storage at the museum for purposes of inspection.
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"It doesn't appear it is necessary to remove art from walls," Rhodes said in his ruling from the bench, noting that it would pose a "substantial risk" to the safety of the art. He said such an inspection wasn't needed in order for creditors to object to the city's restructuring plan.
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At the core of creditors' requests today is their contention that Orr's restructuring plan greatly undervalues the art. The centerpiece of Orr's plan is the
In a statement,
"We were hopeful that the City would cooperate fully with the four parties that expressed interest in entering into transactions that would fully monetize the art," the statement said. "We maintain that the drastically undervalued DIA Settlement under the Grand Bargain places politics over the financial and legal realities of the situation and will almost certainly result in drawn-out litigation that no one wants."
The question of whether the art could legally be sold is a separate issue that was not addressed directly in the court proceedings. However, the issues relating to the possible sale of art and the legality of the Grand Bargain will be central to the fight over Orr's plan at the confirmation trial in July.
The city contends that the Grand Bargain, which has been endorsed by major retiree groups, fairly accounts for the art based on an estimate by Christie's auction house that said the value of roughly 2,700 works at the DIA bought with city funds was worth no more than
"We've got our noses pressed against the glass,"
While municipal bankruptcy law says that the city can't be forced by creditors or the court to sell assets including art, Rhodes could refuse to approve Orr's restructuring plan if he believes it unfairly shields assets. If that happens or the Grand Bargain falls apart, Orr might be pushed to propose a sale of art.
In issuing his decision, Rhodes rejected creditors' arguments that they deserved access to the art to gather photographs of the front and back of works and other information on behalf of their clients, who had offered potential bids for the art. Instead, Rhodes sided with city and DIA arguments that another valuation was unnecessary and overly burdensome for the museum, posing risks to the art and forcing the museum to close galleries to the public.
Rhodes told creditors' attorneys that they were free to examine the art on display at the museum by simply paying the admission charge.
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