WASHINGTON – The U.S. Supreme Court on Monday delayed Chrysler LLC’s sale to Fiat SpA at the request of several Indiana pension funds and some consumer groups opposed to the transaction.

Ahead of the decision, Chrysler and the federal government warned such an intervention might lead to the liquidation of the auto maker, The Wall Street Journal reported. But the high court, in a brief order, said it will extend a temporary stay put in place by an appeals court. Fiat previously set a June 15 deadline for the transaction to close.

Indiana pension funds representing teachers and police officers, among others, are appealing to the Supreme Court to block Chrysler’s bankruptcy and sale to Italy’s Fiat, saying they’re being treated unfairly.

“There is no other bidder for Chrysler’s assets,” an attorney for Chrysler said in a legal brief. “The only other viable alternative for Chrysler is to proceed with a liquidation that will return no more than $800 million for all constituents.”

Monday’s order granting an emergency stay could be a temporary delay. Justice Ruth Bader Ginsburg, after further review, has three options: lift the stay after her own review; issue another order continuing the stay until an appeal can be filed and reviewed; or refer the stay to the full court to decide.

Any decision to seek a hearing by the full court could delay a sale while appeals are filed and hearings scheduled.

Justice Ginsburg acted without referring the case to the entire court. Each Supreme Court justice is individually responsible for handling emergency motions from the various federal appeals-court circuits.

The appeals were filed over the weekend after the Second U.S. Circuit Court of Appeals in New York approved the acquisition of most of Chrysler’s assets by a group led by Fiat. The appeals court stayed the sale until Monday so the funds could make their case to the Supreme Court. A U.S. bankruptcy judge early last week approved the transaction.

The fast-paced stay process played out in a series of legal filings. Investors and creditors lined up on one side or another of the transaction while both Chrysler and the federal government argued in briefs that the deal didn’t warrant Supreme Court review.

Alengthy delay for a Chrysler-Fiat transaction would jeopardize jobs and tarnish President Barack Obama’s efforts to save Chrysler and General Motors. Justice Ruth Bader Ginsburg, above, will handle the funds’ filing seeking a stay.

According to a Chrysler filing, the Indiana pensions challenging the deal are set to lose $5 million dollars under the terms of the Fiat purchase. The pension funds, in their own filing, put their losses in the “millions of dollars.”

The pension funds argued the sale, orchestrated by the U.S. and Canadian governments under bankruptcy laws, was illegal and that the federal government exceeded its bailout authority with its involvement. “The negative economic consequences of permitting an unlawful sale to proceed may well over time dramatically outweigh Chrysler’s short-term harm,” the funds said.

Thomas Lauria, the lead attorney for the pension funds, said he got a call Monday from a Supreme Court clerk informing him of the stay immediately before it was officially announced. Lauria, a partner at White and Case, has been a leading crusader against the bankruptcy proceedings.

“It feels really good,” said Lauria. “We’ve been fighting this for a long time and haven’t had much to show for it along the way.”

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