mr. tourr left goldman sachs and is in a phd program at the university of chicago. >> mary thompson, thank you very much. >>> a judge cleared the way for the bankruptcy case to go forward without legal challenges in other courts. this was the first hearing related to the city's bankruptcy and scott cohn was there. >> reporter: suzy, the city of detroit was founded 312 years ago today and for those who believe that what this city needs is a quick and thorough restructuring, this may have been quite a birthday present. at least, that's what u.s. bankruptcy judge steven rods said. he believed that clearing the way for a court case in his court, doing away with other challenges in state court is in the public interest. a spokesperson for the state, the bankruptcy expert to oversee this restructuring says the ruling by the judge is an important first step. >> this allows us to move forward. what we really can't have are weeks and weeks and weeks of delays because it runs up the cost. everyone in tha

mr. tourre this morning. what's the latest? >> yes, physically is right.listen. >> you feeling confident today? how you feeling today? feeling good? >> great, thank you. >> he also spoke with me in the courthouse moments ago saying he is feeling good. i asked what he thought of the fcc's case, and he said we'll see about that, but right now, we got out of the closing arguments of the fcc case, and the lawyer is giving it to tourre saying essentially he set up a world of lies, trickery, and deceit, a world of conflicts of interest, and he's living in the land of make believe when he did not tell investors in the deal where investors lost a billion where the hedge fund billionaire was sticking the assets and shorting the deal, so he was accused by the fcc of writing the flip book, the deal document that also did not disclose and we've got more breaking news. the fcc lawyer is saying that he lied on the witness stand when he said there's mistakes made. i was inaccurate, in subscribing the role as bearish, that is inconceivable, and they were in on the deal, a

mr. tourre is on the stand.-mail he sent to his girlfriend late one night in 2007, and it reads, the only potential survivor at the fabulous fab, standing in the middle of all these complex, highly levered exotic trades he created without necessarily understanding all the implications of those monstrosities. when asked about this, tourre said it was a silly romantic e-mail i sent to my girlfriend adding he was very stressed that day. the s.e.c. is presenting this as to tourre's mindset. he's repeating it was a flippant e-mail sent late at night. he added three times, i did not create a monstrosity when questioned about the synthetic cdo in question called abacus. a bet on the housing market that netted john paulson a billion dollars whole those on the other side lost a billion. the s.e.c. is accusing mr. tourre of securities fraud. the s.e.c. questioning, as i mentioned, continues. there's a break at about 12:45 today. after that we're expecting at one point the defense will begin its cross-examination of mr. to

mr. tourre and against him, who are hese people? guest: tourre is his own star witness. he spent about a day and a half on the stand telling his own story. he grew up in france. he was educated in france. he got a degree from a top gineering school in paris, came to the united states, got a masters at stanford and started working for gommedman sachs. and engaged.vely he speaks with something of a french accent, so he can be a little bit difficult for the court reporter and the jurors to understand. getting up on the stand, he's doing his best to get across to jurors that, you know, he wasn't one of these masters of the universe. he was part of a big organization on a transaction that was reviewed by lots and you f other people know, he wasn't one of these masters of the universe. he was part of a big organization on a transaction that was reviewed by lots and lots of other people at a place where they have lots of institutional control. and that he depended on those controls and those institutions to make sure there was nothing wrong with the transaction. on the other si

part of the defense or the prosecution's case is that tourre wases,mr.. paulson was going to put into this investment. been testimonys by one of the participants, a company called aca management which was a company that came in as a third-party and select the portfolio behind abacus. claim cutives at aca that goldman sachs convince them that paulson was taking a long position. they thought the housing and securities market would do well but it was exactly the opposite. that is how the investors were allegedly misled. one of the challenges for the andis that memories fade says this transaction, there has been nobody to say that fbarice tourre lied about the transaction. it is a circumstantial case based on e-mails and based on return anyilure to e-mail that suggested that aca thought that paulson and company was lot in the translation -- transaction. host: the phone numbers are on your screen. also send us tweets and e-mails. we're talking about this case being litigated by the securities and exchange commission in new york the last couple of weeks taking

mr. tourre deliberately withheld information to investors about john paulson, the hedge fund titan's roleillion dollars. the investors on the other side of the trade losing $1 billion. tourre's defense attorney foc focusing on two things today. she focused on subsequent e-mails sent by tourre to the members of all the involved parties showing preliminary term sheets that contradicted an earlier e-mail that the s.e.c. focused on. in that earlier e-mail basically there was no one taking an equity position in the subsequent e-mails it showed -- excuse me, there was someone taking an equity position. in subsequent e-mails it showed there wasn't. it goes to the fact that the parties should have known there was no one taking an equity position, ie paulson. they also focused on another e-mail written by tourre describing as surreal a meeting he had with aca and paulson. repeatedly he said he didn't really why he wrote that. he was shown documents by his attorney and he seemed to remember why he thought it was surreal because paulson was asking to buy protection on the banks because he was concer