A federal judge has ruled that California cities may alter pensions in bankruptcy – a move that none of the state's three cities to enter Chapter 9 protection have attempted. The ruling came as the judge presiding over Stockton's bankruptcy trial delayed making a decision in that case about whether the city's exit plan is acceptable. That plan does not include cuts to pension payments and includes settlements with every major creditor except Franklin Templeton Investments. Stockton is proposing paying 1 percent of the $36 million it owes the company while Franklin is asking the judge to reduce the amount the city owes to the California Public Employees' Retirement System (CalPERS), the nation's largest public pension fund. Judge Christopher Klein's ruling on Wednesday is potentially groundbreaking. Until now, CalPERS had argued successfully in the bankruptcy cases of other California cities that the amounts it requires for public worker pensions could not legally be reduced.