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Puerto Rico Bankruptcy Dismissal Sought

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Aurelius Investment, Aurelius Opportunities Fund and Lex Claims filed with the U.S. Bankruptcy Court a motion to dismiss the Title III petition filed by the financial oversight and management board for Puerto Rico.

The motion explains, “The Financial Oversight and Management Board for Puerto Rico derives its existence and authority entirely from PROMESA, and it controls almost every aspect of the Commonwealth’s finances pursuant to that federal law. The Board is composed of seven voting members who have no superior officer save the President, yet were never subject to Senate confirmation.”

The motion further argues, “Moreover, six of them were effectively hand-picked by individual members of Congress pursuant to an intricate system of Balkanized lists designed to severely constrain the President’s appointment powers. There are no ‘historical analogues for this novel structure.’ That is because it violates the Appointments Clause of the United States Constitution and principles of separation of powers. The actions that the Board has purported to take since its inception – including its authorization of this Title III proceeding – are therefore void. The Court must dismiss the Title III petition.”

Read more Puerto Rico bankruptcy news.