Sunday, March 18, 2018

Leases at core of U.S. District Court omnibus hearing over Puerto Rico bankruptcy

By on March 6, 2018

SAN JUAN – An omnibus hearing Wednesday in U.S. District Court is slated to hear arguments on controversies involving government leases.

According to the hearing’s schedule, court-appointed fee examiner Brady C. Williamson will present his recommendations regarding the first interim applications for allowance of compensation and reimbursement of expenses submitted by professionals. He is proposing to pay $75 million to government advisers.

Mitsubishi’s request for relief from the stay on lawsuits imposed by the Promesa law that established the procedure to restructure Puerto Rico debt is also expected to be heard, a move opposed by the commonwealth government.

Arguments on a motion filed by PBA (Public Buildings Authority) Funds, a group of bondholders that is requiring the island government to continue paying rent, will be part of the hearing as well. The commonwealth and other creditors are objecting the motion. The island’s fiscal board said the motion should be denied because PBA Funds lacks standing to assert its purported rights against the debtors in these Title III cases under Promesa. The board contends PBA Funds are but creditors of a landlord–the PBA–of the debtors.

Loan conditions called into question during Prepa omnibus hearing

The judge also plans to hear a motion for an extension of an order for the government to assume or reject unexpired leases of non-residential property.

Meanwhile, the American Federation of State, County and Municipal Employees, and the American Federation of Teachers want an order to permit the processing of their labor claims.

Due to bad weather in New York, the U.S. District Court for the Southern District of New York may be closed, thus lawyers in the area may have to listen to the hearing over the phone.