Saturday, September 23, 2017

Unsecured Puerto Rico creditors disclose claims



By on August 16, 2017

SAN JUAN — On Wednesday, the committee that represents Puerto Rico’s unsecured creditors in the commonwealth’s bankruptcy cases under Title III of Promesa disclosed its claims against the government and its instrumentalities.

The members of the committee hold unsecured claims against the commonwealth arising from a variety of relationships, including contracting, labor and tax-related claims, among others. None of them hold bonds.

One of the committee members is the creditors’ trustee of now-defunct Doral Financial Bank, Drivetrain LLC, which has filed a claim against the government for about $300 million in tax overpayments. The defunct bank shut down its operations in 2015 over a bitter tax dispute with the commonwealth government.

Drivetrain—which was appointed Doral’s trustee in October to prosecute claims and causes of action—seeks payment under a closing agreement dated Dec. 30, 2013 with Puerto Rico under which the bank was allegedly entitled to a credit for overpayment of taxes in the amount of $34,097,526. Other claims related to Doral include certain 2006, 2007 and 2009 closing agreements, under which the financial institution was allegedly entitled to accrue an aggregate deduction of $296.5 million, according to the document.

Retirees, unsecured creditor committees named in Puerto Rico’s bankruptcy cases

Genesis Security Services Inc., meanwhile, said it holds $31 million in claims against the commonwealth and its instrumentalities under agreements for the provision of security services to a host of entities, including $10 million owed by the Education Department and $7 million owed by the Health Department.

Puerto Rico Hospital Supply Inc. holds $3 million in claims against the government under agreements for the purchase of hospital supplies, inventory and related services.

Other members of the unsecured creditors committee include Total Petroleum Puerto Rico Corp., which holds $14.5 million in claims arising from motor fuel purchases and supply contracts; and Unitech Engineering Group S.E., which has $11 million in claims, including $2 million against the Public Buildings Authority under certain construction contracts.

At least two unions—the American Federation of Teachers (AFT) and the Service Employees International Union (SEIU)—hold labor-related claims against the commonwealth, including breach of collective bargain agreements. SEIU represents the local Puerto Rican Workers Union, while AFT is the authorized agent of the Puerto Rico Teachers Association.

The unsecured creditor committee is represented by law firm Paul Hastings LLP.

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