Monday, May 23, 2022

Judge Besosa denies fiscal board’s intervention in lawsuits

By on November 1, 2016

The United States District Court for the District of Puerto Rico (CB photo/ Juan José Rodríguez)

The United States District Court for the District of Puerto Rico (CB photo/ Juan José Rodríguez)

SAN JUAN – U.S. District Court Judge Francisco Besosa dismissed without prejudice Tuesday a request by the Puerto Rico Financial Oversight and Management Board to intervene in three consolidated cases on behalf of the government to maintain the stay on litigations imposed by Promesa.

The board had asked last week to intervene in the bondholder lawsuits, two against the Puerto Rico Highway and Transportation Authority (HTA) and one against the Employees Retirement System. A court hearing to determine if the stay on the cases should be lifted begins Thursday.

The hearing involves the lawsuit filed by Altair Global Credit Opportunities Fund and some 30 hedge funds against the Employees Retirement System. The Altair case wants employees’ contributions to retirement to be put in a separate account to meet certain debt payments.

The Altair case was consolidated with lawsuits filed by Peaje Investments and by Assured Guaranty Corp., which are trying to stop the government from diverting funds from the HTA for uses other than making debt payments.

Besosa didn’t provide reasons for denying the board’s intervention in the case. Because the request was dismissed without prejudice, the board’s rights or privileges aren’t considered lost or waived.

However, in a memorandum, he said the board didn’t comply with federal rules that say the motion must be accompanied by a pleading that states the claim for which intervention is sought.

You must be logged in to post a comment Login