Despite the disruption of the COVID-19 pandemic and the court’s order staying all plan and confirmation related litigation in the Title III cases, the Committee has continued to press the interests of Puerto Rico’s general unsecured creditors in these cases. For example, among other things:
- The Committee filed a motion requesting that the litigation stay be lifted so that it may pursue its objection to the GO bondholders’ asserted priority treatment over general unsecured creditors. As explained in the Committee’s objection, the GO bondholders have no right to recover ahead of general unsecured creditors. Nevertheless, the Oversight Board has preferred to seek a pro-bondholder settlement and has opposed the Committee’s efforts to pursue its GO priority objection. While the court has denied the Committee’s motion to lift the litigation stay, the Committee believes that the stay should be lifted, and, accordingly, is currently appealing the court’s decision to the First Circuit Court of Appeals. For more on the Committee’s motion to lift the litigation stay and pursue its objection, see here.
- The Committee filed a motion to terminate the motion to approve PREPA’s restructuring support agreement (RSA) so that the Committee may pursue its objection to the claims of PREPA’s bondholders. As explained in the Committee’s objection, PREPA’s bonds are largely or completely unsecured and without recourse to PREPA. The Oversight Board and AAFAF are opposing the Committee’s efforts to pursue its objection to the bonds. While the court has denied the Committee’s motion to terminate the PREPA RSA motion, the Committee believes that the stay should be lifted, and, accordingly, is currently appealing the court’s decision to the First Circuit Court of Appeals. For more on the Committee’s motion to terminate the PREPA RSA motion and pursue its objection, see here.
- The Committee, together with the Retiree Committee and the Oversight Board, continues to pursue litigation against the ERS bondholders arguing, among other things, that the ERS bonds were issued ultra vires because the ERS Enabling Act did not authorize ERS to issue public bonds. This litigation remains ongoing. For more on the ERS bondholder litigation, click here.
- The Committee, as part of its commitment to transparency, filed a successful motion for more detailed disclosure of the bonds held by creditor groups.