Puerto Rico Hit With 2 Lawsuits Challenging Board's Power
Puerto Rico was hit with two lawsuits that for the first time challenge the constitutionality of a federal control board overseeing the island's finances and its power to start a bankruptcy-like court process for some of the U.S. territory's more than $70 billion public debt.
August 08, 2017 at 11:00 PM
5 minute read
Puerto Rico was hit with two lawsuits that for the first time challenge the constitutionality of a federal control board overseeing the island's finances and its power to start a bankruptcy-like court process for some of the U.S. territory's more than $70 billion public debt.
One of the lawsuits was filed by U.S. hedge fund Aurelius Capital Management, which holds more than $470 million in Puerto Rico general obligation bonds, among other debt. It is the same hedge fund that was involved in a 15-year dispute over defaulted bonds issued by Argentina.
The second lawsuit was filed by the UTIER, a Puerto Rico union that represents about a third of the 9,550 employees at the island's Electric Power Authority.
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