These are the current lawsuits involving Puerto Rico and its debt
Puerto Rico, for those who may not know, is currently in debt. And where there is debt, there are typically lawsuits. Puerto Rico currently has a list of lawsuits concerning their debt. With that, let’s dive right into the current lawsuits involving Puerto Rico and its debt.
Assured Guaranty Corp vs. Puerto Rico and its Highways and Transportation Authority
The Assured Guaranty Corp (AGC) filed the lawsuit July 21,2016 in a San Juan court in an attempt to remove PROMESA’s stay and to stop Puerto Rico from taking toll revenue. The toll revenue repays the agency’s bonds and instead of using those funds for other expenses, assured guarantees repayment of approximately $1.2 billion of Highways debt, according to the complaint. The main goal of this lawsuit is for the AGC to protect insured bondholders from the Puerto Rico default. (Assured Guaranty Corp. et al v. Commonwealth of Puerto Rico, 16-cv-02384, U.S. District Court, District of Puerto Rico (San Juan))
Servidores Publicos Unidos (SPU) vs. Puerto Rico
SPU files a lawsuit against Puerto Rico recently in the San Juan federal court. SPU is stating that if Puerto Rico were to follow through with their PROMESA plan, both future and current retirees would suffer. If Puerto Rico were to follow through with PROMESA, it would cut government funding for retirees. This lawsuit will only further the strain between those involved in ending the financial crisis. PROMESA was Congress’ plan to help end the financial crisis. However, some of the people who are helping reach that goal believe that taking money from senior citizen programs that are government funded, is not the best way to go about this. The main goal of this lawsuit is to make sure that the retirees of Puerto Rico don’t lose their government funding.
PROMESA, a bill that President Obama signed into law, works as a defense for Puerto Rico while they are dealing with the debt. The Puerto Rico Oversight Board is currently making sure that the lawsuits remain frozen until they can clear their debt, but this ability will expire on May 1. They are able to do this due to PROMESA, because they need to deal with the debt before they can deal with the lawsuits. These are just a few of the several lawsuits that Puerto Rico currently has regarding their debt.