The Puerto Rico Oversight Board sought on Tuesday to restart suits on $6.4 billion of revenue bonds and to set the central government bankruptcy disclosure hearing for June 16, The Bond Buyer reported. The board also extended a deadline for the bond insurers to withdraw their support of the debt deal. The board’s attorneys, led by Proskauer Rose Partner Martin Bienenstock, filed a memorandum of law supporting its motion to remove the stay on the revenue bond adversary proceedings concerning Highways and Transportation Authority bonds, Puerto Rico Infrastructure and Finance Authority rum bonds, and Convention Center District Authority bonds. They also filed a joint motion to schedule the disclosure hearing, establish deadlines for filing objections to it, and establish a document depository for the disclosure hearing. There are three revenue bond adversary proceedings (similar to law suits) in the Puerto Rico bankruptcy, one for each of the HTA, PRIFA, and CCDA. The bondholders claim that Puerto Rico’s central government “is liable to [the bondholders, bond insurers and bond trustee] for (i) not appropriating and transferring certain taxes and fees levied and collected by the Commonwealth [of Puerto Rico], which historically were appropriated and transferred to CCDA and HTA, and (ii) not appropriating and transferring certain rum taxes covered into the commonwealth Treasury by the United States Treasury, which historically were appropriated and transferred to PRIFA,” according to the Oversight Board’s filing.
