U.S. Court of Appeals for the First Circuit

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First Circuit backs Puerto Rico’s public utilities on bankruptcy preemption issue

July 06, 2015

The First Circuit held that the federal Bankruptcy Code preempts Puerto Rico’s Debt Enforcement and Recovery Act, which provided bankruptcy protections for Puerto Rico’s financially troubled public utilities. The district court's decision was affirmed on the grounds that the 1984 Amendments to the Federal Bankruptcy Code are unconstitutional.

U.S. Chamber files amicus brief

April 15, 2015

The U.S. Chamber filed an amicus brief supporting affirmance of a district court decision that held Puerto Rico’s Debt Enforcement and Recovery Act, designed to provide special protection to Puerto Rico’s financially troubled public utilities, is preempted under federal bankruptcy law. The brief argues that Puerto Rico’s Act creates a municipal bankruptcy system impermissible under federal law and, if permitted to stand, would disrupt the municipal bond market and damage the national economy.

William S. Consovoy, Thomas R. McCarthy, and J. Michael Connolly of Consovoy McCarthy PLLC represented the U.S. Chamber of Commerce as co-counsel to the U.S. Chamber Litigation Center.

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