On Bankruptcy and Mediation
Map of Puerto Rico By: Donald L Swanson Mediation is playing a central role in Puerto Rico’s bankruptcy. But mediating parties could not resolve an Appointments Clause dispute under the U.S. Constitution. So, the U.S. Supreme Court recently resolved it for them. And the Supreme Court's decision is a welcome affirmation of the legitimacy of actions... Continue Reading →
By: Donald L Swanson Puerto Rico’s long-standing financial straits, rendered more dire by Hurricane Maria, create an issue of bankruptcy priority: should available funds be used to, (i) address hurricane devastation and daily citizen needs, or (ii) pay creditor claims when due? --The answer to this priority is simple and easy in Puerto Rico: citizen needs... Continue Reading →
By Donald L. Swanson Puerto Rico is dealing with the storms of financial disaster and a hurricane’s aftermath. Here is a false narrative about the financial storm: Forgiving Puerto Rico’s debt “would only free Puerto Rico’s politicians from having to address the policies that were suffocating its economy to begin with.” --Wall Street Journal Op. Ed.,... Continue Reading →
By Donald L. Swanson Imagine this: opposing political partisans singing Kumbayah together over bankruptcy issues and laws! It could happen. It’s because of this rule of thumb: --There is no political constituency for bankruptcy issues – such issues are nonpartisan and apolitical. Put another way, neither conservatives nor liberals nor moderates (nor any other political partisan)... Continue Reading →
By Donald L. Swanson "We must decide whether Puerto Rico is a “State” for purposes of this [bankruptcy] pre-emption provision. We hold that it is." --Commonwealth of Puerto Rico v. Franklin California Tax-Free Trust, U.S. Supreme Court Case No. 15-233 (Decided June 13, 2016). The Bankruptcy Code definition of "State" is contained in Sec. 101(52) and... Continue Reading →
By Donald L. Swanson Have you ever wondered about the nature and history of Puerto Rico's relationship with the United States of America? After all, it’s located 1,600 miles beyond Miami and is separated from the U.S. mainland by the likes of Cuba, Bahamas, Turks and Caicos Islands, Haiti and Dominican Republic. So . .... Continue Reading →
By Donald L. Swanson On May 21, 2017, the Financial Oversight and Management Board for Puerto Rico files its “Petition” initiating a proceeding under the Puerto Rico Oversight, Management, and Economic Stability Act. This proceeding is described as a pseudo-bankruptcy and is pending in the U.S. Bankruptcy Court for the District of Puerto Rico (Case... Continue Reading →
By Donald L. Swanson “Puerto Rico’s federally appointed financial oversight board scheduled mediation in debt restructuring talks between the U.S. Territory’s general obligation bondholders and holders [of other debts] backed by sales tax revenue.” The mediation “will run from April 10-13 in New York.” --Reuters.com, March 31, 2017, at 11:09 a.m. An hour later, March... Continue Reading →
By Donald L. Swanson Let’s start by acknowledging that Argentina’s road from a $100 billion debt default in 2002 to a final mediated resolution in 2016 has been long and complex and difficult. The road began during an economic crisis, reached partial resolutions in 2005 and 2010, and achieved a final mediated-resolution in 2016. During... Continue Reading →
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