IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

In re:

THE FINANCIAL OVERSIGHT AND

MANAGEMENT BOARD FOR

PUERTO RICO,

as representative of

THE COMMONWEALTH OF PUERTO

RICO, et al.,

Debtors.1

PROMESA

Title III

No. 17 BK 03283-LTS

(Jointly Administered)

In re:

THE FINANCIAL OVERSIGHT AND

MANAGEMENT BOARD FOR

PUERTO RICO,

as representative of

THE EMPLOYEES RETIREMENT

SYSTEM OF THE COMMONWEALTH OF

PUERTO RICO (the “ERS”),

Debtor.

PROMESA

Title III

No. 17 BK 03566-LTS

UBS FINANCIAL SERVICES INCORPORATED OF PUERTO RICO’S

OPPOSITION TO MOTION FOR RECONSIDERATION

UNDER BANKRUPTCY RULE 9023

1 The Debtors in these Title III Cases, along with each Debtor’s respective Title III case number and the last four

(4) digits of each Debtor’s federal tax identification number, as applicable, are the (i) Commonwealth of Puerto

Rico (Bankruptcy Case No. 17 BK 3283-LTS) (Last Four Digits of Federal Tax ID: 3481); (ii) Puerto Rico

Sales Tax Financing Corporation (Bankruptcy Case No. 17 BK 3284-LTS) (Last Four Digits of Federal Tax ID:

8474); (iii) Puerto Rico Highways and Transportation Authority (Bankruptcy Case No. 17 BK 3567-LTS) (Last

Four Digits of Federal Tax ID: 3808); (iv) Employees Retirement System of the Government of the

Commonwealth of Puerto Rico (Bankruptcy Case No. 17 BK 3566-LTS) (Last Four Digits of Federal Tax ID:

9686); (v) Puerto Rico Electric Power Authority (Bankruptcy Case No. 17 BK 4780-LTS) (Last Four Digits of

Federal Tax ID: 3747); and (vi) Puerto Rico Public Buildings Authority (Bankruptcy Case No. 19 BK 5523-

LTS) (Last Four Digits of Federal Tax ID: 3801) (Title III case numbers are listed as Bankruptcy Case numbers

due to software limitations).

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UBS Financial Services Incorporated of Puerto Rico (“UBS”),2 by and through its

undersigned counsel, pursuant to section 315(b) of the Puerto Rico Oversight, Management, and

Economic Stability Act (“PROMESA”),3respectfully submits this opposition to the ERS

Beneficiaries’4 Motion for Reconsideration Under Bankruptcy Rule 9023 (Dkt. 23058)

(“Motion” or “Mot.”). In support of this opposition, UBS states as follows:

INTRODUCTION

1. The ERS Beneficiaries have fallen woefully short of the high standard for

reconsideration. The Motion merely recycles – often verbatim – their prior arguments from the

voluminous briefing and asks the Court to come to a different conclusion.5 There is no reason

for the Court to reconsider arguments that have already been thoroughly considered and

addressed. Specifically, in granting UBS’s Motion to Enforce the Plan in the Commonwealth

Action, the Court held that:

 The ERS Beneficiaries’ claims are derivative, not direct. Both the ERS

Beneficiaries’ pleading and their proposed new pleading “asserted claims to recover

for – or ‘on behalf of’ – an injury incurred by ERS” and were therefore “derivative of

ERS’ right to recover on its own behalf.” (Op. at 8)

 The Puerto Rico general tort statute, Article 1802, does not transform derivative

claims for injuries to the ERS into direct claims for injuries to the ERS

Beneficiaries themselves. The Court found that the ERS Beneficiaries’ claims are all

“predicated solely upon secondary harms flowing from UBS’ contractual relationship

2 Effective July 17, 2021, UBS Financial Services Incorporated of Puerto Rico was merged

into UBS Financial Services Inc.

3 PROMESA is codified at 48 U.S.C. §§ 2101-2241.

4 Undefined capitalized terms have the same meanings as in the Memorandum Opinion and

Order Granting the Motion to Enforce the Plan (Dkt. 22927) (“Opinion” or “Op.”) or UBS’s

Motion to Enforce (Dkt. 21651).

5 The ERS Beneficiaries have already made four filings in connection with the Motion to

Enforce – two opposition briefs, a sur-reply and a proposed supplemental brief. (See Dkts.

22175, 22199, 22294 and 22500) Their last proposed filing was rejected by the Court as

repetitive argument. (See Dkt. 22567)

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with ERS...the causal chain to the injuries claimed by the ERS Beneficiaries is quite

indirect and, by definition, starts with injuries inflicted on ERS, not its beneficiaries.”

(Op. at 11)

 The Plan provides that the Avoidance Actions Trustee alone can pursue ERS’

claims against UBS. The Plan provides that the Avoidance Actions Trustee

exclusively may pursue ERS’ claims against UBS on behalf of the Avoidance Actions

Trust for the benefit of creditors other than the ERS Beneficiaries. (Op. at 13)

2. After concluding that every claim brought by the ERS Beneficiaries in the

Commonwealth Court was derivative, the Court stated that “[c]ontinued parallel litigation of

derivative claims by the ERS Beneficiaries will infringe on the Avoidance Actions Trustee’s

ability to exercise litigation control and resolve the Underwriter Action.” (Op. at 14) The Court

therefore enjoined the ERS Beneficiaries from “prosecut[ing] claims against UBS based on its

business dealings with ERS.” (Op. at 14)

3. In asking the Court to reconsider its ruling, the ERS Beneficiaries do not identify

any valid bases for reconsideration. They point to no manifest error of law and do not submit

any newly discovered evidence. Their sole “new” argument – that enjoining the Commonwealth

Action is a “judicial taking” – has been waived because it was not timely raised. That argument

is also baseless because the Court has determined that claims asserted in the Commonwealth

Action are derivative claims that belong to the ERS.

4. Accordingly, as more fully explained below, the Motion should be denied.

ARGUMENT

I. MOTIONS FOR RECONSIDERATION ARE AN EXTRAORDINARY REMEDY.

5. “Rule 59(e) motions should be granted sparingly because parties should not be

free to relitigate issues a court has already decided.” Encanto Rests., Inc. v. Vidal (In re Cousins

Int’l Food Corp.), 553 B.R. 197, 201 (Bankr. D.P.R. 2016), aff’d in part, appeal dismissed in

part sub nom. Cousins Int’l Food Corp. v. Vidal, 565 B.R. 450 (B.A.P. 1st Cir. 2017); see also In

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re FOMB, 427 F. Supp. 3d 260, 263 (D.P.R. 2019) (a motion for reconsideration “is an

extraordinary remedy that must be used sparingly because of interest in finality and conservation

of scarce judicial resources”). To succeed, “[t]he movant must either clearly establish a manifest

error of law or fact or must present newly discovered evidence that could not have been

discovered during the case.” Guzmán v. Rentas (In re Nieves Guzmán), 567 B.R. 854, 863 (1st

Cir. B.A.P. 2017) (citing Banco Bilbao Vizcaya Argentaria P.R. v. Santiago Vázquez (In re

Santiago Vázquez), 471 B.R. 752, 760 (1st Cir. B.A.P. 2012)); see also Albarran v. Rivera (In re

Rivera), 627 B.R. 765, 775 (1st Cir. 2021) (“A manifest error of law is [a]n error that is plain and

indisputable, and that amounts to a complete disregard of the controlling law.”).

6. As a general matter, “it is very difficult to prevail on a Rule 59(e) motion.” Marie

v. Allied Home Mortg. Corp., 402 F.3d 1, 7 n.2 (1st Cir. 2005). “Rule 59(e) motions are aimed at

reconsideration, not initial consideration. Thus, parties should not use them to raise arguments

which could, and should, have been made before judgment issued.” Jorge Rivera Surillo & Co.

v. Falconer Glass Indus., Inc., 37 F.3d 25, 29 (1st Cir. 1994); see also In re Fin. Oversight &

Mgmt. Bd. for P.R., 427 F. Supp. 3d 260, 263 (D.P.R. 2019) (recognizing that a motion for

reconsideration “does not provide a vehicle for a party to undo its own procedural failures or to

introduce new evidence or advance arguments that could and should have been presented to the

district court prior to judgment” (quoting Quality Cleaning Prods. R.C., Inc. v. SCA Tissue N.

Am., LLC, 794 F.3d 200, 208 (1st Cir. 2015))), reconsideration denied, 612 B.R. 821 (D.P.R.

2019).

II. THE ERS BENEFICIARIES HAVE MERELY RECYCLED THEIR PRIOR

ARGUMENTS.

7. The ERS Beneficiaries spend the majority of the Motion rearguing that Article

1802, Puerto Rico’s general tort statute, provides a pathway for them to assert non-derivative tort

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claims against UBS in the Commonwealth Court. (Mot. at 4-7) This is not merely a recycled

argument; it is word-for-word the same argument submitted in their second sur-reply. (See

Exhibit A, comparing Motion for Leave to File Memorandum of Law in Support of ERS

Individual Plaintiff’s Opposition to UBS’ Motion to Enforce the Plan of Adjustment (Dkt.

22500) (the “Memorandum”) with the Motion). The Court rejected the proposed second surreply because “the subject of the second sur-reply—providing legal support for the existence of

an independent claim that would entitle the ERS Beneficiaries to compensation for damages—

has been thoroughly addressed in prior briefing.” (Dkt. 22567) (emphasis added). Indeed, the

ERS Beneficiaries had already briefed at length their argument that the tort claims differed from

the claims asserted by the Avoidance Actions Trustee. (Dkt. 22199 (Opposition) ¶¶ 23, 25-26;

Dkt. 22294 (Sur-Reply) ¶¶ 3-7)

8. The Court also squarely addressed this point in the Opinion. The Court held that

Article 1802 does not provide an independent non-derivative tort claim on the harm alleged in

the FAC because, “on its face, [the harm] derived from contractual relations between UBS and

ERS that allegedly resulted in harm to ERS. Any purported injury sustained by the ERS

Beneficiaries was a secondary harm.” (Op. at 9) The Opinion correctly characterizes the ERS

Beneficiaries’ tort claim as a “generalized injury” arising from the anticipated diminution of

retirement benefits from the ERS, and relating solely to the alleged harm that UBS caused to the

ERS’ financial condition. (Op. at 8) The Court held that in bankruptcy proceedings, this type of

generalized injury is properly asserted by the trustee, and the creditors are bound by that

outcome. Id. (citing St. Paul Fire & Marine Ins. Co. v. PepsiCo, Inc., 884 F.2d 688, 701 (2d Cir.

1989)).

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9. The ERS Beneficiaries have not shown that this conclusion by the Court was a

manifest error of law. Indeed, the Motion does not discuss the Opinion’s reasoning at all. Nor

does the Motion mention the standard for reconsideration. Instead, the ERS Beneficiaries

present their prior arguments for yet another time without giving the Court any reason for

hearing these same arguments again.

10. This rehash of rejected arguments falls far short of the exacting requirements for

reconsideration. Accordingly, the Motion should be denied.

III. THE JUDICIAL TAKINGS ARGUMENT HAS BEEN WAIVED AND IS

WITHOUT MERIT.

11. As stated above, a motion for reconsideration is not an opportunity for the movant

to raise new arguments that could have been raised before judgment was entered. Here, the ERS

Beneficiaries raise a “takings” argument for the first time without even proffering an excuse for

why this argument was not raised previously. Because this argument could have, and should

have, been raised in the prior briefing, it should be rejected as a ground for reconsideration. In re

Fin. Oversight & Mgmt. Bd. for P.R., 427 F. Supp. 3d at 263 (a motion for reconsideration “does

not provide a vehicle for a party to undo its own procedural failures or to introduce new evidence

or advance arguments that could and should have been presented to the district court prior to

judgment”) (quoting Quality Cleaning Prods. R.C., Inc. v. SCA Tissue N. Am., LLC, 794 F.3d

200, 208 (1st Cir. 2015)).

12. This new argument is also deeply flawed. First, “an adjudication of disputed and

competing claims cannot be a taking.” In re Lazy Days’ RV Center Inc., 724 F.3d 418, 425 (3d

Cir. 2013) (finding that “[t]he Bankruptcy Court did not take any of [appellee]’s established

property rights, but rather adjudicated the parties’ bona fide dispute regarding their rights under

the Settlement Agreement”). Here, the Court adjudicated competing claims over litigation

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rights, determined that those claims were property of the estate and held that they were assigned

to the Avoidance Actions Trustee. Resolving that dispute in favor of the litigation trustee was

not a taking.

13. Second, no property rights were taken from the ERS Beneficiaries because, as

determined in the Opinion, the ERS Beneficiaries do not have any personal causes of action.

The only causes of action that the ERS Beneficiaries asserted were derivative claims brought on

behalf of the ERS.

14. Third, a judicial order enjoining the ERS Beneficiaries from litigating the claims

in the Commonwealth Action does not fit the standard for a takings case. To determine whether

an act violates the Takings Clause, “courts consider three factors: ‘(1) the economic impact of

the regulation on the claimant; (2) the extent to which the regulation interferes with the

claimant’s reasonable investment-backed expectations; and (3) the character of the governmental

action.’” In re Fin. Oversight & Mgmnt. Bd. For P.R., 637 B.R. 223, 298 (D.P.R. Jan. 18, 2022)

(citation omitted). None of these factors is satisfied here.

15. On the first factor, there is no economic impact on the ERS Beneficiaries because

they have been separately guaranteed their anticipated retirement benefits under the Plan. As a

result, the ERS Beneficiaries no longer look to the ERS for the funding of their benefits. In the

Commonwealth Action the ERS Beneficiaries seek monetary relief to restore the financial

condition of the ERS – that relief no longer serves their interests. Enjoining that litigation has no

significant economic impact on the ERS Beneficiaries.

16. As to the second factor, the ERS Beneficiaries should not have expected to have

claims against UBS once they exchanged their rights to distributions from the ERS’ assets for

guaranteed benefits from a separate source.

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17. Finally, regarding the character of the government action, those actions benefited

the ERS Beneficiaries and the public. In approving the Plan, the Court explained that “the

restructuring of the relationships between the Commonwealth and its creditors under the powers

established by PROMESA is a prime example of a ‘public program adjusting the benefits and

burdens of economic life to promote the common good.’” In re Fin. Oversight & Mgmnt. Bd.

For P.R., 637 B.R. at 300. As part of that Plan, the ERS Beneficiaries relinquished rights to the

assets of the ERS in exchange for guaranteed payments from another source. This fairly

bargained-for exchange made with the approval of the Court cannot be characterized as a taking.

CONCLUSION

For all of the foregoing reasons, UBS respectfully requests that the Court deny the

Motion.

Respectfully Submitted:

In San Juan, Puerto Rico, this 28th day of December, 2022.

OF COUNSEL:

SKADDEN, ARPS, SLATE, MEAGHER

& FLOM LLP

Paul J. Lockwood (admitted pro hac vice)

One Rodney Square

P.O. Box 636

Wilmington, Delaware 19899

Tel.: (302) 651-3000

Fax: (302) 651-3001

McCONNELL VALDÉS LLC

270 Muñoz Rivera Ave.

Hato Rey, Puerto Rico 00918

Tel.: (787) 250-2631

Fax: (787) 759-9225

By: /s/ Roberto C. Quiñones-Rivera

Roberto C. Quiñones-Rivera, Esq.

USDC-PR Bar No. 211512

rcq@mcvpr.com

Counsel for UBS Financial Services

Incorporated of Puerto Rico

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EXHIBIT A

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MEMORANDUM OF LAW IN SUPPORT 

OF THE ERS BENEFICIARIES’

OPPOSITION TO UBS’S MOTION TO 

ENFORCE THE PLAN OF 

ADJUSTMENT

ERS BENEFICIARIES’ MOTION FOR 

RECONSIDERATION UNDER 

BANKRUPTCY RULE 9023

The ERS Individual Plaintiff’s

Commonwealth Action is based on Article 

1802 of the Puerto Rico Civil Code of 1930, 

as amended, P.R. Laws Ann. tit. 31, § 5141. 

In Puerto Rico, said article serves as the legal 

basis to determine if the actor of certain 

conduct that causes damages is responsible 

for extra-contractual civil liability. It

establishes that: “A person who by act or 

omission causes damage to another through 

fault or negligence shall be obliged to repair 

the damage so done.” P.R. Laws Ann. tit. 31, 

§ 5141. It further provides that “[c]oncurrent 

imprudence of the party aggrieved does not 

exempt from liability, but entails a reduction 

of the indemnity.” Id.

(Memorandum ¶ 1)

The ERS Individual Plaintiff’s

Commonwealth Action is based on Article 

1802 of the Puerto Rico Civil Code of 1930, 

as amended, P.R. Laws Ann. tit. 31, § 5141. 

In Puerto Rico, said article serves as the legal 

basis to determine if the actor of certain 

conduct that causes damages is responsible 

for extra-contractual civil liability. It 

establishes that: “A person who by act or

omission causes damage to another through 

fault or negligence shall be obliged to repair 

the damage so done.” P.R. Laws Ann. tit. 31, 

§ 5141. It further provides that “[c]oncurrent

imprudence of the party aggrieved does not 

exempt from liability, but entails a reduction 

of the indemnity.” Id.

(Motion at 4)

To that end, the Supreme Court of Puerto 

Rico has held that for a cause of action

to prosper under Art. 1802, supra, three 

elements must be present, namely: (1) a 

culpable or negligent act or omission; (2) 

causal relationship between the culpable or 

negligent act or omission and the damage 

being claimed, and (3) an actual damage. 

Nieves Diaz v. González Massas, 178 DPR 

820, 843 (2010); López v. Porrata Doria, 169 

DPR 135, 150 (2006). No contractual 

relationship between plaintiffs and defendants 

is required for a valid cause of action to exist 

under Article 1802.

(Memorandum ¶ 2)

To that end, the Supreme Court of Puerto 

Rico has held that for a cause of action to

prosper under Art. 1802, supra, three 

elements must be present, namely: (1) a 

culpable or negligent act or omission; (2) 

causal relationship between the culpable or 

negligent act or omission and the damage 

being claimed, and (3) an actual damage. 

Nieves Diaz v. González Massas, 178 DPR 

820, 843 (2010); López v. Porrata Doria, 169 

DPR 135, 150 (2006). No contractual 

relationship between plaintiffs and defendants 

is required for a valid cause of action

to exist under Article 1802.

(Motion at 4)

As for the first element, the Supreme Court of 

Puerto Rico has established that “the concept 

of fault...is as infinitely broad as the conduct 

of human beings and includes any fault of a 

person that produces harm or damages.”

As for the first element, the Supreme Court of 

Puerto Rico has established that “the concept 

of fault...is as infinitely broad as the conduct 

of human beings and includes any fault of a 

person that produces harm or damages.”

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2

Lopez v. Porrata Doria, supra, p. 150.

Likewise, the Supreme Court of Puerto Rico 

has held that the concepts of fault and 

negligence are equivalent to non-compliance 

with the duty of care. Which in turn concerns, 

in essence, not anticipating or foreseeing the 

likely consequences of acts, which would 

have been foreseen by a prudent and 

reasonable person. Nieves Diaz v. González 

Massas, supra, p. 844; Lopez v. Porrata 

Doria, supra, p. 151; Valle v. E.L.A., 157 

DPR 1, 18 (2002); Ramos vs. Carlo, 85 DPR 

353, 358 (1962). The foregoing does not 

require precisely imagining the universality

of consequences that may arise from a certain 

conduct. Pons v. Engebretson, 160 DPR 347,

355 (2003). “The essential thing is that there 

is a duty to foresee, in a general way, the

consequences of a certain class.” Id. For such 

purposes, the Supreme Court of Puerto Rico

has resorted to the figure of the good father of 

the family, or the prudent and reasonable

person, for purposes of determining how a 

person of normal or ordinary diligence should

act, by virtue of particular circumstances. 

Nieves Diaz v. González Massas, supra, p. 

844; Lopez v. Porrata Doria, supra, pp. 150-

151. Therefore, if the damage caused was 

foreseeable, there will be liability; if it was 

not, it will be considered a fortuitous event. 

Pons v. Engebretson, supra. The Supreme 

Court of Puerto Rico has also indicated that 

the duty of care and to foresee possible 

damages does not extend to any imaginable 

danger that could cause damage, but rather 

must be based on probabilities, not mere 

possibilities. Lopez v. Porrata Doria, supra, 

pp. 164-165.

(Memorandum ¶ 3)

Lopez v. Porrata Doria, supra, p. 150. 

Likewise, the Supreme Court of Puerto Rico 

has held that the concepts of fault and 

negligence are equivalent to non-compliance 

with the duty of care. Which in turn concerns, 

in essence, not anticipating or foreseeing the 

likely consequences of acts, which would 

have been foreseen by a prudent and

reasonable person. Nieves Diaz v. González 

Massas, supra, p. 844; Lopez v. Porrata 

Doria, supra, p. 151; Valle v. E.L.A., 157 

DPR 1, 18 (2002); Ramos vs. Carlo, 85 DPR 

353, 358 (1962). The foregoing does not 

require precisely imagining the universality of 

consequences that may arise from a certain 

conduct. Pons v. Engebretson, 160 DPR 347, 

355 (2003). “The essential thing is that there 

is a duty to foresee, in a general way, the 

consequences of a certain class.” Id. For such

purposes, the Supreme Court of Puerto Rico 

has resorted to the figure of the good father of 

the family, or the prudent and reasonable 

person, for purposes of determining how a 

person of normal or ordinary diligence should 

act, by virtue of particular circumstances. 

Nieves Diaz v. González Massas, supra, p. 

844; Lopez v. Porrata Doria, supra, pp. 150-

151. Therefore, if the damage caused was 

foreseeable, there will be liability; if it was 

not, it will be considered a fortuitous event. 

Pons v. Engebretson, supra. The Supreme 

Court of Puerto Rico has also indicated that 

the duty of care and to foresee possible 

damages does not extend to any imaginable 

danger that could cause damage, but rather 

must be based on probabilities, not mere

possibilities. Lopez v. Porrata Doria, supra, 

pp. 164-165.

(Motion at 4-5)

On the other hand, the second element 

requires that there be a causal link between 

the damage caused and the culpable or 

negligent act or omission, that is, adequate

On the other hand, the second element 

requires that there be a causal link between 

the damage caused and the culpable or 

negligent act or omission, that is, adequate 

cause. The theory of adequate cause provides 

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3

cause. The theory of adequate cause provides 

that “not every condition without which the

result would not have been produced is a 

cause, but the one that ordinarily produces it

according to general experience.” Colon 

Santos v. Coop. Sec. Mult. PR, 173 DPR 170, 

186 (2008). That is, “damage may be 

considered the probable and natural result of a 

negligent act or omission if after the event, in 

retrospect, the damage appears to be the 

reasonable and common consequence of the 

act or omission.” Pons v. Engebretson, supra, 

pp. 355-356; Hernández Vélez v. 

Televicentro, 168 DPR 803, 815 (2006). To 

that effect, the Supreme Court of Puerto Rico 

has held that “[t]he doctrine of adequate 

causality requires indices or criteria

based on experience and knowledge of causes 

and effects to give it content.” Lopez v. 

Porrata Doria, supra, pp. 166-67.

(Memorandum ¶ 4)

that “not every condition without which the 

result would not havebeen produced is a 

cause, but the one that ordinarily produces it 

according to general experience.” Colon 

Santos v. Coop. Sec. Mult. PR, 173 DPR 170, 

186 (2008). That is, “damage may be 

considered the probable and natural result of a 

negligent act or omission if after the event, in

retrospect, the damage appears to be the 

reasonable and common consequence of the 

act or omission.” Pons v. Engebretson, supra, 

pp. 355-356; Hernández Vélez v. 

Televicentro, 168 DPR 803, 815 (2006). To 

that effect, the Supreme Court of Puerto Rico 

has held that “[t]he doctrine of adequate 

causality requires indices or criteria based on 

experience and knowledge of causes and

effects to give it content.” Lopez v. Porrata 

Doria, supra, pp. 166-67.

(Motion at 5-6)

Lastly, for a cause of action under Article 

1802, supra, to prosper in our legal system, it 

is necessary that a damage actually occurs. 

This, for non-contractual purposes,

refers to “any material or moral impairment 

caused in contravention of a legal norm,

suffered by one person and for which another 

has to respond.” J. Puig Brutau, 

Fundamentals of Civil Law, Barcelona, Ed. 

Bosch, 1983, T. 2, Vol. 3, p. 92. See also

Sagardía De Jesús v. Hospital Aux. Mutuo, 

177 DPR 484, 505 (2009). In the absence of a 

damage, there is no obligation to indemnify. 

Lopez v. Porrata Doria, supra, p. 151.

(Memorandum ¶ 5)

Lastly, for a cause of action under Article 

1802, supra, to prosper in our legal system, it 

is necessary that a damage occurs. This, for 

non-contractual purposes, refers to “any 

material or moral impairment caused in 

contravention of a legal norm, suffered by one 

person and for which another has to respond.”

J. Puig Brutau, Fundamentals of Civil Law, 

Barcelona, Ed. Bosch, 1983, T. 2, Vol. 3, p. 

92. See also Sagardía De Jesús v. Hospital 

Aux. Mutuo, 177 DPR 484, 505 (2009). In

the absence of a damage, there is no 

obligation to indemnify. Lopez v. Porrata 

Doria, supra, p. 151.

(Motion at 6)

UBS, in its capacity as financial consultant 

and investment adviser, had the obligation 

and fiduciary duty to alert the members of the 

System’s Board of Trustees about the risks 

inherent in the issuance and proposed use of 

the proceeds of the 2008 POB’s. By failing to 

UBS, in its capacity as financial consultant 

and investment adviser, had the obligation 

and fiduciary duty to alert the members of the 

System’s Board of Trustees about the risks 

inherent in the issuance and proposed use of 

the proceeds of the 2008 POB’s. By failing to 

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922477-WILSR01A - MSW

do so, UBS breached that duty. Said conduct 

not only harmed the ERS itself, but directly 

inflicted foreseeable damages upon the ERS 

beneficiaries. Such damages consist inter alia 

of the ERS Individual Plaintiffs losing part of 

their pensions, higher age criteria to qualify 

for pensions, loss of their marginal benefit to 

take loans originated by the ERS, as well

as mental anguish and suffering.

(Memorandum ¶ 6)

do so, UBS breached that duty. Said conduct 

not only harmed the ERS itself, but inflicted 

foreseeable damages upon the ERS 

beneficiaries for which they have not been 

compensated. Such damages consist inter alia 

of the ERS Individual Plaintiffs losing part of 

their pensions, including cost of living 

adjustments, higher age criteria to qualify for 

pensions, loss of their marginal benefit to take 

loans originated by the ERS, as well as 

mental anguish and suffering.

(Motion at 6)

If as UBS claims, the individual Plaintiffs 

cannot prove their damages and the causal 

relationship between those damages and 

UBS’s errors, omissions, fault or

negligence, that is something for the 

Commonwealth Court to decide after the

Individual Plaintiffs have had their day in 

court. In other words, UBS cannot shield

itself from liability towards the Plaintiffs by 

simply arguing that it has to defend itself

in another case, against other parties, and in 

another jurisdiction.

(Memorandum ¶ 7)

If as UBS claims, the individual Plaintiffs 

cannot prove the damages suffered by

them and the causal relationship between 

those damages and UBS’s errors, omissions,

fault, or negligence, that is something for the 

Commonwealth Court to decide after the

Individual Plaintiffs have had their day in 

court. In other words, UBS cannot shield 

itself from liability towards the individual 

Plaintiffs by simply arguing that it must 

defend itself in another case, against other 

parties, and in another jurisdiction, in which 

the damages are claimed by another party.

(Motion at 6)

Lastly, it cannot be ignored, that on August 

30, 2013, the Commonwealth Court

of Appeals, at Pedro José Nazario v. UBS, 

KLAN201300738, ruled that the ERS 

Individual Plaintiffs have legal standing to 

prosecute the Commonwealth Action pro se, 

because they are the beneficiaries of the ERS. 

While doing so, the Court of Appeals referred 

to the ERS Individual Plaintiffs as the “people 

of flesh and bones who directly hold the right 

they claim”.

(Memorandum ¶ 8)

Lastly, it cannot be ignored, that on August 

30, 2013, the Commonwealth Court 

of Appeals, at Pedro José Nazario v. UBS, 

KLAN201300738, ruled that the ERS 

Individual Plaintiffs have legal standing to 

prosecute the Commonwealth Action pro se. 

While doing so, the Court of Appeals referred 

to the ERS Individual Plaintiffs as the “people 

of flesh and bones who directly hold the right 

they claim.”

(Motion at 7)

Case:17-03283-LTS Doc#:23175 Filed:12/28/22 Entered:12/28/22 17:54:43 Desc: Main

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