1

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

PROMESA

Title III

No. 17 BK 3283-LTS

(Jointly Administered)

R&D MASTER ENTERPRISES, INC.’S REPLY TO “O’NEILL & BORGES LLC’S 

OPPOSITION TO “MOTION TO DISQUALIFY THE LAW FIRM O’NEILL & 

BORGES, LLC FOR UNRESOLVABLE CONFLICTS OF INTEREST

INCURRED IN VIOLATION OF THE PUERTO RICO RECOVERY

ACCURACY IN DISCLOSURES ACT OF 2021, 48 U.S.C. § 2101

ET SEQ.”” FILED ON FEBRUARY 16, 2023, DOC. NO. 23,552

To the Honorable United States District Judge Laura Taylor Swain:

Comes now R&D Master Enterprises, Inc., a corporation organized under the laws of 

the Commonwealth of Puerto Rico (the “Movant”), represented herein by its undersigned 

counsel, who hereby respectfully files this reply motion and petitions this Honorable Court (the 

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 (the “Commonwealth”) (Bankruptcy Case No. 17-BK-3283-LTS) (Last Four Digits of Federal Tax ID: 

3481); (ii) Puerto Rico Sales Tax Financing Corporation (“COFINA”) (Bankruptcy Case No. 17- BK-3284-LTS) 

(Last Four Digits of Federal Tax ID: 8474); (iii) Puerto Rico Highways and Transportation Authority (“HTA”) 

(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 (“ERS”) (Bankruptcy Case No. 17- BK-3566-

LTS) (Last Four Digits of Federal Tax ID: 9686); (v) Puerto Rico Electric Power Authority (“PREPA”) 

(Bankruptcy Case No. 17-BK-4780-LTS) (Last Four Digits of Federal Tax ID: 3747); and (vi) Puerto Rico Public 

Buildings Authority (“PBA”) (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.)

In re:

THE FINANCIAL OVERSIGHT AND 

MANAGEMENT BOARD FOR PUERTO 

RICO,

as representative of

THE COMMONWEALTH OF PUERTO 

RICO, et al.,

Debtors.

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“Title III Court”) to permanently disqualify the law firm O’Neill & Borges, LLC (“O&B”) as 

advisors to the Financial Oversight and Management Board for Puerto Rico (the “Oversight 

Board”), as well as to disallow and disgorge fees paid and/or otherwise payable to O&B, for 

conflicts of interest and other violations incurred by O&B pursuant to the Puerto Rico 

Recovery Accuracy in Disclosures Act of 2021, 48 U.S.C. 2101 et seq., resultant from O&B's 

concurrent representation of the Oversight Board and of several private clients of O&B that 

possess private interests that are materially adverse to the public interests of the Oversight 

Board, of the Commonwealth of Puerto Rico and of the Puerto Rico Electric Power Authority

(“PREPA”), who are debtors here. The Movant respectfully states and prays as follows:

1. The motion titled “O’NEILL & BORGES LLC’S OPPOSITION TO “MOTION 

TO DISQUALIFY THE LAW FIRM O’NEILL & BORGES, LLC FOR UNRESOLVABLE 

CONFLICTS OF INTEREST INCURRED IN VIOLATION OF THE PUERTO RICO 

RECOVERY ACCURACY IN DISCLOSURES ACT OF 2021, 48 U.S.C. 2101 ET SEQ.”” filed 

by O&B on February 16, 2023, Doc. No. 23,552 (the “Opposition Motion”) is based on false 

and/or misleading premises and entirely fails to address key facts pertaining to O&B’s 

disqualifying conflicts of interest.

2. First, the Economic Development Bank for Puerto Rico (by its Spanish 

acronym, the “BDE”) is a covered entity subject to the supervision of the Oversight Board 

under PROMESA and, therefore, this Title III Court has unimpaired jurisdiction and 

competence to adjudicate any and all controversies involving the BDE.

3. Second, the Movant is a creditor of the Commonwealth of Puerto Rico and a 

client of PREPA suffering the consequences of ill-conceived contracts and, therefore, the 

Movant has unimpaired standing to plead the conflicts of interest incurred by O&B.

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4. Third, O&B is in fact conflicted. The Movant has properly evidenced to the 

Title III Court of the multiple conflictive representations that disqualify O&B.

5. O&B’s engagement as legal counsel to the Oversight Board does not excuse its

ongoing violation of Canons 21 and 38 of the Canons of Professional Ethics applicable to all 

Puerto Rico attorneys.

6. The Oversight Board’s engagement of O&B as its local legal counsel since 

2016 does not exempt O&B from complying with the Canons of Professional Ethics applicable 

to all Puerto Rico attorneys and law firms since 1970.

7. Canon 21 of the Canons of Professional Ethics explicitly prohibits all Puerto 

Rico attorneys and law firms from simultaneously representing any clients holding adverse 

interests. The ethical standard imposed by Canon 21 expressly forbids any single lawyer or 

law firm from simultaneously representing contractual counterparties. It should be noted that 

in Puerto Rico, the Supreme Court has not recognized as applicable the so-called Chinese Wall 

doctrine, so as to avoid or side-step any possible conflict of interest between an attorney and 

the entire firm. See Puerto Rico Fuels Inc. v. Empire Gas Co., 133 PR Dec. 112 (1993). 

Simply put, if an attorney within a firm has a conflict, then the entire firm has a conflict. 

8. Furthermore, Article 5(G) of Law 237 of August 31, 2004, P.R. Laws Ann. Tit. 

3 L.P.R.A. § 8611, expressly prohibits conflict of interest between a private contractor and any 

government agency, including public corporations. The law goes even further prohibiting the 

contractor from breaching public policy.

9. O&B cannot be deemed to be a “disinterested person” under PRRADA by selfdeclaring itself to be disinterested and omitting to address relevant facts relating to its 

conflictive representations.

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10. O&B’s misleading statements as to its own alleged disinterestedness under 

PRRADA do not conform to the reality at hand.

11. Contrary to O&B’s assertions, O&B has in fact represented clients included in 

the MIP List holding interests adverse to the Commonwealth of Puerto Rico and/or PREPA 

during the same time period in which O&B represented the Oversight Board.

12. AES Ilumina, LLC2 and AES Puerto Rico, L.P.3 are clients of O&B, as selfreported by O&B in its PRRADA disclosures. (See Docket Entry No. 21,485, at page 19 of 

37.) PREPA is the sole client and single source of revenue of AES Ilumina, LLC and AES 

Puerto Rico, L.P. in Puerto Rico. Therefore, all business and affairs that the aforesaid 

companies undertake in Puerto Rico – with or without the assistance of O&B – exclusively 

relate to their substantial contractual relationships with PREPA.

13. EcoElectrica, L.P.4 and Gas Natural Aprovisionamientos SDG, S.A. (d/b/a 

Naturgy)5 are also clients of O&B, as self-reported by O&B in its PRRADA disclosures. (See 

Docket Entry No. 21,485, at page 21 of 37.) PREPA is the sole client and single source of 

revenue of EcoElectrica, L.P. and Gas Natural Aprovisionamientos SDG, S.A. (d/b/a Naturgy). 

2 AES Ilumina, LLC maintains a Power Purchase and Operating Agreement with the Puerto Rico Electric Power 

Authority worth at least $90,000,000.00 that is registered at the Office of the Comptroller of Puerto Rico under 

registry number 2010-000050. Said contract was reviewed and approved by the Oversight Board on September 

30, 2020.

3 AES Puerto Rico, L.P. maintains a Power Purchase and Operating Agreement with the Puerto Rico Electric 

Power Authority that is registered at the Office of the Comptroller of Puerto Rico under registry number 1995-

AI0077. AES Puerto Rico, L.P. also maintains an Additional Energy Sales Contract with the Puerto Rico Electric 

Power Authority worth at least $68,000,000.00 that is registered at the Office of the Comptroller of Puerto Rico 

under registry number 2012-P00036. 4 EcoEléctrica, L.P. maintains an Amended and Restated Power Purchase and Operating Agreement with the 

Puerto Rico Electric Power Authority worth at least $1,800,000,000.00 that is registered at the Office of the 

Comptroller of Puerto Rico under registry number 2021-P00098. Said contract was reviewed and approved by 

the Oversight Board on December 26, 2019. 5 Gas Natural Aprovisionamientos SDG, S.A. (d/b/a Naturgy), who is EcoEléctrica, L.P.’s holding company, 

maintains a Natural Gas Sale and Purchase Agreement with the Puerto Rico Electric Power Authority worth at 

least $9,001,000,000.00 that is registered at the Office of the Comptroller of Puerto Rico under registry number 

2012-P00107. Said contract was reviewed and approved by the Oversight Board on December 26, 2019.

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Therefore, all business and affairs that the aforesaid companies undertake in Puerto Rico –

with or without the assistance of O&B – exclusively relate to their substantial contractual 

relationships with PREPA.

14. Puma Energy Caribe, L.P.6 is also client of O&B. (See Docket Entry No. 

21,485, at page 27 of 37.) PREPA is the single source of PREPA revenues of Puma Energy 

Caribe, L.P. All business and affairs that the aforesaid company undertakes in Puerto Rico –

with or without the assistance of O&B – exclusively relates to Puma Energy Caribe, L.P.’s 

substantial contractual relationships with PREPA.

15. Contrary to O&B’s assertions, O&B has also in fact represented clients 

excluded from the MIP List and holding interests adverse to the Commonwealth of Puerto Rico 

and/or PREPA during the same time period in which O&B represented the Oversight Board.

16. NFEnergía, LLC (d/b/a New Fortress Energy)7 is also an important client of 

O&B that O&B intentionally omitted from the MIP List for reasons unknown. O&B served 

as counsel to NFEnergía, LLC (d/b/a New Fortress Energy) in Civil Case No. SJ2020CV06070 

before the Puerto Rico Court of First Instance, San Juan Part, styled Sierra Club and El Puente 

de Williamsburgh, Inc. v. NFEnergía, LLC and others, relating to certain terminal facilities 

constructed by New Fortress Energy in San Juan harbor in violation of FERC regulations. New 

Fortress Energy’s subsidiary, Genera PR LLC, is also the newly awarded operator of all of 

6 Puma Energy Caribe, L.P. maintains a Fuel Oil Purchase Contract with the Puerto Rico Electric Power Authority 

worth at least $1,565,331,447.00 that is registered at the Office of the Comptroller of Puerto Rico under registry 

number 2022-P00020. Said contract was reviewed and approved by the Oversight Board on June 7, 2022. 7 NFEnergía, LLC (d/b/a New Fortress Energy) maintains a Fuel Sale and Purchase Agreement with the Puerto 

Rico Electric Power Authority worth at least ONE BILLION FIVE HUNDRED MILLION DOLLARS 

($1,500,000,000.00) that is registered at the Office of the Comptroller of Puerto Rico under registry number 2019-

P00079. Said contract was reviewed and approved by the Oversight Board on March 24, 2019. NFEnergía, LLC 

(d/b/a New Fortress Energy) also maintains a terminal facilities contract with the Puerto Rico Ports Authority 

worth at least EIGHT MILLION TWO HUNDRED TWENTY-SIX THOUSAND SIX HUNDRED SEVENTYEIGHT DOLLARS ($8,226,678.00) that is registered at the Office of the Comptroller of Puerto Rico under 

registry number 2018-P00089.

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PREPA’s legacy energy generation assets island-wide under a $169,900,000 Thermal 

Generation Facilities, Operation and Maintenance Agreement entered into in early 2023, 

registered at the Office of the Comptroller of Puerto Rico under registry number 2023-PPP042. 

PREPA is the sole client and single source of revenue of New Fortress Energy in Puerto Rico. 

Therefore, all business and affairs that New Fortress Energy undertakes in Puerto Rico – with 

or without the assistance of O&B – exclusively relate to New Fortress Energy’s substantial 

contractual relationships with PREPA.

17. Furthermore, O&B concurrently represented the Oversight Board during the 

same time period that O&B also represented the following private clients that contracted with 

the BDE in a highly controversial 2018 transaction that is causing economic and legal grief to 

the BDE and to hundreds of small Puerto Rican business owners: (a) PR Recovery and 

Development JV, LLC (“PR Recovery”); (b) Parliament Capital Management, LLC (“PCM”); 

(c) Parliament High Yield Fund, LLC (“PHYF”); and (d) Island Portfolio Services, LLC 

(“IPS”, and together with PR Recovery, PCM and PHYF, collectively, the “BDE Conflict 

Parties”).

18. Contrary to O&B’s recent assertions, O&B in fact assisted the BDE Conflict 

Parties in the negotiation, drafting and execution of that certain $384,269,047 Loan Sale 

Agreement entered into as of September 7, 2018, by and between the BDE, as seller, and PR 

Recovery, as purchaser, thru unlawful circumvention of the Oversight Board’s Contract 

Review Policy.

19. As the Title III Court is aware, the aforesaid Loan Sale Agreement caused the 

BDE’s insolvency and is causing economic injury to the BDE, the Government of Puerto Rico8

8 Should BDE not have enough reserves to cover its bond obligations, the Puerto Rico General Fund is obligated

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and to hundreds of small business owners throughout Puerto Rico, including the Movant.

20. O&B has already admitted that it represents certain parties on the MIP List 

which hold interests adverse to the Commonwealth of Puerto Rico and/or PREPA. There is 

no doubt that O&B provides legal and lobbying services to AES Ilumina, LLC, AES Puerto 

Rico, L.P., EcoElectrica, L.P., Gas Natural Aprovisionamientos SDG, S.A. (d/b/a Naturgy), 

and Puma Energy Caribe, L.P. in their dealings with PREPA, their single source of revenues 

in Puerto Rico. O&B has already admitted those disqualifying connections in its PRRADA 

disclosures.

21. O&B also falsely states to the Title III Court that it did not represent any of the 

BDE’s counterparts to the Loan Sale Agreement.

22. The $384,269,047 Loan Sale Agreement is a post-petition contract under 

PROMESA that was never reviewed nor approved by the Oversight Board, as required by the 

Oversight Board’s own Contract Review Policy.

23. O&B in fact assisted the Conflict Parties in arranging the $384,269,047 Loan 

Sale Agreement and bypassing the Oversight Board's contract review process.

24. The Loan Sale Agreement explicitly identifies O&B as legal counsel to the 

buyer in that controversial transaction. See pages 29-30 of the Loan Sale Agreement. 

25. Furthermore, several witnesses are capable of testifying as to O&B’s 

protagonist role as legal counsel to the BDE Conflict Parties in that unfortunate transaction, 

including, but not limited to, Mr. Giovanni Dávila Egipciaco, Mr. Rodolfo Sánchez Colberg, 

Atty. Luis Marini, counsel to Commonwealth of Puerto Rico in these Title III proceedings and 

former O&B partner, among others.

by law to set aside said money in favor of the BDE in its annual budget. Article 8 (f) of Law 22 of July 24, 1985, 

P.R. Laws Ann. Tit. 7 L.P.R.A. § 611g. 

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26. The Oversight Board purports that it has not yet reviewed the highly 

controversial $384,269,047 Loan Sale Agreement because the BDE did not ask for the 

Oversight Board’s approval and the BDE is now seeking to nullify the BDE Contract in 

litigation pending in the Puerto Rico Court of First Instance. The Oversight Board’s 

explanation is absurd.

27. The reality is that in the year 2019 the Oversight Board’s Executive Director, 

Natalie Jaresko, did have the intention of reviewing the Loan Sale Agreement, yet the 

Oversight Board never completed its ministerial duty of reviewing the same – a negligent 

misconduct that subsists to date.

28. On September 29, 2019, Natalie Jaresko, then Executive Director of the 

Oversight Board, correctly demanded that the Loan Sale Agreement be submitted to the 

Oversight Board’s contract review process. In her September 29, 2019 letter, a true and exact 

copy of which is attached hereto as Exhibit A, Natalie Jaresko explicitly asserted that “[a]ll 

government contracts and amendments thereto with an aggregate value of $10 million or 

more are subject to FOMB approval. Moreover, the FOMB in its discretion may review any 

contract below such threshold. In accordance with the Policy, we hereby request that the 

contract mentioned above be submitted to the FOMB not later than October 4, 2019 together 

with an explanation of the reason for the failure to submit such contract prior to its execution. 

Please note that the FOMB may issue subpoenas and exercise any other powers granted to 

it under PROMESA in order to effectuate the Policy.” (Emphasis added.)

29. Contrary to O&B’s recent assertions, the BDE, through its legal counsel, did 

ask the Oversight Board to intervene with the highly controversial Loan Sale Agreement “in 

order to shed light and resolve this issue, for the wellbeing of Puerto Rico”, yet the Oversight 

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Board never completed its ministerial duty of reviewing the Loan Sale Agreement – a 

negligent, continuous misconduct that persists to date. (Emphasis added.) See the BDE’s reply 

letter to the FOMB dated October 4, 2019, a true and exact copy of which is attached hereto 

as Exhibit B.

30. The Oversight Board indeed has the obligation to review all BDE contracts. In 

evidence of the foregoing, on September 21, 2022 the Oversight Board reviewed and approved 

a discounted payoff transaction pursuant to which a $35,070,738.52 loan extended to the BDE

by the Government Development Bank was settled in full thru a one-time payment by the BDE 

to the Government Development Bank of $3,100,000.00, an 89% discount, “to accomplish the 

requirements and goals of PROMESA for the benefit of Puerto Rico’s 78 municipalities and 

its people.” (Emphasis added.) See Exhibit C attached hereto.

31. The fact that the Loan Sale Agreement is presently under scrutiny before state 

court does not exempt the Oversight Board from reviewing the same, independently, pursuant 

to its federal mandate under PROMESA and the Oversight Board’s Contract Review Policy. 

It is highly suspect that the Oversight Board has so vehemently denied examining the Loan 

Sale Agreement that the BDE has denounced in public court pleadings to be the product of a 

$384,269,047 fraud.

32. In further examining this matter, the Title III Court must consider that pursuant 

to Article 5 of the BDE’s organic act the BDE’s Board of Directors is comprised of the 

Government of Puerto Rico’s highest-ranking officers, to wit: (a) Omar J. Marrero Díaz, 

Secretary of State and Executive Director of the Puerto Rico Fiscal Agency and Financial 

Advisory Authority; (b) Manuel Cidre Miranda, Secretary of the Department of Economic 

Development and Commerce; (c) Juan Carlos Blanco, Executive Director of the Puerto Rico 

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Office of Management and Budget; (d) Francisco Parés Alicea, Secretary of Treasury; (e) 

Ramón González Beiró, Secretary of Agricultura; and (f) four minority director appointed by 

the Governor of Puerto Rico, with the advice and consent of the Senate of Puerto Rico. All 

these well-respected, top-ranking cabinet members of the Commonwealth of Puerto Rico 

understand that the Loan Sale Agreement is the product of a mega-fraud requiring the 

Oversight Board’s intervention. No public interest is served by the Oversight Board’s 

negligent inaction as to the Loan Sale Agreement.

33. The Oversight Board commands a $60 million annual budget and has spent over 

$1.5 billion in outside advisors, attorneys, and consultants over the course of the last six years. 

The Oversight Board has the obligation to review the Loan Sale Agreement “in order to shed 

light and resolve this issue, for the wellbeing of Puerto Rico” and “to accomplish the 

requirements and goals of PROMESA for the benefit of Puerto Rico’s 78 municipalities and 

its people.” See Exhibit B and Exhibit C, respectively.

34. For each day that the Oversight Board deliberately continues to evade its 

ministerial duty to review the Loan Sale Agreement pursuant to the Contract Review Policy, 

the Loan Sale Agreement is and remains voidable, unperfected, and legally incomplete.

35. In the adversary proceeding captioned Luis A. Rivera Siaca v. The Financial 

Oversight and Management Board for Puerto Rico that is being litigated as part of these Title 

III proceedings, the Oversight Board seeks to invalidate certain claims for payments due under 

a Puerto Rico government contract based on the premise that such contract: (a) was never 

reviewed nor approved by the Oversight Board in accordance with the Oversight Board’s own 

Congressionally-mandated Contract Review Policy; and (b) remains pending review by the 

Oversight Board. See Docket Entry No. 21,509.

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36. In the Oversight Board’s own words – [t]he Oversight Board established the 

[Contract Review] Policy to require prior Oversight Board approval of contracts or series of 

related contracts, inclusive of any amendments, modifications, or extensions, with an 

aggregate expected value of $10 million or more, proposed to be entered into by the 

Commonwealth or any covered instrumentality. Congress also identified certain benefits to 

the Commonwealth that the Policy was intended to promote, such as competitive procurement, 

fiscal sustainability and integrity as developed by the Oversight Board through fiscal plans, 

increased public faith in contracting, and preservation of Commonwealth resources. See id. 

(“to ensure such proposed contracts promote market competition and are not inconsistent with 

the approved Fiscal Plan”); id. § 204(b)(3) (“to increase the public’s faith in [the 

Commonwealth’s contracting] process” and “to make appropriate use of the Oversight 

Board’s time and resources”). ... Here, Congress’s goals have been impeded because, 

contrary to PROMESA Section 204(b), the Oversight Board was not able to review the 

Contract for compliance with the Fiscal Plan or market competitiveness prior to execution and 

payment. Accordingly, any alleged benefit provided by the Contract has, at the very least, been 

reduced by the loss of the benefits that would have been provided had the Contract been 

reviewed in accordance with the Policy and competitively procured prior to execution. 

Furthermore, the Oversight Board has been unable to conclude the Contract complies with 

Puerto Rico’s certification and registration requirements.” See Docket Entry No. 21,509, at 

pages 7-8.

37. Contrary to the assertions of the Oversight Board and its counsel, in the Rivera 

Siaca matter the Oversight Board and O&B correctly argued that a Puerto Rico government 

contract having a value of $10 million or more is invalid and incomplete until the Oversight 

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Board actually reviews and approves it.

38. The pendency of review of a public contract by the Oversight Board in fact 

renders it annullable and legally incomplete until the Oversight Board actually reviews it.

39. The Oversight Board’s contract review obligations are evergreen. They 

don’t expire, they carry no deadlines, and they’re not subject to any applicable statute of 

limitations. O&B and the Oversight Board have not argued the contrary.

40. The Oversight Board’s contract review obligations are also mandatory. 

They don’t expire, they carry no exceptions (as to contracts having a transactional value of $10 

million or more), and they’re not subject to any statute of limitations. O&B and the Oversight 

Board have not argued the contrary.

41. In this case, the controversy at hand revolves around the highly controversial 

$384,269,047 Loan Sale Agreement that: (a) was crafted by O&B, the Oversight Board’s own 

legal counsel, amidst serious conflicts of interest; (b) was never reviewed nor approved by the 

Oversight Board prior to its execution in the manner required by the Oversight Board’s own 

Contract Review Policy; and (c) remains pending the Oversight Board’s review in accordance 

with the Congressionally-mandated Contract Review Policy, as court record reflects. The 

Oversight Board is required to examine the Loan Sale Agreement and has failed to do so, 

presumably because doing so would expose its own local legal counsel to civil or criminal 

liability.

42. By applying the same reasoning of the Oversight Board in the Rivera Siaca

matter, this Title III Court must find that the Loan Sale Agreement is deemed invalid and 

legally incomplete because the Oversight Board has not yet reviewed and approved it.

43. While the Oversight Board willfully continues to neglect its federal mandate in 

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relation to the Loan Sale Agreement, the top cabinet members of the Government of Puerto 

Rico are separately challenging the legality and validity of the Loan Sale Agreement under 

allegations of fraud and a myriad of other statutory defects, including: (a) the absence of a 

competitive bidding process; (b) the absence of the Oversight Board’s review in accordance 

with the Contract Review Policy; (c) non-compliance with Puerto Rico’s legal formalities and 

requirements; and (d) other motives.9

44. Although the Oversight Board admits having a policy of reviewing government 

contracts exceeding $10 million, it explains that it has not yet reviewed the Loan Sale 

Agreement because the BDE is seeking to nullify the same in litigation pending in 

Commonwealth court. The Oversight Board explains that it has not reviewed the Loan Sale 

Agreement under its Contract Review Policy while that litigation is pending. The Oversight 

Board is wrong.

45. The fact that the Loan Sale Agreement is under scrutiny before Commonwealth 

court does not exempt the Oversight Board from reviewing the same, independently, pursuant 

to federal mandate under PROMESA and its own Contract Review Policy.

46. The Commonwealth of Puerto Rico and hundreds of small Puerto Rican 

business owners like the Movant are being collaterally injured by the Oversight Board’s willful 

misconduct and negligence in relation to the controversial Loan Sale Agreement.

47. Overseeing the legality and transparency of public contracting in Puerto Rico 

is one of the main reasons that the Oversight Board exists, yet the Oversight Board denies and 

delays its review of the Loan Sale Agreement without any justifiable cause and with the 

9 Case sub judice before the Puerto Rico Court of First Instance, San Juan Part, in Civil Case No. SJ2019CV11697, 

captioned Banco de Desarrollo Económico Para Puerto Rico v. Garnet Capital Advisors LLC, PR Recovery and 

Development REO, LLC, PR Recovery and Development JV, LLC, and Parliament Capital Management LLC.

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apparent intent of financially favoring O&B’s clients, the BDE Conflict Parties. 

48. No public interest whatsoever is being served thru the Oversight Board’s denial 

to intervene with the Loan Sale Agreement.

49. In sum, all Puerto Rico government contracts having a transactional value of 

$10 million or more are not legally valid and binding until the Oversight Board formally 

reviews and approves the same. The Loan Sale Agreement is no exception to that policy, and 

O&B and the Oversight Board have not argued the contrary.

50. It was the ministerial mandate of the Oversight Board to examine the Loan Sale 

Agreement before it was executed, and it continues to be ministerial mandate of the Oversight 

Board to examine the Loan Sale Agreement now. 

51. Although the Movant’s position is that the evidence and arguments presented 

to the Title III Court are sufficient to grant the remedies herein requested, should the Title III 

Court consider that more evidence is needed, the Movant reserves the right to conduct 

discovery.

For the reasons set forth above, the Movant requests that the Title III Court grants this 

reply motion as presented and issues a final Judgment that:

(a) Permanently disqualifies O&B and its members from serving as advisors to 

the Financial Oversight and Management Board for Puerto Rico for multiple conflicts 

of interest incurred;

(b) Provides for the disallowment and full disgorgement of fees;

(c) Declares null and void ab initio the $384,269,047 Loan Sale Agreement

described above for lack of due process and the Oversight Board’s willful failure to 

comply with the legal formalities imposed by the Oversight Board’s own Contract 

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Review Policy, which requires the revision and approval of all Puerto Rico government 

contracts having a transactional value of $10 million or more; and

(d) Grants such other relief that the Title III Court deems just, fair, and equitable 

in light of the conflicts of interest that exist and that are continuing.

Dated: February 22, 2023

San Juan, Puerto Rico

Respectfully submitted,

S/Javier A. Rivera Vaquer

USDC-PR No. 225809

Javier A. Rivera Vaquer

PO Box 192376

San Juan, Puerto Rico 00919-2376

Tel. 787-759-3634

jariva@rimerico.com

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Certificate of Service

I hereby certify that, on this date, I electronically filed the foregoing with the Clerk of 

the Court using the CM/ECF system, which will send notifications of such filing to all 

CM/ECF participants in this matter.

In San Juan, Puerto Rico, this 22nd day of February, 2023.

S/Javier A. Rivera Vaquer

USDC-PR No. 225809

Javier A. Rivera Vaquer

PO Box 192376

San Juan, Puerto Rico 00919-2376

Tel. 787-759-3634

jariva@rimerico.com

Case:17-03283-LTS Doc#:23609 Filed:02/22/23 Entered:02/22/23 22:00:04 Desc: Main

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