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 3283-LTS 

(Jointly Administered) 

This filing relates to the 

Commonwealth, HTA, and PBA.

REPLY OF THE COMMONWEALTH OF PUERTO RICO, THE PUERTO RICO 

HIGHWAYS AND TRANSPORTATION AUTHORITY, AND THE PUERTO RICO 

PUBLIC BUILDINGS AUTHORITY TO RESPONSE FILED BY CLAIMANT GEORGE 

AND THERESA RAUSCHER [ECF NO. 20581] TO THE FOUR HUNDRED THIRTYNINTH OMNIBUS OBJECTION (SUBSTANTIVE) TO DUPLICATE AND NO 

LIABILITY BOND CLAIMS 

To the Honorable United States District Judge Laura Taylor Swain: 

The Commonwealth of Puerto Rico (the “Commonwealth”), the Puerto Rico Highways 

and Transportation Authority (“HTA”), and the Puerto Rico Public Buildings Authority (“PBA,” 

and together with the Commonwealth and HTA, the “Debtors”), by and through the Financial 

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”, and together with 

the Commonwealth, COFINA, HTA, ERS, and PREPA, the “Debtors”) (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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Oversight and Management Board for Puerto Rico (the “Oversight Board”), as the sole Title III 

representative of the Debtors pursuant to Section 315(b) of the Puerto Rico Oversight, 

Management, and Economic Stability Act (“PROMESA”),2 file this reply (the “Reply”) to the 

untitled response [ECF. No. 21691] (the “Rauscher Response”) filed by claimants George and 

Theresa Rauscher (the “Rauscher Claimants”), in support of the Four Hundred Thirty-Ninth 

Omnibus Objection (Substantive) of the Commonwealth of Puerto Rico, the Puerto Rico Highways 

and Transportation Authority, and the Puerto Rico Public Buildings Authority to Duplicate and 

No Liability Bond Claims [ECF No. 20497] (the “Four Hundred Thirty-Ninth Omnibus 

Objection”). The Debtors respectfully represent as follows: 

1. On April 1, 2022, the Debtors filed the Four Hundred Thirty-Ninth Omnibus 

Objection seeking to disallow in their entirety certain proofs of claim, each of which is based, in 

part, on (a) bond claims that are duplicative of one or more master proofs of claim filed against 

Debtors on behalf of the holders of certain bonds, (b) an ownership interest in bonds issued by 

GDB, which is not a Title III Debtor, or (c) investments in mutual funds, which in turn may have 

invested in bonds issued by the Debtors. 

2. Any party who disputed the Four Hundred Thirty-Ninth Omnibus Objection was 

required to file a response by 4:00 p.m. (Atlantic Standard Time) on May 2, 2022, in accordance 

with the Court-approved notice attached to the Four Hundred Thirty-Ninth Omnibus Objection as 

Exhibit C, which was served in English and Spanish on the individual creditors subject to the FourHundred Thirty-Ninth Omnibus Objection, the U.S. Trustee, and the Master Service List (as 

2

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

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defined by the Sixteenth Amended Case Management Procedures [ECF No. 20190-1]). See 

Certificate of Service [ECF No. 20558]. 

3. The Rauscher Claimants filed a proof of claim against HTA on October 5, 2021, 

which was logged by Kroll Restructuring Administration LLC as Proof of Claim No. 179635 (the 

“Rauscher Claim”). The Rauscher Claim purports to assert liabilities in the amount of $5,650.00 

based on ownership of bonds issued by HTA. Specifically, the Rauscher Claim attaches certain 

Merrill Lynch brokerage statements identifying the Rauscher Claimants’ purported ownership of 

HTA bonds bearing CUSIP No. 7451902Q0. 

4. On April 20, 2022, the Rauscher Claimants filed the Rauscher Response. Therein, 

the Rauscher Claimants assert that they (i) “did not file any previous claim for this defaulted bond,” 

(ii) “had no intention to file a suit for the balance,” (iii) “just accepted the loss,” and (iv) “knew 

nothing about this filing” until they received certain paperwork. Rauscher Response at 1. 

5. The Debtors construe this statement as a withdrawal of the Rauscher Claim or, at 

the very least, a statement of no objection to the Four Hundred Thirty-Ninth Omnibus Objection, 

and, accordingly, respectfully request that the Court sustain the Four Hundred Thirty-Ninth 

Omnibus Objection as to the Rauscher Claim. 

6. If, however, the Court is not inclined to interpret the Rauscher Response in that 

manner, the Rauscher Claim should nonetheless be disallowed in its entirety because, as set forth 

in the Four Hundred Thirty-Ninth Omnibus Objection, it asserts liabilities related to HTA bonds 

that are duplicative of a master proof of claim filed by BNY Mellon on behalf of HTA bondholders. 

Any failure to disallow the Rauscher Claim would result in the Rauscher Claimants potentially 

receiving an unwarranted double recovery against the Debtors, to the detriment of other 

stakeholders in the Debtors’ Title III Cases. 

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7. Accordingly, the Debtors respectfully request the Rauscher Claim be disallowed in 

its entirety and that the Court grant the Four Hundred Thirty-Ninth Omnibus Objection, 

notwithstanding the Rauscher Response. 

Dated: April 11, 2023 Respectfully submitted, 

 San Juan, Puerto Rico 

/s/ Hermann D. Bauer 

Hermann D. Bauer 

USDC No. 215205 

Carla García Benítez 

USDC No. 203708 

O’NEILL & BORGES LLC 

250 Muñoz Rivera Ave., Suite 800 

San Juan, PR 00918-1813 

Tel: (787) 764-8181 

Fax: (787) 753-8944 

/s/ Brian S. Rosen 

Martin J. Bienenstock (pro hac vice) 

Brian S. Rosen (pro hac vice) 

PROSKAUER ROSE LLP

Eleven Times Square 

New York, NY 10036 

Tel: (212) 969-3000 

Fax: (212) 969-2900 

Attorneys for the Financial Oversight and 

Management Board for Puerto Rico, as 

representative for the Commonwealth of 

Puerto Rico, the Puerto Rico Highways and 

Transportation Authority, and the Puerto 

Rico Public Buildings Authority 

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