UNITED STATES DISTRICT COURT

DISTRICT OF PUERTO RICO

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In re: 

THE FINANCIAL OVERSIGHT AND 

MANAGEMENT BOARD FOR PUERTO RICO, 

as representative of

THE COMMONWEALTH OF PUERTO RICO, et al., 

Debtors.1

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In re: 

THE FINANCIAL OVERSIGHT AND 

MANAGEMENT BOARD FOR PUERTO RICO, 

as representative of

THE COMMONWEALTH OF PUERTO RICO 

Debtor.

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REPLY TO “OBJECTION OF THE COMMONWEALTH TO MOTION FOR RELIEF 

FROM STAY FILED BY THAMARI GONZALEZ MARTINEZ, FOR HERSELF AND IN

REPRESENTATION OF HER MINOR, EDWIN ALEXANDER MATTA GONZALEZ”

COMES NOW, Thamari Gonzalez Martinez, for herself and in representation of her minor, 

Edwin Alexander Matta Gonzalez (“Movant”), through the undersigned counsel, and very

respectfully states as follows:

 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 (“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); and (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). (Title III case numbers are listed as Bankruptcy Case numbers due to software limitations).

PROMESA 

Title III 

No. 17 BK 3283-LTS 

(Jointly Administered) 

PROMESA 

Title III 

No. 17 BK 3283-LTS 

This Motion relates only to the 

Commonwealth and shall only be filed in 

the lead Case No. 17 BK 3283-LTS. 

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INTRODUCTION

Before the Honorable Court Movant filed a “Motion for Relief from Stay” (“Stay Relief 

Motion”), requesting from the Court an entry of order granting relief from the automatic stay 

allowing Movant to continue with her prepetition action, Thamari Gonzalez et al v. Municipio de 

Naranjito et al, DDP2014-0355 (the “Prepetition Action”), against the Commonwealth of Puerto 

Rico (“Commonwealth”), the Department of Transportation and Public Works (the “DPW”) the 

Municipality of Naranjito (“Municipality of Naranjito”), Multinational Insurance Company2

(“Multinational”) and others, pending before the Puerto Rico Court of First Instance, Superior 

Court of Bayamón (the “Prepetition Court”) for the damages suffered by minor Edwin Alexander 

Matta in an area controlled by the Commonwealth and/or the Municipality of Naranjito.

On May 9th, 2013, young Edwin Alexander Matta Gonzalez was waking on the sidewalk 

of 164 Street in the Municipality of Naranjito. As he was waking over a bridge on the same street, 

and due to the poor maintenance of the area and lack of barriers and/or other security measures, 

he slipped and fell over a precipice of approximately 20 feet. As a result of the fall, young Edwin 

fractured his tibia and fibula on both legs and had to endure a surgical intervention to insert metal 

plates and screws in order to join the bones. For the rest of his life, young Edwin will have limited 

mobility of both his legs and back, and a permanent residual impediment of 15% of all 

physiological functions.

The Prepetition Action was stayed, unjustly, by the Prepetition Court on July 5th, 2017. The 

Prepetition Court, instead of applying the stay only to the Commonwealth and the DPW, 

applied the stay to all of the litigation and parties therein. Even if there is no statutory basis for 

an extension of the automatic stay to the Municipality of Naranjito, Multinational nor any of the 

 2 Which is the insurer for the Municipality of Naranjito.

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other defendants, which are indisputably separate legal entities from the Commonwealth and the 

DPW.

As discussed below, it is Movant’s respectful opinion that the automatic stay should be 

lifted in the Prepetition Action as whole. However, if it is the belief oh this Honorable Court that 

stay should remain in effect in regard to the Commonwealth and the DPW, the Court should 

emphatically deny the protection of the automatic stay to the other parties in the Prepetition Action. 

Not doing so would be denying the expeditious and fair resolution of the Prepetition Action, 

harming movant and favoring the non-debtor third parties which § 362(a) does not encompass nor 

protect. The reach of the Automatic Stay is far, but not that far.

BACKGROUND

1. On March 16, 2018, Movant filed the Stay Relief Motion, requesting from the Court an 

entry of order granting relief from the automatic stay allowing Movant to continue with the 

Prepetition Action against the Commonwealth, the DPW, the Municipality of Naranjito, 

Multinational and others, pending before the Prepetition Court for the damages suffered by 

minor Edwin Alexander Matta in an area controlled by the Commonwealth and/or the 

Municipality of Naranjito.

2. In attention to the Stay Relief Motion, on February 14, 2018, this Honorable Court entered 

an "Order Scheduling Briefing of Motion Requesting Relief from Automatic Stay", setting, 

among other things, the deadlines for the filing of opposition and reply papers. Pursuant to 

said scheduling order, "[o]pposition papers to the Motion must be filed by March 30, 2018” 

and “[m]ovant’s reply papers must be filed by April 6, 2018".

3. On March 30, 2018, the Commonwealth filed the document entitled "Objection of the 

Commonwealth to Motion for Relief from Stay Filed by Thamari Gonzalez Martinez, for 

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Herself and in Representation of Her Minor, Edwin Alexander Matta Gonzalez” (the 

"Opposition").

4. On its Opposition, after a brief discussion of the Sonnax factors cited by Movant on its Stay 

Relief Motion, the Commonwealth asserted, wrongly in Movant’s opinion, that Movant 

had failed to establish cause to justify lifting the automatic stay in the Prepetition Action.

5. As further explained below, the Court should enter an order granting relief from the 

automatic stay, as Movant established in the Prepetition Action that sufficient “cause” 

exists to lift or modify the automatic stay under section 362(d) of title 11 of the United 

States Code.

DISCUSSION

Before we begin with the discussion of the arguments in support of the relief from the 

automatic stay in favor of Movant, and as on the Stay Relief Motion, it is important to note that 

said discussion will be focused on the Commonwealth and the DWP, as they are the only 

defendants in the Prepetition Action that the automatic stay applies to. Again, there is no 

statutory basis for an extension of the automatic stay to Municipality of Naranjito,

Multinational nor any of the other defendants, which are indisputably separate legal entities

from the Commonwealth.

Regarding Sonnax Factor 1, “whether the relief will result in a partial or complete 

resolution of the issues”, Movant’s position is that in the event the relief from the automatic stay 

is granted by this Honorable Bankruptcy Court, it will certainly result in a complete resolution of 

the issues between the parties. However, Debtor pointed, citing In re Tuab, 413 B.R. 55, 62, that 

Movant's argument is mistaken since "[t]he first Sonnax factor does not focus on the issues in the 

stayed litigation"; "[i]nstead, the first Sonnax factor primarily focuses on whether the separate 

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litigation would expeditiously resolve issues relevant to the bankruptcy case" and, therefore, "the 

lifting of the stay would not resolve issues relevant to the Commonwealth’s Title III case.” Nothing 

further from the truth. The issues between the parties in the prepetition action will be resolved 

expeditiously by lifting the stay and allowing the litigation to continue. Especially, when the 

Prepetition Court issued the order granting the Commonwealth’s petition for a stay on June 23rd, 

2017 and trial was scheduled for August 22, 23 and 25, 2017; only two months after the order.

Regarding Sonnax Factor 2, “lack of any connection with or interference with the 

bankruptcy case”, Movant’s position is that in the issues that are subject to the Prepetition Action 

will not interfere with the bankruptcy case. Again, and as discussed below, the Prepetition Action

is more than ready for trial.

With respect to Sonnax Factors 10 and 11, “the interest of judicial economy and the 

expeditious and economical determination of litigation for the parties” and “whether the foreign 

proceedings have progressed to the point where the parties are prepared for trial”, Movant takes 

exception with the Commonwealth’s position that “the Prepetition Action is still at a preliminary 

stage.” Again, nothing further from truth. The Prepetition Action is ready for trial now and

delaying the process or subjecting the action to the claims adjustment process under Title III would 

only cause harm to Movant, who has tried this case since May 13th, 2014. The interest of judicial 

economy heavily favors Movant in this regard.

Regarding Sonnax Factor 12, “the impact of the stay on the parties and the ‘balance of 

hurt’”, Movant disagrees with the Commonwealth’s (general) position that "[t]he procedural status 

of the Prepetition Action, the large number of pending lawsuits against the Debtors, the diversion 

of the Commonwealth’s resources to defend Movant’s claims, and the prejudice to interests of 

other similarly situated creditors" favor the continuation of the automatic stay. It is Movant’s belief 

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that at this point of the litigation, the Commonwealth’s will only incur on a minimal expenditure 

of time and resources, as the cost of litigation had already been budgeted by the 

Commonwealth’s Department of Justice. However, not allowing Movant to continue the 

Prepetition Action will not only delay the resolution of its claim but will also make her spend more

of her limited resources on litigating the case before this Honorable Court, after already litigating 

it for almost 4 years before the Prepetition Court.

Finally, with respect to Sonnax Factor 4, “whether a specialized tribunal has been 

established to hear the particular cause of action and that tribunal has the expertise to hear such 

cases”, Movant did not raise said factor in support of its Stay Relief Motion. However, the 

Commonwealth argued that “[n]o specialized tribunal has been established to hear the Prepetition 

Action.” Movant’s respectful opinion is that even though is true that a specialized tribunal has not 

been established, the most expeditious and economical process for the parties leads to the 

resolution of the Prepetition Action before the Prepetition Court. Specially, since the alternative 

option would entail the litigation of such matters before this Honorable Court. In addition, and as 

it has been repeatedly noted by the Honorable Bankruptcy Court throughout its case law, "[t]he 

legislative history to section 362(d)(1) emphasizes the section's applicability to proceedings in 

another forum: "It will often be more appropriate to permit proceedings to continue in their place 

of origin, when no great prejudice to the bankruptcy estate would result in order to leave the parties 

to their chosen forum and to relieve the bankruptcy court from duties that may be handled 

elsewhere." In re Consol. Distribs., 2013 Bankr. LEXIS 3101, citing H.R.Rep. No. 595, 95th 

Cong., 1st Sess., 341 (1977), U.S. Code & Admin. News 1978, pp. 5787, 5297.

WHEREFORE, Movant respectfully requests this Honorable Court to enter an order lifting 

the automatic stay pursuant to 11 U.S.C. Sec. 362(d)(1), permitting Movant to exercise all 

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remedies under non-bankruptcy and non-PROMESA law to enforce its rights and obligations 

related in any way to the claims and causes of action subject of the local court civil action filed by 

Movant, object of the Stay Relief Motion and the foregoing reply, including the continuation and 

culmination of the proceedings in the Prepetition Action and grant Movant such other relief as may 

be just and proper pursuant to Law.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY: That on this same date, we electronically filed the foregoing motion with 

the Clerk of the Court using the CM/ECF Filing system which will send a notification of such to the parties 

of record and to all interested subscribed users.

RESPECTFULLY SUBMITTED

In San Juan, Puerto Rico, this 5th day of April 2018.

 

 

/S/ Emanuel Rier-Soto

EMANUEL RIER-SOTO, ESQ 

U.S.D.C. 304110

Attorney for Movant

 

 HC4 Box 12672

 Rio Grande, PR 00745

(787) 307-5991

E-Mail: rier.emanuel@gmail.com.

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