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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PROMESA

Title III

No. 17 BK 3283-LTS

(Jointly Administered)

RE: ECF No. 3427

STATEMENT IN RESPONSE TO MOTION OF THE INDEPENDENT INVESTIGATOR 

FOR AN ORDER: (I) ESTABLISHING PROCEDURES FOR RESOLVING ANY 

CONFIDENTIALITY DISPUTE IN CONNECTION WITH PUBLICATION OF THE 

INDEPENDENT INVESTIGATOR’S FINAL REPORT; (II) APPROVING THE 

DISPOSITION OF CERTAIN DOCUMENTS AND INFORMATION; (III) RELIEVING 

THE INDEPENDENT INVESTIGATOR FROM CERTAIN DISCOVERY 

OBLIGATIONS; (IV) EXCULPATING THE INDEPENDENT INVESTIGATOR IN 

CONNECTION WITH THE INVESTIGATION AND PUBLICATION OF THE FINAL 

REPORT; AND (V) GRANTING RELATED RELIEF

To the Honorable United States District Court Judge Laura Taylor Swain:

The Commonwealth of Puerto Rico (the “Commonwealth”), the Puerto Rico Sales Tax 

Financing Corporation (“COFINA”), the Puerto Rico Highways and Transportation Authority

(“HTA”), the Employees Retirement System of the Government of the Commonwealth of Puerto 

 

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); (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); and (v) Puerto Rico 

Electric Power Authority (“PREPA”) (Bankruptcy Case No. 17 BK 4780-LTS) (Last Four 

Digits of Federal Tax ID: 3747) (Title III case numbers are listed as Bankruptcy Case numbers 

due to software limitations).

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Rico (“ERS”), and the Puerto Rico Electric Power Authority (“PREPA,” and together with the 

Commonwealth, COFINA, HTA, and ERS the “Debtors”), as Title III debtors, by and through 

the Financial Oversight and Management Board for Puerto Rico (the “Oversight Board”), as the 

Debtors’ representative pursuant to section 315(b) of the Puerto Rico Oversight, Management, 

and Economic Stability Act (“PROMESA”), hereby submit this Statement in response to the

Motion of the Independent Investigator for an Order: (I) Establishing Procedures for Resolving 

any Confidentiality Dispute in Connection with Publication of the Independent Investigator’s 

Final Report; (II) Approving the Disposition of Certain Documents and Information; (III) 

Relieving the Independent Investigator from Certain Discovery Obligations; (IV) Exculpating the 

Independent Investigator in Connection with the Investigation and Publication of the Final 

Report; and (V) Granting Related Relief [ECF No. 3427] (the “Motion”),

2

and respectfully state 

as follows:

STATEMENT

The Oversight Board supports the relief requested in the Motion, and writes to clarify the 

application of the Access Procedures to the Oversight Board. As described in the Motion, the 

Oversight Board, acting by and through the Special Investigation Committee, retained the 

Independent Investigator to conduct the Investigation, pursuant to its statutory authority under 

PROMESA section 104(o). Motion at ¶¶ 17, 55. The Oversight Board directed the Special 

Investigation Committee to oversee the Investigation in order to maintain the integrity and 

independence of the Investigation while it was ongoing. 

The Oversight Board, as the representative of the Debtors, will control and be solely 

responsible for initiating any claims on behalf of the Title III debtors for the benefit of creditors 

 

2 Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Motion.

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and parties in interest in these Title III cases, among other rights and obligations. See

PROMESA Section 315(b) (“The Oversight Board in a case under this title [III] is the 

representative of the debtor.”); PROMESA section 301(c)(7) (replacing “trustee” with 

“Oversight Board” wherever such term is used in title 11 sections incorporated into PROMESA); 

see also, e.g., DiMaio Family Pizza & Luncheonette, Inc. v. Charter Oak Fire Ins. Co., 448 F.3d 

460, 463 (1st Cir. 2006) (“‘[A]ll legal or equitable interests . . . in property as of the 

commencement of the case’ and ‘any interest in property that the estate acquire[d] after the 

commencement of the case’ became the property of their respective bankruptcy estates” and 

“their bankruptcy trustees acquired exclusive standing to assert those claims.”) (quoting 11 

U.S.C. § 541(a)(1), (7)). 

The Oversight Board intends to designate a separate special committee to review the 

Final Report and determine whether any further steps are necessary based upon the findings in 

the Final Report, including, but not limited to, evaluating and initiating claims on behalf of any 

of the Title III debtors for the benefit of creditors and parties in interest in the Title III cases (the 

“Special Litigation Committee”). It is expected that the Special Litigation Committee will

consult with the two statutory committees regarding potential claims. The Special Litigation 

Committee’s access to any materials contained in the Document Depository will be procured 

either by seeking consent of the party that produced the materials sought by the Special 

Litigation Committee or by seeking court approval.

The documents produced in the Investigation are essential to allow the Oversight Board 

to fulfill its statutory duties. Accordingly, the Oversight Board notes that the Special 

Investigation Committee has now, and will continue to have through publication of the Final 

Report and the cooperation period described in Paragraph 51 of the Motion, full access to the 

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Investigative Record, the Final Report Documents, and any and all documents contained in the 

Document Depository, or otherwise produced pursuant to the Investigation, without having to 

seek and obtain prior court approval.

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Dated: July 20, 2018

San Juan, Puerto Rico

Respectfully submitted,

/s/ Martin J. Bienenstock

Martin J. Bienenstock

Paul V. Possinger

Margaret A. Dale

Timothy W. Mungovan

Ehud Barak

Maja Zerjal

(Admitted 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 as representative for the 

Debtors

/s/ Hermann D. Bauer

Hermann D. Bauer

USDC No. 215205

O’NEILL & BORGES LLC

250 Muñoz Rivera Ave., Suite 800

San Juan, PR 00918-1813

Tel: (787) 764-8181

Fax: (787) 753-8944

Co-Attorneys for the Financial Oversight and 

Management Board as representative for the 

Debtors

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