Court Opinion

ID: 4678199
Source: CourtListenerOpinion
Date Created: 2021-04-16 21:00:26.354499+00
Date Added: 2024-06-11T08:03:43.607987
License: Public Domain

United States Court of Appeals
                     For the First Circuit

No. 19-2243

 IN RE: THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO
RICO, AS REPRESENTATIVE FOR THE COMMONWEALTH OF PUERTO RICO; THE
  FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO, AS
 REPRESENTATIVE FOR THE PUERTO RICO HIGHWAYS AND TRANSPORTATION
  AUTHORITY; THE FINANCIAL OVERSIGHT AND MANAGEMENT BOARD FOR
  PUERTO RICO, AS REPRESENTATIVE FOR THE PUERTO RICO ELECTRIC
POWER AUTHORITY (PREPA); THE FINANCIAL OVERSIGHT AND MANAGEMENT
  BOARD FOR PUERTO RICO, AS REPRESENTATIVE FOR THE PUERTO RICO
  SALES TAX FINANCING CORPORATION, a/k/a Cofina; THE FINANCIAL
       OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO, AS
   REPRESENTATIVE FOR THE EMPLOYEES RETIREMENT SYSTEM OF THE
  GOVERNMENT OF THE COMMONWEALTH OF PUERTO RICO; THE FINANCIAL
       OVERSIGHT AND MANAGEMENT BOARD FOR PUERTO RICO, AS
 REPRESENTATIVE OF THE PUERTO RICO PUBLIC BUILDINGS AUTHORITY,

                            Debtors.
                    ________________________

HERMANDAD DE EMPLEADOS DEL FONDO DEL SEGURO DEL ESTADO, INC.,
a/k/a Unión de Empleados de la Corporación del Fondo del Seguro
  del Estado (UECFSE); UNIÓN DE MÉDICOS DE LA CORPORACIÓN DEL
  FONDO DEL SEGURO DEL ESTADO CORP. (UMCFSE); LIZBETH MERCADO
              CORDERO; FRANCISCO J. REYES MÁRQUEZ,

                   Plaintiffs, Appellants,

  ASOCIACIÓN DE EMPLEADOS GERENCIALES DEL FONDO DEL SEGURO DEL
        ESTADO CORP. (AEGFSE); EVA E. MELÉNDEZ FRAGUADA;
                      JOSÉ E. ORTIZ TORRES,

                          Plaintiffs,

                               v.

    UNITED STATES; FINANCIAL OVERSIGHT AND MANAGEMENT BOARD;
                  COMMONWEALTH OF PUERTO RICO,

                     Defendants, Appellees,
   RICARDO ROSSELLÓ NEVARES, through the Secretary of Justice;
                    ROSA E. RODRÍGUEZ-VÉLEZ,

                              Defendants.

          APPEAL FROM THE UNITED STATES DISTRICT COURT
                 FOR THE DISTRICT OF PUERTO RICO

         [Hon. Laura Taylor Swain,* U.S. District Judge]

                                Before

                   Thompson, Kayatta, and Barron,
                          Circuit Judges.

     Rolando Emmanuelli Jiménez, with whom Jessica E. Méndez
Colberg and Bufete Emmanuelli, C.S.P. were on brief, for
appellants.
     Benjamin H. Torrance, Assistant United States Attorney, with
whom Geoffrey S. Berman, United States Attorney, and David S.
Jones, Assistant United States Attorney, were on brief, for
appellee the United States.
     Mark D. Harris, with whom Timothy W. Mungovan, John E.
Roberts, Laura Stafford, Larry Alan Rappaport, Martin J.
Bienenstock, Stephen L. Ratner, Jeffrey W. Levitan, Shiloh
Rainwater, and Proskauer Rose LLP were on brief, for appellees the
Financial Oversight and Management Board and the Commonwealth of
Puerto Rico.

                          April 16, 2021

     *    Of the   Southern    District     of   New   York,   sitting   by
designation.
                 BARRON, Circuit Judge.         Two unions representing public

employees in Puerto Rico together with one of their individual

members brought this suit against the United States, the Financial

Oversight and Management Board ("FOMB"), and the Commonwealth

raising      a    range   of    claims    under    federal   constitutional      and

international law.             The claims all concern the legal status of

Puerto     Rico.       The     District    Court   dismissed    them   because    it

concluded that the plaintiffs lacked standing to bring them under

Article III of the federal Constitution.               We affirm.

                                           I.

                 The plaintiffs are two unions, Hermandad de Empleados

del Fondo del Seguro del Estado, Inc., and Unión de Médicos de la

Corporación del Fondo del Seguro del Estado Corp., and one of their

members, Lizbeth Mercado Cordero.1                 The unions have a combined

membership of about two thousand employees, and they have each

entered into collective bargaining agreements with CFSE, which is

Puerto Rico's State Insurance Fund Corporation.

                 The plaintiffs brought their suit in May 2018 and filed

their second amended complaint on October 5, 2018, against the

United States, the FOMB, and the Commonwealth of Puerto Rico.                    The

eighty-one-page complaint requests a declaration that the Puerto

Rico       Oversight,        Management,     and     Economic    Stability       Act

       1Francisco J. Reyes Márquez was an additional individual
plaintiff below, but has since passed away.

                                          - 3 -
("PROMESA"), see 48 U.S.C. § 2101 et seq., and all of the FOMB's

actions taken pursuant to it violate the First, Fifth, Thirteenth,

Fourteenth, and Fifteenth Amendments of the U.S. Constitution;

seeks to "enjoin[] and stay[]" the defendants "from pursuing this

and any . . . cases" under PROMESA and from taking any other

actions under that law; requests a declaration "overruling the

Insular Cases because they instituted an unconstitutional colonial

regime"; and requests an order "declar[ing] the existence of an

illegal colonial regime that is subject to the procedures enacted

by   international       law    to   decolonize[]     Puerto   Rico,    under   the

Declaration on the Granting of Independence to Colonial Countries

and Peoples, adopted by General Assembly resolution 1514 (XV) of

December 14, 1960."

                 On the defendants' motions, the District Court dismissed

the plaintiffs' claims for declaratory relief for lack of subject

matter jurisdiction.            See Fed. R. Civ. P. 12(b)(1).          It reasoned

that       the     plaintiffs     had   failed   to     allege   concrete       and

particularized injuries that their requested relief could redress.

It concluded on this ground that the plaintiffs had "failed to

demonstrate that they have standing to pursue their claims."2                   The

plaintiffs timely appealed.

       2 The District Court did not reach the defendants' Rule
12(b)(6) arguments.

                                        - 4 -
                                             II.

            Article III limits the judicial power to actual cases

and controversies.            See U.S. Const. art. III, § 2, cl. 1.                     An

actual case or controversy only exists                       if the plaintiff has

demonstrated      "such       a    personal    stake    in     the    outcome     of   the

controversy as to assure that concrete adverseness which sharpens

the    presentation      of       issues    upon    which    the     court   so   largely

depends."      Baker v. Carr, 369 U.S. 186, 204 (1962).

            "To    satisfy         the     personal    stake       requirement,     [the]

plaintiff must establish each part of a familiar triad:                           injury,

causation, and redressability."                Katz v. Pershing, LLC, 672 F.3d

64, 71 (1st Cir. 2012) (citing Lujan v. Defs. of Wildlife, 504

U.S.    555,    560-61    (1992)).            The     redressability         element   of

constitutional standing requires that the plaintiff show "that a

favorable resolution of [the] claim would likely redress the

professed injury."        Id. at 72.           That means "it cannot be merely

speculative that, if a court grants the requested relief, the

injury will be redressed."                 Dantzler, Inc. v. Empresas Berríos

Inventory & Operations, Inc., 958 F.3d 38, 47 (1st Cir. 2020)

(citing Simon v. E. Ky. Welfare Rts. Org., 426 U.S. 26, 42-43

(1976)).       And although the plaintiff "need not demonstrate that

[the] entire injury will be redressed by a favorable judgment,

[the plaintiff] must show that the court can fashion a remedy that

will at least lessen [the] injury."                   Id. at 49 (citing Antilles

                                            - 5 -
Cement Corp. v. Fortuño, 670 F.3d 310, 318 (1st Cir. 2012)).            Our

review of a ruling as to whether the requirements of Article III

standing have been met is de novo.           See Me. People's All. v.

Mallinckrodt, Inc., 471 F.3d 277, 283 (1st Cir. 2006).

            The plaintiffs contend that the District Court erred in

dismissing their suit on Article III grounds in part because their

second amended complaint had alleged that "the enactment of laws

by the Commonwealth that were incorporated to the Fiscal Plans

certified by the FOMB" "inva[ded]" their "pecuniary interest,

collective    bargaining    agreement      and    property   (employment,

salaries, bonuses, pensions and health plans)."              The laws in

question are Acts 66-2014, 3-2017, 8-2017, and 26-2017, each of

which the plaintiffs allege "impair[s] . . . labor rights and

benefits"    that   their   collective     bargaining    agreements     had

previously    secured.      The   fiscal   plan    in   question   is   the

Commonwealth's Fiscal Plan of 2018, certified by the FOMB on June

29 of that year.      That plan provides in relevant part that a

payroll and hiring freeze for public employees as well as certain

restrictions to their healthcare and to their sick and vacation

days "must be continued."

            The problem with the plaintiffs' contention is that none

of the relief that they seek would prevent any of the laws that

they contend caused them pecuniary harm from continuing to have

full force and effect. For that reason, it is entirely speculative

                                  - 6 -
on this record that any of that relief would spare the plaintiffs

the pecuniary harm that they trace back to those laws.         And,

because it is entirely speculative on this record that such relief

would redress the claimed pecuniary harm, that claimed pecuniary

harm provides no support for the plaintiffs' argument that the

District Court erred in dismissing their claims for lack of Article

III standing.   See Dantzler, 958 F.3d at 47, 49.

          The plaintiffs do separately contend that they have

standing to seek the relief at issue because PROMESA's constraints

and the FOMB's oversight powers dilute the power of their vote in

elections in Puerto Rico due to the limits that PROMESA and the

FOMB place on the powers of the Puerto Rico government.    But, the

plaintiffs do not contend that any of these limits have diluted

their voting power within Puerto Rico vis-à-vis others in Puerto

Rico.   Thus, the precedents on which they rely to show that the

burden imposed on their right to vote suffices to secure their

standing under Article III are readily distinguished.     See, e.g.,

Baker, 369 U.S. at 207-08 (explaining that the statute in question

inflicted an injury on the plaintiffs because it "disfavor[ed] the

voters in the counties in which they reside, placing them in a

position of constitutionally unjustifiable inequality vis-à-vis

voters in irrationally favored counties").

          In the end, the plaintiffs are contending that the harm

they have suffered results from the fact that PROMESA and the

                               - 7 -
FOMB's actions are preemptive of local law.                The plaintiffs fail

to explain, however, why this type of harm is not a generalized

grievance of just the sort that cannot suffice the demands of

Article III.       See Gill v. Whitford, 138 S. Ct. 1916, 1923 (2018)

(explaining        that   plaintiffs      must      show    a   concrete    and

particularized injury to demonstrate that they have a "'personal

stake   in   the    outcome,'   distinct     from    a   'generally   available

grievance about government'" (citation omitted) (first quoting

Baker, 369 U.S. at 204; and then quoting Lance v. Coffman, 549

U.S. 437, 439 (2007))).

             The plaintiffs do assert at one point in their briefing

that "the fact that they do not have a right to vote for the

federal officers who appointed and imposed PROMESA, aggravates

their [voting rights] injury."              But, even assuming that this

assertion is responsive to the concern that the plaintiffs are

seeking relief for what is merely a generalized grievance, none of

the relief that they seek would redress their injury insofar as it

inheres in restrictions in their ability to vote in federal

elections.     Thus, this argument, too, fails to show that the

District Court erred in dismissing their claim on standing grounds.

                                     III.

             The    issues   that   the     plaintiffs'      complaint   raises

concerning the legal status of Puerto Rico are weighty ones.               But,

to be fit for adjudication in federal court, they must be raised

                                    - 8 -
in a suit that satisfies the requirements of Article III.   Because

we agree with the District Court that the plaintiffs have not met

their burden to satisfy those federal constitutional requirements,

we affirm the order dismissing their claims for lack of standing.

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