Postage By Phone Reserve Account Files a Motion to Dismiss Financial Oversight and Management Board for Puerto Rico’s Trustee’s Complaint for Lack of Personal Jurisdiction
September 7, 2021, District of Puerto Rico – Defendant Postage By Phone Reserve Account files a motion for dismissal of the adversary proceeding brought by the Special Claims Committee of the Financial Oversight and Management Board for Puerto Rico and the Official Committee of Unsecured Creditors of all Title III Debtors, (the “Plaintiffs”) for lack of personal jurisdiction, insufficient process and insufficient service of process pursuant to Bankruptcy Rule 7012(b)(4) and (5), or Rule 12(b)(4) and (5) of the Federal Rules of Civil Procedure.
Plaintiffs initiated a lawsuits and similar other lawsuits last year to avoid and recover certain transfers the Commonwealth allegedly made to certain individuals and entities during a specified timeframe before the Financial Oversight and Management Board for Puerto Rico’s bankruptcy filing. According to the Plaintiffs, among other things, such transfers were allegedly constructively fraudulent under the Bankruptcy Code and Puerto Rico law. Specifically, in this adversary proceeding, Plaintiffs seek to set aside the payments worth $5,779,431.00 allegedly made to Postage By Phone Reserve Account.
By way of background allegedly, in 2016, the Commonwealth of Puerto Rico was unable to service its debt, resulting in default and straining its ability to deliver essential services for the people of Puerto Rico. As a result, the Financial Oversight and Management Board for Puerto Rico filed a Title III bankruptcy proceeding on behalf of the Commonwealth of Puerto Rico on May 3, 2017.