Puerto Rico Board Takes Fight Over Members to Supreme Court

(Bloomberg) -- Puerto Rico’s federal oversight board is asking the U.S. Supreme Court to overturn a ruling that deemed its members unconstitutionally appointed and opened the door for President Donald Trump to appoint his own nominees to supervise the island’s record bankruptcy.

The board said in a statement Tuesday that it filed a petition with the high court challenging a Feb. 15 decision by the U.S. Court of Appeals for the First Circuit that the appointments weren’t constitutional because the U.S. Senate didn’t approve them. That verdict was prompted by a lawsuit from investment firm Aurelius Investment and other creditors.

The federal board plans to ask the appeals court to prolong a stay that prevents the ruling from taking effect. The current 90-day stay extends through May 16, said Matthias Rieker, spokesman for the federal board.

Trump has yet to seek Senate confirmation for the board’s current members or for new ones, so it’s unclear how he would act if the verdict is allowed to stand. The Wall Street Journal reported on March 28 that Trump was preparing to ask the Senate to approve the current members.

The board, which was established by federal legislation to help the island out of its debt crisis, maintains that its members are exempt from a full vote in the Senate because the panel was created as an entity within the government of Puerto Rico rather than the U.S. government. President Barack Obama in 2016 selected the members from a list of candidates supplied by leaders of both political parties in the U.S. House and Senate.

To contact the reporter on this story: Michelle Kaske in New York at mkaske@bloomberg.net

To contact the editors responsible for this story: James Crombie at jcrombie8@bloomberg.net, William Selway, Adam Cataldo

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