Puerto Rico Restructuring Law Thrown Out in Bondholder Win
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A Puerto Rico law that would have forced investors in some public corporations to accept unfavorable restructuring terms was thrown out in a lawsuit brought by holders of power utility bonds.
Investment funds of Franklin Resources Inc. and OppenheimerFunds Inc., which hold more than $1.5 billion in bonds issued by the Puerto Rico Electric Power Authority, convinced a federal judge in San Juan that bankruptcy law and the U.S. Constitution trump the commonwealth’s legislation.