By: Derek Hawkins//June 22, 2016//
US Supreme Court
Case Name: Puerto Rico v. Franklin Cal. Tax-Free Trust
Case No.: 15-233
Focus: Bankruptcy
Section 903(1) of the Bankruptcy Cade pre-empts Puerto Rico’s Recovery Act
“Three federal municipal bankruptcy provisions are relevant here. First, the “gateway” provision, §109(c), requires a Chapter 9 debtor to be an insolvent municipality that is “specifically authorized” by a State “to be a debtor.” Second, the pre-emption provision, §903(1), expressly bars States from enacting municipal bankruptcy laws. Third, the definition of “State,” §101(52), as amended in 1984, “includes . . . Puerto Rico, except for the purpose of defining who may be a debtor under chapter 9.””
Affirmed
Dissenting: SOTOMAYOR, GINSBURG, ALITO
Concurring: