A bid by Puerto Rico's Legislative Assembly to challenge the authority of the federally appointed oversight board was denied by the 1st U.S. Circuit Court of Appeals in Boston.
Natalie Jaresko, executive director of the oversight board, said in a statement Monday that the oversight board "continues to operate under its legal mandate and within its fiscal authority, despite inaccurate accusations of overreach." The court decision was issued Feb. 22.
In a separate challenge to the board's constitutionality, another panel in the same the federal appeals court said Feb. 15 that oversight board members were not constitutionally appointed. That case was brought by Aurelius Capital Management in a bid to dismiss Puerto Rico's bankruptcy cases involving bondholders and other creditors.
The court did not dismiss those cases but allowed 90 days for board member appointments to be validated or for new members to be properly appointed. Current board members were appointed in 2016 by President Barack Obama on the recommendation of Congress and were not subject to Senate confirmation. The appeals court said they should have been appointed "with the advice and consent of the Senate."