Governor vows to keep suit against LUMA in local courts
- The San Juan Daily Star
- 2 days ago
- 3 min read
By THE STAR STAFF
Gov. Jenniffer González Colón stated on Tuesday that the government will request that the lawsuit challenging the extension of LUMA Energy’s contract not be heard in federal court but rather remain in the commonwealth court, as stipulated in the contract itself.
“We are going to invoke the right to have this case heard in Puerto Rico, because that is what the contract provides and because we are alleging that the granting of that extension was null and void,” the governor told reporters.
González Colón maintained that the government’s argument is not related to bankruptcy or alleged breaches of contract, but rather to the legal validity of the letter that extended the agreement with the private operator of the island’s energy transmission and distribution system.
“We are not addressing issues of breach of contract or matters related to bankruptcy or the [Financial] Oversight [and Management] Board,” she added. “We are saying that the extension of that contract is ultra vires, it is null and void, it should never have been carried out because it did not meet the basic legal requirements.”
The governor stated that the extension letter was granted without the required approvals from the Puerto Rico Electric Power Authority (PREPA), the Puerto Rico Energy Bureau, and the island Legislature.
“We are not talking about the contract itself; we are talking about a letter that unilaterally extended the life of this contract without any oversight or accountability,” she said.
The STAR, meanwhile, found a video in which PREPA approved the extension.
González Colón said the island Justice Department and the Public-Private Partnerships Authority (P3A) are prepared to address LUMA’s legal strategy and reiterated that the case must be heard in Puerto Rico because it is a matter of high public interest.
“This is an issue that directly affects the people of Puerto Rico, the governor said. “Otherwise, our people would be literally left without any protection against an operator that fails to fulfill its obligations and costs the people money every day.”
The governor’s remarks come after LUMA Energy requested that the lawsuit filed by the government to invalidate the contract extension letter be transferred to the U.S. District Court under Title III of the Puerto Rico Oversight, Management and Economic Stability Act, commonly known as PROMESA. According to a previous statement by the consortium’s CEO, Juan Saca, LUMA believes that the federal forum is the appropriate venue to address the dispute.
“We firmly believe this is the most appropriate forum to address this case,” Saca said in a written statement. “The recent politically motivated actions to reverse a legally binding contract only serve to jeopardize all the real progress we have made, harming the people of Puerto Rico by threatening critical projects aimed at revitalizing and strengthening the power grid.”
“The unjustified legal action by the P3A and PREPA is baseless, considering there has been no breach of contract by LUMA,” the CEO added. “These types of actions set a negative precedent, generating serious concerns for any company considering operating or investing in Puerto Rico, and represent an unnecessary obstacle to the island’s economy.”
In its transfer request, filed Monday evening, LUMA said: “Termination of the T&D OMA would have a profound effect on PREPA’s restructuring.”
“It would plainly alter PREPA’s rights, liabilities, options, and freedom of action, as well as impact the handling and administration of the bankruptcy case,” the document said. “It may also give rise to renewed efforts to dismiss the Title III case and/or appoint a receiver for PREPA.”