Arlene-Ocasio v. Comision Estatal de Elecciones

Summarized by David Treacy , U.S. Bankruptcy Court, Eastern District of Kentucky
5 days 22 hours ago

Case Type:

Business

Case Status:

Reversed

Citation:

No. 24-1822 (1st Circuit, Apr 01,2026) Published

Tag(s):

Ruling:

The U.S. Court of Appeals for the First Circuit reversed a district court decision allowing plaintiffs to collect attorneys' fees from Puerto Rico related to a lawsuit about COVID-19 pandemic voting procedures. The lower court erred because the plaintiffs' "claim for fees runs against Puerto Rico; it arose after [the PROMESA restructuring] petition was filed but before [the Plan of Adjustment's] Effective Date; Plaintiffs failed to file proof of their claim by the administrative expense bar date; and therefore, under the [Plan of Adjustment], Plaintiffs' claim is discharged and enjoined."

Procedural context:

The First Circuit's opinion discusses the creation of the Puerto Rico Oversight, Management, and Economic Stability Act ("PROMESA"), the confirmation of Puerto Rico's debt restructuring plan proposed under PROMESA, the plan's provisions concerning the discharge and release of claims and an injunction against continued pursuit of collection efforts on released/discharged claims, and the claims adjustment process. The arguments raised against the discharge of Plaintiffs'/Appellees' attorneys' fee claim under Puerto Rico's plan echo arguments often raised in a non-PROMESA context, including waiver, the timing of when the claim arose, the nature of the obligation (whether it arose under federal police or regulatory laws), and whether Plaintiffs received due process owing to the failure "to provide [Plaintiffs] with constitutionally adequate notice of the administrative expense bar date." Notably, the First Circuit also provided a tip to Plaintiffs in a footnote at the very end of the opinion: "The Bankruptcy Code, as adopted by PROMESA, permits Plaintiffs to file a belated 'request for payment of an administrative expense' in the Title III proceedings and ask the Title III Court to accept the late filing 'for cause.' 11 U.S.C. § 503(a); . . . . We offer no view on how any such filing should be resolved."

Facts:

Plaintiffs/Appellees Belia Arlene-Ocasio and Efrain Colon-Damiani sued Defendants/Appellants Comisión Estatal de Elecciones (the Puerto Rico election commission) and its president under 42 U.S.C. § 1983 in the U.S. District Court for the District of Puerto Rico. They alleged election procedures during the COVID-19 pandemic unlawfully burdened older voters' ability to vote safely. Defendants filed an Answer stating they "appeared 'without waiving any right or defense arising from Title III of" the Puerto Rico Oversight, Management, and Economic Stability Act ("PROMESA"). "[T]he district court granted Plaintiffs a preliminary injunction that allowed voters over sixty to vote early by mail" and shortly thereafter "issued a permanent injunction." After entry of a final judgment, Plaintiffs moved to recover their attorneys' fees and costs under 42 U.S.C. § 1988. More than three years later, the district court awarded Plaintiffs their attorneys' fees. Defendants moved for reconsideration. They then "filed a 'Notice of Injunction,' in which they asserted that under [Puerto Rico's Plan of Adjustment under PROMESA], Plaintiffs were barred from collecting the fee award. Defendants asserted Plaintiffs' claim was a post-petition monetary award against Puerto Rico and implied that Plaintiffs failed to file proof of their claim before the administrative expense bar date. Defendants requested that the court 'take notice of the injunction,' which they said 'stay[ed] the instant case and depriv[ed] [the district court] of jurisdiction.' Prior to filing the Notice of Injunction, Defendants had not provided direct notice to Plaintiffs about the [Plan of Adjustment] or the administrative expense bar date." The district court denied the request to stay the collection of legal fees as "it was 'not persuaded that the [Plan of Adjustment's] injunction on claims and administrative bar date applie[d].'" This appeal followed.

Judge(s):

Gelpí, Hamilton, and Aframe

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