Financial Oversight and Management Board for Puerto Rico v. Aurelius Investment, LLC
Issues
Are members of the Financial Oversight and Management Board for Puerto Rico “principal” officers of the United States subject to the Appointments Clause; and, if their appointment that bypassed Senate confirmation is unconstitutional, what would be the appropriate remedy?
The Supreme Court will decide if the Appointments Clause governs the appointment of members of the Financial Oversight and Management Board for Puerto Rico (the “Board”). In response to Puerto Rico’s debt crisis, Congress enacted the Puerto Rico Oversight, Management and Economic Stability Act of 2016 (PROMESA), which created the Board that institutes Title III proceedings on behalf of Puerto Rico. In 2017, a number of creditors filed complaints seeking to dismiss the Board’s debt adjustment proceedings, challenging President Obama’s appointment of the board members. On appeal, the First Circuit held that the Board members’ appointments are unconstitutional but sustained the Board’s Title III proceedings under the de facto officer doctrine. The Board and other Petitioners argue that the Board members’ appointments are constitutional because the Appointments Clause does not apply when Congress acts in the U.S. territories pursuant to its Article IV authority. The creditors and other Respondents counter that all constitutional safeguards, including the Appointments Clause, always apply in the U.S. territories. The outcome of this case has implications for Congress’s authority in providing administrative structures to govern the U.S. territories.
Questions as Framed for the Court by the Parties
Whether the Appointments Clause governs the appointment of members of the Financial Oversight and Management Board for Puerto Rico.
In June 2016, Congress enacted the Puerto Rico Oversight, Management, and Economic Stability Act (“PROMESA”) to address the dire financial crisis in Puerto Rico. Aurelius Investment, LLC v. Puerto Rico at 842.
Edited by
The authors would like to thank Professor Joshua C. Macey for his guidance and insights into this case.
Additional Resources
- Associated Press, Supreme Court Takes Case on Puerto Rico Financial Crisis, CBS News (Jun. 20, 2019).
- Amy Howe, Justices Add Puerto Rico Appointments Clause Case to Next Term’s Docket, SCOTUSBlog (Jun. 20, 2019).
- Daniel Gill, Judges Call for End to Racial Doctrine in Puerto Rico SCOTUS Case, Bloomberg Law (Aug. 29, 2019).