Perez-Molina et al v. Puerto Rico Electric Power Authority et al

Filing 144

MEMORANDUM AND ORDER. NOTED and GRANTED 139 NOTICE of STAY of Proceedings Pursuant to Title III of PROMESA; DENIED 142 Motion in Opposition to NOTICE of STAY. Signed by Judge Daniel R. Dominguez on 2/20/2018.(JRD)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO

CARLOS PEREZ-MOLINA, ET AL.,
Plaintiffs,
Civil No. 13-1638 (SEC)
v.
PUERTO RICO ELECTRIC POWER
AUTHORITY, ET AL.,
Defendants.

MEMORANDUM AND ORDER
Pending before the Court is the Puerto Rico Electric Power Authority’s (PREPA)
notice of automatic stay pursuant to section 405(b) of the Puerto Rico Oversight,
Management, and Economic Stability Act (PROMESA), 48 U.S.C. § 2194(b). The
plaintiffs filed a motion in opposition. The plaintiffs’ motion is denied and the case is
stayed. The reasons follow.
Plaintiffs Carlos Pérez-Molina and his wife filed this discrimination and
retaliation action against PREPA1—a public corporation and governmental
instrumentality of the Commonwealth of Puerto Rico, see P.R. Laws Ann. tit. 22, §
193—under the Americans with Disabilities Act, 42 U.S.C. §§ 12101–12213, and
several Puerto Rico laws. On June 30, 2016, Congress enacted PROMESA. As relevant
here, section 405(b) of PROMESA provides for an automatic stay of all debt-related

1

Plaintiffs also named Eliu Cruz as a defendant but the federal claims were dismissed against him without
prejudice because the ADA does not provide for individual liability, see Román-Oliveras v. Puerto Rico Elec.
Power Auth., 655 F.3d 43, 52 (1st Cir. 2011), and the Court declined to exercise supplemental jurisdiction over
the state law claims. ECF No. 65. Recently, the Puerto Rico Supreme Court clarified that Law No. 115-1991, the
Commonwealth’s anti-discrimination statute, does not provide a for individual liability either. See Santiago Nieves
v. Braulio Agosto Motors, 197 D.P.R. 369, 372 (2017).

Civil No. 13-1638 (SEC)

Page 2

litigation against the Commonwealth and covered instrumentalities, which was or could
have been commenced before the statute’s enactment. 48 U.S.C. § 2194(b).
On July 2, 2017, the Financial Oversight and Management Board for Puerto Rico
filed a voluntary petition for PREPAS’s adjustment of debts under Title III of
PROMESA. 48 U.S.C. § 2164. Shortly thereafter, PREPA filed a “Notice of Automatic
Stay of Proceedings” under PROMESA in this case. Plaintiffs then filed a response in
opposition arguing that the automatic stay is inapplicable to this case on several grounds,
none of which is convincing.
Plaintiffs first invoke section 405(c) of PROMESA, which exempts from the
automatic stay “the commencement or continuation of an action or proceeding by a
governmental unit to enforce such governmental unit’s or organization’s police and
regulatory power.” 48 U.S.C. § 2194(c)(2). Plaintiffs suggest that this case falls within
the exception because PREPA’s function of providing reliable electric power is
associated with Puerto Rico’s police power. To jettison this argument, it suffices to point
out that the exception applies to actions or proceedings “by a governmental unit,” id.
(emphasis added), not against a governmental unit, as in this case. See e.g. Lucontoni v.
United Airlines, Inc., 446 F. Supp. 2d 4, 6 (D. Mass. 2006) (“[T]here is a clear distinction
between governmental actions pursued to enforce a police or regulatory power, and
actions pursued by private parties. Governmental unit actions are exempted from
automatic stay provision by 11 U.S.C. § 362(b)(4); private party actions are not”).
Plaintiff Pérez-Molina also argues that the automatic stay is inapplicable because
the complaint contains a cause of action for injunctive relief. He claims that he is entitled
to some unspecified reasonable accommodation, an order compelling PREPA to make
Pérez-Molina eligible for extra hours, and “back-pay of extra hours loss of income
caused by the discrimination [and] retaliation” he allegedly suffered. ECF No. 142, p.
10.

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At the outset, it is unclear whether the complaint includes such a specific request
for injunctive relief. The complaint says only that “Plaintiffs request any and all other
remedies appropriate under the law or in equity, injunctive relief and any other remedy
available” and a “[p]reliminary and permanent injunctive relief, enjoining defendants
from engaging in” discriminatory and retaliatory conduct. ECF No. 1, p. 17.2
Regardless, the Court finds that Pérez-Molina’s claim for injunctive relief in any form
has become moot. The short of it is that Eliu Cruz, the only PREPA employee who
allegedly discriminated and retaliated against Pérez-Molina—including depriving him
from working extra hours—no longer works at PREPA. See ECF No. 125, ¶5.
Accordingly, there is no reasonable expectation that the discriminatory or retaliatory
conduct will recur. See United States v. W. T. Grant Co., 345 U.S. 629, 633 (1953);
compare Clark v. Alabama, 141 F. App’x 777, 784 (11th Cir. 2005) (affirming the
district courts’ decision that the plaintiff’s request for relief was moot because he was
no longer under the alleged retaliator’s supervision) with Jean-Baptiste v. D.C., 958 F.
Supp. 2d 37, 50–51 (D.D.C. 2013) (declining to dismiss as moot a request for injunctive
relief where the plaintiff’s harassment did “not appear to have been an isolated incident
by one supervisor against one victim”).
As to Pérez-Molina’s purported injunctive relief claim for “back-pay of extra
hours loss of income,” he has not shown how this does not entail the continuation of an
action “to recover a Liability Claim against the Government of Puerto Rico” that arose
before PROMESA’s enactment, which is clearly included within the automatic stay
“As a matter of professional practice, counsel who seek temporary relief usually should make a motion for a
preliminary injunction separate from the prayer for relief contained in the complaint. In addition to the demands
of good practice, Rule 65(a)(2) of the Federal Rules of Civil Procedure seems to require a separate motion for
temporary relief when it refers to ‘an application for a preliminary injunction.’” James Luterbach Const. Co. v.
Adamkus, 781 F.2d 599, 603 (7th Cir. 1986), citing C. Wright & A. Miller, Federal Practice and Procedure § 2949
(1973) (“The appropriate procedure for requesting a preliminary injunction is by motion....”). Pérez-Molina never
filed a separate motion for preliminary injunction. Neither does his verified complaint “describe the preliminary
injunction sought [nor] state with particularity the grounds for granting it.” C. Wright & A. Miller, Federal Practice
and Procedure § 2949 (3d ed.). And he did not file a proposed order for preliminary injunctive relief as required
by Local Rule 65, D.P.R. Civ. R. 65.
2

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provision. 48 U.S.C.A. § 2194(b). More so, considering that the term “Liability Claim”
is defined to include the “right to payment, whether or not such right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured, or unsecure.” Id., § 2194(a)(2).
Finally, Plaintiffs posit that a lift of the automatic stay is warranted.3 But if that
is the case, then they should request the lift from the Honorable Taylor Swain, who is
the judge assigned to PREPA’s voluntary petition under Title III of PROMESA.
For the reasons stated, none of the exceptions invoked by Plaintiffs to
PROMESA’s automatic stay provision applies. This case is therefore STAYED.
Judgment will be entered closing this case for administrative purposes.
IT IS ORDERED.
In San Juan, Puerto Rico, this 20th day of February, 2018.
s/Daniel R. Domínguez
Daniel R. Domínguez
U.S. Senior District Judge

3

Plaintiffs mention in passing the factors that courts should consider when deciding whether a lift of stay is
warranted, but they fail to properly apply them to the facts of this case. See ECF No. 142, pp. 8-9, quoting In re
Unanue-Casal, 159 B.R. 90, 95–96 (D.P.R. 1993), aff'd, 23 F.3d 395 (1st Cir. 1994).