Len Weiser-Varon

The Oversight Board and the other PREPA parties are attempting to create precedent that frontally attacks not only PREPA bondholders and their insurers but also municipal revenue bond finance and basic bankruptcy jurisprudence.

Counting on transaction participants to file the UCC is like expecting the fox to guard the chicken coop.

Some of the legal precedents potentially being set in Puerto Rico erode the expectations and good order of the municipal bond marketplace that finances the activities of states and municipal instrumentalities nationwide.

Although defaults have not yet occurred, it is not too early for holders to take a hard look at the applicable bond documents to evaluate their rights and leverage in the restructurings or refinancings that have begun and which may proliferate in the years ahead.