Case Explained: JOSÉ ERNESTO HERNÁNDEZ-CASTRODAD; IRIS MARTA MARCANO; CONJUGAL PARTNERSHIP HERNÁNDEZ-MARCANO v. HON. SIGFRIDO STEIDEL-FIGUEROA

Court: United States Court of Appeals for the First Circuit Filed: 2026-07-01 The First Circuit dismissed the appellants’ appeal regarding their administrative fee claim and affirmed the district court’s dismissal of their interest claim. The court held that it lacked jurisdiction to review the administrative fee claim because the suit was filed in violation of the automatic stay provisions under Title III of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). The court reasoned that the appellants’ demand for the return of the 15% administrative fee constituted a “claim against the debtor” (the Commonwealth of Puerto Rico) for “property of the debtor,” thereby triggering the stay under 11 U.S.C. §§ 362 and 922, which were incorporated into PROMESA. Because the claim was filed in violation of the stay without relief from the Title III court, the action was void and without legal effect, precluding appellate review of its merits. Regarding the interest claim, the court affirmed the district court’s dismissal based on a lack of standing under Federal Rule of Civil Procedure 12(b)(6). The court found that the appellants failed to allege an injury in fact sufficient to confer jurisdiction because they did not plead that they had requested disbursement of their accrued interest; consequently, their grievance regarding the lack of transparent notice and calculation procedures was deemed abstract, hypothetical, and akin to a generalized grievance. As a practical consequence, the appeal is dismissed, the district court’s summary judgment on the administrative fee claim is vacated due to lack of jurisdiction, and the dismissal of the interest claim stands, leaving the parties to bear their own costs. Do It For The Case Law is a news reporting service. Nothing in this episode constitutes legal advice.