Puerto Rico Court Suspends Arrest Order for Luma Energy CEO

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A Puerto Rico court late Wednesday suspended an arrest order for Luma Energy Chief Executive Officer Wayne Stensby, saying the company that manages the island’s electricity transmission and distribution system had complied with its instructions to hand over additional documents to local lawmakers.

Even so, during a televised conference call, San Jan Superior Court Judge Anthony Cuevas said he wouldn’t dismiss the arrest order outright until lawyers for Puerto Rico’s House of Representatives confirmed that Luma had provided the relevant information.

Lawmakers have been seeking the information from Luma — a consortium of Atco Ltd. and Quanta Services Inc. working with Innovative Emergency Management Inc. — since March. Cuevas declared the company in contempt of court on Tuesday after weeks of legal wrangling.

At a press conference earlier Wednesday, Puerto Rico House Speaker Rafael “Tatito” Hernandez said it was still unclear if the company had complied with the request, despite the court order.

“As far as the House of Representatives is concerned, no one is above the law and the president of Luma is a fugitive from justice who should be detained immediately,” Hernandez said.

Among the documents Luma initially failed to provide were receipts and time-sheets for the months prior to taking control of the grid. In addition, Luma didn’t turn over emails, texts and correspondence with government officials about the deal, according to Wednesday’s court order.

Ripple Effects

The legal dispute could have lasting effects for the bankrupt U.S. territory, which is hoping to sign deals that would put private companies in charge of operating its aging and fragile energy generators.

Tomas Torres, the consumer representative on the governing board of the Puerto Rico Electric Power Authority, or PREPA, said the executive branch should have compelled Luma to hand over documents months ago.

“This paints Puerto Rico as a country where you can come and do business and ignore the legislature and the high court,” Torres said. It also makes Puerto Rico look problematic in the eyes of investors, he said.

Read More: Puerto Rico’s Plan to Fix Its Power Grid Is Off to a Rocky Start

Luma did not respond to requests for comment about the arrest order.

In a written statement late Tuesday, the company said it had already handed over more than 5,000 documents in response to Puerto Rico’s legislature. The company also accused Puerto Rican lawmaker Luis Raul Torres of trying to “undermine” the company through the document requests.

“Luma is shocked, bewildered and deeply concerned regarding the case initiated by Representative Luis Raul Torres, which is undoubtedly motivated by the politics and interests of groups that oppose the electrical transformation that has begun and that Puerto Rico desperately needs,” the company wrote.

Luma won a 15-year contract to manage the grid in a semi-privatization of the public utility that has divided the island. It came amid long-running frustration with the island’s inconsistent service and aging infrastructure, which was laid bare by Hurricane Maria in 2017.

But problems have persisted since Luma took over on June 1, sparking street protests and legislative investigations. Local lawmakers have questioned the estimated $1.5 billion price tag of the deal.

To contact the reporter on this story:
Jim Wyss in San Juan at jwyss9@bloomberg.net

To contact the editors responsible for this story:
Elizabeth Campbell at ecampbell14@bloomberg.net

Jonathan Levin, Michael B. Marois

© 2021 Bloomberg L.P. All rights reserved. Used with permission.

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