June 2011

U.S. Virgin Islands Delegate to Congress Donna Christensen has introduced legislation that would create an innovative tax program that would leverage private pension assets to raise funds for infrastructure development in the U.S. Virgin Islands.  The bill amends the Internal Revenue Code of 1986 to assist in the recovery and development of the Territory by providing for a reduction in the tax imposed on distributions from certain retirement plans’ assets which are invested for at least 30 years under a U.S. Virgin Islands investment program.  The new program is projected to raise approximately $250 million a year dedicated to infrastructure of the U.S. Virgin Islands, while simultaneously raising an additional $500 million a year for the U.S. Treasury. Continue Reading New VI Tax Break Legislation Introduced in U.S. Congress

Federal authorities in New Jersey recently announced the disruption of an international smuggling ring that prosecutors said brought hundreds of illegal immigrants to the United States, including many young women who worked as dancers at strip clubs to repay their passage.

U.S. Attorney Paul Fishman said four people from New Jersey, one from Massachusetts, and one from Texas are each charged with one count of conspiracy to bring illegal immigrants into the United States through the U.S. Virgin Islands and Puerto Rico.Continue Reading Feds Bust Human Traffickers With VI Connections

 

First BanCorp (the “Corporation”) (NYSE: FBP), the bank holding company for FirstBank Puerto Rico (“FirstBank” or “the Bank”), announced earlier today that it has entered into an agreement with two funds managed by Oaktree Capital Management, L.P. (together “Oaktree”) under which Oaktree would purchase an aggregate of approximately $175.5 million of common stock of the Corporation at a per share price of $3.50. The Oaktree investment will represent 24.9% of the outstanding shares of the Corporation’s common stock upon completion of the capital raise and the conversion into common stock of the $424.2 million of Series G Mandatorily Convertible Preferred Stock (“Series G Preferred Stock”) held by the United States Department of the Treasury.

Continue Reading First BanCorp Announces Agreements for Capital Commitments

The Third Circuit Court of Appeals this past week became the highest court in the nation to draw a clear line establishing what school districts are legally permitted to do to control student expression on the Internet.  The Court with jurisdiction over the U.S. Virgin Islands sided with public school students stating that they cannot be punished for off-campus speech that fails to cause a substantial disruption to in-school activities,.

In the majority opinions for Layshcock v. Hermitage School District and J.S. v. Blue Mountain School District — two simultaneous opinions filed by the entire Third Circuit in Pennsylvania — the judges held that administrators are limited in their ability to restrict student speech that occurs outside of school.Continue Reading Third Circuit Sides with Students Right to Online Speech

An interesting tax case with implications for beneficiaries of the Virgin Islands Economic Development Program is currently being fought in U.S. Tax Court.  On April 1, 2010, Arthur I. Appleton filed a Petition with the Tax Court to challenge as void the tax assessments leveled against him by the Internal Revenue Service (“IRS”) because, he argued, the assessments were imposed after the expiration of the statute of limitations.

Under Section 932 of the Internal Revenue Code, Virgin Islands residents, like Appleton, are required to pay income tax directly to the Bureau of Internal Revenue (“BIR”), not the IRS, pursuant to the “mirror code”, where the term “Virgin Islands” is substituted for the “United States” in the Internal Revenue Code. Yet, the IRS retains audit and assessment powers.  Continue Reading Third Circuit Overrules Tax Court on EDC Case

The U.S. News & World Report has selected the United States Virgin Islands as one of the “Best Destinations in the USA,” in the first-ever “Best Vacations” rankings.

This list of 2011-2012 rankings was created to provide prospective travelers with a collection of the most popular travel spots around the world. The Territory received recognition in three of the 11 categories in the USA rankings: “Best Destinations,” “Best Beaches” and “Best Family Beach Vacations.”Continue Reading U.S. News & World Report Selects USVI as Best Vacation

Many tourists and local Virgin Islanders have enjoyed a Painkiller cocktail over the years, particulary visitors to the Soggy Dollar Bar on Jost Van Dyke, where the tropical concoction is made with the U.S. Virgin Islands’ Cruzan Rum.   

A New York Bar known as the Painkiller, thought to capitalize on the popularity of the drink when it opened on the Lower East Side of Manhattan over a year ago. But the bar’s legal reign as Painkiller has come to a painful end. Due to a federal law suit brought by Pusser’s Rum Ltd., the bar will now have to go under the moniker PKNY.

Pusser’s has also demanded that Painkiller turn over its website address and stop selling the rum cocktail know as Painkiller (which, according to Pusser’s, has to be made with their rum).
 Continue Reading Pusser’s VI Rum Wins Trademark Battle on “Painkiller”

Governor John P. deJongh, Jr. submitted his $1.2 billion Fiscal Year 2012 budget proposal to the the 29th Legislature of the Virgin Islands on Friday.

Of the total budget, $731.3 million would come from the General Fund – $50.6 million less than the FY 2011 budget. The remaining budget would derive revenues from federal funds and special funds.Continue Reading Governor deJongh Submits FY2012 Budget

The U.S. Senate Judiciary Committee has approved President Obama’s nomination of Ronald Sharpe as U.S. Attorney for the Virgin Islands by voice vote.

Sharpe, whom Obama nominated on March 10, has served as the interim U.S. Attorney for the Virgin Islands since September 2009.  He previously served in the U.S. Attorneys Office for the District of Columbia from 1995 to 2009 rising to the position of First Assistant U.S. Attorney.  The Virgin Islands has not had a confirmed U.S. Attorney since October 2008 when Anthony Jenkins resigned.Continue Reading U.S. Senate Judiciary Committee Approves Virgin Islands U.S. Attorney Nomination

A federal judge has dismissed the majority of the Virgin Islands Government Employees Retirement System’s (GERS) class-action complaint alleging J.P. Morgan and three related entities violated federal securities laws by making misleading statements in securities-offering documents concerning the quality of underlying mortgages.

Judge John G. Koeltl of the U.S. District Court for the Southern District of New York said GERS lacked standing to sue with respect to most of the securities because they had not bought them.Continue Reading Judge Kicks Out GERS Suit Against JPMorgan Chase