Wednesday, December 17, 2014

Argentina faces skeptical US court over holdout subpoenas

The US Court of Appeals for the Second Circuit in Manhattan.

Argentina has urged a US appeals court to reverse a lower court decision requiring the country and various banks to provide holdout creditors with information about the country's assets including military equipment and diplomatic property.

Judges on 2nd US Circuit Court of Appeals in New York questioned if bondholders seeking full payment of debts after its $100 billion default in 2002 had made their information requests too broad. But the judges also expressed concerns that if they narrowed the order, Argentina would still defy it.

The appellate arguments stemmed from a 2013 ruling by New York judge Thomas Griesa compelling Argentina and 29 banks to comply with subpoenas and information requests by the holdouts aimed at finding assets to fulfill unpaid judgments.

Argentina contended the order would effectively allow an inventory of military and diplomatic assets that were protected from seizure by US law and various treaties.

"No state has ever been asked to do this before," Jonathan Blackman, Argentina's lawyer, argued.

Matthew McGill, NML holdout lawyer, argued that the requests for information were "proportional to the billions of dollars we are owed."