Argentina, Creditors Appeal Pro-Elliott Ruling On Debt

Nov 27 2012 | 3:30pm ET

Argentina and creditors who accepted its debt restructuring following its 2002 default have appealed a court ruling that could force the country to default again.

The country and the exchange bondholders each filed motions with a federal appeals court in New York to reinstate a stay of a lower-court order that allowed Argentina to continue making payments on debt exchanged in 2005 and 2010 while it continued its fight with those who refused the exchange, including Elliott Associates and Aurelius Capital Management. The lower-court order requires Argentina to put more than US$1.3 billion in escrow to cover payments to the holdouts, whom Argentina has sworn never to pay.

U.S. District Judge Thomas Griesa lifted a stay he placed on his own ruling last week; he wrote, "the less time Argentina is given to devise means for evasion, the most assurance there is against such evasion."

Argentina, which has pledged to adhere to U.S. court rulings and which has said it will not default again, blasted Griesa's ruling, calling it a "kind of judicial colonialism." Argentine economy minister Hernán Lorenzino added that it was "an attack on sovereignty that shows ignorance of the laws passed by our Congress."

For their part, the exchange bondholders complained to the U.S. Second Circuit Court of Appeals, which last month upheld Griesa's underlying ruling, that lifting the stay "unlawfully and unconstitutionally burdens the rights of innocent creditors."

"The exchange bondholders agreed to take under 30 cents on the dollar to support Argentina's debt restructuring in accordance with U.S. government and international fiscal policy," David Boies, a lawyer for the creditors, said. "They should not be further penalized."


In Depth

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Scene Last Night: Clinton, Schwarzman, Corzine, Neidich, Diamond

Nov 25 2014 | 5:52pm ET

Steve Schwarzman had a granddaughter yesterday morning. Last night he sat one table...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.