Bench Memos

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Argentine Doubletalk?


In the litigation arising from Argentina’s default on its bond obligations, I’ve highlighted Argentina’s stated intention to defy any adverse judgment that it receives from American courts even as it tries to petition the Supreme Court for relief. Here’s the latest development:

On Monday of last week, in its reply brief (pages *1-*2) in the Supreme Court on a pending writ of certiorari, Argentina seemed to deny that it would defy any adverse order. A Reuters reporter who has been closely following the litigation hailed the apparent about-face as “an historic concession” by the “most notorious deadbeat in the U.S. courts.”

But then on Friday, the bondholders presented to a federal district judge a six-page memo from Argentina’s lawyers to Argentina’s Minister of Economy and Public Finance that (at least in the English translation available here) presents “not paying the holdouts nor the holders of restructured debt” as a very live option—one that would have the advantage of “triggering a default ordered by the courts,” thus freeing Argentina from “any legal restriction that prohibits it from restructuring all of the debt in default.” To her credit, the Reuters reporter now says that she “may have been too quick to believe” Argentina’s apparent pledge.

While I’m at it, I’ll also call attention to this amicus brief from six former federal judges (including former Attorney General Michael Mukasey) that argues—along the same line that I have—that the Supreme Court should deny review because “Argentina is behaving like a fugitive who appeals his conviction while simultaneously refusing to submit to the courts’ authority.” 


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