U.S. Backs Argentina at High Court in Bank Subpoena CaseGreg Stohr
The Obama administration urged the U.S. Supreme Court to hear Argentina’s challenge to a court order requiring two banks to turn over information about the country’s assets.
The case is part of a multipronged fight by hedge funds to collect billions of dollars owed by the South American country on defaulted bonds. It is separate from a higher-profile lawsuit that the country says threatens to force a new default.
In the Supreme Court case, Argentina is seeking to block a court order enforcing subpoenas against Bank of America Corp. and state-owned Banco de la Nacion Argentina. NML Capital Ltd., an affiliate of billionaire Paul Singer’s Elliott Management Corp., is trying to collect on judgments it has won in U.S. court cases.
Argentina contends that it’s protected by the U.S. Foreign Sovereign Immunities Act. The country says that law limits such orders to assets that are in the U.S. and are used for a commercial activity. The New York-based 2nd U.S. Circuit Court of Appeals rejected that argument.
U.S. Solicitor General Donald Verrilli said in the new filing that the lower court order was too broad and that the sovereign-immunity law shields Argentina.
In a separate case, Argentina is fighting a court order that bars the country from making payments on restructured debt unless it pays holders of the defaulted bonds. Argentina has until February to file a Supreme Court appeal in that case.
The case already before the Supreme Court is Argentina v. NML Capital, 12-842.