Brazil, Mexico, France to back Argentina in bonds case in U.S. court

WASHINGTON Fri Mar 21, 2014 5:06pm EDT

WASHINGTON (Reuters) - Brazil, France and Mexico are expected to file papers in the U.S. Supreme Court on Monday backing Argentina in its legal battle with bondholders who refused to take part in debt restructurings from the country's 2002 default, according to a source familiar with the litigation.

Lawyers for the three countries will support Argentina's request that the high court review a court order requiring it to pay $1.33 billion to "holdout" creditors led by hedge funds Aurelius Capital Management and NML Capital Ltd, a unit of billionaire Paul Singer's Elliott Management Corp.

France had previously supported Argentina in an unsuccessful attempt last year to obtain Supreme Court review at an earlier stage of the legal fight.

The litigation has created concerns about a potential debt crisis. Argentina defaulted on $100 billion more than a decade ago.

The case is being closely watched because of its potential impact on future sovereign debt restructurings.

If justices on the top U.S. court agree to hear the case, a decision could come between October, when the next term begins, and June 2015, the end of the term.

Creditors holding about 93 percent of Argentina's bonds agreed to participate in the two previous debt swaps in 2005 and 2010, which gave them 25 to 29 cents on the dollar.

The case is Argentina v. NML Capital, U.S. Supreme Court, 13-990.

(This story makes correction in the 3rd paragraph to say France previously supported Argentina in Supreme Court, not lower courts)

(Reporting by Lawrence Hurley; Editing by Howard Goller and Tom Brown)

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Comments (1)
lkofenglish wrote:
“so noted” and “pay ten billion plus court costs.”

Mar 21, 2014 6:00pm EDT  --  Report as abuse
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