Aug 8 (Reuters) - The judge in Argentina's long-running debt battle with hedge funds threatened a contempt-of-court order on Friday if the nation does not stop issuing false statements about having made required debt payments.
At a hearing, U.S. District Judge Thomas Griesa told lawyers at Cleary Gottlieb, which represents Argentina, that the country has made several false, misleading statements after he ordered the nation to stop doing so last week.
Argentina and holdout hedge funds that were awarded $1.33 billion plus interest by Griesa have been unable to come to a settlement. The country, which defaulted on about $100 billion in debt in 2002, said in notices in U.S. newspapers that it has paid its debt, which Griesa said was not true. "There has been no payment," he said.
Argentina deposited $539 million into the account of trustee Bank of New York Mellon to pay its scheduled coupon payment on June 30. Payments to bondholders have not been made because of Greisa's order, which stipulated that the nation must also pay the holdouts, who did not participate in the 2005 and 2010 debt restructurings.
Griesa said Friday that Cleary Gottlieb lawyers must try to make sure the government stops issuing false statements. He also said the parties need to continue to negotiate with the aid of court-appointed mediator Daniel Pollack. He said he wasn't going to go further than a warning for now, but that may change.
Jonathan Blackman, an attorney for Argentina, said his firm was not involved with the drafting of legal notices that appeared in newspapers.
"Argentina is a state. The state takes positions and makes decisions. They are not necessarily legal positions. This is a statement of their position, for better or worse," he said. (Reporting By Joseph Ax and Andrew Chung in New York)