| NEW YORK
NEW YORK Aug 15 Holders of euro-denominated
Argentine bonds plan to appeal a U.S. judge's ruling blocking
the country from making payments on their debt, according to a
court filing on Friday.
In a notice filed in Manhattan federal court, lawyers for
the bondholders challenged an Aug. 6 ruling from U.S. District
Judge Thomas Griesa that Argentina cannot pay the bondholders
until it also pays holdout investors who refused to restructure
their debt in the wake of Argentina's 2001-2002 default.
Meanwhile, Citigroup Inc and Argentina on Friday were
granted an expedited appeal of another order from Griesa that
barred future payments to holders of certain U.S.
dollar-denominated restructured bonds, after the judge allowed
the bank to make a one-time payment.
Both appeals will be considered by the 2nd U.S. Circuit
Court of Appeals in New York. The court on Friday set oral
arguments in the Citibank matter for Sept. 18.
Argentina defaulted after missing a July 30 deadline for
payments on restructured bonds. Officials have claimed the
country fulfilled its obligations but was blocked by Griesa,
whom they have criticized, saying he overstepped his authority.
In June, Argentina deposited $539 million in Bank of New
York Mellon Corp's account at the Central Bank of
Argentina, earmarked for bondholders who participated
in sovereign debt exchanges in 2005 and 2010. It also deposited
funds with Citibank Argentina.
But Griesa blocked the payments, saying Argentina's actions
were an "illegal" violation of his prior orders.
The euro bondholders have argued that their bonds should be
exempt because they are governed by the laws of England and
Wales and paid through foreign banking institutions.
"At no point in the euro bonds' payment chain do funds
comprise U.S. dollars, enter the U.S., or flow through U.S.
entities," lawyers for the bondholders argued in a previous
court filing in June.
Separately, in July, Griesa permitted Citibank to pay some
bondholders because the bank indicated it was unable to
differentiate between dollar-denominated exchange bonds and
bonds issued as part of a settlement between Argentina and
Repsol SA, which are not part of the bond dispute.
He said he would not allow a second payment and ordered the
bank to figure out a way to tell the difference, prompting
Argentina and Citibank to appeal.
Last week, Griesa threatened a contempt order if the country
did not stop issuing "false and misleading" statements, but
Argentine officials have continued to defy him. On Wednesday
they accused him of not understanding the case's complexities.
In 2012, Griesa ordered Argentina to pay $1.33 billion plus
interest to the holdout group, led by Elliott Management's NML
Capital Ltd and Aurelius Capital Management.
Aurelius declined to comment on the latest development in
the long-running proceedings. A representative for NML was not
immediately available to comment.
(Reporting by Joseph Ax and Daniel Bases; Editing by David