Aug 8 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)