NEW YORK Aug 21 A U.S. investment fund pressing
for full repayment on Argentine debt is urging a U.S. judge to
consider declaring Argentina in contempt after Buenos Aires
announced plans to skirt court rulings that pushed it into
NML Capital Ltd is one of a group of plaintiffs known as
holdout creditors who U.S. District Court Judge Thomas Griesa
said must be paid in full if Argentina is to resume payments to
other creditors who accepted to exchange debt for a fraction of
In a letter to the judge filed late on Wednesday, NML
Capital Ltd said the measures announced by Argentine President
Cristina Fernandez on Tuesday were a "grave affront" on Griesa's
"The express purpose of these maneuvers is to render this
court's orders a nullity," NML's lawyer Robert Cohen said.
Cohen's letter urged Griesa to hold an emergency hearing to
address "whether this court should hold Argentina in contempt".
President Fernandez's government has sent a bill to Congress
that would replace its New York intermediary bank with state-run
Banco Nacion, which would be a way to resume payments to
creditors who accepted restructured debt following Argentina's
$100 billion debt default in 2002.
In June, Griesa blocked a $539 million coupon payment on
the restructured debt deposited by Argentina at intermediary
Bank of New York Mellon (BONY), saying it violated his
order. Those funds are still held in limbo in BONY's account.
Latin America's No 3 economy then tipped into default on an
estimated $29 billion in debt when negotiations with the New
York hedge funds collapsed.
Griesa, who has presided over the decade-long legal battle
between Argentina and the New York hedge funds, has already
threatened Argentina with contempt for making public statements
that it had honored its debt obligations.
"Argentina's proposed exchange would gut this court's
injunctions by replacing financial institutions such as BONY
that have refused to participate in Argentina's violations ...
with Argentina's patsies that have no interest in abiding by the
court's rulings," Cohen wrote.
(Reporting by Nate Raymond in New York; Writing by Richard
Lough Editing by W Simon)