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U.S. judge defends debt mediator against Argentine broadside
August 4, 2014 / 10:11 PM / 3 years ago

U.S. judge defends debt mediator against Argentine broadside

NEW YORK, Aug 4 (Reuters) - U.S. District Judge Thomas Griesa stepped in on Monday to defend the mediator he appointed to help settle a long-standing sovereign debt dispute between Argentina and holdout creditors after that country’s government accused the go-between of bias.

“The purpose of this ruling is to confirm that Daniel Pollack, the Special Master appointed by the court to preside over settlement negotiations, will remain in office,” Griesa ordered.

Griesa confirmed Pollack’s position, backing the man who was the first in nearly 13 years to succeed in getting both sides to sit down face-to-face to negotiate a settlement on a court-awarded $1.33 billion plus interest for the holdouts led by New York-based hedge funds Elliott Management Corp and Aurelius Capital Management.

Argentina’s lead lawyer, Jonathan Blackman, said in court testimony on Friday he had been instructed by his client to say it had no confidence in Pollack, citing a statement by the mediator as being “harmful and prejudicial to the Republic.”

Argentina repeated the fierce criticism of Pollack on Monday at the same time its markets watchdog said it was going to launch an investigation into possible unlawful speculation by holdout creditors.

The talks failed on July 30 to stop Argentina from entering default on some $29 billion in bonds that fall under foreign law restructured from its massive $100 billion default in 2002.

Griesa said Pollack was following his orders to issue a statement of facts should negotiations break down or were suspended in order not to leave the public record blank.

“He (Pollack) has been even-handed in relationship to the parties. There has been no bias in any degree,” Griesa said.

“It is hard to imagine any worse move that the court could make than to remove the Special Master. It would be a gross injustice and would drastically interfere with the process which has been going on and must continue.” (Reporting By Daniel Bases. Editing by Andre Grenon)

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