| NEW YORK
NEW YORK May 30 Argentina's lawyers sought
Friday to assure a U.S. judge it would not evade orders to pay
$1.33 billion to bondholders who refused to accept its
debt-restructuring offers if the U.S. Supreme Court declines the
U.S. District Judge Thomas Griesa in New York questioned
lawyers for Argentina about a leaked memo described as advising
on a plan for how to restructure its bonds outside the reach of
U.S. courts if the Supreme Court does not take the case.
Carmine Boccuzzi, a lawyer for Argentina at Cleary Gottlieb
Steen & Hamilton, acknowledged the memo was real. He said while
it did address whether Argentina may need to restructure in a
way consistant with U.S. court orders, that was "not the upshort
of the memo."
"There is no secret plan to evade," he said.
Boccuzzi added there "likely would be a default" if the
lower court rulings remained in place, saying "there would be a
cataclysmic result from an affirmance of the order."
The U.S. Supreme Court is scheduled on June 12 to consider
whether to hear Argentina's appeal of rulings requiring it to
pay the holdout bondholders back in full.
The holdouts' case is the last hurdle to the country putting
its 2002 default on $100 billion in debt behind it and regaining
full access to international credit markets.
Argentina on Thursday clinched a landmark deal with the
Paris Club of wealthy creditor nations to repay its overdue debt
worth nearly $10 billion.
After the default, creditors holding about 93 percent of
Argentina's bonds agreed to participate in the swaps, in 2005
and 2010, accepting between 25 cents and 29 cents on the dollar.
But bondholders including NML Capital Ltd, a unit of
billionaire Paul Singer's Elliott Management Corp, and Aurelius
Capital Management went to court seeking payment in full.
The hearing Friday stemmed from the publication in an
Argentine blog of portions of a May 2 memo by Cleary Gottlieb
that advised the country on options if the Supreme Court did not
take the case.
The memo posted online said the "best option" for Argentina
would be to let the Supreme Court force a default and then
restructure its bonds so the payment mechanism was outside U.S.
Robert Cohen, a lawyer for NML, argued the memo "requires
the immediate attention of the court."
He argued the judge should rule it was not protected by
attorney-client privilege, find the county violated the court's
orders and force Argentina to disclose its plans.
Boccuzzi, while not confirming many details of the memo,
said it also laid out "possible settlement scenarios," adding
there was no plan to evade the U.S. courts' jurisdiction.
But Judge Griesa noted another lawyer at Boccuzzi's firm had
previously told a U.S. appeals court Argentina "would not
voluntarily obey" his injunctions even if upheld.
"All that's ever been done by Argentina is to refuse to pay
its just obligations," he said.
The case is NML Capital et al v. Republic of Argentina, U.S.
District Court, Southern District of New York, No. 08-6978.
(Reporting by Nate Raymond in New York; Editing by Lisa