By Lawrence Hurley
WASHINGTON The U.S. Supreme Court on Friday
agreed to consider a dispute over subpoenas in a case stemming
from long-running litigation over Argentina's obligations to
bond investors in the wake of its default on $100 billion in
sovereign debt in 2002.
The court agreed to hear Argentina's appeal after an appeals
court said a hedge fund could subpoena banks for information
about the South American country's non-U.S. assets.
The hedge fund, NML Capital, a holder of Argentine bonds,
wants repayment in full in a fight that was prompted by
Argentina's 2002 default. The repayment issue is the subject of
high-profile litigation that could be headed to the high court
in a separate case.
"Argentina is in open defiance of dozens of judgments of
U.S. courts to pay American investors what it owes," said
Theodore B. Olson, a lawyer for NML. "It's time for Argentina to
stop trying to evade its obligations and to follow the law."
In the matter the court acted upon on Friday, the question
is the narrower issue of whether NML could enforce subpoenas
against Bank of America and Banco de la Nacion
In August 2012, the 2nd U.S. Circuit Court of Appeals in New
York rejected Argentina's argument that some subpoenas should be
quashed because it would infringe on its sovereign immunity. The
Obama administration backed Argentina in the case.
NML, a unit of billionaire hedge fund manager Paul Singer's
Elliott Management Corp, is one of several bondholders that
rejected offers accepted by other investors to swap the
defaulted debt for new paper at a steep discount. The other
major player is Aurelius Capital Management.
In the higher-profile case, the same appeals court declined
in November to reconsider an order requiring Argentina to pay
$1.33 billion, ruling in favor of the bondholders. Argentina is
now expected to seek a Supreme Court review in that case.
A decision in the subpoenas case is expected by the end of
The case is Argentina v. NML Capital Ltd, U.S. Supreme