WASHINGTON – The U.S. Supreme Court on Monday ruled that creditors can seek information about Argentina's non-U.S. assets in a case about bank subpoenas that is part of the decade-long litigation over Argentina's obligations to bond investors.
The ruling, on a 7-1 vote, was a second win at the high court within minutes for hedge fund NML Capital Ltd, which is seeking payment of court judgments it says are worth around $1.7 billion. The court had earlier denied Argentina's appeal challenging court injunctions ordering the government to pay $1.33 billion to creditors.
That case was viewed as more important, meaning the court's ruling on the discovery issue may have limited impact in part because of Argentina's limited assets around the world.
The narrow legal question was whether NML, a unit of billionaire hedge fund manager Paul Singer's Elliott Management Corp, could enforce subpoenas against Bank of America and Banco de la Nacion Argentina.
The South American country defaulted on its debt in 2001-2002 and has been in a legal battle with bondholders led by hedge funds NML and Aurelius Capital Management, which rejected two debt restructuring offers. Argentina argues the funds bought most of the debt at a deep discount after the default and sought to thwart the country's efforts to restructure.
Writing on behalf of the court, Justice Antonin Scalia said the Foreign Sovereign Immunities Act does not prevent NML from seeking the information. Justice Ruth Bader Ginsburg dissented, while Justice Sonia Sotomayor recused herself from the case before the nine-member court.
The case is Argentina v. NML Capital, U.S. Supreme Court, No. 12-842. (Reporting by Lawrence Hurley; Editing by Howard Goller)