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Italian holdouts, following on Paul Singer, present demand against Argentina

Monday, October 6th 2014 - 07:33 UTC
Full article 15 comments
More than 200 Italian holdout bondholders and one another that lives in the Bahamas are represented by the well-known law firm Duane Morries More than 200 Italian holdout bondholders and one another that lives in the Bahamas are represented by the well-known law firm Duane Morries
Judge Griesa so far has refrained from granting similar me-too injunctions so far but the complaint opens a new door in the long-term legal case. Judge Griesa so far has refrained from granting similar me-too injunctions so far but the complaint opens a new door in the long-term legal case.

Italian bondholders filed a complaint order to United States District Judge Thomas Griesa asking to be given the same benefits as Aurelius Management and NML Management, the “holdouts” that were authorized by Griesa to be paid the full debt Argentina has with them.

 It’s the first official demand of the so-called “me too” group, bondholders who did not accept the terms of the 2005 and 2010 debt restructuring but who have not taken legal action against the country and were thus not covered by the ruling filed by Griesa.

The complaint, which was filed on September 25 but was made public this week, was issued by the well-known law firm Duane Morries, which represents more than 200 Italian bondholders and one bondholder that lives in the Bahamas. Judge Griesa has refrained from granting similar me-too injunctions so far but the complaint opens a new door in the long-term legal case.

The firm said that most of the Italian bondholders were granted favorable rulings by Griesa between 2007 and 2009 concerning the Argentine debt. Nevertheless, they weren’t included in the additional ruling in which NML, Aurelius and other smaller holdouts were authorized to be paid the full debt that they hold.

Most of the bondholders represented by Morries work side by side with Paul Singer, billionaire and head of Elliott Management. They were even invited to speak at a conference of the American Task Force Argentina (ATFA), the lobby group created by Singer. The conference was held in January 29 and was titled “Savings of a life time evaporated by the broken promises of a government?.”

In a rare move, Griesa held Argentina in contempt of court last Monday, saying the country is taking “illegal” steps to evade his orders in the longstanding dispute with hedge funds over defaulted debt. Nevertheless, Griesa, who has overseen the litigation in New York for years, put off a decision on imposing sanctions on the country and issued a clear warning that the country must stop efforts to get around his rulings by making payments in Argentina.

In related news the head of the UN Human Rights Council Advisory Committee to investigate US hedge funds that took Argentina to court, Swiss expert Jean Ziegler, said that the speculative funds “undermine development (of debtor countries) and make workers suffer.”

“(Hedge funds) affect social and cultural rights in a direct or indirect way,” stated Ziegler during an interview with Buenos Aires Página/12 newspaper.

The expert appointed by the Human Rights Council to head the committee that will draft a report on the consequences of the actions of vulture funds on human rights praised the creation of the Advisory Committee. He pointed out that it is the first time that the action of global hedge funds “will be studied not only from a financial point of view, where the United States weighs upon, but from a Human Rights viewpoint.”

Ziegler said that hedge funds are not “isolated speculators”, he accused them of being a creation of “financial oligarchies” and aimed at great international banking like Holdman Sachs and Swiss Banks Union.

The expert spoke about the Argentine ongoing legal battle against vulture funds and said that if the government “paid in full as vultures want, it would entail cuts in public spending” causing “the people to suffer.”

Top Comments

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  • chronic

    “The complaint, which was filed on September 25 but was made public this week,”

    If it's a lawsuit filed in Federal Court, it's public record and can be accessed via the Pacer records retreival system immediately.

    Oct 06th, 2014 - 10:10 am 0
  • golfcronie

    Jean Ziegler says “ if the Argentine Government paid in full as the vultures want, it would entail spending cuts causing people to suffer”, My question is where did the US$ 100 billion go? Was it not intended to pull “ the people ” out of poverty. My thoughts are that they would have been worse off if the bondholders had not lent them money. And of course if you borrow money the honourable thing to do is pay it back. Most civilised countries that borrow money pay it back. I am waiting to see if any Argentinian can refute my statement or at the very least tell the world where the money was spent.

    Oct 06th, 2014 - 10:59 am 0
  • ChrisR

    I look at it another way.

    We know where the money was not spent, even though it was designated to be spent for the betterment of Argentina as a whole, not Nestor and TMBOA, et al.

    AND, even if (laughingly) they did not steal it themselves they were mandated to look after it.

    So TMBOA needs to be brought to justice, end of a wire rope?

    Oct 06th, 2014 - 11:26 am 0
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