Remember when Argentina scored a small legal win against the so-called “vulture” funds on Monday?
Put away your party hat. Judge Griesa seems to have lost his legal patience with Argentina. This Wednesday he ordered sanctions for failing to disclose the whereabouts of its assets. These sanctions allow all government assets in the United States, other than diplomatic and military holdings, to be treated as commercial property and thus seizable by NML Capital and the other holdout funds. Argentina must also produce a list of all documents it has withheld in the past by claiming legal privilege within ten days.
These holdouts requested the sanctions based on Argentina’s failure to respond to requests for information, even though a 2013 court order required them to produce it.
According to a report from NASDAQ, Griesa “chided the nation for referring to its creditors as ‘vultures’ and interrupted the defense’s arguments, saying it’s creditors had every right to whatever information they needed to get paid”. Heavy stuff.
The holdouts have repeatedly attempted to seize Argentine property overseas. In 2012 they succeeded in seizing the navel vessel ARA Libertad, and have made attempts to grab Tango 01, Argentina’s presidential plane. They have gone after satellites belonging to the space program. And they have not been shy about going after assets owned by individual politicians that may have been acquired using state funds.
Griesa has not included assets held by Argentina’s Central Bank, state-owned oil company YPF, or the nation’s space agency in the list of assets permitted by this sanction. By automatically declaring all state-owned assets that are neither military nor diplomatic as commercial property and thus eligible for seizure, he has removed the burden from the holdouts to demonstrate a state-owned asset’s commercial use.
While the holdouts claim to have found numerous bank accounts and other entities that fall under this definition, Argentina claims to have produced all the information it has.
I personally hope that Argentina’s assets within the United States include livestock or other items of a humorous nature to seize.