New York Times

Supreme Court Weighs Aid to Holders of Argentine Debt

By ADAM LIPTAK APRIL 21, 2014

WASHINGTON — The Supreme Court on Monday seemed inclined to offer at
least modest help to Argentina’s creditors.

The issue before the justices was in some ways a minor one, and they will
soon decide whether to hear a second and more significant case arising from
Argentina’s 2001 default on billions of dollars of debt. That case is an appeal by
Argentina of a lower court’s decision in favor of hedge funds that held about $1.3
billion in Argentine bonds.

The question for the justices at Monday’s argument was whether federal
courts in the United States may issue subpoenas to banks to help creditors who
have won judgments against Argentina find assets around the world. Several
justices seemed prepared to allow subpoenas for some information, though some
of them suggested the creditors’ requests had been too sweeping.

Theodore B. Olson, a lawyer for the bondholders in both cases, said they were
entitled to detailed information because Argentina had been disguising and
hiding its assets. “If it’s an airline that says Argentine Air Force on the side of it,”
he said, “it still could be commercial property. We need to know what those assets
are.”

Chief Justice John G. Roberts Jr. said that request went too far. “Doesn’t that
seem pretty extraordinary?” he asked, adding: “That’s pretty intrusive at a
sovereign level to say you can find out how many jet fighters Argentina happens to
have.”

Jonathan I. Blackman, a lawyer for Argentina, said the information sought
would also intrude on other matters protected by foreign sovereign immunity.

“The sweeping worldwide forensic examination of foreign state property that the
court of appeals approved,” he said, would reveal information about “diplomatic
and military property, national security assets, property of the states, current and
former presidents, and other property outside the United States.”

Several justices noted that obtaining information about assets abroad was no
guarantee that foreign courts would enforce the judgment the bondholders had
obtained in American courts.

Edwin S. Kneedler, a deputy solicitor general, argued in support of
Argentina. “The United States would be gravely concerned,” he said, “about an
order of a trial court in a foreign country, entered at the behest of a private
person, seeking to establish a clearinghouse in that country of all the United
States’ assets.”

Justice Antonin Scalia responded that the United States seemed alone in
voicing concern. He said no other country had filed a brief supporting Argentina
in the case, Republic of Argentina v. NML Capital, No 12-842.

“They file all the time when there is a case before us that they think trenches
upon their prerogatives,” he said. “Not a single foreign country, maybe because
Argentina owes them money as well as it does these plaintiffs.”

A version of this article appears in print on April 22, 2014, on page B3 of the New York edition with the
headline: Supreme Court Weighs Aid to Holders of Argentine Debt.