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"Oh Dear Me No, I Couldn't Possibly Hear Another Appeal..."

posted by Mark Weidemaier

The Second Circuit has refused to hear Citibank's appeal of Judge Griesa's order enjoining Citi from making payment on USD-denominated, Argentine-law bonds. The Second Circuit's order is a bit... Delphic. Weighing in at all of 56 words, not counting citations, the court simply "decline[d] to find jurisdiction" because the district judge's order "is a clarification, not a modification" of the injunction. The distinction seems a bit fine, given the stakes. Recall that some USD-denominated, Argentine law bonds are Exchange Bonds (and thus subject to the injunction) while some are not. But it seems that it is impossible to tell them apart. Two options, then: (1) forbid Citi to pay anyone, even though NML concededly has no right to block payment on non-Exchange Bonds, or (2) allow Citi to pay everyone, thus allowing a subset of Exchange Bonds to escape the injunction. The district judge chose option one. In theory, the district judge can reconsider (re-clarify?) that decision, but I am not holding my breath.


The whole thing is a travesty. The judge and the Second Circuit are making fools of themselves.

Their logic is akin to throwing a thousands of innocent people into jail (the bondholders who participated in the settlement) for the greed of one small group of holdouts.

So we don't pay any attention to precedent just to rein in Argentina, but we also don't even begin to uphold the letter of the law. Absolutely ridiculous. Why should people bother studying the bond docs when the Courts can't be bothered to do so!

When Courts are arbitrary and unjust that merely spells the Death of Rule of Law.

I think Friday´s hearing with Griesa clarified why the Secoond Circuit Court was absolutely right.

The issue had not even been fully argued, let alone determined, by the District Court.

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