NEW YORK, Dec 17 (Reuters) - Argentina urged a U.S. appeals court on Wednesday to reverse a lower court decision requiring the country and various banks to provide holdout creditors with information about the country’s assets including military equipment and diplomatic property.
Judges on 2nd U.S. Circuit Court of Appeals in New York questioned if bondholders seeking full payment of debts after its $100 billion default in 2002 had made their information requests too broad. But the judges also expressed concerns that if they narrowed the order, Argentina would still defy it.
“You’re not an ordinary litigant,” Circuit Judge Barrington Parker said to Argentina’s lawyer during oral arguments. “You’re a pathological tactical litigant.”
Argentina defaulted in July after refusing to honor orders barring it from paying holders of its restructured bonds without also paying $1.33 billion plus interest to holdout creditors including Elliott Management’s NML Capital Ltd.
The holdouts declined to accept terms of 2005 and 2010 Argentina debt restructurings, in which it swapped about 92 percent of its bonds for new obligations.
Argentina’s latest default came after it refused to obey U.S. District Judge Thomas Griesa’s order on paying the holdouts. Griesa in September held Argentina in contempt.
Argentina says it cannot pay the holdouts until the Dec. 31 expiration of a clause that prevents it from paying them on better terms than what it pays holders of restructured debt.
The appellate arguments stemmed from a 2013 ruling by Griesa compelling Argentina and 29 banks to comply with subpoenas and information requests by the holdouts aimed at finding assets to fulfill unpaid judgments.
Argentina contended the order would effectively allow an inventory of military and diplomatic assets that were protected from seizure by U.S. law and various treaties.
“No state has ever been asked to do this before,” Jonathan Blackman, Argentina’s lawyer, argued.
Matthew McGill, NML’s lawyer, argued that the requests for information were “proportional to the billions of dollars we are owed.”
Some judges questioned why the court should modify Griesa’s order when they had no assurance the country would follow court directives.
“If all the shearing and pruning is done that you’re asking for, you still can’t give us your assurance your client would follow the order?” Circuit Judge Ralph Winter asked Blackman.
Blackman said he could not tell the judges what Argentina would do, but said he would recommend it comply with a narrowed order. (Reporting by Nate Raymond in New York; Editing by David Gregorio)