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US judge lifts Argentina bond payment ban

[JURIST] A judge for the US District Court for the Southern District of New York [official website] on Wednesday lifted injunctions [order, PDF] blocking Argentina from paying its restructured debt. According to Judge Thomas Griesa, the circumstances of the situation have changed so significantly [AP report] that the injunction was now detrimental to public interest. Lawyers for a majority of Argentina's creditors requested [CN report] that the judge instate a 30-day delay of the ruling in order to pressure Argentina to negotiate further, which Griesa denied, citing a pressing need or finality. Argentina, which has been blocked from paying holders of its restructured bonds since July 2014, will now be able to make payments. These bond holders are owed more than $3 billion in past due interest.

Litigation related to Argentina's 2001 debt default has continued for years. In February Argentina and US bondholders settled [JURIST report] a class action lawsuit over the defaulted debt. Last September the US Court of Appeals for the Second Circuit ruled that a lower court judge should not have expanded a class action suit [JURIST report] of bondholders suing Argentina. Griesa had been overseeing litigation related to Argentina's sovereign debt default for roughly 14 years ago. The appeals court noted it was the fourth time it had reviewed and subsequently rejected Griesa's method for calculating damages. In April the Second Circuit dismissed [JURIST report] the Argentine government's appeal of a contempt charge in an ongoing dispute over Argentina's bond default. In September 2014 Argentina signed into law [JURIST report] a bill to continue making payments on foreign-held bonds outside of US jurisdiction, circumventing the US court ruling [JURIST report] that prohibits Argentina from paying its bondholders until the dispute is resolved. In August 2014 Argentina initiated legal proceedings [JURIST report] against the US in the International Court of Justice over US interference in the restructuring of Argentina's foreign debt.

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