The long-running dispute over the payment of Argentina’s sovereign debt, on which the South American nation defaulted for the second time in July 2014, continues to be particularly active.

On April 6, 2015, Argentina appealed a March 12, 2015, order of the U.S. District Court for the Southern District of New York that blocked Citibank, N.A. (“Citibank”) from processing scheduled interest payments on $2.3 billion of Argentine-law governed bonds issued as part of 2005 and 2010 debt restructurings. Argentina’s appeal claims that the order improperly extended a 2012 injunction which barred Argentina from making interest payments on restructured bonds without also paying amounts owed to holdout bondholders. However, on March 20, 2015, U.S. district judge Thomas Griesa approved a stipulation between Argentina’s holdout bondholders and Citibank that conditionally authorized Citibank’s Argentine branch to make interest payments scheduled for March 31 and June 30 on the Argentine-law bonds. The judge also authorized Citibank to exit its custody business in Argentina.

On April 7, 2015, Argentina asked Judge Griesa to hear a group of eight class actions filed by certain holders of the country’s defaulted debt separately from the lawsuits brought by hedge fund holdouts who acquired their bonds at a discount after Argentina defaulted on its debt in 2001. Argentina asked Judge Griesa to deny a request by the non-hedge fund classes to consider their cases along with dozens of what are referred to in the bond dispute as “me-too cases.” Both bondholder groups are seeking the benefit of Judge Griesa’s 2012 rulings blocking Argentina from paying holders of its restructured debt until it pays $1.7 billion owed to the hedge fund holdouts.

On April 7, 2015, the U.S. Court of Appeals for the Second Circuit dismissed an appeal by Argentina of Judge Griesa’s October 3, 2014, order holding the South American nation in contempt for violating his 2012 injunction preventing the country from making payments on restructured bonds without making corresponding payments to holdout bondholders. A two-judge Second Circuit panel dismissed the appeal for lack of jurisdiction, writing that “[w]e conclude that a final order has not been issued by the district court . . . and the collateral order doctrine does not apply to this appeal.”

Argentina’s Economy Minister, Axel Kicillof, announced on April 8, 2015, that the Argentine government will seek an injunction against Citibank in local Argentine courts for its role in the March 20, 2015, agreement between Citibank and holdout bondholders to permit certain one-time payments on Argentine-law bonds, enabling Citibank to wind down its operations in Argentina without violating U.S. district judge Griesa’s orders. Kicillof, however, provided few details with respect to either the nature of the charges or the court in which the government will pursue its case.

On April 20, 2015, Argentina announced that, in an effort to evade U.S. restrictions on its market access, Argentina would issue $500 million of a new series of “BONAR 2024” bonds paying an interest rate of 8.75 percent and maturing in nine years. On April 22, 2015, Judge Griesa ruled that the holdout bondholders suing Argentina are entitled to disclosure of the details of the BONAR 2024 bond offering. Judge Griesa held that the hedge fund holdouts can seek documents from Argentina and banks subscribing to the offering, including Deutsche Bank AG and Banco Bilbao Vizcaya Argentaria, S.A., related to the April 21, 2015, $1.4 billion bond sale to determine whether any assets exist in the United States which could satisfy billions of dollars in unpaid judgments against Argentina.