Griesa Declares Argentina in Contempt

ARGENTINA - In Brief 29 Sep 2014 by Esteban Fernandez Medrano

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Local press published that Judge Griesa ruled in today’s hearing that Argentina is in contempt. He has not yet declared what fine he will set on Argentina, which he would announce at a later point. Earlier today, anticipating such decision, the Argentine government sent a note of protest to both the judge Griesa and the US government (Secretary of State, John Kerry), stating that a sovereign cannot be declared in contempt. In a press conference by the argentine counterpart, Héctor Timerman, he stated that such ruling would violate international law and explicitly the UN convention on sovereign immunity. As the likelihood that Argentina pays any potential fine is as remote (or even remoter), as expecting a payment to holdouts before year end, this ruling implies for all practical purposes the involvement of the US government in the relationship between the Judge/Holdouts and Argentina. So far Griesa received significant judicial support by the Court of Appeal and the Supreme Court. The question that now remains is whether the US government will stand to its initial position of not supporting the peculiar “pari passu” definition, enduring likely criticism from conservative circles if it does "too little", or giving in to political pressures at a moment where its international focus is set on other geopolitical topics.