Aurelius Capital v. The Republic of Argentina

Sullivan & Cromwell LLP obtained the dismissal of a breach-of-contract for The Republic of Argentina in the lawsuit brought by hedge fund Aurelius Capital.

In a January 7 ruling, Judge Loretta Preska of the Southern District of New York held that Argentina did not owe Aurelius $61 million under securities that Argentina issued as part of a debt restructuring, and dismissed the complaint without prejudice.

The impact of this ruling in Aurelius Capital Master, Ltd. v. The Republic of Argentina has significant implications beyond this case. Five additional lawsuits are pending in New York (also before Judge Preska) and London over these same securities.

The dispute arose over securities that Argentina issued in 2005 and 2010, which provide for payments that are calculated under a complex formula that is linked to the country’s economic health. When Aurelius sought payments that it calculated using an alternative formula, Argentina rejected that claim. Judge Preska held that Aurelius could not use this calculation.

The S&C team representing Argentina was led by partners Sergio Galvis (Picture), Robert Giuffra Jr., Joseph Neuhaus and Thomas White.

Involved fees earner: Sergio Galvis – Sullivan & Cromwell; Robert Giuffra Jr. – Sullivan & Cromwell; Joseph Neuhaus – Sullivan & Cromwell; Thomas White – Sullivan & Cromwell;

Law Firms: Sullivan & Cromwell;

Clients: Republic of Argentina;

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Author: Ambrogio Visconti