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1 UNI TED STATES DI STRI CT COURT
SOUTHERN DI STRI CT OF NEWYORK
2 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

3 NML CAPI TAL, LTD. , et al . ,

4 Pl ai nt i f f s,

5 v. 08 CV 6978 ( TPG)

6 THE REPUBLI C OF ARGENTI NA,

7 Def endant .

8 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

9 New Yor k, N. Y.
Sept ember 26, 2014
10 3: 05 p. m.

11 Bef or e:

12 HON. THOMAS P. GRI ESA,

13 Di st r i ct J udge

14 A P P E A R A N C E S

15 GI BSON DUNN & CRUTCHER
At t or neys f or Pl ai nt i f f NML Capi t al , Lt d.
16 BY: THEODORE B. OLSON
J ASON J . MENDRO
17
DECHERT LLP
18 At t or neys f or Pl ai nt i f f NML Capi t al , Lt d.
BY: ROBERT A. COHEN
19
FRI EDMAN KAPLAN SEI LER & ADELMAN LLP
20 At t or neys f or I nt er est ed Par t i es Aur el i us Capi t al Par t ner s
and Bl ue Angel
21 BY: EDWARD A. FRI EDMAN

22 CLEARY GOTTLI EB STEEN & HAMI LTON
At t or neys f or Def endant
23 BY: CARMI NE BOCCUZZI

24

25


SOUTHERN DI STRI CT REPORTERS, P. C.
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1 APPEARANCES ( Cont ' d)

2 DAVI S POLK & WARDWELL LLP
At t or neys f or Ci t i bank
3 BY: KAREN E. WAGNER
MATTHEWROLAND
4 LI NDSEY KNAPP
J AMES KERR
5
MORGAN LEWI S & BOCKI US
6 At t or neys f or Cl ear St r eam
BY: J OHN M. VASSOS
7
LEVI LUBARSKY & FEI GENBAUM
8 At t or neys f or J P Mor gan Chase
BY: HOWARD B. LEVI
9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25


SOUTHERN DI STRI CT REPORTERS, P. C.
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1 THE COURT: Thi s wi l l be at 3: 00 Monday. Thi s i s t he

2 f i r st of t wo hear i ngs. The hear i ng t oday wi l l deal wi t h i ssues

3 about Ci t i bank and Buenos Ai r es. The hear i ng Monday wi l l deal

4 wi t h r ecent conduct by t he Republ i c of Ar gent i na. The hear i ng

5 t oday i s br ought on by a mot i on whi ch was ser ved on Monday, an

6 or der t o show cause was si gned.

7 Ms. Wagner , woul d you l i ke t o speak t o t hat mot i on?

8 MS. WAGNER: I woul d. Thank you, your Honor .

9 Good af t er noon, your Honor .

10 Fi r st , we t hank t he Cour t f or hear i ng us on an

11 expedi t ed basi s. As you know, your Honor , Ci t i bank sought an

12 expedi t ed hear i ng because i t f aced ser i ous r i sk i f i t coul d not

13 make t he Sept ember 30 payment on t he Ar gent i ne l aw bonds t hat

14 i t hol ds f or i t s cust omer s. Pl ai nt i f f s have now agr eed t o

15 consent t o t hat payment .

16 So you may ask, why i s i t t hat we ar e havi ng t hi s

17 hear i ng t oday. And wi t h your Honor ' s per mi ssi on, I woul d l i ke

18 t o go t hr ough a l i t t l e bi t of t he hi st or y whi ch I t hi nk wi l l

19 expl ai n t o you why we ar e - -

20 THE COURT: The r eason we ar e havi ng t he hear i ng i s,

21 we ar e not j ust deal i ng wi t h t he Sept ember 30 payment . The

22 quest i on i s, i s t her e any pr obl emabout Ci t i bank ser vi ci ng t hat

23 debt on an ongoi ng basi s. I f t her e was some consent t o a

24 Sept ember 30 payment , t hat di d not sol ve t he pr obl em. Let ' s

25 pass t hat .


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1 MS. WAGNER: Yes, your Honor .

2 And t o go t o t he poi nt , what i s t he i ssue r el at i ng t o

3 Ci t i bank and t he Ar gent i ne l aw bonds, j ust t o go t hr ough a

4 l i t t l e of t he hi st or y, when t hi s mot i on f i r st came on bef or e

5 your Honor , af t er t he Supr eme Cour t i ssued a deni al of

6 cer t i or ar i , t he f i r st t hi ng t hat your Honor di d when Ci t i bank

7 br ought t hi s mot i on was t o ask t he pl ai nt i f f s i f t hey woul d

8 consent t o t he mot i on. Obvi ousl y, f r omt he ver y begi nni ng your

9 Honor has under st ood t hat Ci t i bank i s i n a ver y di f f er ent

10 posi t i on f r omBank of New Yor k Mel l on, an i ndent ur e t r ust ee,

11 and t he Ar gent i ne l aw bonds ar e ext r emel y di f f er ent f r omt he

12 bonds t hat ar e New Yor k l aw bonds t hat ar e gover ned by an

13 i ndent ur e as t o whi ch Bank of New Yor k i s t he i ndent ur e

14 t r ust ee.

15 Your Honor has cont i nued t o expr ess hi msel f r epeat edl y

16 t hat t he bonds ar e ver y di f f er ent and t hat Ci t i bank i s ver y

17 di f f er ent . Your Honor has sai d r epeat edl y, most r ecent l y on

18 Sept ember 10, as t o t he bonds t hat when you wer e deal i ng wi t h

19 t he i nj unct i on, what you have r ef er r ed t o as t he maj or

20 i nj unct i on i n t hi s case, what I t hought I was deal i ng wi t h was

21 somet hi ng t hat was qui t e di f f er ent f r omt he bonds deal t wi t h i n

22 t he l ar ge i nj unct i on, whi ch ar e payabl e i n New Yor k, subj ect t o

23 New Yor k l aw.

24 I t ' s my under st andi ng t hat what i s bei ng deal t wi t h i n

25 Ar gent i na ar e bonds i ssued i n Ar gent i na, speci f i cal l y subj ect


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1 t o Ar gent i ne l aw. As t o Ci t i bank t he Cour t has obser ved Bank

2 of New Yor k has a compl et el y di f f er ent r el at i onshi p t o t he case

3 ver sus t he Ci t i bank br anch i n Buenos Ai r es. Ci t i bank Ar gent i na

4 has t o deal wi t h t he Republ i c of Ar gent i na, and most r ecent l y

5 you di r ect ed t he par t i es.

6 I t was my vi ew and st i l l i s my vi ew t hat t he Ar gent i ne

7 l aw bonds, i ssued i n Ar gent i na, payabl e i n Ar gent i na, subj ect

8 t o Ar gent i ne l aw, ar e di f f er ent f r omt he bonds subj ect t o t he

9 Febr uar y 23 or der . And t he par t i es shoul d know t hat what ever

10 i ssues t her e ar e about Ci t i bank and Ar gent i na, Sept ember 30 or

11 December 31, i t i s t he vi ew of t he Cour t t hat what we ar e

12 deal i ng wi t h and what your appl i cat i ons r el at e t o ar e bonds

13 t hat ar e di f f er ent f r omt he bonds cover ed by t he Febr uar y 23

14 or der .

15 Your Honor , i f you go back and l ook at t he mot i on

16 whi ch was br ought by pl ai nt i f f s wi t h r espect t o t he Febr uar y 23

17 or der , you wi l l f i nd t hat t hat mot i on was di r ect ed ver y

18 speci f i cal l y t o t wo ser i es of bonds f or whi ch Bank of New Yor k

19 was i ndent ur e t r ust ee. You wer e pr ovi ded wi t h evi dence about

20 t hose bonds. You wer e pr ovi ded no evi dence what soever about

21 Ci t i bank or about t he Ar gent i ne l aw bonds or anyt hi ng ot her

22 t han t he Bank of New Yor k bonds. For t hat r eason, dur i ng t hose

23 hear i ngs you di d not consi der t he di f f er ence bet ween Bank of

24 New Yor k Mel l on and Ci t i bank or t he di f f er ence bet ween t he Bank

25 of New Yor k bonds and t he Ci t i bank bonds.


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1 However , your Honor , as you know, you wr ot e an opi ni on

2 i n connect i on wi t h t he i nj unct i on, t he maj or i nj unct i on t hat

3 was i ssued at t hat poi nt , and i t was ver y cl ear f r omt he

4 opi ni on t hat what you wer e deal i ng wi t h wer e t he par t i es t hat

5 wer e i nvol ved somehow i n t he cont r act r el at i ng t o t he Bank of

6 New Yor k bonds. Your Honor ' s i nj unct i on was i nt ended t o

7 enf or ce a cont r act ual obl i gat i on. That cont r act ual obl i gat i on

8 was based on t he f i scal agency agr eement whi ch def i nes ext er nal

9 debt and whi ch says t hat ext er nal i ndebt edness i s subj ect t o

10 t he par i passu cl ause. Ther e was not a bi g di scussi on i n t hat

11 hear i ng about whet her t he Bank of New Yor k bonds wer e subj ect

12 t o t he cl ause.

13 THE COURT: Let me i nt er r upt you. We have had many

14 sessi ons on var i ous t hi ngs i n t hi s case and t he l awyer s have

15 made st at ement s and I ' ve made st at ement s. But we ar e now at a

16 di f f er ent st age. We ar e deal i ng wi t h t he quest i on of

17 Ci t i bank' s ongoi ng r i ght or l ack of r i ght t o ser vi ce t he

18 Ar gent i ne bonds. Now, i f we coul d get t o t he i ssues, t he l egal

19 i ssues on t hat and not go back - -

20 MS. WAGNER: Cer t ai nl y, your Honor .

21 THE COURT: And r ecap a whol e l ot of t hi ngs i n t he

22 past . Ther e ar e l egal i ssues on t hat poi nt . I amsur e you' r e

23 r eady t o addr ess t hem.

24 MS. WAGNER: Yes, your Honor .

25 Ther e ar e many l egal i ssues. Ther e ar e some l egal


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1 i ssues r el at i ng t o t he Ar gent i ne l aw bonds. Ther e ar e some

2 i ssues r el at i ng t o Ci t i bank Ar gent i na. The i ssues r el at i ng t o

3 Ci t i bank Ar gent i na i s t hat i t i s a separ at e ent i t y. I t i s

4 l ocat ed i n Buenos Ai r es. I t i s a br anch bank l i censed by

5 Ar gent i na. I t i s subj ect t o t he l aws of Ar gent i na. And as a

6 mat t er of comi t y i t i s not appr opr i at e f or a U. S. cour t t o

7 i ssue an or der t hat r equi r es a br anch bank i n Ar gent i na t o

8 vi ol at e t he l aw. Appl yi ng t he i nj unct i on of t hi s Cour t t o

9 payment s t o cust omer s by Ci t i bank Ar gent i na woul d r equi r e t hat

10 Ci t i bank Ar gent i na vi ol at e t he l aw of t he count r y i n whi ch i t

11 i s l i censed and woul d put Ci t i bank Ar gent i na and i t s empl oyees

12 at gr eat r i sk. And we have put i n evi dence bef or e t he Cour t

13 t hat i s undi sput ed as t o t hese poi nt s.

14 So as t o Ci t i bank Ar gent i na, t he l aw i s t hat a comi t y

15 anal ysi s whi ch i s now r equi r ed by t he new Gucci case i n t he

16 Second Ci r cui t woul d l ead you t o t he concl usi on t hat you can' t

17 r equi r e t hose ent i t i es t o vi ol at e Ar gent i ne l aw.

18 I woul d al so make one ot her poi nt as t o Ci t i bank

19 Ar gent i na whi ch does r el at e t o t he or i gi nal i nj unct i on, and

20 t hat i s t he or i gi nal i nj unct i on was i ssued t o enf or ce a

21 cont r act . And t he par t i es who wer e enj oi ned di d pl ay some r ol e

22 i n t hat cont r act , whi ch woul d be t he i ndent ur e and f i scal

23 agency agr eement .

24 Ci t i bank i s not a par t y t o ei t her one of t hose

25 cont r act s. I t pl ays no r ol e i n ei t her one of t hose cont r act s.


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1 I t i s a cust odi an. I t i s pai d by i t s cust omer s. I t has no

2 cont r act ual r el at i onshi p wi t h Ar gent i na. I t has no cont r act ual

3 r el at i onshi p under t he i ndent ur e. I t si mpl y hol ds bonds f or

4 cust omer s. And, t her ef or e, i t i s out si de t he bounds of t he

5 cont r act whi ch was bei ng enf or ced i n t he or i gi nal i nj unct i on.

6 As t o Ci t i bank Ar gent i na I woul d suggest t o you, t hose

7 ar e t wo key poi nt s. And t he ot her key poi nt s t hat f l ow f r omi t

8 ar e al so i ssues of comi t y, ar e t hat Ar gent i na makes payment s on

9 t he bonds, t he Ar gent i ne l aw bonds ent i r el y wi t hi n Ar gent i na.

10 Payment i s made, as a mat t er of l aw, by Ar gent i na when payment

11 i s made t o t he CYRL, whi ch i s a gover nment ent i t y i n Ar gent i na,

12 and t hen i t ' s passed on t o t he Caj a de Val or es, whi ch i s

13 anot her l ocal Ar gent i ne ent i t y, nei t her of whi ch i s i n any way

14 pr esent i n New Yor k.

15 Payment i s compl et e by t he t i me t he payment r eaches

16 t hese ent i t i es. When Ci t i bank get s t he payment , t he money

17 bel ongs t o cust omer s. Under Ar gent i ne l aw Ci t i bank has no

18 choi ce but t o pass i t on t o cust omer s. And i f Ci t i bank doesn' t

19 pass i t on t o cust omer s, Ci t i bank wi l l be subj ect t o anot her

20 doct r i ne, whi ch i s f or ei gn sover ei gn compul si on.

21 Ar gent i na has made i t ver y cl ear t hat i t wi l l enf or ce

22 i t s banki ng l aws agai nst Ar gent i na. I t has suggest ed t hat i t

23 coul d t ake qui t e ser i ous enf or cement act i on, but t her e i s no

24 quest i on t hat Ar gent i na, as a sover ei gn, i s ent i t l ed t o enf or ce

25 i t s banki ng l aw wi t h r espect t o a bank l i censed i n Ar gent i na.


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1 So f or ei gn sover ei gn compul si on woul d al so be a doct r i ne t hat

2 woul d be r el evant t o t hi s anal ysi s, and obvi ousl y t he quest i ons

3 of separ at e ent i t y, of act i ve st at e, and sover ei gn f or ei gn

4 compul si on wer e not i ssues t hat wer e addr essed by anyone i n

5 connect i on wi t h t he or i gi nal i nj unct i on because t her e was

6 nobody i n t hat capaci t y. I ndeed, t her e was nobody i n any

7 cust odi an capaci t y. I t was r at her peopl e i nvol ved i n t he

8 cont r act f or payi ng t he bonds.

9 Then wi t h r espect t o t he Ar gent i ne l aw bonds, your

10 Honor , t hey ar e di f f er ent f r omt he bonds t hat wer e addr essed i n

11 t he hear i ng, t he Bank of New Yor k bonds. The bonds ar e l ocal

12 l aw bonds. They ar e gover ned by Ar gent i ne l aw. Some of t hem

13 ar e peso bonds. Some of t hemar e dol l ar bonds. But t hey ar e

14 al l l ocal bonds. Some of t hemwer e i ssued i n exchanges t hat

15 t ook pl ace at t he same t i me as t he i nt er nat i onal exchanges. We

16 know now t hat many of t hemwer e not i ssued i n exchanges. Most

17 of t hemwer e not . Most of t hemwer e i ssued i ndependent l y of

18 any exchange. Those t hat wer e i ssued i n t he exchanges wer e

19 exchanged f or ot her domest i c debt . Ther e was no exchange of

20 somet hi ng t hat was ext er nal i ndebt edness f or an Ar gent i ne l aw

21 bond, and t her e was no Ar gent i ne l aw bond exchange f or

22 somet hi ng t hat i s ext er nal i ndebt edness.

23 Because t hese bonds, t her ef or e, ar e not ext er nal

24 i ndebt edness - - t hey ar e cal l ed domest i c f or ei gn cur r ency

25 i ndebt edness - - t hey ar e not subj ect t o t he par i passu cl ause,


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1 whi ch t he i nj unct i on was i nt ended t o enf or ce. They have no

2 i ndent ur e t r ust ee. They wer e i ssued pur suant t o l ocal l aws,

3 l ocal gover nment decr ees. The gover nment of Ar gent i na di d not

4 submi t t o j ur i sdi ct i on i n t he Uni t ed St at es - -

5 THE COURT: Can I i nt er r upt you. Maybe you ar e goi ng

6 t o come back t o t hi s. You went over ver y qui ckl y t he i ssue

7 about whet her t hese bonds ar e subj ect t o t he par i passu

8 pr ovi si on of t he 1994 i nst r ument .

9 MS. WAGNER: Yes, your Honor .

10 THE COURT: Ar e t hey or ar e t hey not ?

11 MS. WAGNER: Your Honor , t hey ar e not subj ect t o.

12 THE COURT: Why not ?

13 MS. WAGNER: They ar e not because t hey const i t ut e what

14 i s cal l ed domest i c f or ei gn cur r ency i ndebt edness. The f i scal

15 agency agr eement i s t he agr eement t hat gover ns t he par i passu

16 obl i gat i on. Pur suant t o t he f i scal agency agr eement , ext er nal

17 i ndebt edness i s t he debt t hat i s subj ect t o t he par i passu

18 obl i gat i on. Ext er nal i ndebt edness i s def i ned t o excl ude

19 domest i c f or ei gn cur r ency i ndebt edness.

20 So t hen t he quest i on i s, what i s domest i c f or ei gn

21 cur r ency i ndebt edness? And we have put bef or e you a number of

22 paper s t hat wi l l demonst r at e domest i c f or ei gn cur r ency

23 i ndebt edness i s ei t her one of sever al bonds t hat ar e i dent i f i ed

24 by name, or i t i s a bond t hat was i ssued i n exchange f or such a

25 bond, or i t i s anot her ki nd of bond, whet her i t i s Ar gent i ne


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1 peso denomi nat ed or dol l ar denomi nat ed or some ot her cur r ency

2 denomi nat ed, but i ssued onl y i n Ar gent i na.

3 THE COURT: You ar e goi ng a l i t t l e qui ckl y f or me. Go

4 back and I want t o ask, agai n, why ar e t hese bonds subj ect t o

5 t he 1994 f i scal agency agr eement and t he par i passu? J ust

6 expl ai n t hat agai n.

7 MS. WAGNER: Sur e, your Honor .

8 The par i passu cl ause i s cont ai ned i n t he f i scal

9 agency agr eement .

10 THE COURT: Of 1994?

11 MS. WAGNER: Of 1994. And i t i mposes t he obl i gat i on,

12 and I ' mj ust goi ng t o r ead i t t o you, your Honor . The payment

13 obl i gat i ons of t he Republ i c under t he secur i t i es shal l at al l

14 t i mes r ank at l east equal l y wi t h al l i t s ot her pr esent and

15 f ut ur e unsecur ed and unsubor di nat ed ext er nal i ndebt edness, as

16 def i ned i n t hi s agr eement .

17 So I j ust r ead a quot e f r omt he f i scal agency

18 agr eement . The f i scal agency agr eement t hen def i nes ext er nal

19 i ndebt edness t o mean obl i gat i ons of t he Republ i c denomi nat ed i n

20 a cur r ency ot her t han t he l awf ul cur r ency of t he Republ i c,

21 pr ovi ded, however , and t hi s i s t he key pr ovi so, t hat no

22 domest i c f or ei gn cur r ency i ndebt edness shal l const i t ut e

23 ext er nal i ndebt edness. So domest i c f or ei gn cur r ency

24 i ndebt edness i s excl uded f r omt he i ndebt edness t hat i s subj ect

25 t o t he par i passu cl ause.


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1 So f ar i s t hat cl ear , your Honor ? Shal l I cont i nue?

2 THE COURT: I ' d l i ke t hat l anguage.

3 MS. WAGNER: I t ' s par agr aph 1C of t he f i scal agency

4 agr eement .

5 THE COURT: The l anguage I see, I don' t know how you

6 r ef er t o i t as t he except i on i s. Fr omt he f i scal agency

7 agr eement of 1994 of f er ed excl usi vel y wi t hi n t he Republ i c of

8 Ar gent i na. I s t hat what you ar e t al ki ng about ?

9 MS. WAGNER: Your Honor , I amt al ki ng about t he

10 def i ni t i on of domest i c f or ei gn cur r ency i ndebt edness, whi ch i s

11 on page 17 of t he f i scal agency agr eement . And t hat i ncl udes a

12 ser i es of i dent i f i ed cat egor i es of bonds i n subpar agr aph l i t t l e

13 i . And t hen i t adds t o t hat : Any i ndebt edness i ssued i n

14 exchange or as a r epl acement f or t he i ndebt edness, r ef er r ed t o

15 i n l i t t l e i above, and t hr ee l i t t l e i : Any ot her i ndebt edness

16 payabl e by i t s t er ms or whi ch at t he opt i on of t he hol der

17 t her eof may be payabl e i n a cur r ency ot her t han t he l awf ul

18 cur r ency of t he Republ i c of Ar gent i na.

19 THE COURT: Thi s i s a def i ni t i on of what ?

20 MS. WAGNER: Domest i c f or ei gn cur r ency i ndebt edness.

21 That ' s on page 17 of t he FAA.

22 THE COURT: J ust a mi nut e.

23 I t hought I was quot i ng f r omt hat , but maybe you ar e

24 quot i ng f r oma di f f er ent par t of i t . Wher e ar e you r ef er r i ng

25 t o?


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1 MS. WAGNER: Your Honor , i f you l ook t owar ds t he

2 mi ddl e of i t wher e t her e i s t wo l i t t l e i - - f i r st of al l , t her e

3 ar e a ser i es of cat egor i es of bonds. Then t wo l i t t l e i says:

4 Anyt hi ng i ssued i n exchange f or t hose bonds. Thr ee l i t t l e i :

5 Any ot her i ndebt edness, whi ch i s of f er ed excl usi vel y wi t hi n t he

6 Republ i c of Ar gent i na or i ssued i n exchange f or i ndebt edness

7 payabl e t o t he l awf ul cur r ency i n t he Republ i c of Ar gent i na.

8 Ther e ar e a number of di f f er ent t ypes of bonds.

9 THE COURT: J ust a mi nut e.

10 MS. WAGNER: I t ' s a ver y dense par agr aph.

11 THE COURT: I j ust want t o make sur e we ar e f ocusi ng

12 on t he same l anguage. I ' mf ocusi ng on t hat same l ong par agr aph

13 headed domest i c f or ei gn cur r ency i ndebt edness, and I ' mt al ki ng

14 about or I was r ef er r i ng - - I meant t o r ef er t o a pr ovi si on way

15 down i n t hat par agr aph, l i t t l e i i , and t hen subpar agr aph:

16 Of f er ed excl usi vel y wi t hi n t he Republ i c of Ar gent i na.

17 Ar e we t al ki ng about t he same l anguage?

18 MS. WAGNER: We ar e t al ki ng about t he same l anguage,

19 your Honor , except I t hi nk i t ' s possi bl e t hat you ar e l i mi t i ng

20 your f ocus t o f ewer pr ovi si ons of i t t han I mi ght f ocus on.

21 But , yes, we ar e t al ki ng about t he same l anguage i n t he same

22 pr ovi si on.

23 THE COURT: You go ahead.

24 MS. WAGNER: Your Honor , I t hi nk i t i s cl ear t hat i f a

25 bond i s domest i c f or ei gn cur r ency i ndebt edness, t hen i t i s not


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1 ext er nal i ndebt edness and t her ef or e i t i s not subj ect t o t he

2 par i passu cl ause. We have put evi dence bef or e you, your

3 Honor , and t he Republ i c has al so put evi dence bef or e you t hat

4 t he Ar gent i ne l aw bonds wer e ei t her obt ai ned because t hey wer e

5 of f er ed and exchanged f or one of t hese ot her l ocal l aw bonds,

6 or t hey wer e of f er ed excl usi vel y i n Ar gent i na. Ther e ar e

7 sever al di f f er ent cat egor i es. We have put evi dence bef or e you

8 t hat t hey f al l wi t hi n one of t hese cat egor i es.

9 THE COURT: When wer e t hese bonds i ssued?

10 MS. WAGNER: These bonds wer e i ssued at var i ous t i mes,

11 your Honor . Some of t hemwer e i ssued i n 2005 i n connect i on

12 wi t h a par al l el l ocal exchange. Many of t hemwer e i ssued at

13 ot her t i mes f or ot her pur poses. For exampl e, as we t al ked

14 about sever al hear i ngs ago, a l ot of t hemwer e i ssued i n

15 connect i on wi t h t he Repsol set t l ement . That was f ai r l y

16 r ecent l y. That i s one cat egor y of t hem. They ar e al l i ssued

17 i n t he same ser i es usi ng t he same I SI N number s.

18 And whi l e we do know how many of t hemwer e i ssued i n

19 some f or mof exchange, we know t hat most of t hemwer e not . And

20 we know t hat we cannot t el l t he di f f er ence bet ween ones t hat

21 wer e and ones t hat wer e not . So t he Ar gent i ne l aw bonds, i n

22 f act , have t wo di st i nct char act er i st i cs whi ch make t hemnot

23 subj ect t o t he i nj unct i on. One i s t he ones t hat wer e not

24 i ssued i n any exchange obvi ousl y do not f al l even wi t hi n t he

25 l i t er al l anguage of t he i nj unct i on. But , t wo, domest i c f or ei gn


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1 cur r ency i ndebt edness i s not subj ect t o t he par i passu cl ause

2 and, t her ef or e, coul d not be subj ect t o an i nj unct i on i ssued

3 f or t he pur pose of enf or ci ng t he par i passu cl ause.

4 THE COURT: We have a number of peopl e who may wi sh t o

5 t al k. Can you concl ude.

6 MS. WAGNER: Cer t ai nl y, your Honor . I wi l l concl ude.

7 I guess what I woul d concl ude, f i nal l y, your Honor , i s

8 t hi s. The i nj unct i on, t he maj or i nj unct i on was i ssued i n t hi s

9 case on a r ecor d t hat had onl y t o do wi t h Bank of New Yor k

10 bonds. I f pl ai nt i f f s wi shed t o enj oi n payment s on t he

11 Ar gent i ne l aw bonds, t hey need t o make t he r ecor d and t hey have

12 not done t hat . However , I woul d al so say t hat even i n t he

13 maj or i nj unct i on, t he l i mi t of t he i nj unct i on was on a par t y

14 t hat had some cont r act ual connect i on t o t he bonds. So, f or

15 exampl e, i n your Honor ' s opi ni on expl ai ni ng t he payment s t hat

16 wer e i nt ended t o be enj oi ned, your Honor not ed at page 10 of

17 t hat opi ni on t hat af t er t he f unds got t o a deposi t or y t r ust

18 company i n New Yor k, t he f unds ar e t hen deposi t ed i nt o

19 f i nanci al i nst i t ut i ons, appar ent l y banks, whi ch t hen t r ansf er

20 t he f unds t o t hei r cust omer s, who ar e t he benef i ci al i nt er est

21 hol der s i n t he bonds. Pl ai nt i f f s asser t t hat under Rul e 65( d) ,

22 t he i nj unct i on shoul d bi nd Ar gent i na, t he i ndent ur e t r ust ee,

23 t he r egi st er ed hol der s, and t he cl ear i ng syst em. They di d not

24 ask t hat t hose f i nanci al i nst i t ut i ons who r ecei ved t he money

25 f r omt he DTC be enj oi ned, and t hey wer e not .


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1 I n our si t uat i on, your Honor , on t he Ar gent i ne l aw

2 bonds, t he equi val ent of DTC i s t he Caj a de Val or es, and your

3 Honor f ound t hat i n a pr evi ous opi ni on i nvol vi ng Ci t i bank

4 Ar gent i na. We r ecei ved t he money f r omt he Caj a de Val or es and

5 under your Honor ' s anal ysi s i n t hi s i nj unct i on, no mat t er what

6 el se i s i n t he case, we shoul d not be bound by t he i nj unct i on.

7 Thank you, your Honor .

8 THE COURT: Who want s t o speak next .

9 MR. OLSON: Theodor e Ol son, your Honor , on behal f of

10 NML and t he ot her pl ai nt i f f s.

11 A coupl e of pr el i mi nar y poi nt s.

12 Your i nj unct i on whi ch you i ssued was cl ear and

13 war r ant ed. I t was t he subj ect of r epeat ed hear i ngs and

14 r epeat ed br i ef i ngs. I t ' s been af f i r med as i ssued by t he Second

15 Ci r cui t t wi ce. The Supr eme Cour t r ef used t o hear t he case. I t

16 has never been modi f i ed.

17 What we ar e her e t oday about i s an appl i cat i on by

18 Ci t i bank t o modi f y t he i nj unct i on t hat has been af f i r med t wi ce

19 by t he Second Ci r cui t , whi ch has been opened, an ef f or t by

20 ot her par t i es f or si mi l ar modi f i cat i ons of t he i nj unct i on and

21 wi l l open t he way f or Ar gent i na t o engage i n si mi l ar evasi ons

22 of t he or der t hat you' ve al r eady i ssued.

23 Our posi t i on i s t hat Ci t i bank does not have t he r i ght

24 cer t ai nl y at t hi s t i me t o seek modi f i cat i on of an i nj unct i on

25 i ssued i n a case af t er al l t hat br i ef i ng, ar gument , and appeal s


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1 i n a case at whi ch i t was not a par t y and whi ch, i f i t had

2 sought t o i nt er vene, or sought t o seek modi f i cat i ons of t he

3 i nj unct i on, shoul d have been done a l ong t i me ago, much

4 ear l i er , and shoul d have been r ai sed bef or e.

5 THE COURT: Why i s t hi s seeki ng a modi f i cat i on of t hat

6 i nj unct i on? And t he r eason I ask i s, t hat i nj unct i on appl i ed

7 t o cer t ai n bonds. Of cour se, i t had ot her pr ovi si ons. But i t

8 appl i ed t o cer t ai n bonds.

9 MR. OLSON: I t appl i ed t o - -

10 THE COURT: I t di dn' t appl y t o al l t he bonds i ssued i n

11 t he wor l d. And ar e t hese not di f f er ent bonds t han t he ones

12 cover ed by t hat i nj unct i on?

13 MR. OLSON: These ar e not , r espect f ul l y, your Honor ,

14 di f f er ent bonds t han t he bonds cover ed by t he i nj unct i on. The

15 i nj unct i on was cl ear . I t had t o do wi t h exchange bonds. These

16 bonds, as Ms. Wagner acknowl edged i n t he Second Ci r cui t , wer e

17 exchange bonds. Two of t he j udges i n t he Second Ci r cui t dur i ng

18 t hat hear i ng ei ght days ago speci f i cal l y sai d, t he i nj unct i on

19 i s cl ear , doesn' t i t cover . You deci ded t hat i t di d cover

20 t hese bonds. The j udges of t he Second Ci r cui t f el t t hat i t

21 di d. They t hought t hat t he i nj unct i on was cl ear . I f t her e i s

22 goi ng t o be a change i n t he i nj unct i on, i t ' s goi ng t o have t o

23 be r equi r ed t o be modi f i ed. And t he i mpl i cat i ons of t hat i s

24 t hat ot her par t i es ar e goi ng t o come i n and say, our bonds ar e

25 di f f er ent . They wer e i ssued at di f f er ent t i mes and t hey ar e


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1 not subj ect t o t he i nj unct i on. You ar e goi ng t o have a gr eat

2 deal of l i t i gat i on. I f t he i nj unct i on i s modi f i ed, t hat ' s

3 goi ng t o be an appeal abl e or der . I t i s goi ng t o f r ust r at e any

4 possi bi l i t y of set t l ement i n t hi s case. And i t ' s goi ng t o have

5 t o be done, your Honor , I r espect f ul l y submi t , on t he basi s of

6 a f act ual r ecor d. Ms. Wagner basi cal l y sai d t hat t her e ar e

7 i ssues, f act ual i ssues. Ther e need t o be f act s wer e her wor ds,

8 wi t h r espect t o t he Ci t i bank Ar gent i na i t sel f , t he nat ur e of

9 t hat i nst i t ut i on, and my cl i ent s have sought di scover y on t hi s

10 i ssue and t he ot her i ssues I ' mabout t o ment i on. And we have

11 not had t he oppor t uni t y t o do t hat because Ci t i bank Ar gent i na

12 has r ej ect ed any ef f or t t o do t hat . That di scover y woul d f ocus

13 on t he nat ur e of t he ent i t y, Ci t i bank Ar gent i na, t he nat ur e of

14 t hese bonds. You' ve j ust hear d t hat t her e ar e al l sor t s of

15 bonds her e, possi bl y i ssued at di f f er ent t i mes, some of whi ch

16 may be so- cal l ed exchange bonds, some of t hemmay not be

17 exchange bonds. We have al so hear d asser t i ons by Ci t i bank - -

18 THE COURT: Look. The bonds t hat ar e cover ed by t he

19 i nj unct i on, i t wasn' t some i ndef i ni t e concept . They ar e

20 def i ned. They wer e a par t i cul ar ki nd of bond. And i t ' s not

21 al l possi bl e bonds. I t ' s a par t i cul ar ki nd of bond t hat was

22 cover ed.

23 MR. OLSON: Pr eci sel y, your Honor . And i t ' s cover ed

24 and i n cl ear t er ms i n t he i nj unct i on t hat you or der ed of

25 exchange bonds - -


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1 THE COURT: And t hey wer e payabl e i n New Yor k,

2 gover ned by New Yor k l aw.

3 MR. OLSON: That i s not i n t he t er mi nol ogy of your

4 i nj unct i on, your Honor . I t i s not i n t he i nj unct i on whi ch t he

5 Second Ci r cui t ei ght days ago t hought was cl ear .

6 THE COURT: The Second Ci r cui t di d not i ssue any

7 opi ni on.

8 MR. OLSON: No. But t he i nj unct i on t hat you i ssued

9 was i ssued af t er numer ous hear i ngs, numer ous exchanges back and

10 f or t h bet ween al l of t he par t i es. Thi s i ssue was not r ai sed

11 t hen and was not r ai sed because t he i nj unct i on was cl ear . I t

12 appl i ed t o bonds t hat wer e exchange bonds and what we ar e

13 t al ki ng about t oday i s car vi ng out an except i on f or cer t ai n

14 t ypes of bonds and i t ' s not ver y cl ear and i t cannot be cl ear

15 unt i l t her e i s a f act ual exposi t i on of t he r ecor d pur suant t o

16 t he di scover y t hat we sought .

17 What Ms. Wagner has ar gued her e i s, t hey ar e not

18 subj ect t o t he par i passu cl ause. Your i nj unct i on was br oader

19 t han t hat . And i t wasn' t so l i mi t ed and i t was i ssued i n

20 conj unct i on wi t h a r epeat ed hi st or y of Ar gent i na of at t empt i ng

21 t o evade t hei r r esponsi bi l i t i es by engagi ng i n l i t i gat i on and

22 changi ng t he l egi sl at i on and t hr eat eni ng t o exchange t he

23 bond - -

24 THE COURT: You ar e get t i ng i nt o a compl et el y

25 di f f er ent i ssue.


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1 MR. OLSON: I ampoi nt i ng t hat out , your Honor ,

2 because t he i nj unct i on t hat you i ssued was i ssued i n t he

3 cont ext of al l of t hat .

4 THE COURT: Look. I ' ve got t o t el l you t hat what ever

5 was wr i t t en by me or t he Cour t of Appeal s, i t r el at ed t o t he

6 bonds t hat wer e i ssued i n 1994 by t he Republ i c and wer e subj ect

7 t o an exchange or t wo exchanges i n ' 05 and 2010. But t hey wer e

8 t he bonds, t he bonds t hat wer e i ssued i n 1994, and subj ect t o

9 cont r act ual document s per t ai ni ng t o t hem, and t hey wer e bonds

10 t hat wer e payabl e i n New Yor k, subj ect t o U. S. l aw. They wer e

11 a par t i cul ar ki nd of bond.

12 MR. OLSON: Your Honor , t hat ' s cor r ect . But t he equal

13 payment pr ovi si on and t he par i passu pr ovi si on t hat we have

14 been t al ki ng about t hr oughout t hi s l i t i gat i on t al ked about

15 pr ovi di ng t hat t hose bonds t hat you j ust r ef er r ed t o woul d be

16 put on an equal f oot i ng wi t h r espect t o payment obl i gat i ons t o

17 ot her ext er nal i ndebt edness i ssued by Ar gent i na.

18 THE COURT: Look. We have got a ver y pr eci se i ssue of

19 l aw her e, whi ch you have j ust r eal l y al l uded t o. And t hat i s,

20 I don' t know whet her you meant t o descr i be i t t he way I ' m

21 descr i bi ng i t , but I hope we ar e i n agr eement on t he i ssue.

22 Ther e cer t ai nl y i s an i ssue and you went over t hi s r at her

23 qui ckl y. But I ' ve gi ven t hought t o t hi s bef or e t hi s moment .

24 And t hat i s, t he 1994 f i scal agency agr eement does i ndeed have

25 a pr ovi si on deal i ng wi t h ext er nal i ndebt edness, r i ght ?


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1 MR. OLSON: Yes.

2 THE COURT: And one t hi ng t hat i t says i s t hat any

3 ext er nal i ndebt edness i ssued by t he Republ i c i s subj ect t o t he

4 par i passu, r i ght ?

5 MR. OLSON: Yes, your Honor .

6 THE COURT: Now, t he i ssue t hen i s qui t e pr eci se, and

7 t hat i s, do t hese bonds t hat we ar e t al ki ng about , t he bonds

8 i ssued i n Ar gent i na - - I won' t t r y t o def i ne t hem, al t hough

9 t hat def i ni t i on I ' msur e we wi l l come back t o. Ar e t hey

10 ext er nal i ndebt edness cal l i ng i nt o pl ay t he par i passu cl ause

11 or ar e t hey not such ext er nal i ndebt edness. And t hat depends

12 on some par t i cul ar wor di ng of t he 1994 f i scal agency agr eement .

13 MR. OLSON: Yes, your Honor .

14 THE COURT: Ms. Wagner r ef er r ed t o t hat and she

15 r ef er r ed t o i t , t he l anguage whi ch def i ned domest i c f or ei gn

16 cur r ency i ndebt edness. Ther e i s l anguage about bonds of f er ed

17 excl usi vel y wi t hi n t he Republ i c of Ar gent i na.

18 Can you deal wi t h t hat l anguage? Because t hat i s

19 r eal l y, i n my mi nd, what t hi s i s al l about .

20 MR. OLSON: Yes, your Honor . May I make t hi s one

21 poi nt . And I woul d l i ke Mr . Fr i edman t o be al l owed t o answer

22 speci f i c quest i ons about t hi s.

23 But you ar e pr eci sel y r i ght , i n our vi ew, t hat t he

24 quest i on i s, ar e t hese bonds, t he Ci t i bank Ar gent i na bonds,

25 ext er nal i ndebt edness or ar e t hey car ved out because t hey ar e


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1 domest i c f or ei gn cur r ency i ndebt edness.

2 Now, Mr . Fr i edman wi l l addr ess t hat , addr ess your

3 speci f i c quest i ons wi t h r espect t o t hat . But you hear d

4 ear l i er , t her e i s al l ki nds of bonds her e. You woul d need a

5 speci f i c f act ual r ecor d t o make t hat det er mi nat i on. We wer e

6 engaged i n an ef f or t t o obt ai n di scover y so we coul d f i nd out

7 about Ci t i bank Ar gent i na, t he nat ur e of t hose bonds when t hey

8 wer e i ssued, how t hey wer e payabl e, and al l of t hose f act s

9 whi ch ar e necessar y t o make t he di st i nct i on t hat you ar e bei ng

10 asked t o make her e t oday. And i t wi l l r equi r e some change i n

11 t he i nj unct i on. And I t hi nk t hat t hat wi l l open t he door t o

12 f ur t her ef f or t s - -

13 THE COURT: I f t hi s l anguage I ' mt al ki ng about

14 appl i es, I don' t t hi nk i t r equi r es any change i n t he i nj unct i on

15 at al l .

16 MR. OLSON: Cer t ai nl y we woul d di f f er wi t h t hat , but

17 i t cer t ai nl y wi l l r equi r e f act f i ndi ng wi t h r espect t o, and we

18 ar e ent i t l ed t o conduct t hat di scover y wi t h r espect t o t he

19 di f f er ence bet ween t hese bonds and t he ot her bonds. And i f I

20 mi ght yi el d t o Mr . Fr i edman t o speci f i cal l y, because he' s much

21 mor e f ami l i ar t han I amwi t h t hese par t i cul ar bonds.

22 THE COURT: Al l r i ght . Fi ne. Thank you ver y much.

23 MR. FRI EDMAN: Good af t er noon, your Honor . Edwar d

24 Fr i edman, Fr i edman Kapl an Sei l er & Adel man, at t or neys f or

25 pl ai nt i f f s, Aur el i us and Bl ue Angel .


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1 I woul d l i ke t o st ar t by di r ect l y addr essi ng your

2 Honor ' s quest i on about domest i c f or ei gn cur r ency i ndebt edness

3 and t he pr ovi si on i n t he f i scal agency agr eement t hat your

4 Honor was di scussi ng wi t h Ms. Wagner , who i s counsel f or

5 Ci t i bank.

6 The U. S. dol l ar denomi nat ed Ar gent i ne l aw bonds t hat

7 ar e at i ssue on t hi s mot i on ar e ext er nal i ndebt edness, and t hey

8 ar e not domest i c f or ei gn cur r ency i ndebt edness, whi ch i s car ved

9 out of ext er nal i ndebt edness.

10 The r eason why t hese bonds ar e not domest i c f or ei gn

11 cur r ency i ndebt edness i s as f ol l ows: And as your Honor

12 di scussed wi t h Ms. Wagner , i n t he def i ni t i on of DFCI , or

13 domest i c f or ei gn cur r ency i ndebt edness, t her e ar e a number of

14 i t ems expl ai ni ng what const i t ut es DFCI . None of t hose i t ems

15 r esul t i n t he concl usi on t hat t hese U. S. dol l ar denomi nat ed

16 Ar gent i ne l aw bonds ar e domest i c f or ei gn cur r ency i ndebt edness.

17 And I can t ake t he i t ems i n t he def i ni t i on i n any or der , your

18 Honor , and maybe i t makes sense t o st ar t wi t h Roman at I and

19 t hen concl ude wi t h Roman at I I I , whi ch i s one of t he i t ems t hat

20 your Honor was quest i oni ng Ms. Wagner about . Woul d t hat be

21 okay?

22 THE COURT: Ver y good. Thank you.

23 MR. FRI EDMAN: Under Roman at I , domest i c f or ei gn

24 cur r ency i ndebt edness consi st s of cer t ai n speci f i cal l y

25 i dent i f i ed bonds i ssued by t he Republ i c of Ar gent i na. We can


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1 l ook at t hose bonds l i st ed, but i t i s obvi ous t o ever yone t hat

2 t he bonds at i ssue her e wer e not even i n exi st ence at t he t i me

3 of t he f i scal agency agr eement and t hus ar e cl ear l y not l i st ed

4 i n Roman at I I .

5 Then we come t o Roman at I I , whi ch says: DFCI woul d

6 i ncl ude any i ndebt edness i ssued i n exchange or as r epl acement

7 f or t he i ndebt edness r ef er r ed t o i n i t em1. So we have t o

8 consi der , your Honor , t hese.

9 THE COURT: I woul d t hi nk t hat l i t t l e i i doesn' t

10 appl y. Can we j ust pass t hat .

11 MR. FRI EDMAN: Sur e. And t he onl y r eason why I paused

12 on i t , t her e has been, on t hi s mot i on, an ar gument by Ci t i bank

13 and by Ar gent i na t hat l i t t l e i i does appl y. And I bel i eve your

14 Honor i s cor r ect , i t does not appl y her e. I ' mhappy t o addr ess

15 t hat or l et t hemaddr ess i t f i r st , and I ' l l t ur n t o i t emRoman

16 at I I I . Shal l I do t hat , your Honor ?

17 THE COURT: Pl ease.

18 MR. FRI EDMAN: I t emI I I says: Domest i c f or ei gn

19 cur r ency i ndebt edness woul d be - - i t ' s got t wo par t s, an A and

20 a B. And t he A, whi ch i s what your Honor was r ef er r i ng t o

21 ear l i er , i t ' s i ndebt edness of f er ed excl usi vel y wi t hi n t he

22 Republ i c of Ar gent i na. That ' s what I woul d l i ke t o t al k about .

23 Ever ybody agr ees t hat i t emB does not appl y her e, because t hese

24 ar e dol l ar denomi nat ed bonds, not peso bonds.

25 THE COURT: You' r e f ocusi ng on t he cr i t i cal l anguage.


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1 MR. FRI EDMAN: Yes. Ar e t hese U. S. denomi nat ed

2 Ar gent i ne l aw bonds, wer e t hey of f er ed excl usi vel y wi t hi n t he

3 Republ i c of Ar gent i na. And t he answer , your Honor , i s, t he

4 r ecor d shows, t hese bonds wer e not of f er ed excl usi vel y i n t he

5 Republ i c of Ar gent i na. They wer e of f er ed pur suant t o t he same

6 pr ospect us t hat of f er ed t he New Yor k l aw, t he UK l aw, and al so

7 t he Ar gent i ne l aw exchange bonds. The pr ospect us i s par t of

8 t he r ecor d. The pr ospect us was i ssued t hr ough t he SEC i n t he

9 Uni t ed St at es. The bonds wer e not of f er ed excl usi vel y i n

10 Ar gent i na. They wer e of f er ed pur suant t o t he same pr ospect us

11 t hat i n 2005 and 2010 - -

12 THE COURT: I woul d not t hi nk t hat t he pr ospect us

13 gover ns. I woul d t hi nk i t ' s a mat t er of f act wher e t hese bonds

14 wer e of f er ed. And, obvi ousl y, t he f act ual i ssue has t o be

15 deal t wi t h. But I don' t t hi nk t he pr ospect us answer s t he

16 quest i on.

17 MR. FRI EDMAN: As a mat t er of f act , your Honor , t he

18 per sons who r ecei ved t he U. S. dol l ar denomi nat ed Ar gent i ne l aw

19 bonds wer e not l ocat ed excl usi vel y i n Ar gent i na and t he bonds

20 wer e not of f er ed excl usi vel y i n Ar gent i na. The el i gi bl e bonds

21 f or t he exchange whi ch r esul t ed i n t he i ssuance of t hese

22 Ar gent i ne l aw bonds, t he el i gi bl e bonds coul d be hel d, wer e

23 hel d t hr ough account s at cl ear i ng agenci es such as Eur ocl ear

24 and Cl ear st r ai ght . When t he hol der s of bonds par t i ci pat ed i n

25 t he exchange i n 2005 and 2010 and r ecei ved Ar gent i ne l aw dol l ar


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1 denomi nat ed bonds, t hose exchanges t ook pl ace out si de of

2 Ar gent i na.

3 THE COURT: I ' mr eal l y not r ef er r i ng t o t hose

4 exchanges because t hey wer e exchanges f or a di f f er ent bond.

5 They wer e exchanges f or t he 1994 bond. Let ' s not get t hat

6 conf used.

7 MR. FRI EDMAN: I f I may, your Honor , t he exchanges

8 wer e not excl usi vel y f or t he 1994 bonds. When we l ook at what

9 your Honor r ef er s t o as exchange bonds, t he exchanges wer e

10 of f er ed f or - -

11 THE COURT: I don' t use t he t er mexchange bonds.

12 MR. FRI EDMAN: Your Honor , i f I may j ust st ep back f or

13 a moment , I t hi nk i t woul d be ver y hel pf ul j ust some put i n

14 f r ont of t he Cour t t he l anguage f r omt he i nj unct i on, t he

15 amended Febr uar y 23 or der . What t hat or der says i s t hat t he

16 i nj unct i on and t he equal t r eat ment obl i gat i on appl i es t o

17 exchange bonds and, your Honor , i n t hat i nj unct i on def i nes

18 exchange bonds as bonds i ssued i n t he 2005 or 2010 exchange.

19 That l anguage - -

20 THE COURT: Let me j ust i nt er r upt you.

21 I t i s not goi ng t o hel p t o get conf used, and t o

22 pr event conf usi on l et us keep i n mi nd, and I ask you t o keep i n

23 mi nd - - and I was t he aut hor of t he i nj unct i on. I have a

24 pr et t y good i dea of what i t meant . And t hat i s, we wer e

25 deal i ng wi t h t he 1994 bonds i ssued by t he Republ i c, subj ect t o


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1 New Yor k l aw, payabl e i n New Yor k. That ' s what we wer e deal i ng

2 wi t h.

3 Now, when I was deal i ng wi t h t he exchanges t hat

4 occur r ed i n 2005 and 2010, I was cl ear l y deal i ng, as f ar as I

5 was concer ned, as t he j udge, wi t h exchanges f or t he 1994 bonds.

6 And l et us keep t hat i n mi nd and not st r ay f r omi t .

7 MR. FRI EDMAN: May I say, your Honor , t hat I ' m

8 obvi ousl y not i n a posi t i on t o addr ess what your Honor had i n

9 mi nd at t he t i me of t he i ssuance of t he par i passu i nj unct i on,

10 but what I woul d l i ke t o say i s t hat t her e has been ext ensi ve

11 l i t i gat i on bot h i n t he Second Ci r cui t Cour t of Appeal s and i n

12 t hi s cour t , your Honor , concer ni ng t he pr oper i nt er pr et at i on of

13 t he wor ds i n t hat i nj unct i on. And I woul d - -

14 THE COURT: What l i t i gat i on ar e you t al ki ng about ?

15 MR. FRI EDMAN: I ' mr ef er r i ng t o t he or i gi nal t wo

16 appeal s t o t he Second Ci r cui t , when your Honor i ssued t he

17 i nj unct i on back i n 2012. I ' mr ef er r i ng t o t he r ul i ng by your

18 Honor on J ul y 28 of t hi s year expl ai ni ng and cl ar i f yi ng t he

19 i nj unct i on. And t hen I ' mr ef er r i ng t o t he t r anscr i pt of t he

20 ar gument bef or e t he Second Ci r cui t l ast week wher e t her e was

21 ext ensi ve di scussi on bot h by counsel t hat was si gni f i cant and

22 by t he j udges on t he Second Ci r cui t concer ni ng t he wor ds of t he

23 i nj unct i on and t he pr oper i nt er pr et at i on of t hose wor ds. And

24 i f your Honor woul d - -

25 THE COURT: What was t he i ssue of i nt er pr et at i on?


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1 MR. FRI EDMAN: The i ssue I ' mr ef er r i ng t o, your Honor ,

2 I woul d cent er on your Honor ' s or der j ust J ul y 28, 2014, l ess

3 t han t wo mont hs ago, i n t hi s case and i t ' s an or der t hat

4 Ms. Wagner di d not ment i on when she was r eci t i ng what your

5 Honor has sai d about t he par i passu i nj unct i on. I n t hat J ul y

6 28 or der , af t er havi ng hear d ext ensi ve ar gument f r omcounsel ,

7 your Honor r ul ed t hat t he U. S. dol l ar denomi nat ed exchange

8 bonds i ssued under Ar gent i ne l aw ar e exchange bonds cover ed by

9 t he par i passu i nj unct i on. And your Honor may r ecal l t hat - -

10 THE COURT: When di d I i ssue any such r ul i ng?

11 MR. FRI EDMAN: I f I may, your Honor , may I gr ab my

12 bi nder wi t h t hat r ul i ng. Because I t hi nk i t ' s i mpor t ant , j ust

13 t o be cl ear , about what i s i n t he r ecor d al r eady. Thi s was

14 J ul y 28, 2014. I ' msur e your Honor wi l l r ecal l t hat t he

15 concl usi on of t hat or der by your Honor was, and I ' l l j ust r ead

16 t hi s shor t par agr aph i nt o t he r ecor d: However , t he Cour t wi l l

17 onl y al l ow t hi s one- t i me payment on t he dol l ar - denomi nat ed

18 exchange bonds af t er J ul y 30, 2014. The Cour t wi l l r esci nd t he

19 Ci t i bank or der wi t h r egar d t o t he dol l ar - denomi nat ed exchange

20 bonds. And t hen your Honor went on t o say: To avoi d f ut ur e

21 conf usi on, t he par t i es ar e di r ect ed t o devi se a way t o

22 di st i ngui sh bet ween t he Repsol bonds and t he exchange bonds

23 bef or e t he next i nt er est payment i s due. And I ' d l i ke t o say a

24 wor d f ur t her about t hat or der , i f I may, your Honor .

25 THE COURT: Go ahead, pl ease.


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1 MR. FRI EDMAN: The i ssue bef or e t he Cour t at t he t i me

2 of t hat or der was whet her t he U. S. dol l ar denomi nat ed Ar gent i ne

3 l aw bonds wer e exchange bonds wi t hi n t he meani ng of t he

4 i nj unct i on. And your Honor speci f i cal l y r ul ed, and t hi s came

5 up dur i ng t he ar gument a f ew days bef or e, i t ' s r ef l ect ed i n

6 t hi s or der . Your Honor r ul ed t hat t hese Ar gent i ne l aw dol l ar

7 denomi nat ed bonds ar e exchange bonds wi t hi n t he meani ng of t he

8 i nj unct i on.

9 The conf usi on t hat ar ose t hat i s addr essed at t he end

10 of t he par agr aph I r ead i s t hat counsel f or Ar gent i na and f or

11 Ci t i bank, af t er t he ar gument on t he mot i on f or r econsi der at i on,

12 af t er t he ar gument , af t er t he br i ef i ng, f or t he f i r st t i me sai d

13 t o t he Cour t , you know, f or some of t he Ar gent i ne l aw exchange

14 bonds, t her e i s some conf usi on because t her e ar e bonds t hat

15 wer e i ssued t o Repsol wi t h t he same I SI N number . And as your

16 Honor knows, an I SI N number i s a speci f i c i dent i f yi ng

17 char act er i st i c f or a bond.

18 So t he si t uat i on t hat your Honor was addr essi ng was,

19 one, t he Cour t r ul ed t hat t hese Ar gent i ne l aw dol l ar

20 denomi nat ed exchange bonds ar e exchange bonds. But t her e was

21 an i ssue t hat t he Cour t f el t shoul d be addr essed because when

22 you l ook at t hese exchange bonds, t her e ar e some ot her bonds

23 out t her e t r adi ng t hat wer e act ual l y not i ssued i n t he

24 exchange.

25 THE COURT: Let me i nt er r upt you. Can I have t he


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1 Febr uar y 23 i nj unct i on.

2 The Febr uar y 23, 2012 or der , as i t ' s cal l ed, or i t was

3 amended, was deal i ng wi t h t he 1994 bonds and t he exchanges of

4 2005 and 2012 deal i ng wi t h t hose bonds.

5 Now, what t he Febr uar y 23, 2012 or der meant was t hat

6 i f t he Republ i c sought t o make a payment pr esumabl y of

7 i nt er est , but sought t o make a payment on t he bonds t hat wer e

8 i ssued on t hose exchanges, t hen t her e had t o be a payment under

9 t he par i passu cl ause.

10 But t he r ecor d shoul d be cr yst al cl ear t hat t he Cour t

11 was deal i ng wi t h t he 1994 bonds and bonds i ssued i n exchange

12 f or t he maj or i t y of t hose 1994 bonds.

13 Now, t he r ecor d suppor t s what I ' ve sai d. I amt he

14 j udge on i t and t hat i s what I i nt ended and t he r ecor d suppor t s

15 t hat .

16 And what i s cal l ed t he i nj unct i on was t he i nj unct i on

17 sayi ng t hat t her e coul d be no payment on t hose bonds unl ess

18 t her e was a r ecogni t i on of t he par i passu f or t he peopl e who

19 di dn' t exchange, who had t hei r j udgment s.

20 Now, no act i on was t aken by t he Cour t . Let me st ar t

21 agai n. Af t er t hat i nj unct i on was i ssued, t her e wer e cer t ai n

22 act i ons t aken by t he Republ i c whi ch r equi r ed some r emedy by me

23 and t hey ar e r eal l y not r el evant t o what we ar e t al ki ng about

24 now. The Republ i c at t empt ed t o make a payment of $500 mi l l i on,

25 maybe mor e, and t he Cour t hel d t hat t hat payment coul d not be


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1 made because i t di d not deal wi t h t he par i passu si t uat i on.

2 And so I t hi nk about $500 mi l l i on was pai d i nt o t he Bank of New

3 Yor k and may st i l l be t her e. But , anyway, t he Bank of New Yor k

4 act ed ver y r esponsi bl y and di d not pass t hat on t o bondhol der s.

5 What I ' mget t i ng at i s t hi s. When summer came, Kar en

6 Wagner , on behal f of Ci t i bank, made an appl i cat i on t o t he Cour t

7 or r equest t o t he Cour t f or cl ar i f i cat i on, or what ever you want

8 t o cal l i t , about t he quest i on of whet her Ci t i bank and

9 Ar gent i na woul d be vi ol at i ng an i nj unct i on i f t hey made a J ul y

10 30, 31, what ever i t was, i nt er est payment . At t hat j unct ur e

11 t her e was not t he ki nd of f ul l br i ef i ng and ar gument t hat we

12 ar e now havi ng. The i dea was t o ei t her cl ear or not cl ear an

13 i nt er est payment down i n Ar gent i na due at t he end of J ul y.

14 Ul t i mat el y, t he Cour t sai d okay t o t hat payment , but made i t a

15 one- t i me t hi ng, t he i dea bei ng, obvi ousl y, t he Cour t knew,

16 ever ybody knew t her e woul d be i nt er est payment s due Sept ember

17 30 and December 31, et cet er a. We di dn' t at t empt t o cover al l

18 of t hat .

19 Now, what I hope t hese f i ne pr of essi onal l awyer s wi l l

20 under st and, and I ' msur e you do under st and, i s t hat we ar e now

21 engaged i n somet hi ng f ar di f f er ent f r omwhat went on i n J une

22 and J ul y. We ar e now consi der i ng at a dept h whi ch was not gone

23 i nt o i n J ul y, we ar e consi der i ng t he quest i on of whet her

24 cer t ai n t ypes of bonds i ssued i n Ar gent i na ar e subj ect or ar e

25 not subj ect t o t he 1994 f i scal agency agr eement and t he


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1 r equi r ement of par i passu t r eat ment . And I have t o say t hat i t

2 i s not r eal l y hel pf ul t o me and i t i s not hel pf ul t o t he case

3 t o make al l t hese i ssues depend on t he i ssue of a par t i cul ar

4 t er mi n a J ul y 28 or der .

5 You f ocused ver y heavi l y on t he phr ase exchange bonds.

6 I t ' s used a coupl e of t i mes i n t he J ul y 28 or der . I have t o

7 t el l you t hat as t he j udge i n t he case, I amnot wi l l i ng t o l et

8 t he whol e case depend on t he use of t hat t er mt wi ce i n t he J ul y

9 28 or der . The i ssues ar e bi gger , deeper t han t hat . So i f you

10 want t o r el y on t hat , pl ease don' t .

11 MR. FRI EDMAN: I do have mor e t hi ngs I ' d l i ke t o say

12 about t he pr i or or der s of t hi s Cour t , not j ust t he J ul y 28

13 or der , but , f i r st , i f I may, I woul d l i ke t o of f er a pr act i cal

14 suggest i on.

15 Pl ai nt i f f s bel i eve t hat t he i ssues bef or e t he Cour t

16 t oday ar e ext r emel y i mpor t ant , and we appr eci at e t hat your

17 Honor i s wr est l i ng wi t h t hose i ssues. The r eason why

18 pl ai nt i f f s have pr oposed a st ay as set f or t h i n our pr oposed

19 or der , so as t o al l ow Ci t i bank t o pr ocess t hi s Sept ember 30

20 payment , i s so t hat t he par t i es and your Honor wi l l not have t o

21 deal wi t h t hese i mpor t ant i ssues on an emer gency basi s. Your

22 Honor has hear d ext ensi ve ar gument about bot h t echni cal i ssues

23 and what i s DFCI and f act ual asser t i ons r el at i ng t o t hat . Your

24 Honor has hear d l egal ar gument , and t her e i s mor e t o come,

25 about t he or der s ent er ed by your Honor , as wel l as st at ement s


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1 by counsel bef or e your Honor and bef or e t he Second Ci r cui t ,

2 st at ement s by t he Second Ci r cui t , and I know your Honor wi l l

3 want t o gi ve f ul l consi der at i on t o t hese mat t er s because - -

4 THE COURT: I want t o gi ve f ul l consi der at i on, but I

5 al so don' t want t o compl i cat e t hi s t hi ng beyond al l r eason.

6 Her e i s what I have i n mi nd. Let us assume, and I

7 bel i eve t he r ecor d bef or e me suppor t s t hi s, but I wi l l j ust

8 assume i t f or t he moment , l et us assume t hat t he bonds we ar e

9 t al ki ng about , whi ch t he par t i es have r ef er r ed t o conveni ent l y

10 as Ar gent i ne l aw bonds, l et us assume t hat - - i t ' s not an

11 assumpt i on. They wer e not i ssued. Let us assume, i n case

12 t her e i s any possi bl e quest i on, l et us assume t hat t hey wer e

13 not i ssued i n 1994, as wer e t he bonds t hat ar e subj ect t o my

14 i nj unct i on. Let us assume t hat t hey ar e payabl e i n Ar gent i na.

15 Let us assume t hat t hey ar e subj ect t o Ar gent i ne l aw.

16 Now, t her e ar e cer t ai n i ssues, not an i ndef i ni t e vast

17 uni ver se of i ssues, but t her e ar e cer t ai n i ssues whi ch f l ow

18 f r omt hat . The pr i me i ssue i s, despi t e t he descr i pt i on I ' ve

19 gi ven, ar e t hey subj ect i n any way t o t he f i scal agency

20 agr eement of 1994. That i ssue has been r ai sed by t he par t i es

21 and i t i s an i ssue, a r eal i ssue. But t he i ssue i s not

22 i ndef i ni t e i n t he t hi ngs t hat bear upon i t . I t i s a f i ni t e

23 i ssue.

24 Agai n, t he i ssue i s whet her i n some way t hose bonds,

25 as I ' ve descr i bed t hem, ar e subj ect t o t he 1994 f i scal agency


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1 agr eement per t ai ni ng t o t he 1994 bonds. And as I under st and

2 i t , t he pr eci se i ssue i s whet her a payment of i nt er est on t hose

3 bonds woul d i nvoke t he par i passu pr ovi si on of t he 1994 f i scal

4 agency agr eement . J udgi ng f r omt he br i ef i ng bef or e me and t he

5 ar gument bef or e me, t hat i s t he i ssue now. How i s i t t o be

6 deal t wi t h.

7 MR. FRI EDMAN: Shal l I answer t hat , your Honor ?

8 THE COURT: Let me j ust f i ni sh.

9 MR. FRI EDMAN: I ' msor r y. I apol ogi ze.

10 THE COURT: Of cour se I ' l l get back t o you.

11 J udgi ng by what has been r ef er r ed t o by Mr . Ol sen and

12 by you and i n t he br i ef s, t o r esol ve t hat i ssue you l ook t o t he

13 1994 f i scal agency agr eement because i f t hi s i s ext er nal

14 i ndebt edness of t he Republ i c wi t hi n t he meani ng of cer t ai n

15 par t s of t he FAA, t hen t her e can be no payment wi t hout payi ng

16 under t he par i passu cl ause. I f t hat i s t he case, t he quest i on

17 i s, i s t hat t he case? That ' s t he i ssue. And f or t hat we don' t

18 l ook t o 100 sour ces of i nf or mat i on and vast amount s of

19 di scover y. We l ook t o a pr ovi si on whi ch def i nes domest i c

20 f or ei gn cur r ency i ndebt edness, and we l ook t o what I t hi nk was

21 di scussed wi t h Mr . Ol sen and wi t h you, t he pr ovi si on l i t t l e

22 i i i , whi ch has t hi s l anguage of f er ed excl usi vel y wi t hi n t he

23 Republ i c of Ar gent i na.

24 We wer e t her e, I t hi nk, wi t h Mr . Ol sen and wi t h you

25 and t hat ' s wher e we ought t o be, deal i ng wi t h t he


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1 i nt er pr et at i on of t hose pr ovi si ons, because under t he cl ear

2 l anguage of t he FAA, i f t hi s i s ext er nal i ndebt edness and you

3 go no f ar t her , t hen t her e can be no payment wi t hout t aki ng car e

4 of t he par i passu. I f i t i s not so, t hen t her e can be a

5 payment wi t hout deal i ng wi t h t he par i passu. And t hat ' s wher e

6 t he i ssues come. I t ' s t he i nt er pr et at i on of t hose pr ovi si ons.

7 Do you have anyt hi ng t o add t o t hat subj ect ?

8 MR. FRI EDMAN: Yes, I do, your Honor .

9 THE COURT: The r eason I went t hr ough al l of t hat i s

10 t hat I ask t he l awyer s t o be ver y car ef ul when you ar e deal i ng

11 wi t h bonds whi ch ar e r eal l y bonds i ssued i n 1994 or exchanges

12 f or t hose bonds. Pl ease keep t hat cl ear . They ar e what t hey

13 ar e. They ar e not somet hi ng el se. Go ahead.

14 MR. FRI EDMAN: Wi t h r espect t o your Honor ' s quest i on

15 concer ni ng whet her t hese Ar gent i ne l aw bonds ar e ext er nal

16 i ndebt edness or whet her t hey f al l wi t hi n t he car ve- out f or

17 domest i c f or ei gn cur r ency i ndebt edness, your Honor has f ocused

18 our at t ent i on on i t em3 l i t t l e i , whi ch i ndi cat es t hat domest i c

19 f or ei gn cur r ency i ndebt edness woul d i ncl ude i ndebt edness t hat

20 was - - I ' msor r y, pr i nt i s a l i t t l e smal l - - i ndebt edness.

21 THE COURT: Of f er ed excl usi vel y wi t hi n t he Republ i c of

22 Ar gent i na.

23 MR. FRI EDMAN: Of f er ed excl usi vel y wi t hi n t he Republ i c

24 of Ar gent i na.

25 THE COURT: That ' s t he cr uci al l anguage.


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1 MR. FRI EDMAN: What I woul d say as t o t hat , your

2 Honor , i s, f i r st , when we l ook at t he document ar y r ecor d, t he

3 document ar y r ecor d does not i ndi cat e t hat t he bonds wer e

4 of f er ed excl usi vel y i n Ar gent i na.

5 THE COURT: What do you mean by document ar y r ecor d?

6 MR. FRI EDMAN: When I say document ar y r ecor d, I mean

7 t he document s t hat have been put bef or e t he Cour t wi t h t he

8 par t i es' submi ssi ons i n connect i on wi t h t hi s mot i on. And t he

9 document ar y r ecor d, as an exampl e, i ncl udes t he pr ospect us t hat

10 I ment i oned. And i f you l ook at t hat pr ospect us, t he

11 concl usi on one woul d dr aw i s t hat t hese bonds wer e not of f er ed

12 excl usi vel y wi t hi n Ar gent i na.

13 Now, I know Ci t i bank and Ar gent i na make t he ar gument

14 t hat t he bonds wer e of f er ed excl usi vel y i n Ar gent i na. That , I

15 woul d say, i s an unt est ed asser t i on of f act . Wer e t hese bonds

16 of f er ed excl usi vel y i n Ar gent i na. We see Ci t i bank and

17 Ar gent i na ar gui ng t hey wer e. To t he ext ent t he Cour t - -

18 THE COURT: Let me i nt er r upt you. I t hi nk t hat t aki ng

19 Mr . Ol sen' s ar gument and your ar gument and t he di scussi on we

20 have al l had, we r eal l y ar e now at t he i ssue. And i t i s t he

21 i ssue of whet her t hese bonds wer e of f er ed excl usi vel y wi t hi n

22 t he Republ i c of Ar gent i na. That i s a f act ual i ssue. And what

23 has been submi t t ed t o me by Ms. Wagner and I bel i eve Cl ear y

24 Got t l i eb i s what t hey consi der evi dence t hat t hese wer e.

25 But i f t her e i s a f act ual i ssue, t hen what do you do


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1 about f act ual i ssues. You f i gur e out a way t o r esol ve t hem.

2 And what I woul d l i ke t o hear f r omyou i s why you bel i eve t her e

3 ar e f act ual i ssues. Because I t hought f r omt he r ecor d bef or e

4 me t her e wer e not . Why do you bel i eve t her e ar e f act ual

5 i ssues?

6 MR. FRI EDMAN: The r eason why I bel i eve t her e ar e

7 f act ual i ssues, your Honor , i s t hat t he quest i on of whet her

8 bonds wer e of f er ed excl usi vel y i n Ar gent i na wi l l depend on t he

9 f act ual i ssue of whet her t he bonds wer e, i n f act , of f er ed

10 excl usi vel y i n Ar gent i na. I f t he bonds wer e, i n f act , of f er ed

11 i n ot her pl aces, t hen, obvi ousl y, t hey wer e not of f er ed

12 excl usi vel y i n Ar gent i na. So t he f act ual i ssue i s, what i s t he

13 evi dence, what i s t he hi st or i cal r ecor d about how and wher e

14 t hese bonds wer e of f er ed.

15 THE COURT: I don' t under st and why you ar e t al ki ng

16 about a hi st or i cal r ecor d. I bel i eve t hese ar e not bonds t hat

17 dat e back t o t he War of 1812 or somet hi ng l i ke t hat . I t hi nk

18 t hey ar e a pr et t y r ecent cr eat i on. Ar e t hey not ?

19 MR. FRI EDMAN: Your Honor , t he bonds i n quest i on wer e

20 of f er ed i n t he 2005 and 2010 exchanges.

21 THE COURT: You ar e r i ght . I had f or got t en. 2005 and

22 maybe a l i t t l e l at er . But , pl ease, I have t o t el l you r i ght

23 now, I do not bel i eve t her e i s any mer i t i n sayi ng t o t he i dea

24 t hat t hose bonds wer e par t of t he exchange of 2005 and 2010

25 whi ch had t o do excl usi vel y wi t h t he 1994 bonds.


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1 MR. FRI EDMAN: Your Honor , may I j ust say one t hi ng?

2 THE COURT: Yes.

3 MR. FRI EDMAN: I n t he ar gument bef or e your Honor on

4 J ul y 22, counsel f or Ci t i bank conceded and acknowl edged t hat

5 t hese Ar gent i ne l aw dol l ar denomi nat ed bonds wer e, i n f act ,

6 of f er ed i n t he 2005 and 2010 exchanges and t hat t hese dol l ar

7 denomi nat ed bonds wer e t hus wi t hi n t he def i ni t i on of exchange

8 bonds i n your Honor ' s i nj unct i on. Ther e i s no doubt t hat

9 t hese - -

10 THE COURT: Can I i nt er r upt you. I was t he aut hor of

11 t he i nj unct i on and I had no such i nt ent i on.

12 MR. FRI EDMAN: I under st and your Honor has sai d t hat .

13 THE COURT: I don' t mean t o be so br usque wi t h you.

14 MR. FRI EDMAN: Shal l I cont i nue?

15 THE COURT: What I ' mt r yi ng t o do at t hi s hear i ng, and

16 I t r i ed t o do i t t he ot her day, I r eal i ze t hat some conf usi on

17 has come i nt o t he r ecor d and some of i t undoubt edl y has been by

18 my usage of wor ds and so f or t h. I want t o get r i d of t hat

19 conf usi on and go f r omher e on, f r ombegi nni ng her e at l east on

20 an unconf used r ecor d, and I want t o say t o you t hat i t i s cl ear

21 t o me t hat t her e ar e cer t ai n bonds t hat wer e i nvol ved i n t he

22 1994 of f er i ng. Ther e wer e cer t ai n bonds t hat wer e pr oduced as

23 a r esul t of t he exchange r el at ed t o t hat bond i ssue, and t hen

24 t her e ar e ot her bonds. Pl ease do not conf use t hem.

25 MR. FRI EDMAN: May I cont i nue, your Honor ?


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1 THE COURT: Yes.

2 MR. FRI EDMAN: What I woul d submi t i s t hat we ar e

3 deal i ng wi t h i mpor t ant l egal and f act ual i ssues. One exampl e

4 of a l egal i ssue t hat I bel i eve your Honor wi l l want t o

5 consi der i s what your Honor has j ust st at ed as t o your Honor ' s

6 i nt ent at t he t i me t he i nj unct i on was i ssued and how t hat

7 i nt ent r el at es t o t he wor ds of t he i nj unct i on. And we have t he

8 f act ual i ssue t hat I ' ve ment i oned concer ni ng whet her t he

9 of f er i ng of t hese Ar gent i ne l aw bonds was excl usi vel y i n

10 Ar gent i na.

11 And what I woul d r espect f ul l y submi t i s t hat because

12 pl ai nt i f f s have vol unt ar i l y agr eed t o a st ay t hat woul d enabl e

13 Ci t i bank t o make t he Sept ember 30 payment , t her e i s no

14 emer gency and no ur gency bef or e your Honor . And t her e ar e

15 i mpor t ant i ssues t hat I cannot emphasi ze how i mpor t ant t hey ar e

16 t o t he meani ng and ongoi ng enf or cement of t he i nj unct i on. And

17 i t ' s because t hese i ssues ar e so i mpor t ant t hat t he pl ai nt i f f s

18 have sai d, we wi l l acqui esce and not obj ect and al l ow t he Cour t

19 t o ent er an or der per mi t t i ng t he Sept ember 30 payment , and t hen

20 we know t he par t i es wi l l have t i me t o devel op t he r ecor d and

21 pr esent t o t he Cour t what ever i s appr opr i at e, and t he Cour t

22 wi l l not be under t i me pr essur e t o deci de t hese i ssues. And I

23 woul d r espect f ul l y ask t hat your Honor al l ow t he par t i es t o do

24 t hat . Because we have agr eed t o t he st ay, because we have

25 submi t t ed an or der t hat woul d enabl e your Honor t o memor i al i ze


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1 t hat , t her e i s no ur gency. And t hese ar e ver y i mpor t ant

2 i ssues.

3 I woul d j ust , i f I may, as j ust one exampl e of some of

4 t he l egal i ssues, when Ci t i bank cont ended i n t he Second Ci r cui t

5 t hat your Honor ' s J ul y 28 or der shoul d be r ever sed, J udge

6 Par ker sai d t hat he does not even know how Ci t i bank coul d

7 ser i ousl y ar gue t hat t he Ar gent i ne bonds ar en' t cover ed by t he

8 i nj unct i on. I j ust ment i on t hat , your Honor , as one exampl e.

9 THE COURT: The Second Ci r cui t , i ncl udi ng J udge

10 Par ker , di d not come down wi t h a r ul i ng. I t doesn' t hel p me a

11 l ot t o hear about col l oquy.

12 MR. FRI EDMAN: Your Honor , i f I may, yes and no. The

13 Second Ci r cui t l ast week di d come down wi t h a r ul i ng i n t hat

14 t he Second Ci r cui t di smi ssed t he appeal because - - t hi s i s i n

15 t hei r or der - - because your Honor ' s J ul y 28 or der cl ar i f yi ng

16 t hat t he i nj unct i on appl i es t o t he Ar gent i ne l aw bonds was, i n

17 t he vi ew of t he Second Ci r cui t , i n t hei r or der - -

18 THE COURT: You ar e goi ng beyond t hei r l anguage.

19 MR. FRI EDMAN: I f I may, your Honor , t he Second

20 Ci r cui t sai d t he J ul y 28 or der was a cl ar i f i cat i on and not a

21 modi f i cat i on of t he i nj unct i on. That was t hei r l anguage.

22 I appr eci at e your Honor want s t o f ocus on cer t ai n

23 i ssues. Of cour se, I r espect t hat . I ' mr eal l y t r yi ng t o make

24 t he poi nt t hat t her e ar e i mpor t ant i ssues and t her e i s no

25 emer gency because t he pl ai nt i f f s have agr eed t o t he st ay t hat


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1 Ci t i bank want s and, t her ef or e, we ar e r equest i ng t hat your

2 Honor al l ow t he par t i es an oppor t uni t y t o devel op t he r ecor d so

3 t hat t he Cour t can make a deci si on wi t hout t hi s emer gency

4 hangi ng over ever ybody' s heads. I t ' s because of t he i mpor t ance

5 of t hi s and t he ur gent desi r e on t he par t of t he pl ai nt i f f s t o

6 al l ow t he r ecor d t o be devel oped, t he Cour t t o consi der al l t he

7 i ssues, t hat we have pr oposed and ar e pr epar ed t o agr ee t o t he

8 st ay. That ' s our r equest , your Honor .

9 THE COURT: I t ' s a f ai r r equest . What do t he ot her

10 par t i es say t o t hat ?

11 MS. WAGNER: Your Honor , may I be hear d f or anot her

12 mi nut e?

13 THE COURT: Pl ease.

14 MS. WAGNER: Your Honor , of cour se, we agr ee t hat

15 compl i cat ed i ssues shoul d not be deci ded under emer gent

16 condi t i ons. I woul d suggest t hat what you have hear d t oday i s

17 t hat pl ai nt i f f s agr ee t hat t hey di d not make a r ecor d bef or e

18 you i n connect i on wi t h t he i nj unct i on, and I t hi nk your Honor

19 agr ees as wel l t hat t he i nj unct i on appl i es t o t he Ar gent i ne l aw

20 bonds.

21 Gi ven t hat , t he pl ai nt i f f s ar e ent i r el y wel come t o

22 make t hat r ecor d i f t hey want . But i t i s not appr opr i at e r i ght

23 now t o appl y t hat i nj unct i on t o Ci t i bank and t o t he Ar gent i ne

24 l aw bonds.

25 So what I woul d suggest t o t he Cour t i s t hi s. I


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1 bel i eve t hat we can show you, I bel i eve your Honor ' s f ocus on

2 t he f i scal agency - -

3 THE COURT: I di d not know anybody was suggest i ng t hat

4 my i nj unct i on of Febr uar y 23 appl i ed t o t hese new bonds. I

5 di dn' t know anybody was suggest i ng t hat .

6 MS. WAGNER: I bel i eve t hat i s t he suggest i on, your

7 Honor , and I woul d r espect f ul l y submi t t hat what we need t o do

8 her e i s l eave t he i nj unct i on wher e i t i s, agr ee t hat i t does

9 not appl y t o t he Ci t i bank and t he Ar gent i ne l aw bonds.

10 Pl ai nt i f f s t hen can make a mot i on t o have a new i nj unct i on.

11 They can expl ai n why t he Ar gent i ne l aw bonds shoul d be subj ect

12 t o t he par i passu cl ause i f t hey can. We bel i eve t hey cannot

13 make t hat showi ng because we bel i eve you coul d not get an

14 Ar gent i ne l aw bond by t ender i ng a bond t hat was i ssued under

15 t he f i scal agency agr eement . So we don' t t hi nk t hey can make

16 t hat showi ng.

17 Our suggest i on woul d be, your Honor , t o vacat e t he

18 r est r i ct i on on Ci t i bank and t he Ar gent i ne l aw bonds t hat t hey

19 i nsi st you i nt ended i n J ul y of 2014, t o r ei nst at e t he

20 cl ar i f i cat i on or der t hat says t he or i gi nal i nj unct i on does not

21 appl y. Then we can al l go and have di scover y and t hey can make

22 a mot i on and t hey can expl ai n t o t he Cour t why i t i s t hey t hi nk

23 an i nj unct i on shoul d appl y t o Ar gent i ne l aw bonds and t o a

24 cust odi an such as Ci t i bank, who i s not i n any way connect ed t o

25 any r el evant cont r act .


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1 So my suggest i on, your Honor , i s t hat I adopt t he

2 suggest i on t hat we shoul d t ake t he pr essur e of f and we shoul d

3 have di scover y and pl ai nt i f f s shoul d do what ever t hey wi sh t o

4 do. But t hey ar e not ent i t l ed t o have an i nj unct i on hangi ng

5 over Ci t i bank' s head when t hey acknowl edge t hemsel ves t hey

6 cannot pr ove t hat t he bonds t hat we hol d ar e subj ect t o t he

7 par i passu cl ause. That woul d be my suggest i on, your Honor .

8 MR. FRI EDMAN: Your Honor , may I be hear d br i ef l y?

9 THE COURT: Sur e.

10 MR. FRI EDMAN: We absol ut el y do not acknowl edge what

11 Ms. Wagner says we acknowl edge. We bel i eve, so t he r ecor d i s

12 cl ear , t hat your Honor ' s or i gi nal i nj unct i on, as your Honor has

13 r ul ed on J ul y 28, as t he Second Ci r cui t j udges have sai d, as

14 t he pl ai n t er ms of t hat i nj unct i on st at e, we bel i eve i t appl i es

15 t o t he Ar gent i ne l aw bonds. And I appr eci at e Ms. Wagner

16 di sagr ees, I appr eci at e t hat your Honor has st at ed t hat t he

17 Cour t had i n mi nd a di f f er ent i nt ent i on at t he t i me i n 2012.

18 But t hese ar e i mpor t ant i ssues. And t he way t o deal wi t h

19 i mpor t ant i ssues i s not t o st ar t by vacat i ng t he i nj unct i on or

20 modi f yi ng t he i nj unct i on or changi ng t he i nj unct i on i n any way.

21 Ther e ar e or der s i n pl ace now and t he whol e poi nt of our

22 agr eei ng t o a st ay i s t o ensur e t hat Ci t i bank i s i n no way

23 pr ej udi ced, t hat Ci t i bank i s abl e t o pr ocess t he payment t hat

24 i t says i t want s t o make. And what t hat means i s t hat t he

25 i ssue does not become l i ve or ur gent agai n, your Honor , unt i l


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1 December .

2 And t he whol e poi nt of t he st ay i s t o enabl e t he Cour t

3 and t he par t i es t o consi der t hese i ssues wi t hout bei ng i n cour t

4 on t he second day of Rosh Hashanah, on a Fr i day af t er noon,

5 af t er a f ew days of br i ef i ng wi t hout t he Cour t and t he par t i es

6 havi ng t he t i me t o devot e what i s appr opr i at e and, I woul d

7 submi t , necessar y f or t he consi der at i on of t hi s i mpor t ant i ssue

8 when t her e i s no emer gency and no t i me pr essur e i n f act .

9 THE COURT: Anyone el se wi sh t o be hear d?

10 MR. OLSON: May I , your Honor ?

11 THE COURT: Sur e.

12 MR. OLSON: Thank you, your Honor . I ' l l be ver y, ver y

13 br i ef .

14 I t hi nk t hat you put and expr essed pr eci sel y what t he

15 i ssue i s. The par i passu cl ause r equi r ed t hat t he payment

16 obl i gat i ons of t he Republ i c, under t he secur i t i es pur suant t o

17 t he f i scal agency agr eement of 1994, be t r eat ed equal l y wi t h

18 al l pr esent and f ut ur e unsecur ed and an unsubor di nat ed ext er nal

19 i ndebt edness. That i s what your i nj unct i on cover ed, ext er nal

20 i ndebt edness wi t h r espect t o t hat par i passu pr ovi si on of t he

21 f i scal agency agr eement of 1994. The t er mext er nal

22 i ndebt edness i s expl ai ned i n t he f i scal agency agr eement , and

23 you ar e cor r ect , i n our submi ssi on, t hat i f t hese bonds ar e t he

24 t ype of bonds t hat ar e exempt ed under t he pr ovi si ons t hat we

25 have been t al ki ng about her e t oday, t hat i s t o say, of f er ed


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1 excl usi vel y wi t hi n Ar gent i na, t hen t hey may not be cover ed by

2 your i nj unct i on. They woul dn' t be cover ed by t he par i passu

3 cl ause, t he equal t r eat ment pr ovi si on. We addr essed pr eci sel y

4 t hi s poi nt on t he br i ef t hat we submi t t ed t o you on pages 16,

5 17, and so f or t h, t he br i ef wi t h r espect t o, we demonst r at e

6 t hat t hese bonds wer e not of f er ed excl usi vel y wi t hi n Ar gent i na,

7 and we pr ovi de evi dence t o t hat .

8 However , t he r ecor d i s not compl et e because we wer e

9 not per mi t t ed t o conduct di scover y wi t h r espect t o t hat ver y

10 i ssue. And so, as Mr . Fr i edman poi nt s out , t he st ay t akes car e

11 of Ci t i bank i nt o t he f ut ur e. We have t i me t o f ul l y br i ef

12 pr oper l y wi t h appr opr i at e di scover y t he f act ual i ssue t hat you

13 put your f i nger on. Ther e i s no r eason t o do i t any ot her way.

14 Because i t i s i mpor t ant t o al l t he par t i es t hat ar e i nvol ved i n

15 t hi s l ong di sput e. And t he i ssues ar e ser i ous and ver y, ver y

16 i mpor t ant . And t hat i s a pr oper appr opr i at e j udi ci ous way t o

17 handl e t hi s i ssue.

18 THE COURT: Anyone el se?

19 MR. VASSOS: J ohn Vassos f r omMor gan Lewi s & Bocki us

20 on behal f of Cl ear St r eam.

21 We have not seen t he pr oposed or der r egar di ng t he

22 st ay. Cl ear St r eam, l i ke Eur ocl ear , J P Mor gan Chase, one of

23 t he downst r eampar t i es, we woul d j ust ask t hat i t be cl ear t hat

24 t o t he ext ent Ci t i bank can pass t he money on t o us, t hat we be

25 al l owed t o pass t he money on t o our cust omer s i n ki nd.


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1 MR. FRI EDMAN: Your Honor , I can r espond t o t hat , i f I

2 may.

3 THE COURT: Pl ease.

4 MR. FRI EDMAN: The pr oposed or der does speci f i cal l y

5 pr ovi de and per mi t t hat t he downst r eamr eci pi ent s f r om

6 Ci t i bank, such as Eur ocl ear and Cl ear St r eam, can pr ocess t he

7 payment . We don' t speci f i cal l y r ef er t o Eur ocl ear and Cl ear

8 St r eam, because we expl i ci t l y r ef er - -

9 THE COURT: Wher e i s t he pr oposed or der ?

10 MR. FRI EDMAN: May I hand i t up, your Honor ?

11 THE COURT: Yes.

12 MR. FRI EDMAN: I t ' s j ust one par agr aph.

13 THE COURT: Di d I i nt er r upt you?

14 MR. VASSOS: Your Honor , no. I j ust st at ed my

15 quest i on. Mr . Fr i edman has answer ed i t f r ankl y t o my

16 sat i sf act i on. I ' mcomf or t abl e wi t h hi s r epr esent at i on on t he

17 r ecor d. I don' t need t o wast e t he Cour t ' s t i me and r ead t he

18 or der . I t hi nk t he i ssue i s pr obabl y cl ear , assumi ng t he or der

19 he has put bef or e your Honor you wi l l si gn.

20 THE COURT: Ms. Wagner .

21 MS. WAGNER: Thank you, your Honor .

22 Your Honor , j ust t o st at e i t agai n, I don' t t hi nk i t ' s

23 appr opr i at e t o keep an i nj unct i on on Ci t i bank when t he par t i es,

24 t he pl ai nt i f f s who moved f or t he i nj unct i on agr ee t hat t hey

25 need di scover y about i t . So I woul d r espect f ul l y ask you t o


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1 vacat e t he Ci t i bank i nj unct i on and r ei nst at e t he or der t hat

2 says your ear l i er i nj unct i on does not appl y t o us, and t hen t he

3 pl ai nt i f f s can move t o get an i nj unct i on t hat wi l l appl y t o us.

4 And i f your Honor i s ot her wi se i ncl i ned t o j ust i ssue

5 a st ay, t hen I woul d r espect f ul l y r equest a st ay t hat woul d

6 cover t he per i od of t i me dur i ng whi ch any appeal woul d be t aken

7 f r omyour Honor ' s r ul i ng on t he mer i t s. But I woul d

8 r espect f ul l y say t hat t hey have not made a case f or keepi ng t he

9 i nj unct i on on Ci t i bank. And t her e i s no r eason t o keep i t on

10 Ci t i bank and, t her ef or e, i t shoul d be vacat ed and t hey shoul d

11 be put t o t he pr oof of expl ai ni ng why t he i nj unct i on shoul d be

12 appl i ed ei t her t o Ci t i bank or t o t he Ar gent i ne l aw bonds, and

13 t hose I woul d submi t t o you ar e di f f er ent quest i ons. Thank

14 you, your Honor .

15 MR. LEVI : Howar d Levi nor nonpar t y J P Mor gan Chase.

16 J ust t he same concer n expr essed by Mr . Vassos f or

17 Cl ear St r eam, namel y, whet her t her e i s a vacat ur or t her e i s a

18 st ay, what ever occur s, we j ust want t he or der i ssued by t he

19 Cour t cl ear t hat t he downst r eampar t i es f r omCi t i bank and t he

20 payment chai n ar e f r ee t o r ecei ve and pay t he payment t hat t hey

21 get . I t hi nk t hat pl ai nt i f f ' s counsel has submi t t ed an or der

22 wher e he says i t pr ovi des f or t hat . We j ust want t o make cl ear

23 whet her i t ' s pl ai nt i f f ' s or der t hat ' s adopt ed or t he or der t hat

24 Ci t i bank has asked f or . I n ei t her event , i t ' s cl ear t hat t he

25 downst r eampar t i es ar e t aken car e of i n t hat manner .


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1 THE COURT: Thank you ver y much.

2 I t hi nk Ms. Wagner has a pr et t y i mpor t ant poi nt and

3 t hat i s t hi s. I f t her e i s t o be an i nj unct i on agai nst

4 Ci t i bank, t hen t her e has t o be a pr oper r ecor d suppor t i ng such

5 an i nj unct i on, and t he Cour t has t o cl ear l y i ssue t hat

6 i nj unct i on.

7 Let me say t hi s. The or der t hat I ent er ed i n t he

8 summer was i nt ended t o be si mpl y a t empor ar y way t o hol d t hi ngs

9 i n pl ace. But as f ar as an i nj unct i on i s concer ned, t her e i s

10 one i nj unct i on and t hat i s t he Sept ember 23. That i s t he onl y

11 i nj unct i on i n pl ace t hat appl i es, as I ' ve sai d numer ous t i mes

12 t hi s af t er noon, onl y t o t he 1994 bonds and t he bonds t hat wer e

13 i ssued i n exchange f or t hose bonds i n 2005, 2010. That ' s what

14 t hat i nj unct i on appl i es t o.

15 Now, what happened t hi s summer was not a mot i on by

16 anybody t o enj oi n Ci t i bank, and cer t ai nl y Ci t i bank was not

17 enj oi ned by t he or i gi nal i nj unct i on. But t her e was no mot i on

18 t o enj oi n Ci t i bank t hi s summer . Ther e was a r equest t o see

19 what t he Cour t woul d say about whet her a cer t ai n payment bei ng

20 pr oposed woul d vi ol at e t he i nj unct i on, and I al l owed t he

21 payment . I f ol l owed i t up wi t h an or der t hat i t be a one- t i me

22 t hi ng and we woul d come back. But none of t hat i nvol ves t he

23 i ssuance of an i nj unct i on agai nst Ci t i bank.

24 Ther e has been a r ef er ence t hi s af t er noon t o al l t he

25 i mpor t ant i ssues. Wel l , t hat ' s ver y i nt er est i ng and I don' t


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1 mean t o t ake t hat l i ght l y. But i t ' s not cl ear t o me how al l

2 t hose i mpor t ant i ssues ar i se. I ssues gener al l y don' t ar i se

3 unl ess t her e i s a mot i on or some ki nd of an appl i cat i on t o t he

4 Cour t , ot her ki nd of an appl i cat i on.

5 Let ' s t ake a shor t br eak and we wi l l t r y t o concl ude

6 pr ompt l y af t er t hat . We wi l l t ake a shor t br eak.

7 ( Recess)

8 THE COURT: I ' d l i ke t o know, go t hr ough t he par t i es

9 her e know who consent s t o and who woul d obj ect t o t he pr oposed

10 or der submi t t ed by t he pl ai nt i f f s. Obvi ousl y, t he pl ai nt i f f s

11 submi t t ed i t , so you agr ee wi t h i t .

12 MR. OLSON: Yes, your Honor .

13 THE COURT: Let ' s go t o ot her par t i es.

14 Ms. Wagner , do you agr ee t o i t or not or obj ect t o i t ?

15 MS. WAGNER: I obj ect t o i t , your Honor .

16 THE COURT: Let ' s see who el se. Does t he Republ i c

17 want t o say whet her t hey agr ee or obj ect ?

18 MR. BOCCUZZI : Car mi ne Boccuzzi f r omCl ear y Got t l i eb.

19 The Republ i c agr ees wi t h t he posi t i on st at ed by

20 Ci t i bank.

21 THE COURT: Do you agr ee wi t h t hi s pr oposed - -

22 MR. BOCCUZZI : We obj ect t o pl ai nt i f f s and we t hi nk

23 t hat what Ci t i bank, Ms. Wagner pr esent ed, was t he bet t er way of

24 pr oceedi ng.

25 THE COURT: I di dn' t under st and.


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1 MS. WAGNER: J ust t o be cl ear , your Honor , t hat ' s what

2 I meant i s, t her e shoul d be no i nj unct i on and, t her ef or e, no

3 need f or a st ay.

4 MR. VASSOS: Your Honor , we t ake no posi t i on as t o t he

5 i ssue t hat Ms. Wagner r ai ses. To t he ext ent t hat t he Cour t

6 deci des t o si gn t hi s or der , t he quest i on i s, ar e we okay wi t h

7 i t . We woul d be okay wi t h t he or der . Agai n, we t ake no

8 posi t i on on whet her t he or der shoul d be si gned or i f

9 Ms. Wagner ' s r equest shoul d be gr ant ed.

10 THE COURT: Anybody el se want t o st at e whet her you

11 consent or obj ect ?

12 MR. LEVI : Your Honor .

13 THE COURT: I ' mt al ki ng about t he pr oposed pl ai nt i f f ' s

14 or der .

15 MR. LEVI : We l i kewi se do not t ake a posi t i on on t he

16 or der . To t he ext ent your Honor i s goi ng t o ent er i t , i t

17 cont ai ns l anguage r egar di ng downst r eamr eci pi ent s t hat i s

18 accept abl e t o us.

19 THE COURT: I t what ?

20 MR. LEVI : I t cont ai ns l anguage r egar di ng downst r eam

21 r eci pi ent s and cl ear st r eamask be addr essed, and we see i t ' s

22 addr essed i n t hi s or der . We ot her wi se don' t t ake a posi t i on on

23 whet her t hi s par t i cul ar or der shoul d be ent er ed or not .

24 THE COURT: I ' mnot cl ear what you ar e sayi ng about

25 t he downst r eamsi t uat i on.


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1 MR. LEVI : I n ot her wor ds, i f Ci t i i s f r ee t o make t he

2 payment , t hen t he payment f l ows t o downst r eamr eci pi ent s i n t he

3 payment chai n.

4 THE COURT: Ri ght .

5 MR. LEVI : My cl i ent , whi ch i s a nonpar t y, J P Mor gan

6 Chase Bank, mai nt ai ns account s t hat i t expect s wi l l r ecei ve

7 moni es downst r eamf r omt he Ci t i payment . And so we j ust want

8 what ever or der i s i ssued by t he Cour t , f or i t t o be cl ear t hat

9 t he var i ous downst r eamr eci pi ent s, Cl ear St r eam, J P Mor gan,

10 ot her s, ar e f r ee, al so, t o r ecei ve and t o pay over t hese

11 moni es.

12 THE COURT: I sn' t t hi s l anguage suf f i ci ent i f I si gn

13 i t : Fur t her al l ow Ci t i bank' s downst r eamr eci pi ent s t o r ecei ve

14 and pr ocess t hei r r espect i ve por t i ons of such payment . I sn' t

15 t hat cl ear enough?

16 MR. LEVI : I t i s. That l anguage i s accept abl e.

17 THE COURT: Anyone el se want t o obj ect or consent t o

18 t hi s?

19 I wi l l si gn t he or der pr oposed by t he pl ai nt i f f s and I

20 amgoi ng t o r ead i t . I t wi l l t ake a mi nut e. But t he r ecor d

21 ought t o be cl ear and peopl e who ar e her e ought t o hear t hi s.

22 At t he r equest of t he pl ai nt i f f s, i n or der t o al l ow

23 t he par t i es and nonpar t y Ci t i bank t he t i me necessar y t o pr esent

24 a suf f i ci ent r ecor d and l egal ar gument t o r esol ve t he i ssues

25 pr esent ed by Ci t i bank' s Sept ember 23, 2014 mot i on by or der t o


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1 show cause t o vacat e t he Cour t ' s J ul y 28, 2014 or der or t o

2 modi f y t he i nj unct i on cont ai ned i n t hat or der , or f or a st ay of

3 t hat or der , t he Cour t wi l l def er t he hear i ng on t he mot i on

4 schedul ed f or Sept ember 26, 2014 and enl ar ge t he br i ef i ng

5 schedul e t o dat es t o be set and wi l l al l ow Ci t i bank t o pr ocess

6 t he Sept ember 30, 2014 i nt er est payment , appr oxi mat el y $5

7 mi l l i on, t hat i t r ecei ves on t he U. S. dol l ar denomi nat ed

8 Ar gent i ne l aw bonds, I SI N, t hen ARARGEO3EO97, and ARARGEO3G704,

9 and wi l l f ur t her al l ow Ci t i bank' s downst r eamr eci pi ent s t o

10 r ecei ve and pr ocess t hei r r espect i ve por t i ons of such payment .

11 The Cour t wi l l now si gn t hat or der .

12 Now, t he f ur t her pr ocesses must pr oceed ver y pr ompt l y.

13 What ever di scover y i s t o be t aken, what ever i nqui r y or

14 i nvest i gat i on, t he Cour t set s 30 days as a t i me wi t hi n whi ch

15 t hat has t o be done. That i s t i ght , but we do not want t o be

16 back her e over and over when i nt er est payment s ar e due. Thi s

17 phase of t he l i t i gat i on must be concl uded pr ompt l y. Obvi ousl y,

18 when t he di scover y i s concl uded wi t hi n 30 days, t her e wi l l be,

19 as cont empl at ed by t hi s or der , br i ef i ng and t her e wi l l be a

20 hear i ng on t he ongoi ng per manent si t uat i on about Ci t i bank.

21 That concl udes t he pr oceedi ngs f or t oday. Thank you.

22 MS. WAGNER: Your Honor , may I be hear d f or a mi nut e?

23 THE COURT: Ms. Wagner , I di dn' t hear you.

24 MS. WAGNER: Your Honor , i f I may j ust ask a

25 cl ar i f yi ng quest i on, i f I may use t hat t er m.


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1 I bel i eve t hat your Honor had i ndi cat ed bef or e on t he

2 r ecor d t hat t he i nj unct i on of Febr uar y 23 does not appl y t o

3 Ci t i bank at t he moment and t hat your Honor ' s i nt ent i on was t hat

4 pl ai nt i f f s woul d make a mot i on t o addr ess how t hey i nt end t o

5 make an appl i cat i on f or an i nj unct i on t hat woul d appl y t o

6 Ci t i bank and t he Ar gent i ne l aw bonds. I j ust want t o make sur e

7 t hat my under st andi ng of t hat i s cor r ect .

8 THE COURT: Say t hat agai n. I ' mnot cl ear what you

9 ar e sayi ng.

10 MS. WAGNER: I had under st ood your Honor t o say a

11 shor t t i me ago t hat t he maj or i nj unct i on of Febr uar y 23 does

12 not appl y t o Ci t i bank' s payment s on Ar gent i ne l aw bonds, and

13 t hat i t woul d be appr opr i at e f or pl ai nt i f f s t o make a mot i on t o

14 i ndi cat e how t hey i nt end t o suppor t a cl ai mt hat an i nj unct i on

15 shoul d be appl i ed t o Ci t i bank. I j ust want ed t o under st and

16 whet her i t i s t he case, as I under st and, t hat t he maj or

17 i nj unct i on does not appl y t o payment s by Ci t i bank Ar gent i na on

18 t he Ar gent i ne l aw bonds.

19 MR. FRI EDMAN: May I r espond t o t hat , your Honor ?

20 THE COURT: Sur e.

21 MR. FRI EDMAN: I t hi nk t he Cour t has been cl ear t hat

22 t her e i s a st ay i n ef f ect t hat wi l l al l ow t he par t i es t i me t o

23 pr esent t he l egal ar gument s and t he f act ual ar gument s and

24 devel op t he r ecor d, and t he Cour t made ver y cl ear t hat i t ' s not

25 maki ng r ul i ngs t oday about t he scope of t he i nj unct i on. That


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1 was t he whol e poi nt of t he or der t hat your Honor si gned. And I

2 bel i eve t he quest i on f r omCi t i bank' s counsel i s out of or der

3 af t er your Honor i ssued an or der and cl osed t he pr oceedi ngs.

4 THE COURT: She i s not out of or der .

5 MR. OLSON: I was si mpl y goi ng t o say somet hi ng ver y

6 much al ong t he same l i ne; t hat i s, what was j ust r equest ed

7 seems squar el y i nconsi st ent wi t h t he or der t hat you j ust i ssued

8 t o al l ow t he par t i es t o conduct di scover y and br i ef t hese

9 i ssues and have a hear i ng t o r esol ve t hi s ver y quest i on.

10 THE COURT: That ' s exact l y r i ght .

11 Let me say t hi s. At a sessi on l i ke t hi s I do not si t

12 her e mumand I have a gi ve and t ake wi t h t he l awyer s. But as

13 f ar as a r ul i ng, as f ar as a r ul i ng, I have not made a r ul i ng

14 t oday and wi l l not make a r ul i ng unt i l t he r ecor d i s compl et e

15 and t he br i ef i ng i s f i ni shed and t hat i s not t oday.

16 We ar e adj our ned. Thank you.

17 o0o

18

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