Second Circuit Reestablishes Attachments Against Argentina

Capital Ventures International (CVI) v. Republic of Argentina, Dkt. Nos. 10-4520-cv (Lead) (2d Cir. July 2011), is, by the Court's own count, roughly the nineteenth time the Second Circuit has had to deal with issues arising from Argentina's default on its debt.

On this appeal the Court modifies the District Court's own modification of prior attachments of assets granted to CVI in a prior trip to the Second Circuit. In the earlier appeal, the Second Circuit found that CVI was entitled to attach assets of Argentina – the assets at the time were the collateral on "Brady Bond", replacement debt that Argentina had issued, Because of what the Court of Appeals calls a "quirk in the original Collateral Pledge Agreement", a risk was created that early retirement of the Brady Bond debt would cause the release of collateral to Argentina, and it was this collateral that might in the future be returned to Argentina that created an attachable interest.