Vol 12 (2015) - Issue 3

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More Gobbledygook: A European Chapter in the Argentine Sovereign Debt Litigation Saga

1. Introduction
This case comment concerns the recent decision in Knighthead Master Fund LP v the Bank of New York Mellon. These proceedings were initiated in the UK and are related to the still ongoing litigation in New York in NML Capital Limited v the Republic of Argentina.
The claimants are four investment funds, which hold or are interested in euro-denominated debt securities issued by the Republic of Argentina (Argentina) in 2005 and 2010 as result of the exchange offer it launched to cure the default of its outstanding external debt obligations. The euro-denominated debt securities that were issued both in 2005 and 2010 are both governed by English law. The euro-denominated debt securities are also subject to the terms of a trust indenture dated 2 June 2005 (as amended in 2010), which is also governed by English law (Trust Indenture).
The defendants are The Bank of New York Mellon (BoNY or Trustee, indistinctively) and The Bank of New York Depository (Nominees) Limited. BoNY is a company formed under the laws of the State of New York and has its registered place of business in England. BoNY is the trustee with respect to euro-denominated debt securities (as well as other securities issued by Argentina in Argentine pesos and US dollars as result of the exchange offers of 2005 and 2010). The second defendant is The Bank of New York Depository (Nominees) Limited, a company incorporated under the laws of England and Wales, and a wholly owned subsidiary of BoNY. It is the registered holder of the global securities issued in respect of each series of debt securities.