Law, Disrupted: Execution on $310 Million of Intangible Sovereign Assets
On the latest episode of Law, Disrupted, John B. Quinn is joined by Partner Dennis Hranitzky, based in the New York office, Partner John Bash, based in the Austin office, and Associate Alex Loomis, based in the Boston office.
Together, they discuss sovereign debt litigation, particularly the challenges of enforcing judgments against sovereign entities, and the team’s recent success executing on over $310 million in assets to enforce in judgments against Argentina. Dennis describes his decades-long history of enforcing judgments against Argentina, starting with a case for Elliott Management in 2002, where strategies like freezing Argentina out of capital markets and exposing corruption were key to recovery. The team’s recent case focused on the collateral for Argentina's “Brady” bonds, instruments from the 1990s designed to make sovereign debt more tradable. The enforcement litigation was not over the collateral itself, but on Argentina’s "reversionary interest" in the collateral. Alex explains how the team discovered and leveraged admissions from Argentina's SEC filings to identify attachable assets, including Argentina’s reversionary interest in zero-coupon bonds held in New York and Germany. The legal arguments involved nuanced interpretations of the Foreign Sovereign Immunities Act, including whether the reversionary interest qualified as commercial property subject to attachment and whether its situs (location) was in New York or Germany. John Bash describes the appellate process, in which the Second Circuit upheld the attachment, agreeing that Argentina’s reversionary interest was a commercial asset located in New York. The discussion highlights the intellectual rigor required in such cases, involving intricate property law and sovereign immunity issues. The podcast concludes with reflections on Argentina’s expected attempt to obtain review by the U.S. Supreme Court and the professional satisfaction the team derived from winning such a unique and challenging case.
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