By Natalia Siniawski and Leila Miller
Oct 1 (Reuters) – Investment firms Petersen Energia and Eton Park petitioned the US Supreme Court on Wednesday to reinstate a $16.1 billion judgment against Argentina in the long-running litigation on Argentine energy firm YPF .
The petition seeks to overturn a March decision by the US Court of Appeals for the Second Circuit, which held the claims belonged in Argentine courts rather than the United States. That decision overturned a judgment entered after more than a decade of litigation. The investors argue the ruling improperly allows a foreign nation to rely on its own laws to avoid liability in U.S. courts.
BACKGROUND
• The dispute centers on Argentina’s 2012 nationalization of a controlling stake in YPF. Petersen and Eton Park allege Argentina violated YPF’s bylaws by failing to launch a tender offer to minority shareholders after seizing a 51% stake from Spain’s Repsol.
• Argentina amended YPF’s bylaws prior to its 1993 New York Stock Exchange listing to require a mandatory tender offer to all shareholders if the government ever regained majority control.
• A US district court had previously entered a $16.1 billion judgment — described in the petition as the largest commercial award in US history — after a three-day damages trial.
KEY ARGUMENTS
• The petition asks whether a foreign sovereign can use its own law to require claims to be brought to its domestic courts despite jurisdiction established under the Foreign Sovereign Immunities Act.
• It also questions whether US courts should defer to a sovereign’s interpretation of its own law when that interpretation is first advanced on appeal.
• The petition, filed by former US Solicitor General Paul Clement, argues the 2nd Circuit decision conflicts with Supreme Court precedent and creates a split among federal appellate courts.
• A spokesperson for the Argentine Treasury Solicitor’s Office said the filing “constitutes a procedural step that had already been anticipated by the Argentine Republic and on which we are already working.”
(Reporting by Natalia Siniawski in Mexico City and Leila Miller in Buenos Aires; Editing by Chizu Nomiyama)
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