A round won by the Argentine defense in the YPF trial, which has been heard since April 2015 in the Court of the Southern District of New York, USA. In a legal battle in which Argentina has lost every round by defeat, it has just reversed a decision approved in the past by Judge Loretta Preska herself.
New York federal judge Loretta Preska decided to temporarily suspend the order allowing the plaintiffsthat manage the insolvencies of the Petersen Energía companies; Petersen Energía Inversora, owned by the Eskenazi family, and Eton Park, funded by the “vulture” fund Burford Capital, investigated YPF assets with the aim of pushing ahead with possible embargoes, al to accept a proposal from the company itself to await the decision of the Second District Court of Appeal on the legality of treating the oil company as an “alter ego” of the Argentine state.
The decision represents an immediate halt to so-called “discovery,” a procedural mechanism that allowed plaintiffs to request sensitive information to prove that YPF does not act independently of the national state, thereby circumventing the sovereign immunity that protects its assets abroad.
One of the analysts following the case, Sebastián Maril, director of Latam Advisor, explained on his social networks: “Christmas present for YPF: Preska agrees to the oil company’s request to suspend the discovery of the alter ego (search for assets to be seized) while the company appeals against the decision that allowed this discovery and prevented YPF from defending itself, considering that the state is doing it in its place.” This order does not apply to investigations into other sovereign assetswhich remains in force,” he explained.
This means that the decision of the US judicial system can continue the investigation and search for confiscated assets of other companies where the Argentine state is an owner or shareholder in their share capital.
And they are trying to find out whether organizations such as the Central Bank with the mysterious gold invested somewhere in Europe, the Aerolíneas Argentinas companies with their planes, the ARSAT satellites, the Argentine energy materials and even the assets of the Banco Nación act as enforcers of the nation-state’s policies. If so, they could be confiscated by the strict judge.
The multi-million dollar legal dispute has its origins in the public renationalization of the oil company in 2012 under the government of Cristina Kirchner and with Axel Kicillof as Economics Minister.
Back then at the bottom Eton Park was a minority shareholder in YPFwhile Burford Capital acquired the right to sue before the Spanish judiciary following the bankruptcy of the Petersen companies founded by the family Eskenazi in this country, and also shareholders of the Argentine oil company.
The trial is taking place in the USA, as the oil company has been listed on the New York Stock Exchange since 1993. Its statutes were submitted to the United States Securities Commission (SEC) andin accordance with Article 7 of these statutes, Any buyer who acquires more than 15% of the company’s share capital is obliged to make a takeover offer to the remaining shareholders.
The takeover offer is a public takeover offer. ORn Financial mechanism through which an investor or group of investors publicly proposes to the shareholders of a listed company Purchasing your shares at a predetermined price. This step was never taken by the Kirchner administration and led to the million-dollar demand that continues to this day.
A million-dollar fine for the Argentine state
The judge lowered the gavel in September 2023 and ordered Argentina to pay the maximum possible amount to the Burford Capital fund – owner of the rights to the Petersen and Eton Park companies – totaling $16,000 million. In addition, interest accrues with every day that passes without the country paying that amount to nationalize the company. The country must pay $2.5 million in interest.
As if that wasn’t enough, the American judge ruled in June this year The country must deliver 51% of the shares of the oil company, the package, that It was nationalized in 2012, as part of the compensation process for the fact that no public takeover offer (OPA) was made at the time of expropriation.
Argentine lawyers appealed this latest ruling and this case proceeds independently of the Preska court’s decision a few hours before Christmas.
This is the second good news that Javier Milei’s government has received related to the YPF process.
Last October, the United States Court of Appeals for the Second Circuit held a hearing that was considered crucial in connection with the appeal filed by Argentina against the verdict $16.1 billion issued September 2023 by the Southern District Court of New York, in this case Petersen Energy / Eton Park Capital Management vs. Argentine Republic and YPF SA
The representatives of the Procurement of the state treasurythey explained iProfessional that the Argentine defense had presented its arguments “with clarity, conviction and determination” concentrates his approach The US court misinterpreted Argentine law and based its decision on “a series of legal fictions with serious consequences.”
The country’s position was based on this fact The trial should not have taken place in New Yorksince all the events in question took place in Argentina under Argentine law and the related operations were carried out in pesos. In addition, the defense also argued that the case was a matter of public law – not commercial – and should therefore be protected by sovereign immunity.
The judges Jose Cabranes, Denny Chin and Beth Robinson They sharply questioned some of the positions taken by representatives of the plaintiff funds. One of them even said: “If we reversed it, if it were the United States, how would we feel if it were judged in Argentina?”
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