Judge finds Argentina in contempt of court

A Manhattan judge took the extreme and rare action of finding a sovereign nation — Argentina —in contempt of court on Monday.

Judge Thomas Griesa, acknowledging it was an unusual ruling, said ‘the court holds the Republic of Argentina is in civil contempt of court” because of the nation’s recent efforts to evade his earlier orders.

Argentina recently passed legislation allowing some bondholders to swap their US debt for Argentine law bonds that ostensibly avoided Griesa’s order to pay back $1.6 billion owed to hedge fund mogul Paul Singer and other creditors.

“Both [bondholder groups] have to be dealt with,” said Griesa.

The ruling was a big victory for the Singer group.

“This is an extreme sanction,” said Argentina’s lawyer, Carmine Boccuzzi of Cleary Gottlieb.