U.S. Judge Loretta Preska gave her final judgment on the YPF expropriation case on Friday, ordering Argentina to pay a total of US$16.09 billion to the plaintiffs represented by Burford Capital. The country is set to appeal the decision.
In a four-page document, Preska took up one of the last points of the dispute between Argentina and Burford regarding the date to be taken as a reference for the calculation of punitive interest.
In her ruling a week ago, when she set the parameters to be used for the calculations, Preska established that the interest should run from May 3, 2012. This opened a discussion between the country’s and the claimants’ lawyers on the exchange rate to be used to estimate the payment.
Argentina argued that, since the damages should run from May 3, 2012, that day’s exchange rate should be used. However, Preska agreed with Burford that damages should be calculated from May 3 but using the exchange rate of April 16, when then-President Cristina Fernández de Kirchner first presented the intervention bill.
In 2012, through its Congress, Argentina expropriated shares of oil and gas company YPF held by the Spanish multinational Repsol, at the time the majority shareholder.
Preska ruled that YPF’s bylaws were breached on April 16, and called Argentina’s arguments “a final ambush.”
Today’s ruling is Preska’s final sentence, but Argentina has two possible instances of appeal.
From now on
The parties now have 30 days to take the case to the U.S. Court of Appeals for the Second Circuit. The judgement will not be enforced during this period, so Argentina will not have to make any payments in the next month. At this point, Argentina will ask for the execution of the sentence to be suspended until it has exhausted its appeals.
If the Court of Appeals rejects Argentina’s request, then at the end of the 30-day term the plaintiffs can ask for the country’s assets to be seized.
Official sources told the Herald that Argentina will appeal Preska’s decisions.
After the Court of Appeals, parties can take the case to the Supreme Court, although that court agrees to hear very few cases a year.
Burford Capital is a fund that bought the trial rights from two companies belonging to the Argentine Eskenazi family, Petersen Energia Inversora and Petersen Energía, and another company, Eton Park. The fund will be entitled to about 39% of whatever is awarded in the lawsuit.
Earlier this week, consulting firm 1816 calculated that, since on Friday the company’s market cap rose by 14.7% to US$ 447 million. That means that, after that ruling, the market calculated the value of the lawsuit at US$1.1 billion.