ARGENTINA v. NML CAPITAL, LTD.
During an economic crisis in 2001, the Republic of Argentina (Argentina) failed to make payments on bonds owned by foreign investors. One such bondholder, NML Capital, Ltd. (NML), later prevailed in several actions it filed against Argentina in federal district court, which entered judgments totaling more than US$2 billion in NML’s favor. In order to execute the judgments against Argentina, NML served subpoenas on two banks requesting information about Argentina’s assets held worldwide. Argentina moved to quash the subpoenas and argued that they violate the Foreign Sovereign Immunities Act (FSIA) by requiring the disclosure of assets that are immune from collection by NML. The district court ordered the banks to comply with the subpoena requests. The U.S. Court of Appeals for the Second Circuit affirmed, reasoning that the FSIA did not apply to the subpoena because it was a discovery order directed at commercial entities that did not have a claim to sovereign immunity.
Does a subpoena that requires a bank to disclose information about all assets of a foreign state, without respect to their location or use, violate the Foreign Sovereign Immunities Act?