Republic of Argentina Wins D.C. District Court Denial of Bondholder’s Motion to Attach Argentine Military Attaché Building

Cleary Gottlieb successfully represented the Republic of Argentina in a decision published on July 31, 2023, in which the U.S. District Court for the District of Columbia denied a bondholder’s motion for attachment of an Argentine military attaché building to satisfy a prior U.S. District Court for the Southern District of New York judgment against the Republic of Argentina.

In denying the plaintiff’s motion, District Court Judge John D. Bates agreed with the Republic’s argument that under the Foreign Sovereign Immunities Act, even with the prior waiver of sovereign immunity in the bond documents, the plaintiff needed to demonstrate that the property was “used for a commercial activity” in order to subject it to attachment. Judge Bates rejected the plaintiff’s argument that the commercial lease of the property in the 1980s/90s and the sales listings in 2003 and 2018 were “commercial activity,” since they were isolated uses in the distant past. Moreover, the court agreed with the Republic that any ongoing use of the building, including the storage of documents, is diplomatic in nature. Given that the Argentine military attaché building is effectively not in use for any other purpose, the court concluded that, under the totality of the circumstances, it is not “used for a commercial activity” and therefore immune from attachment.