The holders of some $1.9 billion in defaulted Venezuelan bonds are urging a Delaware judge to dismiss Canadian mining company Crystallex's allegations against them in a long-paused lawsuit that argues Venezuela's decision to secure the bonds with shares in U.S. oil giant Citgo's parent company was illegal.
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2nd Circ. Told $1.9B In Debt Valid Despite Venezuelan Actions
Law360 (May 17, 2021, 7:01 PM EDT) A lower court was right to find that Venezuela s state-owned oil company is responsible for $1.9 billion in principal and interest on defaulted Citgo-backed bonds and that any holding to the contrary would disrupt foundational capital market principles, debtholder interests told the Second Circuit.
The bonds, which use a majority stake in Citgo Holding Inc. as collateral, are intimately tied to New York: They were issued there, subject to New York state law and purchased by Empire State investors, the collateral agent and trustee of the 2020 notes at issue told the court. Even though the National Assembly of Venezuela concluded.