U.S. Funds Default Claim Hits Hurdle in Iceland’s Court Process
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Iceland has taken the unusual step of trying to block the nation’s court system from appointing a specialist as it seeks to fight off a claim by U.S. funds that it committed a sovereign default by imposing haircuts in an offshore krona auction earlier this year.
Eaton Vance Corp. and Autonomy Capital LP asked the Reykjavik District Court in June to appoint specialists to investigate whether Iceland had any economic grounds for refusing to exchange their kronur at market prices at a June auction. The specialist investigation would then be followed by a lawsuit where the plaintiffs would argue that the government violated their constitutional property rights.