The class action threat to sovereign workouts.

The article looks at recent rulings on class action suits that followed Argentina's bond default and argue that, negotiated restructurings are the best way to resolve sovereign. In the first case, a retired individual from Hanover, Germany, his wife and their foundation sought to certify a class of all holders of an unspecified number of different series of Argentine bonds denominated in six different currencies, including those covered by the October 1994 Fiscal Agency Agreement, as well as bonds issued under various German, English and Spanish law documents. In the second class action, the class plaintiff proposed to certify a class of all persons who, as of December 23, 2001, held bonds issued by Argentina pursuant to the October 19, 1994 Fiscal Agency Agreement. INSET: The class action mechanism.