07
- 15 51
- cv

C ap i t al V ent ures v. R ep ub l i c o f A rgent i na U N IT E D S T A T E S C O U R T O F A P P E A LS F OR THE S EC OND C IR C U IT

_______________ August Term, 2008 (Arg ued: Novembe r 10, 2008 De cided: January 13, 2009 Errata filed: Mar ch 19, 2009) Docke t No. 07-1551-c v

________________________________________________________

C A PIT A L V EN T U RE S I NTERNATI ONAL , Plain tif f- Ap pe lla nt,
—v.— R EP U BLI C O F A R GE NTI NA ,

Defendant-

Appellee

.

________________________________________________________ B e f o r e : S OTOMAYOR , K ATZ MANN , and H A LL , Circuit Judges
.

_______________ Appea l from a judg ment of the United States District Court for the Southern District of New Y ork (Gr iesa, J. ) dismissing, for la ck of subjec t matter jurisdiction, those claims of pla int if f- a pp e lla nt C a pit a l V e ntu

re s Inte rn a tio na l th a t r e late to b on ds iss ue d b y de fe nd antappellee Republic of Ar g entina under Ger man law, a

nd denying Ca

pital Venture s International’s reque st for statutory

prejudg ment interest on unpaid inter est pay ments that would have c ome due on Un ite d St ate s d oll ar d e no min ate d b on ds iss ue d b y the Re pu bli c a ft e r t

he a c c e le ra

tio n o f t ho se bonds. We affirm in par

t and vac ate in par

t, finding that there is subjec t matter jurisdiction over th e c l ai m s re l at i n g t o th e G erm an b o n d s b ec au s e A rge n t i n a e x p l i ci t l y wa i v edi t s s o v er ei gn immun ity to s uit in Unit e d St ate s c ourt s o n th os e c la ims , a nd that th e dis tr ic t c ourt

c or re c tly deter mined that no interest pay ments beca

me due on the United States bonds after they had bee n acc eler ated.

_______________2

Couns e l f or Pla int if f- Ap pe lla nt: M. N OR MAN G OL DBER GER , H ang le y Ar on c hic k Se g a l & Pudlin, P hiladelphia, P.A. Ke nn e th G . Ro be rt s, Jenn if e r F . B e ltr ami ( of counsel), Wolf, Block, Schorr

and Solis-Cohen L L P, New Yor k, N.Y. Counsel for De fenda

nt-Appellee : C ARMI NE D. B O C C U ZZ I (Jonathan I . Bla ckman, of counsel),

Cleary Gottlieb Steen & H amilton L L P, New Yor k, N.Y.

_______________ K ATZ MANN , Circuit Judge : This case calls upon us in principal pa rt to determine whether

the Republic of Ar g entina
e xplic itl y wa ive d it s so ve re ig n immun ity fr om s uit in t he Un ite d St a te s a s to c la ims re latin g to bonds issued by

Arg entina under

Ger man law. Plaintiff-appe llant Capital Ventures International (“CVI ”) a ppeals fr om a judg ment of the United States District Court for the Southern D istrict of NewYork (G riesa, J. ) dismissing, for lack of subject matter jur isdiction, those of CVI ’s claims that re late to bonds issued by defe ndant-a

ppellee Re public of Arg entina (“ Arg entina” or “the Republic” ) under

Ger man law, and deny ing CVI ’s re quest for statutory prejudg ment interest on unpaid inter est pay ments that would have c ome due on United States dollar denominated bonds issued by the Republic af

ter the a c c e le ratio n o f t

ho se bo nd s. We f

ind that th e re is s ub

je c t matte r j ur isd ic tio n o ve r t he c la ims
re latin g to t

he Ge rm an b on ds be c a

us e Ar g e nti na

e xplic itl y

wa ive d it s so ve re ig n immun ity to s uit in United States courts on those cla ims, and that the district court cor rec tly deter mined that no interest pay

ments beca

me due on the United States bonds after they had bee n acc eler ated. Ac c or din g ly , w e a ff

ir m in pa rt and va c a te in p art .This lang uag e is taken f rom the Off

eringCircular g overningthe 8% De utsche Mar k 1 B on ds of 19 97 /20 09 . T he pa

rt ie s a g re e that e ve ry

of fe ri ngc ir c ula

r c on ta ins su

bs tanti a lly identical provisions, insofar a s is releva nt to this appea l. 3 F A CT U A L B AC K GR OUND CVIis the benef

icial owner

of ce rtain bonds issued by the Republic of Ar g entina. One g roup of the bonds owned by CVIis gove rned by

Ger man law, a

nd these bonds ar e denominate d in D e uts c he Mark s a

nd Euro s ( “ the Ge rm an b on ds ” ). Ea c h G e rm an b on d w a s is su e d p ur su ant t o its own o ff

e ri ngc ir c ula

r. Se c tio n 1 3 o f t

he of fe ri ngc ir c ula

rs pr ov ide s in

pa rt : (3) The Republic here by

irrevoc ably

submits t o the non-e x clusive jurisdiction of the Di str ic t Co ur

t ( L and g e ri c ht) in F ra

nk fu rt am Ma in a

nd any fe de ra l c ourt

sittin g in t

he City of B uenos Aire s as well as a ny appellate court of a

ny there of [sic] , in any

suit, action or proce edingag ainst it arising out of or relating to these Bonds. The Republic here by irrevoc ably

waives – to the f

ullest ex tent it may

eff ectively do so – the defe nse of a

n inconvenient f

orum to the maintenanc e of suc h suit or action or such pr ocee ding a nd any prese nt or future objection to such suit, action or proc eedingwhether on the g rounds of ve nu e , r e sid e nc e or

do mic ile . T he Re pu

bli c a g re e s th a t a

fi na l ju dg me nt i n a

ny su c h s uit , action or pr ocee ding in the c ourts mentioned above shall be conc lusive and may be enfor ced in other

jurisdictions by

suit on the judgment or a ny other method provide d by law. (4 ) T o th e e x t en tth atth e R ep u b l i c h as o r h er ea ft er

m ay ac qu i re an y

i m mun i ty

(s o v er ei gn o r o th erwi s e) fr o mj uri s d i ct i o no f a n y co urt o r f ro man y l ega l p ro ce s s (w h et h er

th ro u gh service or notice, attachment prior to judg ment, attachme nt in aid of execution, execution or oth e rw ise ), wi th r e sp e c t to its e lf or its re ve nu e s, a sse ts o r p ro pe rt ie s, the Re pu bli c he re by ir re vo c a bly wa ive s su c h immun ity

in r e sp e c t of

its ob lig a tio ns un de r t

he B on ds to the extent it i s permitted to do so under a pplicable law
. 1 The re mainder of

the bonds owned by

CVIare denominated in United States dollars ( “the U.S. bonds”) and w ere issued pursuant to a F iscal Ag ency Ag ree ment (“F AA”)
. The F AA pr ov ide s th at A rg e nti na

wi ll “ pa y int e re st” on

the pr inc ipa l of

the U. S. b on ds “ un til the pr inc ipa l . . . is paid.” It also sets forth per iodic dates on whic h interest is due. The FAAcontains an
acc eler ation provision, which does not spec ify whether or not interest is due on the pe riodic date sTh is p ro vis ion g ov e rn s th e a c c e le ratio n o f t he pa y me nt o f p ri nc ipa l up on

c e rt a in e ve nts 2 of de fa ult
. 4 afte r any acc eler ation. 2 In Dec ember

2001, Arg entina dec lare d a moratorium on the pay ment of principa l and interest on its fore ign de bt and stopped pay ing pr incipal and inter est on the bonds at issue her e. In r e sp on se to t

he de fa ult , o n v ari ou s d a te s in

20 05 and 20 06 , CV Ia c c e le ra

te d th e bo nd s it owned, makingthe principa l immediately due. The instant lawsuit was f

iled in the Southern District on April 25, 2005. Afte r var ious preliminary

proce eding s, the district court g rante d summary judgme nt in favor of

CVIon the claims related to the U.S. bonds on May 17, 2006. Subsequently , on Fe bruar y 15, 2007, the dis tr ic t c ourt

he ld a n o ra l argume nt o n v ari ou s o pe n is su e s, inc lud ingAr g e nti na ’s mot ion to dismiss the claims re lated to the Ge rman bonds for lack of subject matter jur isdiction and CVI ’s reque st for statutory

prejudg ment interest on ce rtain intere st pay ments it claimed wer e due a fter
acc eler ation of the U.S. bonds. At the ora l argument, the district court rule d that it lacked subjec t matter jurisdiction over th e c l ai m s re l at i n g t o C VI’s Ge rm an b o n d s b ec au s e A rge n t i n a w as en t i t l edt o s o v er ei gn immunit y with respec t to those claims; the district court ac cording ly dismiss ed the Ge rman bond claims. Construing se ction 13(3) a nd (4) of the offe ringcirc ulars, the district cour t concluded that Arg entina had not e x plicitly waived its sover eig n immunit y in U.S. courts in section 13. Ins te a d, it h e ld t

hat su bs e c tio n 3 wa s a

lim ite d s ub mis sio n to the jur isd ic tio n o f c ourt s in F ra nk fu rt and B ue no s A ir e s. Th e dis tr ic t c ourt re a so ne d th a t “ wh a te ve r [s ub se c tio n 4 ] me ans it should not be rea d as re adingout of this inst rument the re fer ence to Fra nkfurt and the city

of5

Bue nos Aires.” Acc ording ly , while ac knowledg ing that the languag e of subse ction 4 was “ very br oa d, ” the dis tr ic t c ourt

ult imate ly

he ld t hat “ wh e re the re is a

n e xpre sse d g ra

nt o f j ur isd ic tio n in specific place s . . . a g ener al waive r of sove reig n immunit y [such as in subsection 4] does not mean that . . . suit ca

n be brought any

place in the world.” H avingfound that Arg entina did not waive its sover eig n immunit y to suit i n U.S. courts, the district cour t dismi ssed the Ge rman bond
c la ims and

c on c omi tantl y

de nie d CV I ’s mot ion

fo r s umm ary

jud g me nt o n th os e c la ims
. As to CVI ’s re quest for pr ejudg ment interest, the district cour t found that the F AA did not require the continued pa

y ment of intere st after

the principa l was ac cele rate d, beca use the a ct of
a c c e le ratin gthe pr inc ipa l so that “ [i]t is du e no w” is i nc on sis te nt w ithint e re st t hat “ c on tin

ue [s] to a c c ru e qu art e rl y ” wh e re the c on tr a c t do e s n ot s pe c if ic a lly pr ov ide that c on tr a c tua l in te re st continues to ac crue . Acc ording ly , the district court only awa rded pr ejudg ment interest, at the contra ctual rate, for the entire a mount of the principal a fter the date of acc eler ation and for interest pay

ments that were due but unpaid prior to a cce leration. On Marc h 16, 2007, the district court e ntere d final judg ment ref lectingits rulings at the Fe bruar y 15, 2007 oral a

rgument. This appea l followed.

D I S C US S I ON On appe al, CVIchalleng es both the dismissal of the claims re lated to the Ge rman bonds and the de nial of pre

judgme nt interest on intere st pay ments that would have c ome due a fter
acc eler ation of the U.S. bonds. A
. S o v e r e i g nIm mun i ty 1. Ba ckg round L aw a nd Standard of Re viewCongr ess has provide d that persona l jurisdiction over a for eig n state exists when the 3 FSIA per mits a suit aga inst that state and the ser vice of proce ss require ments set forth in 28 U.S.C. § 1608 have bee n satisfied, see2 8 U
. S. C. § 1 3 3 0 ( b ) , a lt h o u g he v e nin

th e F SIA c o n te xt the re quirements of due proce ss must be satisfied befor e a c ourt may exercise pe rsonal jurisdiction. Se e Te

x as Tra ding &Mi ll. Cor

p. v . F e de ra l R e pu bli c of N

ige ria , 647 F.2d 300, 308 (2d Cir. 1981). It should be noted, howeve r, that this Court rece ntly hear d oral a

rgument on the question of whethe r Texas Trading rema ins good la w. Se e Fron te ra Re

s. Az e r. Cor

p. v . S tate Oi l Co. of t heAz e r. Re

pu bli c , N o. 07 -1 81 5- c v ( 2d Cir . a rgue d O c t. 2 7, 20 08 ). We n e e d n ot a dd re ss the issue of pe rsonal jurisdiction here , as Arg entina has not ra ised it before us and the district court did not consider

it. W e express no opinion as to whether Arg entina may

raise the issue on re mand or wh e the r Arg e nti na

ha s w a ive d a

ny ob je c tio n to pe rs on a l juri sd ic tio n b y fa ili ngto r a ise it b e fo re the dis tr ic t c ourt . 6 The F oreig n Sovereig n I mmuniti es Ac t (“F SI A”) “is the sole sourc e for subject matter jurisdiction over any

action ag ainst a for eig n state.” Kensington Int’l Ltd. v. Itoua , 505 F.3d 147, 15 3 ( 2d Cir . 2 00 7) (i nte rn a l qu otatio n ma rk s o mitte d) ; see28 U.S.C. §§ 1330(a), 1604. The F SI A p ro vid e s th at f

or e ig n s ov e re ig ns are immun e fr om s uit un le ss a sp e c if ic e xce pti on

to
sovere ign immunity

applies. Id. § 1604. One suc h exception is that a fore ign state is not immune from suit “in any case . . . in which the for eig n state has wa ived its imm unity either expli citly or by implication.” Id. § 1 60 5( a )( 1) . T he te rm “ e xplic it, ” in t

his c on te xt, take s it s 3 normal mea

ning of “cle ar a nd unambiguous.” Libra Bank Ltd. v. Banco Nacional de Costa Rica, S.A. , 676 F.2d 47, 49 ( 2d Cir. 1982) (interpr eting 28 U.S.C. § 1610(d)). The purpose of an

“ e xplic it” wa ive r r e qu ir e me nt “ is t o p re c lud e ina dv e rt e nt, imp lie d, or c on str uc tiv e wa ive r i n
case s where the intent of the for eig n state is equivoca l or ambig uous.” Id. “On a ppeal f rom a dismissal for lac k of subject matter jurisdiction, we re view the district court’s le g al conc lusions de novo . . . .” Correspondent Servs. Corp. v. First Equities Corp. of Fla. , 442 F.3d 767, 769 ( 2d Cir. 2006) (per curiam). The inter

pretation of a contra ct is a leg al question which is also revie wed de novo. Phillips v. Audio Active Ltd. , 494 F.3d 378, 384 ( 2d Cir. 2007).We note that the offe ringcirc ulars ar e g overne d by Ger man law. The pa

rties have not 4 prese nted us with any

thing to sug g est that Ger

man law would a lter the e ssential analy sis. I ndeed, they have not c ited any

Ger man law with re spect to any aspec t of this case. 7 2. Discussion In th e of fe ri ngc ir c ula

rs , A rg e nti na

e xplic itl y

wa ive d it s so ve re ig n immun ity to s uit in U.S. courts on claims re lated to the Ge rman bonds. Section 13(4) of the off eringcirc ulars pr ov ide s th at, “ [t]o th e e xtent th at th e Re pu bli c ha s o r h e re a ft e r m ay

a c qu ir e any

immun ity (sover eig n or otherw ise) fr om jurisdiction of any court or f rom any leg al proc ess . . . , the Republic here by

irrevoc ably

waives suc h immunit y

in respec t of its obligations under the Bonds to the extent it is permitted to do so under applica ble law.” This provision clear ly and unambig uously

waives A rg entina’s “ immunit y (sover eig n or otherw ise)” in “ anyc ourt .” Th is clea r languag e satisfies the F SI A’s re quirement of a n “explicit” waiver
. Arg entina adva

nces the argument that section 13(4) , rea d in conjunction with section 13(3), mer ely

allows for judg ments obtained pursua nt to section 13(3) to be e nforc ed in other courts. Howe ver, the languag e of subse ction 4 is not so li mited. Subsection 4 refe rs to “any le g a l pr oc e ss ( wh e the r t

hr ou g h s e rv ic e or

no tic e , atta c hme nt p ri or

to j ud g me nt, a tta c hme nt i n a id of e xec uti on , e xec uti on

or oth e rw ise ), ” langua g e that c on te mpl a te s a c tio ns oth e r t ha n th os e to enfor ce judg ments. Furthe r, subsec tion 3 ends with the provision that “a fina l judgment in any such suit . . . in the courts mentioned above . . . may be enf orce d in other jurisdictions by suit on the judg ment or any

other method provide d by law.” I f the Republic’ s interpre tation of subsection 4 wer e adopte d, this last sentence in subsec tion 3 would render subsection 4 superf luous, a result that should be avoide d. See U nited States v. Hamdi , 432 F.3d 115, 123 ( 2d 4 Cir . 2 00 5) . F ur

the r, if su bs e c tio n 4 we re int e nd e d to dis c us s e nf or c e me nt i n o the r j ur isd ic tio ns ,8

we wo uld e xpe c t th at th e same te rm s in the la st s e nte nc e of

su bs e c tio n 3 wo uld

be re pe a te d in
su bs e c tio n 4 —b ut t

he y are no t. A c c or din g ly , w e do no t r e a d s e c tio n 1 3( 4) a s a pp lyingon ly

to the enf orce ment of judg ments. Arg entina also a

rgues that re adingsection 13(4) as a w aiver of sover eig n immunit y

in any court re nders subsec tion 3 superfluous, a r esult which, as just discussed, is disfavore d. See id. Acc ordingto Arg entina, under such a r eadingArg entina has “ ag ree [d] to jurisdiction in Germany and Ar g entina” in subsec tion 3 and also “a g ree [d] to jurisdiction every wher e” in subsec tion 4. Of c ourse, suc h an interpr etation of sec tion 13(4) would re nder subse ction 3 superf luous—but th ati s n o twh ats u

b s ec t i o n4 s ay s . S u

b s ec t i o n4 i s a w ai v er

o f A rge n t i n a’ s “i m mun i ty (s o v er ei gn or otherw ise),” but it does not wa ive other obje ctions to suit t hat Arg entina mig ht have, suc h as objections based on la ck of pe rsonal jurisdiction, improper ve nue, or f orum non conve niens. Section 13(3), on the othe r hand, pr ovides that Arg entina “submits to the non-exclusive jurisdiction” of the c ourts in Fra nkfurt and B uenos Aire s as well as “ waives . . . the defe nse of a n inconvenient f

orum . . . and a

ny . . . objection . . . on the g rounds of ve nue, re sidence or domicile.” It is thus clear that re adingsubsection 4 as a waiver of sover eig n immunit y

in any
c ourt do e s n ot r e nd e r s ub se c tio n 3 su pe rf luo us . Arg entina also pre sses the ar g ument that the ca se law r evea ls a requir ement that, to be
e xplic it, a wa ive r m us t c on ta in a

re fe re nc e to t

he Un ite d St a te s o r a

sp e c if ic jur isd ic tio n w ith in the Un ite d St ate s. We d o n ot f ind su c h a re qu ir e me nt i n th e c a se s. Of c ours e , a sp e c if ic ref ere nce to the United States can be helpful in deter mining that a w aiver

meets the F SI A’s require ment of explicitness, see, e .g. , Proyec fin de Vene

z., S.A. v. Banc o Indus. de Ve nez., S.A. , 760 F.2d 390, 393 ( 2d Cir. 1985) (findingan explicit waiver obvious wher e the wa iver mentioned New

York c ourts), but the statutory require ment is only

that the waive r be “ expli cit.”9

Th e re c an b e e xplic it w a ive rs wi tho ut a re fe re nc e to t

he Un ite d St a te s, a s th e wa ive r o f i mmunit y in “any court” in this case illustrates. See also W alker Int’ l Holdings L td. v. Republic of Congo , 395 F.3d 229, 234 ( 5th Cir. 2004) (findingan explicit waiver unde r the F SI A wher e a c ontrac t
rea d “[t] he Cong o here by irrevoc ably

renounc es to claim any

immunit y

duringany

proce dure
re latin g to a

ny arb itr atio n d e c isi on

ha nd e d d ow n b y

a n A rb itr a tio n Co ur

t” ); W orld W ide Minerals, Ltd. v. Republic of Kazakstan , 296 F.3d 1154, 1162 & n.13 (D.C. Cir. 2002) (f inding an “e x press wa iver[] of sover eig n immunit y ” whe re the waiver said “[i] n respe ct of a

ny arbitration or leg al ac tion or proce eding s arisingout of or in conne ction with this Agre ement, . . . [the Ka zak

hs tan St ate Committe e ] he re by ir re vo c a bly a g re e s n ot t o c la im a

nd he re by ir re vo c a bly waives . . . immunity

for itself a

nd the assets of the Republic of Ka zakstan to the full ext ent permitted by

the laws of suc h jurisdiction”). Any oth e r r e su lt w ou ld s tr a

y fr om t he pla in meaningof the statutory

languag e. See U

nited States v. Santos , 541 F.3d 63, 67 ( 2d Cir. 2008) (“Statutory

interpre tation alway s beg ins with the plain lang uag e of the statute, assuming the statute is unambiguous.” (interna l quotation marks omitted)). Despite Ar g entina’s a

rgument, Argentine Re

public v. Ame rada Hess Shipping Corp. , 488 U.S. 428 (1989), does not re quire a contra ry result. In Am e ra da He

ss , the Supreme Court stated that it did not “see how a

fore ign state ca

n waive its immunity

under § 1605( a)( 1) by

signingan international a g ree ment that contains no mention of a w aiver of immunity

to suit i n United States courts or e ven the a

vailability

of a c ause of

action in the United States.” Id. at 442-43. Ar g entina would have us r ead this languag e as a require ment that, for a

waiver to satisfy the FSIA’s expli citness re quirement, it must mention the United States in some way . That is not the holding of Am e ra da He

ss . The international ag ree ments at issue in Am e ra da He ss wer e the Ge neva Conve nti on

on the Hi g h Se a s, Ap r. 29 , 1 95 8, 13 U. S.T . 2 31 2, and the Pan A me ri c an M ari tim e10

Neutra lity

Convention, Feb. 20, 1928, 47 Stat. 1989—neither of which me ntions waiving
sovere ign immunity

at all, let alone in the United States. The off eringcirc ulars at issue he re, wh ic h a re c on tr a c ts b e tw e e n A rg e nti na and the bo nd ho lde rs , a re fa r r e mov e d f

ro m mu lti -p art

y international a g ree ments and do discuss waive r of sove reig n immunit y to suit i n anyc ourt , there by indicating “wa iver of immunity to suit i n United States courts.” Am e ra da He ss , 4 88 U. S. at 442-43. Ac cording ly , Am e ra da He ss does not control the outcome here
. There is likewise no support in our ca ses for Arg entina’s sug g estion that the mention of sp e c if ic , n on -Unit e d St ate s juri sd ic tio ns in s ub se c tio n 3 of the of fe ri ngc ir c ula

rs pr e c lud e s a fi nd ingthat A rg e nti na

wa ive d it s so ve re ig n immun ity to s uit in t he Un ite d St a te s. Of

c ours e it i s true that ther e will be ca ses in which, whe n a docume nt mentions a non-U.S. jurisdiction, there wi ll b e no e xplic it w a ive r f or F SIA p ur po se s b e c a

us e it w ill be c le ar t

hat th e re is n o inte nt t o waive sove reig n immunit y in United States courts. See , e.g. , Eaglet Corp. v. Banco Cent. De Nic ar . , 839 F. Supp. 232, 234 (S.D.N.Y. 1993) (findingno expli cit waiver wher e jurisdictional clause stated “[t] his Ag ree ment is gove rned by Eng lish law and there fore BCN submits to the
no ne xclu siv e jur isd ic tio n o f t he En g lis h H ig h Co ur

t of Justi c e ” ); Atl. Tele-Network Inc. v

. Inter-Am . Dev . Bank, 251 F. Supp. 2d 126, 133 (D.D .C. 2003) (findingthat a broa d, nong eog raphic ally

limit ed wa iver of immunity , when “ jux tapos[ed] immediately below a
c ho ic e -o f- law s e le c tio n c la us e (s pe c if

yingthe law o f Guyana ) a nd a bo ve a fo rum- se le c tio n c la

us e (spec ifying the courts of Guy ana) ,” does not wa ive immunity in the United States). It is not t rue, howeve r, that the mer e mention of a non-U.S. jurisdiction will preclude a finding of wa iver, beca use the statute r equire s only that the waive r be “ expli cit.” As the w aiver at issue her e demonstrates, a

waiver of sover eig n immunit y

can be expli cit even when other provisions of the document ar e applica

ble only to specific, non- United States jurisdictions.Be cause we f ind an explicit waiver of immunity , we do not re ach CVI ’s ar g uments that 5 oth e r F SI A e xce pti on s to so ve re ig n immun ity a pp ly a s w e ll. 11 Ac c or din g ly , b e c a

us e we fi nd

that A rg e nti na

e xplic itl y

wa ive d it s so ve re ig n immun ity to suits in t he United States re lating to the G erma n bonds, we re verse the district court’s dismissal of CVI ’s Ger

man bond claims. In addition, beca use it is clear

from the tra

nscript of the 5 proce edingbefor e the district cour t that CVI ’s motion for summary judgme nt on the Ger

man bo nd -r e late d c la ims wa s d e nie d o nly be c a us e the dis tr ic t c ourt

dis mis se d th os e c la ims , we va c a te the de nia l of

CV I ’s summa

ry jud g me nt m oti on , s o th a t th e dis tr ic t c ourt c an c on sid e r, in t

he fi rs t ins tanc e , w he the r o r n ot s umm ary jud g me nt w ou ld b e a

pp ro pr iate on

tho se c la ims
. B
. Pr e

jud g me nt I

nte re st Un de r N e w Y or

k C. P.L .R. § 5 00 1, a

c re dit or is e nti tle d to pr e

jud g me nt i nte re st o n a ll
sums d ue , a s o f t he date the y

be c ame du e . N .Y . C. P.L .R. § 5 00 1; se e als o Spodek v . Park Prop. De v . A sso cs. , 759 N.E.2d 760, 762 (N.Y . 2001) (holdingthat “CPL R 5001(a) pe rmits a cre ditor to r e c ov e r p re

jud g me nt i nte re st o n unp a id i nte re st a nd pr inc ipa l pa

y me nts awa

rd e d f ro m th e date
eac h pay ment beca

me due” ). While awar ds of intere st are g ener ally discretionar

y , “Ne w York law d oe s n ot p e rm it the tr ia l c ourt to e xer c ise any

dis c re tio n w he re a

pa rt y is e nti tle d to [prejudgme nt interest] as a matter of rig ht.” Ne w Eng. In s. Co. v . H e alt hc ar e Un de rwr ite rs M

ut. Ins. Co. , 352 F.3d 599, 602- 03 (2d Cir. 2003). We re view the inter pretation of a contra ct, which is a leg al question, de novo. Phillips v. Audio Active Ltd. , 494 F.3d 378, 384 ( 2d Cir. 2007). The pa rties ag ree that the district court c orre ctly awa rded CVI statutory prejudg ment interest on the c ontrac tual interest pay ments that Arg entina fa iled to make prior to a cce leration of the principa l of CVI ’s U.S. bonds, as well as on the entire a mount of the principal star ting on the date of a c c e le ratio n. Ho we ve r, CV Iargue s th a t c on tr a c tua l in te re st p ay me nts c on tin

ue d to c ome12

due af ter a cce leration, and there fore that the district court should have awa rded CVI statutory prejudg ment interest on the post-a cce leration, unpaid interest pay ments. The norma l conseque nce of acc eler ation is that interest pay ments that would have be en du e in t he futur e are no lon g e r d

ue , b e c a us e , a ft e r a c c e le ratio n, the e nti re pr inc ipa l is imm e diate ly due and ow ing; in other

words, future interest pay ments are “unea

rned” beca

use the c reditor is no longe r loaningthe debtor the principal. See, e .g. , Aardwoolf Corp. v. Nelson Capital Corp. , 861 F.2d 46, 47 ( 2d Cir. 1988) (“N ew Yor k leg islation and judicial pronounce ments demonstrate a
c on sis te nt i nte nt t o d e ny

a c re dit or the ri g ht t o c ha

rg e or re ta in i nte re st t

hat is un e arn e d. ” ); Atlas Fin. Corp. v. Ezrine , 3 45 N. Y. S.2 d 3 6, 38 -3 9 ( Ap p. Di v. 19 73 ) ( statin g the “ e qu ita ble pr inc ipl e that the unea

rned pa rt of the inter est must be deducte d [from the amount due] upon acce leration,”
and re a so nin g in p art

that “ by a c c e le ratio n o f p ay

me nts up on

de fa ult the pr inc ipa l sum c e a se d to be at r isk some y ear s prior to the time contemplate d by the contra ct” ( internal quotation marks omi tte d) ); Bostwick-W

estbury Corp. v. Comme rcial Trading Co. , 404 N.Y.S.2d 968, 973 (Civ. Ct. 1978) (stating that at acc eler ation, “indebtedne ss encompasse d the unpaid bala nce of the principal a

nd the mature d interest at the time of defa ult and does not include a ny unear ned future int e re st” ); se e als o In re LHD Re alty Corp. , 726 F.2d 327, 331 ( 7th Cir. 1984) (“[A] lender may
a ba nd on or wa ive its c la im t o inte re st p ay a ble ov e r a pe ri od of y e ars . . . . [T]he le nd e r, by its acts, may establish that it prefe rs ac cele rate d pay ment to the opportunity

to ear n interest over

a period of year s. . . . [The lender] has voluntarily waived the unpaid intere st in the ex pectation of
acc eler ated pa

y ment of the re maining pr incipal.”)
. The F AA that g overns the U .S. bonds at issue here c ontains nothing to demonstrate that the par ties intended to displace the normal mea ning of acc eler ation with a conc ept of a cce leration that allows interest to continue to c ome due a fter the principal is ac cele rate d. CVIargues that the13

FAAdoes mandate that intere st pay ments continue to be due afte r ac cele ration bec ause the FAA pr ov ide s th at A rg e nti na

wi ll “ pa y int e re st” on

the pr inc ipa l “ un til the pr inc ipa l . . . is pa id. ” Th a t, howeve r, is mere ly

a truism that is not specific e noug h to alter the tra ditional concept of
acc eler ation. In the abse nce of ambig uity

or a pr ovision in t he F AA spec ifying othe rwise,
acc eler ation should be g iven its normal meaning
. Al e x an de r &Al e

x an de r S e rv s. , I nc . v . Th ese Certain Underwriters at L loyd’s, London , 136 F.3d 82, 86 ( 2d Cir. 1998) (“I f the c ourt finds that the c on tr a c t is no t ambi g uo us it s ho uld a ssi g n th e pla in a

nd or din ary me anin g to e a c h te rm

. . . . ” ). To ho ld o the rw ise wo uld a llo w C VI

to r e c ov e r i nte re st t

wi c e on the same principal—onc e as statutory prejudg ment interest af

ter the date of a cce leration and once a s interest pay

ments that came due af

ter a cce leration. Such an unusual result should not be infer red in the absenc e of c lear

intent in the FAA.

C ONC L US I ON For the fore g oing r easons, we VA CA TE the portion of the judg ment of the district cour t dis mis sin g the c la ims re late d to the Ge rm an b on ds and de nyingsumma

ry jud g me nt o n th os e claims, AF F IRM the re mainder of the judg ment, and REMAND fo r f urt h er p ro ce ed i n gs consistent with this opi nion.