On June 16, 2014, in Republic of Argentina v. NML Capital, the US Supreme Court held that the Foreign Sovereign Immunities Act of 1976 (FSIA) does not immunize a foreign country debtor from postjudgment discovery of information about the location of its extraterritorial assets (No.12-842, (S. Ct. June 16, 2014)).

In 2001, the Republic of Argentina defaulted on external debt securities. NML Capital, Ltd. (NML), one of its bondholders, successfully sued in 11 separate actions to recover the debt. Having been unable to recover the $2.5 billion owed to it through the judgments, NML sought execution against Argentina's property. In 2010, NML served subpoenas on two non-party banks seeking information regarding Argentina's account activity and balances. Argentina and one of the banks moved to quash the subpoena, but the US District Court for the Southern District of New York denied the motion, holding that extraterritorial asset discovery did not infringe upon Argentina's sovereign immunity. The US Court of Appeals for the Second Circuit affirmed, reasoning that because the district court's order involved discovery rather than attachment of property, and was directed at third-party banks rather than Argentina, it did not offend Argentina's sovereign immunity.

The Supreme Court affirmed. The FSIA sets forth two types of immunity for foreign sovereigns: the immunity of foreign sovereigns from the jurisdiction of US courts, and the immunity of a foreign state's property in the United States, under certain circumstances, from attachment, arrest and execution. Argentina waived its right to the first type of immunity through its bond indenture agreement. The second type does not apply here because NML did not seek execution directly, but instead sought discovery about what property it might be able to execute against. The FSIA does not provide any immunity from the federal discovery process.