The decision by the federal appeals panel in Manhattan upholds a ruling by U.S. District Judge Thomas Griesa, who has clashed with Argentina’s lawyers over the country’s failure to adhere to earlier orders.

The ruling implies entities that aren’t alter egos of Argentina and aren’t liable for its debts may still have to reveal their assets to creditors seeking repayment on debt from the country’s 2001 default on a record $95 billion.

Such entities may “hold attachable assets on behalf of Argentina,” the appeals court said. Likewise, “an entity that is closely tied to (but legally distinct from) Argentina may possess information about Argentina’s assets, even if it does not own or hold those assets itself.”

Holders of about 92 percent of Argentina’s repudiated debt agreed to take new bonds, at a discount of about 70 percent, in restructurings in 2005 and 2010, pitting them against individual investors who sued for full payment in the U.S., the forum selected by Argentina in the original bond agreements.

Barred Payment

Griesa in 2012 barred Argentina from paying the restructured debt without also paying $1.6 billion to the holdouts, led by NML Capital Ltd., a unit of Paul Singer’s Elliott Management Corp. hedge fund. The U.S. Court of Appeals in New York upheld that ruling, which took effect after the U.S. Supreme Court declined to hear the case in June.

Argentina told Griesa in November that holders of its defaulted bonds have filed 25 lawsuits since June as investors seek to profit from his order.

In the dispute over subpoenas, Argentina had argued that the Foreign Sovereign Immunities Act bars sharing information about sovereign property “that is potentially immune from attachment,” according to the ruling.

The country also argued that the demands of holdout investors for documents were too broad because they “reach entities — and, in some cases, individuals — that are not alter egos of the republic and therefore not liable for Argentina’s debts.”

‘The Norm’

The appeals court disagreed, ruling today that “broad post-judgment discovery is the norm” in U.S. federal and state courts. “Discovery” is the term for sharing information in litigation.

Argentina’s lawyer, Jonathan Blackman of Cleary Gottlieb Steen & Hamilton LLP in New York, didn’t immediately return a call or e-mail seeking comment on the ruling.

The appeals court also weighed in on the tense atmosphere that has pervaded the dispute among Argentina, the holdouts, and the judge in Manhattan, including NML’s bid for a contempt ruling against the nation and harsh words by Griesa over newspaper advertisements placed by Argentina that were perceived as attacks on the investors.

“We stress that Argentina — like all foreign sovereigns — is entitled to a degree of grace and comity,” the appeals court said in its ruling. “We urge the district court to closely consider Argentina’s sovereign interests in managing discovery, and to prioritize discovery of those documents that are unlikely to prove invasive of sovereign dignity.”

The case is NML Capital Ltd. v. Republic of Argentina, 08- cv-06978, U.S. District Court, Southern District of New York (Manhattan).