YPF Investors Pivot to International Arbitration in $16-Billion Legal Battle Against Argentina

Former YPF investors pivot to international treaty arbitration and further appeals after a US court threw out a $16.1-billion judgment against Argentina.

By: AXL Media

Published: Apr 23, 2026, 10:24 AM EDT

Source: Buenos Aires Times

Reversal of the Historic Judgment

The legal battle centers on the Argentine government’s decision to nationalize YPF in 2012, which plaintiffs argued violated shareholder rights and local bylaws. In 2023, US District Judge Loretta Preska in New York initially awarded a record-breaking US$16.1-billion judgment in favor of the plaintiffs. However, on March 27, 2026, the US Second Circuit Court of Appeals reversed this decision, ruling that the trial court had misinterpreted Argentine law. This reversal effectively wiped the multi-billion-dollar liability off Argentina’s balance sheet, at least within the US court system.

Shift to International Treaty Arbitration

Facing the loss of their US judgment, lawyers for the investors informed Judge Preska on Tuesday that they intend to trigger international treaty arbitration. This process allows private investors to sue sovereign states for alleged breaches of investment treaties. The plaintiffs' legal team has requested permission to utilize evidence gathered during the years of US litigation to bolster their upcoming arbitration claims. By shifting to an international tribunal, the investors hope to find a more favorable venue that prioritizes international investment protections over the interpretation of domestic Argentine statutes.

Financial Fallout for Burford Capital

The legal setback has had immediate and severe consequences for Burford Capital Ltd, the litigation funder that financed the lawsuit in exchange for a substantial portion of any potential award. Since the Second Circuit’s ruling in late March, Burford’s shares have plunged approximately 40% on both the New York and London stock exchanges. Despite the market volatility, Burford has signaled its commitment to the fight, stating it is exploring an appeal to the full Second Circuit (an en banc review) or potentially the US Supreme Court, in addition to the newly announced arbitration path.