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Courts As Information Intermediaries: A Case Study Of Sovereign Debt Disputes, Sadie Blanchard
Courts As Information Intermediaries: A Case Study Of Sovereign Debt Disputes, Sadie Blanchard
BYU Law Review
When foreign sovereigns default on their debt, creditors sometimes sue them. These creditors are sophisticated actors, and they know that if they sue, courts can do little to force a sovereign to satisfy a judgment. Why do they sue? This Article argues that these creditors sue because they use litigation to produce information about the debtor state or its government that induces third parties to sanction or refuse to deal with the state or the government. The ability to produce such information strengthens the litigating creditors’ bargaining position in settlement negotiations. Courts thus serve as information intermediaries that strengthen reputational …