Argentina is asking the U.S. Supreme Court to avert an “economic catastrophe” by overturning a Second Circuit ruling that could force the South American government to default on billions of dollars in debts.

Argentina defaulted on its $100 billion in debt in 2002. It settled with many of its creditors by offering them new bonds in 2005 and 2010. However, some investors refused to take these new bonds. Those holdouts, led by Cayman Islands-based hedge fund NML Capital Ltd., are now seeking payment in full.

Second Circuit Judges Barrington Parker, Rosemary Pooler and Reena Raggi ruled last August in NML Capital v. Republic of Argentina, 12-105, that Argentina must either pay these holdouts what they’re owed, about $1.4 billion, or their payments to the rest of investors, which go through BNY Mellon, will be frozen. The ruling affirmed an order by Southern District Judge Thomas Griesa (NYLJ, Aug. 26, 2013).

Argentina said in its petition to the Supreme Court that the order disregarded the nation’s sovereignty and that enforcing it would be economically devastating, cutting Argentina’s reserves in half.

“Any sovereign would protest if a foreign court issued an extraterritorial order threatening its creditors and citizens and coercing it into turning over billions of dollars from its immune reserves,” Argentina said in its petition.

“The ‘choice’ between satisfying a monetary obligation … and defaulting on $24 billion of exchange bond debt—threatening draconian consequences for the Argentine people—is no choice at all, let alone something a district court can impose on a foreign sovereign,” the petition said.