April 5, 2019 / 10:25 PM / 8 months ago

Lawyers for Venezuela's Guaido ask U.S. court to protect Citgo

April 5 (Reuters) - Representatives of Venezuelan opposition leader Juan Guaido have asked a U.S. court to overturn a prior ruling allowing Canadian miner Crystallex to seize part of U.S. refiner Citgo, which is owned by state oil company Petroleos de Venezuela.

Guaido heads the opposition-controlled National Assembly and in January invoked the country’s constitution to assume an interim presidency, arguing President Nicolas Maduro’s 2018 re-election was a fraud. The United States and most Western countries have recognized him as the country’s rightful leader.

Last year, a judge ruled Crystallex could seize shares in Citgo and auction them in its bid to get paid on a $1.4 billion award tied to the 2008 nationalization of its gold mining operations by the now cash-strapped South American country.

That conflicts with Guaido’s efforts to preserve the country’s assets abroad, especially Citgo, which is pledged as collateral to multiple creditors. His lawyers argued to an appeals court that a lower court’s ruling in favor of Crystallex be reversed in light of the new political circumstances.

“Such an auction would not just be unseemly; it would be dangerous, undermining U.S. foreign policy by impeding President Guaido’s ability to complete the transition of the Republic to democracy,” the attorneys with Washington law firm Arnold & Porter wrote in a brief dated April 3.

Guaido named a board of directors to Citgo in February, a move he described as “protecting our assets.” Last month, the U.S. Court of Appeals for the Third Circuit ruled Guaido’s representatives could request a stay, and gave them until this week to present their arguments.

Maduro, a socialist who says he is the victim of an attempted U.S.-led coup, has accused the opposition of trying to “steal” Citgo.

In its March 20 ruling allowing Guaido’s representatives to intervene in the case, the judge said Crystallex would have until April 10 to respond to its arguments.

Reporting by Luc Cohen; editing by Chris Reese

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