Argentine bondholders fear U.S. court ruling could trigger default NEW YORK (Reuters) - Investors holding $1 billion worth of restructured Argentine debt say they are preparing to appeal a U.S. court ruling that they fear would trigger another default and prevent them from being paid principal and interest due on their bonds next month. U.S. District Judge Thomas Griesa ordered late on Wednesday that Argentina immediately pay a separate group of holdout investors who rejected two debt restructuring offers the $1.33 billion in judgments they have won in court, a stinging blow to the country's efforts to overcome a 2002 debt crisis. The holdout investors in the case are led by NML Capital, an affiliate of Elliott Management, and Aurelius Capital Management, both based in New York. Griesa's order means Argentina must deposit the money into an escrow account by December 15, which protects both sides of the case pending a final decision by the U.S. 2nd Circuit Court of Appeals. Given Judge Griesa's obvious frustration with the Republic of Argentina, we expected this ruling. What we did not expect was the disregard of innocent Exchange Bond Holders' due process rights," said Sean O'Shea, a lawyer representing a group of hedge fund investors. He was referring to investors who agreed to the restructured debt deals in 2005 and 2010. At stake for all exchange bondholders is a potential technical default on approximately $24 billion worth of debt issued in the 2005 and 2010 exchanges. Principal and interest payments due those bondholders next month total over $3 billion. "We are preparing an immediate appeal and motion to stay this ruling so that we may be heard in the 2nd Circuit Court of Appeals," O'Shea said in a statement released late on Thursday through a spokesman. It said the exchange bondholders represented by O'Shea hold approximately $1 billion in restructured Argentine government debt. Griesa ruled in February that all bondholders must be treated on equal terms, also known as pari passu. That means bondholders who fought Argentina in the courts for payment must be paid alongside those who cut deals with Buenos Aires. If Griesa's ruling is upheld and Argentina still refuses to pay, U.S. courts could eventually block debt payments to creditors who took part in the debt restructurings out of consideration for investors who rejected Argentina's terms at the time. That would trigger a technical default. The exchange bondholders group represented by O'Shea and attorney David Boies, and who have had no involvement in the pari passu case, includes Greenwich, Connecticut-based Gramercy Funds Management, Boston-based MFS Investment Management, London-based Brevan Howard Asset Management, and Newport Beach, California-based SW Asset Management. Reporting By Daniel Bases; Editing by Paul Simao