Argentina could less than a month away from defaulting on approximately $24 billion worth of debt, reported the Associated Press on Thursday, after a US court barred the government from paying off investors who had agreed to swap their holdings of defaulted sovereign bonds for new securities, unless it also paid other bondholders suing for full repayment.

New York district judge Thomas Griesa ruled that Buenos Aires had a responsibility to pay off every single bondholder, even the minority - mainly hedge funds - who had ignored two exchanges of defaulted debt back in 2005 and 2010.

Griesa also upheld his own ruling of last month, ordering Argentina to pay over $1.3 billion to these hedge funds by December 15, claiming "Argentina owes this and owes it now."

But Argentina president Cristina Fernandez de Kirchner has already vowed not to pay "one dollar" to the so-called "vulture funds".

Related: Argentine President Re-Elected, Buoyed By Strong Economic Performance

Related: Obama Suspends Trade Benefits For Argentina

Fernandez claimed that hedge funds, such as Elliot Capital Management and Aurelius Capital Management, often snapped up debt issued by struggling countries, before holding out on debt swaps in favour of pursuing interest payments via the legal system. According to The Independent, Elliot Capital Management also recently waded into Greek debt.

"These funds are vultures who seek to profit by betting on a technical default," said Argentina's Economy Minister Hernán Lorenzino as cited by The Guardian.

"To pay the vultures is not only unfair but illegal in terms of our internal rules," he said. "We will continue to defend the position of Argentina in all forums and with all available legal instruments."

The Argentinean government said on Thursday that it would appeal Griesa's ruling to the U.S. 2nd Circuit Court of Appeals. Failing which, Argentina also said that it would ready to take its appeal all the way to the U.S Supreme Court, before bringing it in front of an international body.

"We still believe the U.S. justice system will fix this in a way that won't affect Argentina, its legitimate creditors and, in an international context where the importance of these decisions is patent ... in terms of the financial international architecture," said Lorenzino to AP, denouncing Griesa's ruling as "a kind of judicial colonialism."

"Someone is sitting in a courtroom in a very important country making decisions that go against the laws and institutions not only of Argentina but other countries as well... The only thing we're missing is for Griesa to send in the Fifth Fleet," he said.

Argentina's battle with the holdouts traces back to 2001, when the country defaulted on nearly $100 billion in debt - still a world record to date. Though the Argentinean economy has since gotten back on track, by restructuring about 93 percent of its defaulted bonds at a rate of 33 cents on the dollar, the New York ruling could set a legal precedent for other holdouts who could demand immediate payment on the entire $24 billion they are owed - including interest.

"The judge is killing all the people who signed up to the restructuring," told a European investor to the Financial Times. "For a New York judge to tell Argentina a decade on that it has to fully pay the holdouts is unreasonable, to put it mildly."

Whitney Debevoise, a lawyer at Arnold & Porter and former US executive director at the World Bank, also warned that making it easier for lenders to sue countries could complicate future debt restructurings.

"Restructuring deals like Greece would have been much harder if 'holdouts' had much better rights," he said.

Related: Is Greece Still Headed Down A Dangerous Dead-End Path? : Mohamed El-Erian

Related: The No-Win Greek Debt Buyback Trap - Lessons from Ecuador: Eduardo Levy-Yeyati

Charles Blitzer, a former International Monetary Fund official who has worked on several sovereign restructurings, however saw things differently.

"This is a partial clawback of creditor rights, which I personally think was overdue," he said.