icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm
31 Aug, 2012 09:39

Berezovsky loses $5.6bn High Court case against Abramovich

A UK court has struck down a $5.6 billion lawsuit filed against Russian billionaire Roman Abramovich by his former partner Boris Berezovsky. The case recalls the 1990s disputes over Russia’s natural resources.

­Judge Elizabeth Gloster ruled that Russian executive Roman Abramovich, the billionaire owner of the Chelsea Football Club, will not pay the huge sum to the self-exiled Russian tycoon Boris Berezovsky.

The judge ruled that almost every aspect of the case was in dispute, RT producer Valentina Shpakova tweeted from the courtroom.

Berezovsky appeared disappointed and slightly nervous, Shpakova reported. Abramovich did not attend the verdict announcement. His team of lawyers merely smiled as the judge read out her lengthy statement.

Judge Elizabeth Gloster said that the 45-year-old Abramovich was the more reliable witness, with the 66-year-old Boris Berezovsky acting "deluded" while testifying and providing unreliable evidence. The case heavily depended on the oral evidence so the court needed to have a high degree of confidence in its quality, explained the judge.

"I found Mr. Berezovsky an unimpressive, and inherently unreliable witness who regarded truth as a transitory, flexible concept," Reuters quoted Judge Gloster as saying.

Berezovsky remained expressionless, and did not visibly react to the remark.

"At times the evidence which he gave was deliberately dishonest; sometimes he was clearly making his evidence up as he went along in response to the perceived difficulty in answering the questions in a manner consistent with his case,” the Judge told the courtroom.

The judge also rejected Berezovsky’s claim that Abramovich had provided false testimony.

Upon losing the legal battle in London, Berezovsky claimed that "everything Abramovich presented in court was a lie.”

Berezovsky’s lawyer said the London High Court did not understand the nuances of doing business in Russia.

Berezovsky says he is "totally disappointed" and "surprised" by the verdict, adding his confidence in English justice has been undermined. Still he claimed he had “no regrets about bringing the case.”

"I don't understand what happened,” he told journalists on leaving the courtroom. "But a legal decision cannot rewrite history."

Berezovsky is considering whether to appeal the verdict. Experts believe it may be worth his time to contest the decision: “The sums are so great: $5 billion or more. It is worthwhile, his appealing,” John Flood, Professor of Law at Westminster University told RT.

And that might lead to a settlement talk. But the trouble with Russian cases is that there is no move towards settlement. They keep entrenched in polar opposite positions and just want to fight it out,” he said.

Meanwhile, Abramovich’s defense team expressed satisfaction with the ruling: “We are pleased to hear the judge describing Mr. Abramovich as a truthful and honest witness."

Wild post-Soviet business exposed: Cronyism, underhanded deals, private jets

The verdict closed a case that shed light on the secret world of oligarchs: Unimaginable sums of money, offshore bank accounts, illicit payments, glamour, luxury cruisers and deals done by handshake alone.

Since both men live in the UK, the warring billionaires brought their case to a London court – along with entourages of high-priced lawyers, menacing bodyguards and beautiful women.

The two businessmen accused each other of lying, corruption, greed and dishonesty, and also leveled allegations of threats of physical violence.

Berezovsky claimed Abramovich used his close ties with Kremlin to intimidate his former partner and forced him to sell Russia’s fourth biggest oil company for a fraction of its value. In 2002, Berezovsky sold the Sibneft oil company to Abramovich for $1.2 billion.

Roman Abramovich denied the charges, claiming that Berezovsky never owned shares in the company. Abramovich alleged he was paying the exiled oligarch for political protection.

In Russian criminal slang, a protection racket is called a ‘krysha’ (roof). As the result of this case, the word is widely used in UK legal circles.

The case recalled many of the grim perils of doing business in Russia during the violent, post-Soviet era. Commentators speculated on the idiosyncrasies of the criminal slang used by the Russian mafia in the 1990s, the same vernacular used by the those who elbowed their way into the ranks of the oligarchs.

Abramovich said he made regular undocumented payments to Berezovsky in return for political protection, totaling several hundred million dollars. The payments were made in $5 million cash increments.

He also revealed that he paid for Berezovsky’s travels on a private jet, as well as for luxurious living accommodations and even jewelry for Berezovsky’s girlfriend.

Berezovsky made a fortune through his close ties to the late Russian President Boris Yeltsin.

While Yeltsin was in office, Berezovsky spent more time in the Kremlin than any other Russian executive, and was rumored to be Yeltsin’s personal family broker. When Putin was elected president of Russia in 2000, Berezovsky was disgraced, and was forced to flee to London, where the UK granted the former tycoon political asylum.

The UK denied Russian demands to extradite Berezovsky, despite his being charged with guilty verdicts for numerous economic crimes.

The trial was one of the biggest in British history, costing tens of millions of pounds in legal fees on both sides and involving hundreds of hours of court time.

We have what’s now known as the Russian premium on fees. The top [Queen’s Counsels] who were in these cases have been making money anywhere 800-1500 pounds in hour. The clerks who work for them are now becoming very skilled at negotiating with Russians,” Professor Flood said.

Abramovich, possessing a personal net worth of $12.1 billion, is ranked as the world's 68th richest man. Berezovsky’s current personal wealth remains unknown.