LONDON: Chelsea Football Club owner Roman Abramovich emerged victorious on Friday from a $6 billion legal battle with his former mentor Boris Berezovsky that has laid bare the intrigue behind the post-Soviet carve-up of Russia’s vast natural resources.
Berezovsky, who became a Moscow powerbroker under the late President Boris Yeltsin only to fall foul of Vladimir Putin, had accused Abramovich of using the threat of Kremlin retribution to intimidate him into selling prized assets at a knockdown price.
But Judge Elizabeth Gloster told a packed London courtroom that she had found Berezovsky to be an “unimpressive and inherently unreliable witness” who gave sometimes dishonest evidence and would say “almost anything to support his case”.
Gloster dismissed all of Berezovsky’s $6 billion in claims in one of the biggest private litigation cases ever, saying Abramovich – the world’s 68th richest man with a $12.1 billion fortune – was a “truthful and on the whole reliable witness”.
“I am absolutely amazed about what happened today,” Berezovsky, 66, told reporters after listening expressionless as the verdict was read out in a modern, glass courtroom crowded with lawyers, bodyguards and journalists.
“My confidence in English justice has been undermined by the judge’s decision,” he said, adding that the ruling was so sympathetic to Putin that it read as if the Kremlin chief had written it himself.
But such a stinging rebuke from one of Britain’s most experienced commercial judges is likely to cement Berezovsky’s reputation as a publicity-seeker and opens him up to claims for costs that could exceed $100 million.
“There was a marked contrast between the manner in which Mr Berezovsky gave his evidence and that in which Mr Abramovich did so,” Gloster said in an hour-long dissection of Berezovsky’s claim which delved into the murky world of Russian business.
Abramovich, who made headlines by buying Chelsea in 2003, had denied Berezovsky owned the assets and said that he merely paid Berezovsky for political cover and protection – known in Russian gangster slang as “krysha” or “roof”.
The 38-page preliminary ruling marks the beginning of the end for a legal odyssey stretching from the gilded corridors of the Kremlin via the offshore enclaves favoured by Russia’s tycoons to the rarefied atmosphere of London’s High Court.
Judge Gloster stumbled at times trying to pronounce “krysha”, a term used by leather-jacketed gangsters on the streets of Russian cities and now the partial basis of a ruling in one of the most respected legal systems in the world.
“It is a very tough verdict for Mr Berezovsky: it is very much based on an appreciation of him as a witness whether that is justified or not and he clearly thinks it is not,” said Philippa Charles, a litigation partner at law firm Mayer Brown, which is not directly involved in the case.
The case has captivated some of the top lawyers in Britain, whose globally respected, tradition-bound courts where barristers still wear wigs have become the venue of choice for the international rich to sue each other. Russian firms often settle their legal differences in London because they do not trust the courts at home.
Friday’s judgment comes less than a month before the main proceedings in another legal battle between two Russian tycoons – metals billionaire Oleg Deripaska and his former associate Michael Cherney – are set to begin in a London courtroom.
Berezovsky had claimed that Abramovich used the threat of retribution at the hands of Putin’s Kremlin to intimidate him into selling out of Sibneft, Russia’s fourth biggest oil company, at a knockdown price.
The judge said that though she felt the court had not got the full picture of the relations between Berezovsky, his late partner Badri Patarkatsishvili, and Abramovich, she had dismissed the $5 billion Sibneft claim and another $565 million claim relating to claimed ownership in aluminium company RUSAL.
Abramovich was not in court to hear the verdict and his team of lawyers, led by Karyl Nairn a litigation partner at Skadden, Arps, Slate, Meagher & Flom LLP, merely smiled as the judge read out her lengthy statement.
“There were many serious allegations made against Mr Abramovich by Mr Berezovsky, including attacks on Mr Abramovich’s honesty and integrity,” Abramovich’s investment vehicle, Millhouse, said in a statement.