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Exiled Russian Boris Berezovsky loses $5.6bn High Court case against Chelsea FC Owner Roman Abramovich
2012-08-31
Exiled Russian Boris Berezovsky loses $5.6bn High Court case against Chelsea FC Owner Roman Abramovich

Mr Berezovsky, 65, said Mr Abramovich, 45, had intimidated him into selling shares in Russian oil giant Sibneft. He was claiming £3bn ($4.7bn) in damages.

 

But the London Commercial Court judge said Mr Berozovsky had been an "inherently unreliable" witness.

 

Mr Berezovsky said he was "shocked" at Mrs Justice Gloster's decision and that she had rewritten Russian history.

 

It is alleged that the estimated legal costs, in the case, are up to £100m.

 

In her ruling the judge said: "On my analysis of the entirety of the evidence, I found Mr Berezovsky an unimpressive, and inherently unreliable, witness, who regarded truth as a transitory, flexible concept, which could be moulded to suit his current purposes."

 
 

 

She said she dismissed Mr Berezovsky's claims in relation to Sibneft - and a claim Mr Abramovich had broken a promise over a deal involving Russian aluminium company RusAl - "in their entirety".

 

She also said she found Mr Abramovich "to be a truthful, and on the whole reliable, witness".

 

Mr Berezovsky, who had told reporters before the verdict that: "I believe in the system", afterwards said : "I am absolutely amazed by what's happened today... particularly because Lady Gloster took the responsibility to rewrite Russian history."

 

The case focused on one of the most shadowy periods of modern Russian history, when the majority of the country's billionaires started to accumulate their capital.

 

The informal link between business and power that existed in post-Soviet Russia has always been well-rumoured, but the detailed open hearing in London made them public, and turned guesswork into fact.

 

Many within the Russian business community welcomed the judge's decision to dismiss Mr Berezovsky's claims. The Russian President's spokesperson said: "It is pleasant, when libel is called libel."

 

Asked if he felt Russia's President Vladimir Putin would be happy with the ruling, he replied: "Sometimes I have the impression that Putin himself wrote this judgment."

 

He said he did not regret bringing the case against Mr Abramovich and did not know if he would appeal, adding: "I was absolutely shocked... but life is life."

 

Defiant: Berezovsky leaves in a car after his defeat. Asked how he felt, he replied in English 'Perfect'. He said that the decision would not affect history. I dismiss Mr Berezovsky's claim in relation to both Sibneft and RUSAL,' Judge Elizabeth Gloster told the courtroom. Mr Berezovsky spoke to reporters in Russian as he walked out of the courtroom. Translated into English by a bystander, he said: 'A legal decision cannot rewrite history. History happened.'

 

 

There has reportedly been a lot of interest in the case in Russia as it shed light on the controversial sale of Russia's mineral wealth by the state to a small group of oligarchs in the early 1990s.

 

Mr Abramovich was not in court for the ruling and is thought to be in Monte Carlo for Chelsea's Super Cup Final on Friday night.

 

But a statement issued on his behalf said: "There were many serious allegations made against Mr Abramovich by Mr Berezovsky, including attacks on Mr Abramovich's honesty and integrity.

 


 

"We are pleased that the judge has firmly rejected all such allegations and has described Mr Abramovich as a truthful and frank witness who showed a responsible and honest approach when giving evidence in this case."

 

When he gave evidence, Mr Abramovich had said Mr Berezovsky was paid millions of pounds for his services as a "political godfather" but was not a business partner.

The court heard Mr Berezovsky "fled Russia, never to return" in 2000, after falling out with President Vladimir Putin.

 

Both men have homes in London, with Mr Abramovich owning a property in Knightsbridge as well as a 400-acre estate in Fyning, West Sussex.

 

During the three-month trial, the court heard details of the lifestyles of Russia's super-rich oligarchs.

 

Mr Berezovsky claimed Mr Abramovich was a "gangster" while Mr Abramovich responded by saying there were times when Mr Berezovsky was "something of a megalomaniac".

 

The hearing was told Mr Abramovich bought a businessman a plane to say thank you after one deal.

 

Mr Berezovsky told the court he was born in Moscow, studied mechanics and mathematics and worked as a designer for Russian state car maker AvtoVAZ in the 1970s, before going into business in the 1980s.

 

Mr Abramovich objected about the hearing taking place in the UK, claiming it was "essentially Russian claims arising out of a uniquely Russian story"

 

The trial used new technology, called Magnum Cloud, which gave the judge and lawyers secure access to documents from computers in the courtroom.

 

In the 1990s, following the collapse of communism, Mr Berezovsky embarked on a political career and Mr Abramovich's lawyers claimed he was a "power broker" and a "highly controversial figure".

 

The hearing was told Mr Berezovsky's expenses - including "Palaces in France", "private aircraft", "valuable paintings" and "jewellery for his girlfriend" - were paid for by Mr Abramovich.

 


 

 

Meanwhile, the case has been followed carefully by Russia's business community.

 

Commenting on the ruling, Alexandr Shokhin, head of Russian Unions of Industrialists and Entrepreneurs, said: "It's a good signal for all Russian businessmen and also power structures - highlighting that all relations should be built lawfully, on paper, and witnessed by reliable and independent witnesses."

 

The judge added: 'That meant confidence not only in his ability to recollect things accurately, but also in his objectivity and truthfulness as a witness.'

 

She announced in a lengthy summary of her judgment: 'On my analysis of the entirety of the evidence, I found Mr Berezovsky an unimpressive, and inherently unreliable, witness, who regarded truth as a transitory, flexible concept, which could be moulded to suit his current purposes.

 

'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; at other times, I gained the impression that he was not necessarily being deliberately dishonest, but had deluded himself into believing his own version of events.

 

'On occasions he tried to avoid answering questions by making long and irrelevant speeches, or by professing to have forgotten facts which he had been happy to record in his pleadings or witness statements.

 

'He embroidered and supplemented statements in his witness statements, or directly contradicted them.'

 

Berezovsky, in a grey suit and white shirt with no tie, sat expressionless as the ruling was delivered.

 

Mr Berezovsky told the trial that Mr Abramovich 'intimidated' him into selling shares in a Russian oil company at a fraction of their value.

He also claimed that Mr Abramovich broke a promise by selling his shares in a Russian aluminum company they owned together, and so devaluing Berezovsky's stake.

 

The legal fight centered on deals done in Russia following the break-up of the Soviet Union two decades ago. Mr Abramovich disputed the claims.

Berezovsky and Abramovich traded accusations throughout the case and gave onlookers a glimpse into the lifestyles of the super-rich during a three-month trial thought to have cost tens of millions of pounds in legal fees.