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Russian Tycoon Loses Multibillion-Dollar Case Against Ex-Partner Russian Tycoon Loses Multibillion-Dollar Case Against Ex-Partner
(about 2 hours later)
In an epic legal battle between two Russian oligarchs that became a window on the sometimes murderous carve-up of the Soviet Union’s vast resource wealth, a High Court judge rejected a $5.1 billion claim on Friday brought by Boris A. Berezovsky, a London-based émigré, against Roman A. Abramovich, a Kremlin favorite who owns London’s Chelsea football club. In an epic legal battle between two Russian oligarchs that became a window on the sometimes murderous carve-up of the Soviet Union’s vast resource wealth, a High Court judge rejected a $5.1 billion claim on Friday brought by Boris A. Berezovsky, a London-based émigré, against Roman A. Abramovich, a Kremlin favorite who owns London’s Chelsea football club. Mr. Berezovsky had accused Mr. Abramovich of acting in concert with the current Russian president, Vladimir V. Putin, to bully and blackmail him into selling his shares in the Russian oil company Sibneft and other assets in 2001 for a fraction of their value, under threat that the Kremlin might expropriate his holdings.
Mr. Berezovsky had accused Mr. Abramovich of acting in concert with the current Russian president, Vladimir V. Putin, to bully and blackmail him into selling his shares in the Russian oil company Sibneft and other assets in 2001 for a fraction of their value, under threat that the Kremlin might expropriate his holdings.
The case had been billed as the world’s largest private lawsuit since it began more than four years ago. It culminated on Friday with a stunning victory for Mr. Abramovich, 45, and a harsh repudiation for Mr. Berezovsky, 65, who was characterized by the judge in the case, Elizabeth Gloster, as an “unimpressive and inherently unreliable witness,” and at times a dishonest one, during the four months of testimony that ended in January.The case had been billed as the world’s largest private lawsuit since it began more than four years ago. It culminated on Friday with a stunning victory for Mr. Abramovich, 45, and a harsh repudiation for Mr. Berezovsky, 65, who was characterized by the judge in the case, Elizabeth Gloster, as an “unimpressive and inherently unreliable witness,” and at times a dishonest one, during the four months of testimony that ended in January.
Justice Gloster contrasted Mr. Berezovsky’s testimony starkly with Mr. Abramovich’s, saying the younger of the two men had been “a truthful, and on the whole reliable, witness.” While Mr. Berezovsky was in court for the ruling, Mr. Abramovich was in Monaco to watch a game involving Chelsea, which rode his billion-dollar investment in the club to victory this spring in Europe’s Champions League, the most coveted club trophy in soccer. Justice Gloster contrasted Mr. Berezovsky’s testimony starkly with Mr. Abramovich’s, saying Mr. Abramovich had been “a truthful, and on the whole reliable, witness.” While Mr. Berezovsky was in court for the ruling, Mr. Abramovich was in Monaco to watch a soccer game involving Chelsea, which rode his billion-dollar investment in the club to victory this spring in Europe’s Champions League, the most coveted club trophy in the sport.
Mr. Berezovsky, hugely wealthy but a financial minnow compared with Mr. Abramovich, a multi-billionaire, emerged from the case with nothing to show for the lavish sums that he, like Mr. Abramovich, spent on recruiting some of Britain’s most expensive legal talent. The judgment Friday deferred until the fall a ruling on an estimated $200 million to $250 million in legal and other costs, much of which could be assessed against Mr. Berezovsky, and left the loser to ponder the hazards involved in a possible appeal. Mr. Berezovsky, hugely wealthy but a financial minnow compared with Mr. Abramovich, a multibillionaire, emerged from the case with nothing to show for the lavish sums that he, like Mr. Abramovich, spent on recruiting some of Britain’s most expensive legal talent. The judgment on Friday deferred until the fall a ruling on an estimated $200 million to $250 million in legal and other costs, much of which could be assessed against Mr. Berezovsky, and left the loser to ponder the hazards involved in a possible appeal.
Mr. Berezovsky, in a gray suit and open-collared white shirt, sat glumly through the reading of Justice Gloster’s 38-page judgment, at times shaking his head. He emerged smiling stoically from the packed courtroom in the modern building that houses the commercial division of the High Court, where litigants are required to pay for the court’s operating costs as well as their own legal fees. Mr. Berezovsky, in a gray suit and open-collared white shirt, sat glumly through the reading of Justice Gloster’s 38-page judgment, at times shaking his head. He emerged, smiling stoically, from the packed courtroom in the modern building that houses the commercial division of the High Court, where litigants are required to pay for the court’s operating costs as well as their own legal fees.
But by the time he reached the throng of reporters and news cameramen on the sidewalk outside, he had recovered his pugnacious style, saying he was "absolutely amazed by what’s happened today," and accusing Justice Gloster of rewriting Russian history and glossing over the intimidation he had faced from Mr. Putin. He said he had made no decision on whether to appeal the judgement, which he said “could have been written by Putin.” But by the time he reached the throng of reporters and news cameramen on the sidewalk outside, he had recovered his pugnacious style, saying he was “absolutely amazed by what’s happened today,” and accusing Justice Gloster of rewriting Russian history and glossing over the intimidation he had faced from Mr. Putin. He said he had made no decision on whether to appeal the judgment, which he said “could have been written by Putin.”
“Life is life.” he said, before driving off in a chauffeur-driven Mercedes. He said, “Life is life,” before driving off in a chauffeur-driven Mercedes.
The case had strong reverberations in the Kremlin, where Mr. Abramovich, who remains at least formally a Russian resident, retains the political and personal ties to Mr. Putin that were crucial to his success in amassing a fortune estimated at more than $12 billion by Forbes earlier this year.The case had strong reverberations in the Kremlin, where Mr. Abramovich, who remains at least formally a Russian resident, retains the political and personal ties to Mr. Putin that were crucial to his success in amassing a fortune estimated at more than $12 billion by Forbes earlier this year.
Mr. Berezovsky, 65, has been cast as an embezzler and turncoat in recent years by the Kremlin, which has also accused him of links to Chechen terrorists. He was forced to flee Russia in 2001 after the Kremlin connections he built under former President Boris N. Yeltsin turned to ashes under Mr. Putin.Mr. Berezovsky, 65, has been cast as an embezzler and turncoat in recent years by the Kremlin, which has also accused him of links to Chechen terrorists. He was forced to flee Russia in 2001 after the Kremlin connections he built under former President Boris N. Yeltsin turned to ashes under Mr. Putin.
With a worth estimated recently by the Sunday Times of London at about $800 million, Mr. Berezovsky, who gained political asylum in Britain in 2003, has lived a reclusive if extravagant life in Britain and at homes he has acquired elsewhere in Europe.. Surrounded by bodyguards, he has claimed that he lives under permanent threat of assassination by Kremlin-assigned agents. With a worth estimated recently by The Sunday Times of London at about $800 million, Mr. Berezovsky, who gained political asylum in Britain in 2003, has lived a reclusive if extravagant life in Britain and at homes he has acquired elsewhere in Europe. Surrounded by bodyguards, he has claimed that he lives under permanent threat of assassination by Kremlin-assigned agents.
Once close enough to be photographed in a beaming embrace aboard a gleaming yacht in the Mediterranean, the two Russian businessmen — with their superyacht cruises, their villas and chalets in France and in other jetset retreats, and their entourages of expensively groomed women — became synonymous with the extravagant lifestyles of the oligarchs who plundered their fortunes from the privatization of state assets, particularly in oil, gas and minerals, after the Soviet Union collapsed in 1992. The two businessmen, once close enough to be photographed in a beaming embrace aboard a gleaming yacht in the Mediterranean, became synonymous with the extravagant lifestyles of the oligarchs who acquired their fortunes from the privatization of state assets, particularly in oil, gas and minerals, after the Soviet Union collapsed in 1992.
It was an era of lawlessness, corruption and intimidation, with almost unimaginable rewards available to those able to muster the muscle, cunning and patronage to outflank their enemies — and willing, in turn, to use their riches to help shore up the power of their their Kremlin protectors. Russian chroniclers say few men worked the system better than Mr. Berezovsky and Mr. Abramovich, only for their relationship to founder on the personal but ultimately vengeful chemistry they had ridden to success. It was an era of lawlessness, corruption and intimidation, with almost unimaginable rewards available to those able to muster the muscle, cunning and patronage to outflank their enemies. Russian chroniclers say few men worked the system better than Mr. Berezovsky and Mr. Abramovich, only to have their relationship founder on the personal but ultimately vengeful chemistry they had ridden to success.
That the ultimate legal test of their rivalry took place in London, and not in Moscow, carried its own irony. Deeply distrustful of the courts in their homelands, many of the superrich from countries around the world with unstable political systems have turned to Britain’s courts for a fair reckoning in cases, like the one involving the two Russians, in which the events at contest took place entirely outside Britain. It was thus that the court, in London’s steel-and-glass Rolls building, became the forum for an unsparing exposure of the murky business underworld where Mr. Berezovsky and Mr. Abramovich made their fortunes. Mr. Berezovsky, the court learned, had migrated from his earlier job as an academic mathematician to become the owner of Russia’s largest car dealership and an intimate of Mr. Yeltsin, Russia’s first post-Soviet president.
It was thus that the court in London’s steel-and-glass Rolls building, center for many of the billion-dollar lawsuits filed by foreign businessmen in recent years, became the forum for an unsparing exposure of the murky business underworld where Mr. Berezovsky and Mr. Abramovich made their fortunes. Far from seeking to put a gloss on their past, or on the kind of country Russia had become by the mid-1990’s, the two men laid out the seamy background to their fallout in ways that seemed at times to have been taken from the mafia culture of 20th-century America. Mr. Abramovich, a former Soviet Army conscript, garage mechanic, street trader and toy-duck importer, brought his business acumen and cash to the deal, while Mr. Berezovsky used his Kremlin influence to gain control of valuable Siberian oil holdings and to transform them into a new company, Sibneft.
Mr. Berezovsky, the court learned, had migrated from his earlier job as an academic mathematician to become the owner of Russia’s largest car dealership and an intimate of Mr. Yeltsin, Russia’s first post-Soviet president. The core of the case rested on the roles played by Mr. Berezovsky and Mr. Abramovich, with Mr. Abramovich claiming Mr. Berezovsky’s part had been that of “the godfather,” providing the “krysha,” or protection, that eased the way for the Sibneft deal. But he denied that Mr. Berezovsky had ever been a major stakeholder in Sibneft, and said Mr. Berezovsky’s role had been limited to providing what he called “political clout.”
Mr. Abramovich, a former Soviet Army conscript, garage mechanic, street trader and toy-duck importer, brought his business acumen and cash to the deal, while Mr. Berezovsky used his Kremlin influence to gain control of valuable Siberian oil holdings and to transform them into a new company, Sibneft, whose principals were Mr. Berezovsky, Mr. Abramovich and the richest man in Georgia, Arkady Patarkatsishvili.
The core of the case rested on the roles played by Mr. Berezovsky and Mr. Abramovich, with Mr. Abramovich claiming Mr. Berezovsky’s part had been that of “the godfather,” providing the “krysha” — a Russian word meaning roof, used in common parlance to mean protection — that eased the way for the Sibneft deal. But he denied that Mr. Berezovsky had ever been a major stakeholder in Sibneft, and said Mr. Berezovsky’s role had been limited to providing what he called “political clout.”
Mr. Berezovsky and his lawyers belittled Mr. Abramovich’s business competence and intelligence, saying he had been menaced into accepting $1.3 billion from Mr. Abramovich in 2001 for his Sibneft holding, while Mr. Abramovich sold his own share in the company in 2005 for $11.9 billion.Mr. Berezovsky and his lawyers belittled Mr. Abramovich’s business competence and intelligence, saying he had been menaced into accepting $1.3 billion from Mr. Abramovich in 2001 for his Sibneft holding, while Mr. Abramovich sold his own share in the company in 2005 for $11.9 billion.
But it was Mr. Berezovsky, not Mr. Abramovich, who took the brunt of Justice Gloster’s verdict. In her judgment, she was unsparing of Mr. Berezovsky, saying that he had come across in the witness box, and in court papers, as a man who “regarded truth as a transitory, flexible concept, which could be molded to suit his current purposes.” But it was Mr. Berezovsky, not Mr. Abramovich, who took the brunt of Justice Gloster’s verdict. She was unsparing of Mr. Berezovsky, saying that he had come across as a man who “regarded truth as a transitory, flexible concept, which could be molded to suit his current purposes.”
“At times,” she said, “the evidence which he gave was inherently dishonest; sometimes, he was clearly making his evidence up as he went along.” She added, “At other times, I gained the impression that he was not necessarily being dishonest, but had deluded himself into believing his own version of events.”“At times,” she said, “the evidence which he gave was inherently dishonest; sometimes, he was clearly making his evidence up as he went along.” She added, “At other times, I gained the impression that he was not necessarily being dishonest, but had deluded himself into believing his own version of events.”

Sarah Lyall contributed reporting.

Sarah Lyall contributed reporting.

This article has been revised to reflect the following correction:This article has been revised to reflect the following correction:
Correction: August 31, 2012Correction: August 31, 2012

An earlier  headline on some digital platforms misidentified the loser of the legal case as Roman A. Abramovich.

An earlier  headline on some digital platforms misidentified the loser of the legal case as Roman A. Abramovich.