Oleg Deripaska Loses Court Case In Israel

By Israel News Agency Staff

Jerusalem ---- March 18, 2007..... Russia billionaire Oleg Deripaska has lost a defamation suit in Israel against Jalol Khaydarov. In the 1990’s, Khaydarov served as the director of Kachkanar GOK Vanadium, one of Russia’s top five mining and processing plants. The suit commenced in late 2002, when a Khaydarov interview with Le Monde led to a series of articles on the Russian aluminum industry.

Deripaska and his Russia Aluminum company (RusAl) considered the printed results as damaging to their reputation. In March 2003, Deripaska and RusAl attempted to file a defamation suit against Le Monde in France, but it was turned down because it exceeded that country’s statute of limitations. Deripaska then decided to turn to Israel courts to pursue his claim.

When Khaydarov eventually visited Israel on a tourist visa, he was served with a subpoena. Israel’s courts found, however, that regardless of any possible defamation that might or might not have appeared in the articles, Khaydarov was nothing more than a legitimate interviewee and as such, not liable in any way in Israel.

The Tel Aviv’s District Court ruled that Oleg Deripaska and RusAl had to pay the defendant’s court costs of $6,000. The latter verdict is another in a growing chain of litigations compromising RusAl’s recent agreement to merge with The Sual Group, Russia's second largest aluminum producer, and to purchase the assets of Glencore International, the Swiss commodities trading giant, positioning the new joint company to rival Alcoa and Alcan as the world's largest producer of primary aluminum.

BFI Group Divino, a California company run by an expatriate Nigeria businessman, is challenging RusAl and Nigeria's government for ownership of the smelter in court cases in Nigeria and the U.S.
One allegation in the U.S. suit is that Oleg Deripaska and RusAl won control of the smelter after promising payoffs to Nigeria officials.

In a suit filed last March in US District Court in New York, BFI is seeking $2.8 billion in damages from RusAl. It accuses RusAl of interfering in a contract, interfering with a prospective business advantage, unfair competition and conspiracy to commit fraud.

Meanwhile, in Britain, Ansol, a company registered in Guernsey, has filed a suit alleging that RusAl conspired with TadAz, a Tajik smelter, to expel Ansol from a joint venture with RusAl in Tajikistan. With a claim running into several hundred millions of dollars, Ansol alleges that it was pushed out of the venture shortly after Deripaska met with Tajikistan President Emomali Rakhmonov in 2004.

Ansol also contends, in a case still to be heard in the High Court in London, that RusAl hacked into the computers of Ashton Investments, an English outfit that provides legal and investment services to Ansol, to view confidential information concerning the litigation.

The Ansol case is already the second in a major western court in which Deripaska, the controlling shareholder of RusAl, and his CEO Alexander Bulygin, have faced criminal charges relating to the way in which they acquired their aluminum smelters, and operate elaborate international trading schemes that keep most of Rusal’s profits offshore, outside Russia.

The first international legal challenge, involving the takeover of Russian smelter Novokuznetsk Aluminum Plant, failed to win jurisdiction in the federal district court of New York. Later, however, RusAl paid the claimants, the former owners of Novokuznetsk, more than $65 million to resolve their claims for compensation.

Another legal suit against Oleg Deripaska has been filed in the Commercial Court of the High Court in London last November by Michael Cherney (Mikhail Chernoy), who introduced Oleg Deripaska to the metals business by making him his manager and later his partner. Cherney now seeks over USD three billion, which he says represents 20 percent of RusAl’s stock for which Cherney says he has yet to be paid.