Yukos Finance B.V. and Others v Lynch and Others [2019] EWHC 2621 (Comm)
The High Court has dismissed a claim for up to £35 million brought by the former management of Yukos Oil Company against five individuals who were alleged to have colluded with the Russian state to rig an auction of a valuable Yukos subsidiary, Yukos Finance BV. The claim was governed by Russian law. Sebastian Isaac appeared on behalf of the hedge fund manager, Richard Deitz. Abra Bompas appeared on behalf of Bob Foresman, a former senior employee of Renaissance Capital, a Russian investment bank.
The Lawyer named the case one of “The Top 20 Cases of 2019”.
Yukos Oil was bankrupted in 2006 as a result of actions taken by the Russian state, and its assets were sold off in a series of state-run auctions. The last auction, in August 2007, was of the shares in its Dutch subsidiary, Yukos Finance, which owned around US$1.5 billion in cash as well as a valuable oil pipeline. It was won by a consortium of investors including the hedge fund, VR Capital founded by Mr Deitz, and Renaissance Capital, where Mr Foresman was employed. The Claimants alleged that the consortium had made an unlawful agreement with the Russian government whereby it would be allowed to win the auction at a pre-agreed price.
After a six-week trial, Sir Michael Burton GBE rejected the Claimants’ allegation that the Defendants were party to any unlawful rigging of the auction. The Court also concluded that the Claimants’ case failed as a matter of causation, and was time-barred, and that the Defendants were in any event not the correct defendants to the claim as a matter of Russian law.
Sebastian Isaac appeared for the Fourth Defendant, led by Stephen Houseman QC.
Abra Bompas appeared for the Fifth Defendant, led by Jonathan Adkin QC.
A copy of the judgement can be found here.