Berezovsky loses against Abramovich

Boris Berezovsky, the Russian oligarch and fierce critic of the Kremlin, has lost his $6.5bn lawsuit against fellow oligarch Roman Abramovich, the billionaire owner of Chelsea football club, after one of the most expensive court battles heard in Britain.

Mrs Justice Gloster, who presided over the four-month High Court battle, dismissed Mr Berezovsky’s claims in a ruling handed down on Friday in a decision seen as a humbling blow for the oligarch.

In a devastating ruling, she said Mr Berezovsky’s sworn evidence was at times “deliberately dishonest”. She described him as an “inherently unreliable witness, who regarded truth as a transitory, flexible concept, which could be moulded to suit his current purposes”. By contrast, she said Mr Abramovich in his witness evidence gave “careful and truthful” answers and was a reliable witness.

Mrs Justice Gloster made it clear that her verdict on Friday boiled down to which of the two men she believed in a case where there were no documents or contemporaneous notes to rely on. She concluded: “I regret to say that the bottom line of my analysis of Mr Berezovsky’s credibility is that he would have said almost anything to support his case.”

The case centred on claims that Mr Abramovich intimidated Mr Berezovsky into selling his oil and gas stakes, including his holding in oil group Sibneft, at a “gross undervalue” after Mr Berezovsky’s falling-out with Vladimir Putin, Russian president. Mr Abramovich denied this and claimed he paid Mr Berezovsky $2.3bn for krysha, or political protection, when he was building up his businesses.

The four-month trial shone an unforgiving spotlight on the chaos of Russia’s transition to a market economy, a period of lawlessness that Mr Abramovich’s lawyer memorably likened to medieval England. It highlighted the lavish lifestyles of Russia’s mega-rich, the Caribbean cruises, the mansions, the art collections, in details that were lapped up not just in Britain but back in Russia.

While confirming much of what was already known of Russia’s post-communist business history, the case may alter perceptions of some elements.

One is the role of Mr Berezovsky himself. He gloried in his image as oligarchic kingpin – telling the Financial Times in 1996 that he and six other businessmen controlled half Russia’s economy – years before anyone had heard of his publicity-shy partner. Mr Abramovich came to prominence only after 1999.

The judge read a summary of her ruling to the assembled media, and legal teams representing the two men, but the full ruling will not be made public until at least mid-September, after it has been seen by the parties.

The case, which resulted in an estimated £100m in legal costs, explored in forensic detail the events after the collapse of the Soviet Union, when vast swaths of state-owned assets were sold at knock-down prices to a small group of oligarchs.

Both oligarchs gave evidence during the trial. Mr Berezovsky spoke in English and at times became very emotional, whereas Mr Abramovich spoke in Russian and was cautious and at times monosyllabic in his answers.

Mr Abramovich was not in the packed courtroom to hear the verdict, but Mr Berezovsky was present, along with his large legal team and his girlfriend Elena. So many lawyers and journalists turned up on Friday that an overspill courtroom was opened.

The case also underlined the growing status of London’s High Court as the favoured destination for the super-rich of the former Soviet Union to fight their legal battles. It is estimated that more than 60 per cent of the case load of the High Court’s commercial division now comes from Russia and eastern Europe.