Liechtenstein body may play key role in Blackrock Clinic case

A foundation in Liechtenstein may take centre stage if the High Court battle over the ownership of the Blackrock Clinic goes according to plan for clinic founder Joseph Sheehan in the coming months.

In submissions to the court last week he claimed changes to the structure of the Goodman Group meant that control of Breccia, the Goodman company that holds shares in the Blackrock Clinic, changed in March 2006, when a Blackrock shareholders' agreement was signed.

In an expert's report submitted to the court by Sheehan, it was argued that, while the group and its various holding companies were owned by Larry Goodman and his wife, and controlled by Goodman, at the time the agreement was signed, this then changed, with the end result that the Rabena Foundation, of Vaduz, ended up as the "ultimate owner" of the group.

However, the Goodman side is saying that there has been no change in the control of the Goodman group since the agreement was signed and, furthermore, it never said Goodman controlled the group.

It objected to an amendment of Sheehan’s statement of claim to introduce the control issue, but was unsuccessful. In objecting, it said the issue was being raised to create an impression of impropriety when no such impropriety existed.

Material breach

Sheehan wants to explore the issue because he wants to claim that the shareholders’ agreement requires the parties to notify each other of any change in control of a shareholder.

A material breach of this part of the agreement could lead to the shares being sold to the other shareholders. In other words, it could lead to Goodman losing out in the battle over who gets the Blackrock Clinic.

The court heard last week that the expert's report was prepared after details of the Goodman group's structure were revealed for the first time in The Irish Times last year.

Those reports were based on publicly available filings in Luxembourg and elsewhere by companies that form part of the financing and holding company structure behind Goodman’s beef processing, property and investment empire.

That empire is worth hundreds of millions of euro, and details of its finances and ownership structure had long been a secret. It seems clear from the filings that legal, though controversial, tax planning entities in Luxembourg formed part of the international structure.

While the ABP beef processing group is headquartered in Co Louth, the Rabena Foundation in Liechtenstein appears to be high up the group ownership pyramid, if not at the peak. Accounts for a Luxembourg group financing entity called Silverbirch Investments show share and loans dealings with Rabena in 2013 of €300 million.

However, as the reports in The Irish Times also stated, some of the companies in the Goodman group state in their accounts they are ultimately owned by an entity called the "Goodman Family Trust".

The Blackrock Clinic case has already heard claims that Breccia is owned by this trust. It is not clear if this is the same entity as the Rabena Foundation.

Autonomous funds

According to the office of justice of the Liechtenstein National Administration, foundations in the principality are autonomous funds with a legal personality that serve a designated purpose, such as charitable, family or religious purposes.

“The founder of a foundation loses all rights in relation to the foundation, unless the statute explicitly provides for certain non-transferable rights to be reserved. The foundation law also knows beneficiaries, to whose favour the realisation of the foundation’s designated purpose is carried out, which the founder may be part of.”

In the filings in Luxembourg for the Goodman group financing company called Silverbirch Investments SA, with details of a meeting held in August 2013 concerning its shares and more than €300 million in share and loan transactions between Silverbirch and Rabena, one of the parties mentioned is Christof Ebersberg of a firm called Praesidial Anstalt. He appears to have had preferential rights in relation to the Luxembourg company.

Ebersberg features in the Panama Papers, the leaked files of the Panama-headquartered Mossack Fonseca law firm. The files show Praesidial Anstalt of Vaduz, Liechtenstein, is a client of Mossack, and that Ebersberg acted as a director of a number of offshore companies to which Mossack provides services.

The files show that in relation to one company, Rondeberg Limited, of the British Virgin Islands, Ebersberg acted as the holder of a bearer share certificate for the company.

None of the companies that form part of the international Goodman structure feature in the leaked Panama files and there is nothing to indicate, and no suggestion intended, that the Goodman group had any dealings with Mossack, or with the other companies associated with Ebersberg.