High Court rules in case of four Caribbean-registered firms
Companies entitled to damages against man over defrauding of Russian ammonia firm
Yevgeniy Yakovlevich Sedykin and Belport have been ordered by the court not to reduce their assets below $78 million. Photograph: Bryan O’Brien
The High Court has ruled four Caribbean-registered companies are entitled to damages against a man allegedly behind an alleged campaign of vexatious litigation and conspiracy involving an Irish-registered firm to defraud a leading Russia-based ammonia producer.
Judgment in default of entering an appearance to defend the action was given by Mr Justice David Barniville against Yevgeniy Yakovlevich Sedykin from Togliatti City in the Samara Region of Russia. Judgment in default was also given against a British Virgin Islands registered company, Belport Ltd, also claimed to be part of the alleged conspiracy.
The exact amount of damages will be determined later but in the meantime Mr Sedykin and Belport have been ordered by the court not to reduce their assets below $78 million.
Both had failed to enter an appearance in a case being brought against Dublin registered firm Eurotoaz Ltd, which it is claimed, was the company which Mr Sedykin acted for in alleged vexatious litigation in Russia to unlawfully gain control of another company, Togliattiazot (ToAZ), a €3 billion ammonia-producing company.
ToAZ is 70 per cent owned by four Carribbean-registered firms who have brought the High Court action against Mr Sedykin and 11 other individuals and companies, including Eurotoaz, claiming they were part of a conspiracy to defraud them of their $2 billion shareholding in ToAZ.
The alleged leading individual among them is Russian billionaire Dmitry Mazepin, a former member of the Kirov Regional Duma as a representative of the United Russia Party headed by Russian president Vladimir Putin.
Mr Mazepin is alleged to be the beneficiary of the fraud and his company United Chemical Company Uralchem (UCCU), which is also being sued, is a direct competitor of ToAZ. Mr Sedykin has public links to Mr Mazepin which have been reported in the Russian press, it is claimed.
The four plaintiff companies, Trafalgar Developments, Instantania Holdings, Kamara and Bairiki Inc, have sought judgment against 11 defendants whom it alleges were part of the conspiracy.
The alleged conspiracy allegedly involved the phenomenon known as “raider attacks” in which a so-called raider acquires a minority shareholding in a target company. Then illegal and dishonest means, including improper criminal and civil lawsuits, are used to wrest control of the target and devalue a company’s stock.
It is claimed ToAZ was targeted in this way and that raiding is prevalent in the Russian Federation.
After the proceedings were issued in Dublin, the plaintiffs sought judgment in default against eight of the 11 defendants including Mr Mazepin, UCCU, Mr Sedykin and Belport.
Mr Mazepin and five other defendants registered appearances to defend but not Mr Sedykin or Belport. Mr Justice Barniville was satisfied Mr Sedykin and Belport had been properly served with notice of the proceedings and the plaintiffs were entitled to judgment in default against them.
The amount of the damages is to be ascertained at the time of the trial of the case against the other defendants against whom, the judge emphasised, proceedings have yet to be determined. He was making no findings in relation to them, he said.
He also granted the plaintiffs various injunctions, including orders freezing the Sedykin/Belport assets below $78 million. He granted them liberty to apply on relation to the injunctions including whether the court should require the plaintiffs to give an undertaking as to their ability to pay damages if they lose the main case.