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Michael Cherney of the Michael Cherney Foundation has generously decided to donate $600 million dollars to charity if he wins his up and coming court case against Oleg Deripaska of RUSAL the Russian aluminium giant. This court case is rooted in the aluminium wars of the 1990s and their culmination
Michael Cherney however hasnt won the court case yet. It's an attention grabbing headline (and Cherney even states the various charities that will share in the proceeds when the Michael Cherney foundation receives the money!)
The question is what are the chances of the Michael Cherney foundation receiving the money and what are the facts behind the claim?
The "aluminium wars" of the 1990s, were fought for control of the Russian aluminium industry and the stakes were high. Today, an economic giant, Rusal, stands as a statement of Russia's new found global influence in aluminium and commodities markets, where it is now a leading player.
The Dispute
The dispute however is being fought in London rather than Moscow .
Why?
This is due to the fact that Cherney believes that senior Russian politicians are against him and he will not see a fair trial in Moscow. Its case number 2006/1218 and it can be viewed on line and will be heard in the High Court in London .
In one corner Michael Cherney and in the other Oleg Deripaska - the majority owner of Rusal the world's largest aluminium producer. The dispute could be worth billions if Michael Cherney wins and as we have said he is very confident, as he has already set aside $600 million for the Michael Cherney foundation to spend.
Cherney has allegedly numerous documents as evidence, to prove his past partnership with Rusal owner Oleg Deripaska and now wants what he feels he is owed. He claims 20% of Rusal, a huge sum of money, worth billions. Oleg Deripaska denies the claim.
With Deripaska in no mood to pay, it is up to Michael Cherney to take the matter into the courts and fight for what he feels is his.
The first stage has gone to Deripaska, as the Judge has decided that documents were not validly served. This maybe technicality, and remedied but reading the documents on line there are some interesting points not least what the judge says of Cherney in terms of proving this case should be heard in London in the first place and he says regarding Cherney:
"and establish, the burden being upon him, that England was the appropriate forum for the determination of the claim."
To most observers this would seem an obvious point, as the UK has nothing to do with the dispute, neither live in the UK and the dispute originates thousands of miles away, in Russia .
If the case does go to court then it is likely to be very expensive for Mr. Cherney to bring as:
When a non UK domiciled party sues in the UK , the defending party has the right to ask for security for costs in the event that they win. Cherney must therefore deposit a substantial sum to cover Deripaska's costs if he loses. The amount that is ordered by the Judge to be deposited is in direct correlation to the strength or weakness of the claim. The amount of money that this will cost in terms of security could be up to several million dollars - if the case is on weak ground and of course less if on strong ground.
It will be interesting to see why Cherney believes London is a suitable venue for the case and also - if it does proceed, how much money needs to be deposited? What the judge orders will give an indication of the strength of the claim.
Disgruntled business partners or employees, often come out of the woodwork years later, to make claims and demand what they say is rightfully theirs. The more successful the business is, the more dramatic the claim tends to be.
Can the chosen charities look forward to a $600 million dollar windfall, from the Michael Cherney foundation if Oleg Deripaska losses?
Time will tell but the case is far from won. It does not look like the claim is rock solid or a forgone conclusion that Mr. Cherney believes it is. Deciding how to spend the money before its even been won is premature and really just a media grabbing headline.
The "aluminum Wars" are over, but arguments live on today, the above court action and argument between Michael Cherney and Oleg Deripaska, is a good illustration of this.
The Michael Cherney foundation has decided how to spend the money but it will be interesting to see how much further the case goes and the outcome.
More About The Author
Marcus Lund is a graduate in political philosophy and writes on economic and political matters and has a special interest in Russia and China . He is presently writing books on: "Russia In The New Millennium" and "War Behind The Lines" a history of the resistance movement to German occupation in wartime Russia .
» left by steve from boston (1 year 85 days ago.)
excellent article about Michael Cherney and Oleg Deripaska of the Michael Cherney Foundation and RUSAL respectively
I'll be keeping an eye on the progress of the case
fascinating to watch rich people squabble over money - guess they're not that different from us! Respond to this comment
» left by Michael (333 days 23 hours ago.)
When will be the case held in London? Respond to this comment
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Article added to SearchWarp.com on Sunday, October 14, 2007 View other articles written by Marcus Lund(33)
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