26 Mar 2015

Stephenson Harwood wins victory for Mr Dmitry Skarga in Fiona Trust case


"International law firm Stephenson Harwood LLP has secured a Court of Appeal win for its client, Mr Dmitry Skarga in a dispute with his former employer Sovcomflot, a Russian tanker company.

This latest decision by the Court of Appeal on 6 March 2013 (judgment was handed down yesterday afternoon), follows the firm's previous success in December 2010, when the High Court dismissed the claims against Mr Skarga in their entirety– a trial which The Times labelled as “the shipping trial of the century” and TradeWinds as the “trial of the decade”.

Commenting on the outcome of the appeal, Louis Flannery, partner in the litigation group at law firm Stephenson Harwood LLP, said: "During the seven and a half years that Mr Skarga has fought this legal battle, he has had to suffer an imposed exile, a bitterly fought (and ultimately unsuccessful) extradition request, unlawful hacking into his bank and email accounts and seizure of all his assets, while being forcefully separated from his wife and young children.

He has now been fully vindicated by an impartial and dispassionate tribunal of three eminent Court of Appeal judges, who have reviewed Mr Justice Andrew Smith’s judgment fully and decided that there were no grounds of appeal. Perhaps he can now be left alone at last to rebuild his life."

Throughout this case, Stephenson Harwood LLP acted for two of the defendants, Dmitry Skarga and Tagir Izmaylov. Mr Skarga was Director General of the Russian state-owned shipping monolith Sovcomflot between 2000 and 2004, while Mr Izmaylov was President of its sister company Novoship between 2001 and 2005.

Louis Flannery added: "I would add that even though the claim against Mr Tagir Izmaylov was not appealed, he too suffered as a result of the claim brought against him (that claim also being dismissed in its entirety)."

Sovcomflot and Novoship were among the largest Russian operators of tankers and other commercial ships. The Claimants (in excess of 75 companies), including Sovcomflot and Novoship brought proceedings in the Commercial Court alleging, inter alia that Mr Skarga and Mr Izmaylov conspired to defraud Sovcomflot and Novoship respectively by a series of unlawful and uncommercial shipping and banking transactions because they were bribed to do so by another defendant, Mr Nikitin (not represented by Stephenson Harwood LLP).

The trial of the claims against both Mr Skarga and Mr Izmaylov involved claims of over US$1bn and consideration of over 100 transactions over a number of years. Allegations were made of a political persecution in Russia, with illegal evidence gathering including the misuse of private investigators, coercion of witnesses and concoction of evidence. Many of the witnesses against both Mr Skarga and Mr Izmaylov were found to have been untruthful. The Judge’s conclusion that as a matter of Russian law neither Mr Skarga nor Mr Izmaylov were bribed has been upheld by the Court of Appeal."



Louis Flannery QC

Louis Flannery QC

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Andrew Rieley
Head of communications

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