The Nicosia district court denied on Friday a request by Hermitage Capital for an order banning Cypriot authorities from cooperating with Russia in a probe against the company’s founder, Bill Browder, on the grounds that possible damages would not be irreparable.
While the applicants presented evidence that they would suffer serious damages and that the case is politically motivated, Cyprus would be in position to cover such damages if a separate lawsuit filed by the applicants is successful, the judge said. Unless all three preconditions were met, the order could not be satisfied.
“I don’t believe that the third precondition is satisfied,” the judge said. “The alleged threatened violation of the rights of the applicants does not justify the issue of the temporary order. It has not been, rightfully, alleged that the remedy which concerns compensation cannot be satisfied without the issue of the temporary order.
“Furthermore, it has not been shown that in case that the Republic of Cyprus executes the particular request for legal assistance of the Russian Federation, the plaintiffs will suffer irreparable damage,” he continued. “Nor have they claimed of course that they have suffered that as a result of the execution of previous requests.”
Browder and his associate Ivan Cherkasov applied in September last year for a court order to stop Cyprus from assisting Russia in an investigation into a possible tax evasion case against him, which he says is politically motivated. Russia launched the probe in response to Browder’s campaign for justice for lawyer Sergei Magnitsky who died in a Russian prison nine years ago after exposing a $230m tax theft.
The Russian lawyer had filed a complaint a year before that Russian officials were part of a plot to steal the ownership of three subsidiaries of Hermitage Capital, then the largest foreign investment fund in Russia, and file a request for a tax refund. The police officers involved in the scheme arrested Magnitsky and held him imprisoned for almost a year, subjecting him to torture and denying him access to medical care.
As a result of Browder’s campaign, the US passed in 2012 the Magnitsky Act which imposes targeted sanctions on individuals and entities suspected of human rights violations. The Parliamentary Assembly of the Council of Europe asked member states in 2014 not to cooperate with Russia in its actions against Browder and adopt similar legislation like the US. Interpol repeatedly ignored Russia’s request for an arrest warrant against Browder.
The ruling comes weeks after Russian President Vladimir Putin stepped up his efforts against Browder. On July 16, he asked US President Donald Trump to allow Russian authorities to question the former US ambassador to Moscow Michael McFaul and Browder, who meanwhile relinquished his US citizenship and is now a British citizen.
The US president’s decision to agree to Putin’s proposal to deliver McFaul and Browder to Russia triggered demonstrations against Trump whose campaign is currently under investigation by special counsel Robert Mueller on suspicion that it had colluded with Russia.
Three days after the summit, the US Senate passed a non-binding resolution refusing Russia’s request to interrogate the former US ambassador. Mueller’s team has already filed charges against dozens of individuals in the US and Russia and led to five guilty pleas.
In October, when the Cyprus government decided to temporarily freeze cooperation with Russia pending the outcome of the court’s decision on Browder’s request, the Russian ambassador said that this step had hurt bilateral relations. Russia is one of Cyprus’s main commercial partners with Russian entrepreneurs being a top customer of the Cypriot corporate, accounting and legal services providing firms. In addition, tourist arrivals from Russia make up roughly one fourth of total arrivals.
Christos Pourgourides, who represented Browder, said in a telephone interview on Friday that he would study the ruling before consulting with his clients on further action, including a possible appeal against the court’s decision to reject their request.