A legal position developed by Ellex Valiunas and White & Case on behalf of the Republic of Lithuania, represented by the Lithuanian Ministry of Justice, in a dispute with Vladimir Antonov, the former owner of Snoras bank, has been accepted by Russian courts.
Antonov sought damages of over RUB 40 billion as compensation for Lithuania's alleged expropriation of Snoras' shares and alleged damage caused to Antonov's business reputation caused by statements made by the Lithuanian President to the press.
The Commercial Court of Moscow agreed with the line of reasoning suggested by White & Case and Ellex Valiunas and terminated the proceedings based on the court's lack of jurisdiction over the dispute.
The court reached its decision in reliance on, inter alia, the Russian-Lithuanian "Agreement on Legal Assistance and Legal Relations in Civil, Family and Criminal Matters" dated July 21, 1992 and "Investment Promotion and Protection Treaty" dated July 29, 1999. The former provides that claims for damages shall be considered by the competent court of the state-party in whose territory the action or circumstance giving rise to the claim took place. The latter provides that investment-related disputes between a state-party's investor and anther state-party shall be submitted to the competent court of the state-party in whose territory the investment was made or to arbitration under the Rules of the SCC, ICC, or UNCITRAL.
The Ninth Commercial Appellate Court upheld the ruling of the Commercial Court of Moscow and dismissed Antonov's appeal. The appellate court also pointed out that Russia's Federal Law No. 297-FZ "On Jurisdictional Immunities of Foreign States and Their Property in the Russian Federation", dated November 3, 2015, did not apply to the dispute, as it arose from circumstances which took place in 2011, before the law was enacted.
The Commercial Court of Moscow Circuit later returned Antonov's cassation appeal after he missed the deadline for filing.
According to White & Case, "this is a landmark case with respect to investment claims against foreign states in the Russian courts. It explores the legal provisions on jurisdictional immunity and resolves other issues with regards to the competence of Russian courts."
The White & Case team was headed by Partner Julia Zagonek and Counsel Pavel Boulatov and included Associates Daria Scheglova, Anton Vasin, and Alexander Sysoev (all based in Moscow). The Ellex Valiunas team consisted of Partner Valiunas Vilija Vaitkute Pavan and Senior Associate Darius Bugailiskis.