The Court of Appeal has dismissed an appeal by Eurotoaz Limited and its director, Andrey Babichev, against a refusal to strike out a conspiracy action brought by four companies over control of Russian fertilizer producer Togliattiazot (ToAZ).
The appeal concerned only whether the plaintiffs’ case against the fourth and fifth named defendants was bound to fail and should be dismissed under the court’s inherent jurisdiction. The High Court refused that application in November 2017. In a judgment delivered on 18 July 2019, the Court of Appeal upheld the refusal. The action remains for determination; the appeal court did not decide whether the alleged conspiracy or forgery occurred.
The plaintiffs say they together own about 70% of ToAZ and allege that the defendants took part in a scheme orchestrated by Dmitry Mazepin to wrest control of the company. Their pleaded allegations include vexatious litigation, false evidence and forged documents. They seek damages and other relief. These are allegations in the underlying claim, not findings made in this appeal.
Eurotoaz and Babichev argued that documents showed Eurotoaz had a genuine claim to ToAZ shares and that the plaintiffs’ forgery allegation could not succeed. They said this undermined the case that their Russian litigation was part of a conspiracy.
The Court of Appeal held that the documents Babichev relied on were copies whose provenance and authenticity had not been properly established. His involvement with Eurotoaz began in November 2011, so he could not give direct evidence about events before then. The court concluded that the documents were not properly in evidence and that the appellants had not provided admissible evidence to show the plaintiffs’ case was bound to fail.
The court also considered the appellants’ substantive arguments on the assumption that the documents were validly before it. It concluded that they still did not establish that the claim was bound to fail. The alleged forgery was not the only basis of the claim against Eurotoaz and Babichev: the pleadings also alleged multiple unfounded claims to shares and criminal complaints. The court said the broader disputed facts, the purpose of the litigation and the parties’ competing evidence and expert views on Russian law were matters for trial, not resolution on this application.
The court dismissed the appeal. It made no final determination of the plaintiffs’ underlying claims.