Quillon Law successfully represents Oleg Deripaska in application against Quinn Emanuel

The High Court has today (14 October) handed down judgment in the case of (1) Filatona Trading Limited and (2) Oleg Deripaska v Quinn Emanuel Urquhart & Sullivan UK LLP, in which Mr Deripaska and his company, Filatona (the “Deripaska Parties”) successfully obtained Norwich Pharmacal relief against Quinn Emanuel. In granting the relief sought, Calver J rejected each of Quinn Emanuel’s arguments as to why the relief should not be given.

Calver J granted the relief on the basis that each of the conditions for a Norwich Pharmacal were satisfied, that the information sought was not privileged and that granting the relief sought was a “necessary and proportionate response to this serious wrongdoing”.

Background

Mr Deripaska and Vladimir Chernukhin have been engaged in litigation for several years. In April 2020, Mr Chernukhin and his company, Navigator Equities Limited (the “Chernukhin Parties”), issued proceedings in the High Court to set aside an arbitration award of $95 million in their favour.  At the time, the Chernukhin Parties’ solicitors on the record were Clifford Chance, with Quinn Emanuel acting for them in an advisory capacity.

In issuing those proceedings, the Chernukhin Parties relied on a document (the “Glavstroy Report”) which it was said had been dishonestly suppressed by the Deripaska Parties during the course of the arbitration proceedings.  It was said that, had it been disclosed, the award in the Chernukhin Parties’ favour would have been as high as $395 million.  The set aside proceedings were therefore of the utmost seriousness, given their value and the nature of the allegations made against the Deripaska Parties.

In fact, the Glavstroy Report was a forgery (as was apparent to an inquisitive reader, including from the fact that the Glavstroy Report, which purported to be dated May 2016, referred to an official document dated April 2018). The Glavstroy Report had been provided to Quinn Emanuel by a business intelligence consultancy (the “Consultancy”).

Unsurprisingly, the Deripaska Parties wish to seek redress and therefore sought disclosure from Quinn Emanuel as to the identity of the Consultancy from whom they had obtained the Glavstroy Report.  Quinn Emanuel vigorously resisted providing such information and therefore a Norwich Pharmacal application was necessary.

Thresholds

The requirements for Norwich Pharmacal relief are well-established and as to each condition, Calver J found in the Deripaska Parties’ favour:

• Arguable Wrong Condition

Calver J held that “All of the evidence before [the court] points to this document being a forgery designed to cause very considerable loss to the Deripaska Parties...” and that being so, the Deripaska Parties have a good arguable case that the legal wrongs committed against them include unlawful means conspiracy, lawful means conspiracy and malicious falsehood.

Quinn Emanuel had sought to argue that the Deripaska Parties had not suffered any loss and therefore that the application must fail. The Judge, however, accepted that there had been loss, but that in any event, it is not necessary for a claim in malicious falsehood.  Further, it is not necessary that an applicant intends to bring legal proceedings in respect of the arguable wrong, any form or redress will suffice to ground an application for Norwich Pharmacal relief, including disciplining or dismissing any individuals concerned (if it is someone within Mr Deripaska’s organisation) or bringing criminal or contempt proceedings.

• Mixed Up in Condition

Calver J was satisfied that Quinn Emanuel had become involved in the wrongdoing and had “unwittingly facilitated it”.  Their involvement included (a) engaging the Consultancy, (b) following receipt of the Russian-language Glavstroy Report, sending it to a translation firm to be translated into English, (c) conducting “enquiries” and “detailed analysis” in relation to the Glavstroy Report, and (d) providing it to Clifford Chance.

Quinn Emanuel had sought to argue that they were a mere witness but that was rejected by the Judge who said: “QE were not a mere onlooker or witness, advising on a document…they were actively involved in the (unwitting) verification and deployment of that document in legal proceedings”.

• Possession Condition

Quinn Emanuel had accepted that it was in possession of the information sought by the Deripaska Parties. The Judge concluded that there was no realistic prospect of the Deripaska Parties being able to seek redress unless the court granted the relief sought.  He considered that there was a realistic prospect that the information sought from Quinn Emanuel would assist in identifying the wrongdoer.

• Overall Justice Condition

Calver J found that the following factors strongly support disclosure: (a) there is a strong public interest in allowing the Deripaska Parties to vindicate their legal rights, (b) the making of an order will likely deter similar wrongdoing in future, (c) the information cannot be obtained from any other source, (d) after the Deripaska Parties had raised questions about the authenticity of the Glavstroy Report, “QE failed to make the urgent enquiries which they ought to have made at that stage to satisfy themselves as to the authenticity of the report”, and (e) there is no reliable evidence to support any suggestion by Quinn Emanuel that there was any risk of physical harm to the relevant employees at the Consultancy.

Privilege

Quinn Emanuel had argued that (i) the information sought was privileged in so far as it is information contained in confidential and privileged communications with a third party for the dominant purpose of litigation, and (ii) relief should not be given because it would interfere with the solicitor client relationship.  The Judge rejected those arguments, stating “The starting point is that litigation and legal advice privilege is concerned with communications, and not merely facts or information”.

He went on to conclude that “The provision of the identity of the Consultancy and of the persons who procured the Glavstroy Report will reveal nothing about the content of any privileged communications, nor will it reveal anything about the litigation strategy of the Chernukhin Parties…Nor will revealing the identity of the Consultancy or the relevant employees inhibit candid discussion between Mr Chernukhin and QE.”.

Abigail Healey, Partner at Quillon Law, representing the Deripaska Parties, commented: “Whoever was involved in creating the Glavstroy Report and providing it to the business intelligence consultancy for onward transmission to Quinn Emanuel intended to deceive the court and defraud the Deripaska Parties of c. $300 million. 

“We are pleased that the Court has ordered Quinn Emanuel to identify the consultancy which supplied it with the forged report.  This is the first step towards the Deripaska Parties vindicating their legal rights.”

Quillon Law instructed Thomas Grant KC of Wilberforce Chambers and James Sheehan KC of Essex Court Chambers.

Calver J’s judgment can be found here.

This case was reported in Reuters, The Lawyer, Law360, CDR Magazine, Law.com and The Law Society Gazette.