An airing for Russia's dirty laundry

British court case will give an insight into the post-Soviet carve-up, predicts Shaun Walker

The lawsuit brought by Israel-based businessman Michael Cherney against Oleg Deripaska, the aluminium tycoon known for schmoozing politicians on his yacht and at one point the richest man in Russia, will toss yet more dirty Russian laundry into the public domain via the London courts.

After the veritable, oligarch porn that was Boris Berezovsky vs Roman Abramovich (verdict yet to come), the case against Mr Deripaska, which kicked off earlier this month, looks set to provide fascinating insights into one of the murkiest and deadliest sectors of the post-Soviet infrastructure carve-up.

Justice Andrew Smith ruled that the court needs to outline further preliminary matters before the case gets under way properly, and those hearings are due next week. Witnesses should take the stand in the autumn.

Mr Deripaska is one of the most successful Russian businessmen, marrying into the extended family of the country's first post-Soviet leader Boris Yeltsin and remaining steadfastly loyal to the Kremlin to avoid an unpleasant fate during the rule of current president Vladimir Putin.

He is unlikely to relish having to delve into the murky secrets of his rags-to-riches story, and the main beneficiaries of the trial will be Russia watchers and analysts, and, of course the British lawyers who will pocket a fortune for representing both sides of a case that has very little to do with the UK.

So, what have we learnt so far, and what gems might the case throw up?

The claims and counterclaims

Mr Cherney's £700m claim rests on the insistence that he was a legitimate business partner of Mr Deripaska.

He says he had a stake in companies that would go on to become Mr Deripaska's RusAl empire, which Mr Deripaska offered to buy back from him for $1bn (£646m) in 2001, but that he only paid $250m. Mr Deripaska agrees he did make the $250m payment, but claims that it was not part of a deal to buy back shares, but simply the final instalment of protection money that he paid to Mr Cherney to keep organised crime groups at bay and protect himself from hostile raids on his businesses and violent attempts on his life.

This is what the case will hinge on: was Mr Cherney a legitimite business partner for Mr Deripaska, or was he his "krysha"?

The "krysha"

The krysha, literally "roof", is a key part of Russian business, especially in the 1990s when the state institutions were weak and the police and courts were even more weak and corruptible than they are today.

Every business needed a krysha, whether it was a hot-dog stand owner paying a policeman a weekly bribe to make sure his stall didn't get any hassle from the cops, or an oligarch doling out millions of pounds of protection money to government officials or organised crime groups.

Especially in the metals sector, where there were regular raids and assassinations, having the right krysha was essential for financial and physical survival.

The aluminium wars

Even by the standards of the chaotic 1990s in Russia, the battle for control of Soviet-era aluminium assets achieved legendary status for its ruthlessness and nastiness.

Mr Deripaska rarely talks about these years, and the only precedent is a painful-to-watch interview on the BBC's Panorama programme, in which the oligarch visibly gulps before awkwardly answering questions about possible relationships with organised crime figures.

The case is likely to provide some startling insights into how he became one of Russia's richest and most successful oligarchs.

One of his own witnesses, in separate court proceedings in Israel, has alleged that Mr Deripaska ordered a murder in 1995, something which the businessman denies.

The claims and counterclaims may not bring us closer to what really happened in those years but should at least prove interesting listening.

The personalities

Mr Deripaska is not quite as secretive as Chelsea FC owner Roman Abramovich – he does, after all, give the occasional interview.

Mr Deripaska has always vehemently denied any links to organised crime, although he has been refused a US visa before, apparently on the grounds that American authorities suspect him of having such links (he was later granted a visa).

But Mr Cherney is hardly above suspicion, and indeed, Mr Deripaska's whole case against him is likely to rest on a claim that his opponent was not a business partner but a criminal figure whom he paid for protection.

The claimant is not even able to travel to the UK due to the Interpol warrant out in his name over a money-laundering case in Spain, and will give evidence to the court via video link.

A cast of other major Russian business figures will also be brought before the court, including Mr Abramovich, who will testify in an attempt to back up the case of his fellow Kremlin loyalist, Mr Deripaska.

The Russian legal system

The big question is why these cases are being heard in the UK at all.

With Berezovsky v Abramovich, there was at least the excuse that both are either permanently based in or have significant interests in the UK, but with this case the links to Britain are tenuous at best.

The lawyers, however, will pocket millions in legal fees and are thus not likely to complain.

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