On March 21, 2023, the Appeals Chamber of the Court of England and Wales upheld the judgment of July 25, 2022, which ordered businessman Irakli Rukhadze, his business partners Benjamin Marson and Igor Alekseev to pay multimillion-dollar compensation to the companies Revoker and Recovery Partners.
The total amount of damages awarded exceeds $170 million, which includes both direct compensation and accrued interest and legal fees.
The litigation over this damages has been ongoing since 2018, when the English court found that Rukhadze and his business partners committed a “commercial conspiracy”, as a result of which the companies, Recovery Partners GP Limited and Revoker LLP lost the opportunity to implement the “billion dollar project”.
Litigation was about the recovery of late billionaire Badri Patarkatsishvili’s assets that were embroiled in the multiple litigations after his sudden death in 2008. Most of Patarkatishvili’s assets were managed by the investment firm Salford Capital Partners International (SCPI), which was led by his chief financier Eugene Jaffe.
SCPI had to perform a strenuous task, because some of Patarskatishvili’s assets were not secured in an official way, including his holdings in Russian Metallurgy plant. At this point his family was cash-stranded, therefore the success of recovery of assets had utmost importance. SCPI founded the companies Recovery Partners GP Limited and Revoker LLP to lead the recovery process.
For a number of years, Irakli Rukhadze and his associates Benjamen Marson and Igor Alexeev held managerial positions at the SCPI, therefore they had fiduciary responsibilities towards the company. According to the 2018 court ruling after the death of Badri Patarkatsishvili, Rukhadze and his partners schemed against SCPI to name themselves as a leader in the asset recovery process, instead of the Salford Capital Partners International and the companies Revoker and Recovery Partners.
According to the court ruling, after removing SCPI from the picture, Irakli Rukhadze; Benjamin Marson and Igor Alekseev completed the search/collection of Patarkatsishvili’s assets through Hunnewell Partners, a company they established specifically for this purpose. In addition, they have received multi-million dollar service fees and other incomes related to this task.
The 2018 ruling states that over the years the trio accumulated vast amounts of profits, by which they made a number of serious investments in Georgia. Among the investments were the purchase of controlling stake in ‘Liberty Bank’ and ‘Rustavi Metallurgical Plant’. Hunnewel also became a minority shareholder in the largest cement producer in Georgia ‘Heidelberg’ and minority shareholder in Georgia’s largest telecom company ‘Magti’.
Irakli Rukhadze has also became the owner of Georgia’s number #1 TV channel ‘Imedi’ which he bought from Patarkatishvili’s widow Inna Gudavadze.
In 2018 the English country established that Recovery partners and Revoker have a right to compensation for the damages they incurred as a result of Rukhadze’s actions. Ruling stated that companies lost the opportunity to implement a billion dollar project. Irakli Rukhadze and his partners appealed the initial decision to the Court of Appeal, but in March 2019 the court upheld the verdict.
In 2019, the form of compensation was also determined – the plaintiffs chose the account for profits, which was received by the defendants in breach of fiduciary duties.
In 2022, the quantum process was finalized where the court established that the trio had to pay 129.5 million to Revoker LLP and Recovery Partners. Alongside this compensation the trio has been ordered to pay interest and the legal fees of plaintiffs, as a result the total sum of compensation reaches $173 million USD.
Irakli Rukhadze and his partners have appealed this decision, but on March 21, 2023 court upheld the 2022 decision.
According to the information obtained by Forbes, Irakli Rukhadze has already started paying the imposed compensation.
