The PrivatBank case regarding the now state-owned bank’s return of shares to its former owners, scheduled for Oct. 17, was supposed to bring the hearing to its final stage. But a judge at the Kyiv Economic Court stopped the case on Oct. 17 without prior notice, surprising all 10 participants.
Dozens of people including protesters, journalists and lawyers gathered in front of the court for the hearing scheduled to begin at 10:30 a.m., but the doors were closed and the building was cordoned off by police and firefighter searching for a bomb after an anonymous caller said there was an explosive device inside the court.
Billionaire oligarch Ihor Kolomoisky and Triantal Investments Ltd, a Cypriot company that he owns, filed the lawsuit back in April asking the court to reverse the share sale agreement on PrivatBank’s nationalization and return to him the 41.3% of PrivatBank shares that he owned and 16.5% in shares that belonged to Triantal. The State nationalized PrivatBank in 2016 after Kolomoisky allegedly misappropriated $5.5 billion from it.
However, two hours after the hearing was scheduled to begin, a representative of the court went out to the crowds and made an announcement.
“According to what I know there is no explosive device found in the building. The court is about to open the doors soon and get back to normal,” said Petro Palamar, deputy chief of the Kyiv Economic Court. “The case you all are asking about is not going to be heard today as the judge made a decision to stop the proceeding because of another case being heard in another court.”
The official left as the protesters continued waving flags and shouting their demands for justice, heavily criticizing presiding Judge Liudmila Shkurdova. The Kyiv Post recently reported that some of the lawyers representing the State in the legal battle accused Shukordova of bias in favor of Kolomoisky.
Kolomoisky’s lawyer, in turn, said that the lawyers representing the state sabotaged the case, although neither they nor those defending the state knew that the case had been stopped. It appeared that the judge had made the decision the day before in silence.
“We did not expect this. The hearing was scheduled for today, and we are finding now that the court issued some order and that this happened yesterday,” said Viktor Hryhorchuk, representing the National Bank of Ukraine.
The lawyers were then invited into the court and given a written notice saying that the case was stopped until another Kyiv court, The Sixth Appeal Administrative Court, made a decision on a similar dispute. That court is about to start hearing PrivatBank’s appeal over the decision of a lower court in favor of Kolomoisky.
On April 18, Kyiv District Administrative Court, which made a number of controversial decisions that led to an investigation from the National Anti-Corruption Bureau of Ukraine, ruled in favor of the oligarch and reversed the so-called nationalization of the bank.
Both PrivatBank and the National Bank representatives said they were satisfied with this ruling.
“The demands in these both cases are de facto identical,” said PrivatBank’s lawyer Andriy Pozhidaev.
“The state institutions brought the court’s attention earlier to the fact that there is another dispute over the nationalization, however, while we were filing this claims the judge rejected them not wanting to stop the case. For some reason she did it yesterday herself,” said Hryhorchuk.
The case
In April, Kolomoisky applied to Kyiv’s Economic Court asking it to overturn the share agreement which allowed the State to buy his and his associates’ shares in PrivatBank for one hryvnia.
In December 2016, the bank’s former owners wrote a letter to then-Prime Minister Volodmyr Groysman asking him to “make a positive decision regarding the purchase of the PrivatBank’ shares by the State.”
Kolomoisky’s lawyer, Oleksandr Vinnychenko, said that his client did not want the nationalization to happen. Vinnychenko called it confiscation.
“If the state takes away your phone without paying you for it, would it be a contract or a confiscation?” he asked.
PrivatBank’s 2016 nationalization was backed by the International Monetary Fund to save the bank from collapse and was a requirement to maintain its financial aid program for Ukraine.
The former owners of the bank are accused of fraud, and the state invested $5.5 billion in taxpayer funds to replace the money the bank’s owners allegedly took from its depositors.
