Briefing Papers

On September 7, 2010, the Wall Street Journal and Financial Times both published major reports on PwC’s decision in June 2007 to withdraw a decade of Yukos audits. Why did these stories appear now?

With new charges having been brought against Khodorkovsky and Lebedev in 2007 to prevent their scheduled release from prison in 2011, it was clear to prosecutors that PwC’s stamp of approval on the Yukos audits was raising serious questions worldwide about the credibility of the case. Since June 2007, when PwC withdrew its Yukos audit opinions for the 10 years from 1995 to 2004, the Khodorkovsky‐Lebedev defense team has been asserting that this unusual and unconventional reversal was made in response to coercion and threats from Russian authorities. In the three years since then, the defense team has documented its assertions and initiated legal actions in order to prove that PwC legally should have stood by its audits, and that the excuses PwC gave for its decision are factually incorrect and meant to cover up the truth.

Neither the Wall Street Journal nor the Financial Times would have run their major features on September 7, 2010 had they not recently obtained proof of the truth and credibility of the assertions being made against PwC. The Wall Street Journal and Financial Times stories also raise troubling questions about the reputation and reliability of PwC in Russia, given the firm’s national predominance. In today’s challenging financial environment, the value of PwC audits that can be pulled essentially on orders from corrupt officials alters the calculus of risk in the Russian economy.

Please click here to read the full Q&A addressing all the details of PwC’s controversial withdrawal of the Yukos audits.

March 31st, 2010 marks the first anniversary of the beginning of the second trial against Mikhail Khodorkovsky and Platon Lebedev. This brief fact sheet was compiled to share all the details of the lack of grounds for the prosecution’s impossible accusation that the two defendants had embezzled all oil produced by Yukos from 1998-2003. International as well as various Russian observers of the second trial have emphasized the politically motivated nature of the case against Khodorkovsky and Lebedev while calling for their immediate release.

Click here to read the full fact sheet.

Mikhail B. Khodorkovsky was arrested in October 2003 and sentenced in 2005 to an 8-year prison term for alleged fraud and tax evasion. In February 2007, when the former Yukos Oil Company chief had become eligible for release on parole, new charges of embezzlement and money laundering were brought against him. The second trial based on that indictment began in March 2009. Khodorkovsky and his co-accused business partner Platon L. Lebedev pleaded not guilty, while emphasizing that the charges against them were incomprehensible and unexplained. After 20 months of grave procedural violations throughout the trial, on December 27, 2010, both Khodorkovsky and Lebedev were found guilty by Moscow’s Khamovnichesky Court. On May 24, 2011, the Moscow City Court rejected the appeal lodged by Khodorkovsky and Lebedev against the Khamovnichesky Court verdict. With just months remaining before completion of their current prison terms, their overall sentences were extended to a total of 13 years, pushing their scheduled release from 2011 to 2016.

Download the full briefing paper here.

This document has been prepared by defense counsel of Mikhail Khodorkovsky, former Yukos Oil Company CEO, and of his business partner and friend Platon Lebedev. From March 2009 to December 2010 Khodorkovsky and Lebedev were subjected to a trial centering on allegations that they had embezzled the entire oil production of Yukos over the six‐year period from 1998 to 2003. This document provides an overview of the trial. Additional information is available in a series of legal summaries issued by defense counsel as the case unfolded. The defense counsel also publicly released extensive official trial documentation, with English translations. For further information, the legal defense team may be contacted here.

Click here to read “Justice Under Pressure.”

This document has been prepared by defense counsel of Mikhail B. Khodorkovsky, former Yukos Oil Company CEO, and of his business partner and friend Platon L. Lebedev. From March 2009 to December 2010 Khodorkovsky and Lebedev were put on trial on allegations that they had embezzled the entire oil production of Yukos over the six-year period from 1998 to 2003. The purpose of this document is to provide an overview of the December 27, 2010 decision delivered by Judge Viktor N. Danilkin, pronouncing Khodorkovsky and Lebedev guilty.

Click here to read “Justice Under Pressure: The Verdict.”

This document has been prepared by defense counsel of Mikhail B. Khodorkovsky, former Yukos Oil Company CEO, and of his business partner and friend Platon L. Lebedev, who have been on trial since March 2009 in Moscow’s Khamovnichesky Court. The purpose of this document is to provide an overview of the pre-verdict trial proceedings, which ran from March 2009 to November 2010. More detailed information is available in a series of legal summaries issued by defense counsel as the case unfolded. Certain elements of the analysis herein may be impacted by the forthcoming verdict. A more detailed and definitive report, to be issued following the verdict, will supersede this document.

Read Justice Under Pressure: The Pre-Verdict Executive Summary here.

Mikhail B. Khodorkovsky, former chief executive of the Yukos Oil Company, and his business partner Platon L. Lebedev, were convicted and sentenced to eight years imprisonment in 2005 and banished to Siberia. They were victims of severe abuses of institutions of Russian state power – from investigatory, prosecutorial and regulatory authorities to the judiciary – committed by a group of figures in the political establishment who viewed them as challengers or competitors. The interests of political and commercial adversaries had coalesced to orchestrate the state’s incarceration of the two men and raiding of their company’s assets. When Khodorkovsky and Lebedev became eligible for parole in 2008, those in power who still perceive them as a threat stepped up a long-dormant effort to find new grounds to keep them incarcerated for a long time to come. In addition to keeping Khodorkovsky and Lebedev isolated from society, their adversaries seek to conceal the corrupt and criminal actions committed against them and other victims of the Yukos affair with the participation and under the protection of high-ranking officials.

This summary covers courtroom proceedings from March 31 to April 27, 2009.

Click here to read the full version of Justice Under Pressure: The First Month of Trial Executive Summary.

This document has been prepared by defense counsel of Mikhail B. Khodorkovsky, former chief executive of the Yukos Oil Company, and of his business partner Platon L. Lebedev, who have been on trial since March 2009 in Moscow’s Khamovnichesky Court. The purpose of this document is to provide a summary of the prosecution’s presentation of its case against the defendants, which ran from April 21, 2009 to March 29, 2010. This document is part of a series of legal summaries issued by defense counsel as the case has unfolded. Certain elements of the analysis herein may be impacted by developments in court as the trial continues to unfold. This document does not purport to list all the violations of due process and examples of prosecutorial misconduct which occurred during the presentation of the prosecution’s case. A more detailed and definitive summary report, to be issued following the trial, will supersede this document.

Click here to read Justice Under Pressure: The Prosecution’s Case.

This document has been prepared by defense counsel of Mikhail B. Khodorkovsky, former chief executive of the Yukos Oil Company, and of his business partner Platon L. Lebedev, who have been on trial since March 2009 in Moscow’s Khamovnichesky Court. The purpose of this document is to provide a summary of the defense phase of the trial, which ran from April 5 to September 22, 2010. This document is part of a series of legal summaries issued by defense counsel as the case has unfolded. Certain elements of the analysis herein may be impacted by developments in court as the trial continues to unfold. A more detailed and definitive summary report, to be issued following the trial, will supersede this document.

Click here to read Justice Under Pressure: The Defense.

Lebedev, on December 27, 2010 the two men were declared guilty of embezzling and laundering the proceeds of all oil produced by Yukos subsidiaries over a six-year period. The Khamovnichesky Court found the defendants guilty of having embezzled significantly more oil than prosecutors had alleged or even attempted to prove. Lead defense lawyer Vadim V. Klyuvgant called the trial “a charade of justice”. On December 30, 2010, with less than a year remaining before completion of their existing 8-year prison terms, Khodorkovsky and Lebedev were sentenced to an overall total of 14 years in captivity, meaning that counting time already served they are now expected to remain in jail at least until 2017. The defense initiated appeal procedures on December 31, 2010.2 The appeal is scheduled to be heard by the Moscow City Court on May 17, 2011.

Click here to read Justice Under Pressure: The Appeal.

Lawyers representing Mikhail B. Khodorkovsky and Platon L. Lebedev have catalogued a series of severe abuses of the Russian criminal justice system in a new case being prepared against Khodorkovsky and Lebedev, underlined the prosecution’s duty to recognize these abuses as irremediable, and called upon the prosecutors to fulfill their legal obligation to terminate the proceedings immediately. According to the lawyers, the new case against Khodorkovsky and Lebedev was ordered and is directed by high-level Russian government officials acting through prosecutors. The lawyers assert that the case is incurably flawed under Russian law and would be thrown out of court in any country with an independent judiciary.

Read the full version of the Stay Motion here.