Ex-Ukrainian PM Must Cough up Documents | Courthouse News Service
Tuesday, November 28, 2023
Courthouse News Service
Tuesday, November 28, 2023 | Back issues
Courthouse News Service Courthouse News Service

Ex-Ukrainian PM Must Cough up Documents

WASHINGTON (CN) - A corrupt former Ukrainian prime minister must produce tax documents despite his claims that the request for them were was "oppressive" and meant to "harass and annoy," a federal magistrate ruled.

Jurors in 2004 convicted Pavel Ivanovich Lazarenko of laundering ill-gotten gains through banks worldwide. The United States sought forfeiture of more than $250 million from banks in Antigua and Barbuda, Guernsey, Liechtenstein, Lithuania and Switzerland.

Over nearly a decade, the government successfully dismissed seven would-be intervenors and survived a motion to dismiss.

However, a contest to the forfeiture filed by the European Federal Credit Bank of Antigua - known as Eurofed - proved to be a tougher thorn.

U.S. District Judge Paul Friedman in November 2014 approved a proposed settlement for more than $2 million in assets held at Bank Julius Baer & Company, and called the ousted politician's objections "nonsensical."

Lazarenko claimed that dismissal of the forfeiture action, with respect to a portion of the Lithuanian funds, would deprive him of the opportunity to assert a statute of limitations defense regarding.

Lazarenko was prime minister of Ukraine from 1996 to 1997. From 1992 to 1998, he allegedly pocketed more than $300 million from kickbacks, multimillion-dollar natural gas import contracts and other deals.

The United States demanded in October 2014 that Lazarenko produce tax records and other financial documents, from 1992 to date.

Lazarenko balked, calling the request "overly broad," and said his tax records were not discoverable.

Specifically, Lazarenko objected "to any and all document requests to the extent that they are overly broad, seek information that is irrelevant ... are unduly burdensome ... are not reasonably calculated to lead to the discovery of admissible evidence, are oppressive, and are propounded merely to harass or annoy claimant," Magistrate Judge G. Michael Harvey recounted in his Tuesday ruling .

Harvey granted in part and denied in part the government's motion. He found that the government met its burden in establishing that the tax and other financial records requested were discoverable for fiscal years 1992 to 1999.

The government also met that burden for years 2000 to present, but only for the limited purpose of discovering information relating to Lazarenko standing to intervene in the case.

Lazarenko's pretrial services records and pre-sentence investigation were off limits, Harvey said, as the documents were subject to special statutory and court-imposed protections.

"In short, [Lazarenko] has not demonstrated that the information contained in his tax

records is readily obtainable from other sources," Harvey ruled. "Accordingly, no common-law privilege grants claimant the ability to refuse to answer plaintiff's requests."

On May 29, a federal court separately entered a protective order in the case permitting the parties to designate discovery materials as confidential.

Lazarenko sought to modify the order, requesting that additional materials, which were not included in the scope of the order, be added to protect them from disclosure to third parties.

Specifics on the materials are included in a sealed motion and referred to as "claimant's requested materials" in court documents .

Also Tuesday, Harvey granted and denied Lazarenko's motion in part.

Harvey ruled that modification was appropriate to protect "an equitable, non-contractual interest in confidentiality," and ordered a portion of the materials protected.

Harvey said the government's arguments against Lazarenko's motion were "unavailing," and did not demonstrate that unfair prejudice would "result from anything less than uninhibited use of the confidential materials."

"As [Lazarenko] makes clear in his reply, he does not seek to prohibit the government's derivative use of the confidential materials in discovery provided that the government does not disclose the source of that information," the ruling states. "Accordingly, the government will have a fair opportunity to test the veracity of that information in discovery."

In 2011, the U.S. government forfeited its right to nearly $2.5 million in Lazarenko-related assets - held in two Eurofed correspondent accounts at Bank of America in San Francisco - by botching forfeiture proceedings.

Lazarenko won reversal of a $19 million restitution award he was ordered to pay to his co-conspirator, Peter Kiritchenko, in 2010.

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.