On July 20 a group of Spanish funds won a $2.6 million arbitration award that cost nearly $15 million in unawarded fees, and may well be vacated by a Swedish court. Good investment? Hell yes, from the viewpoint of the oligarchs who used to control Yukos Oil Company and fronted the fees.
Five friends of Yukos founder Mikhail Khodorkovsky owned about three-quarters of the company when it was driven into bankruptcy by Russian tax authorities in 2004. The oligarchs are pressing $102 billion in Energy Charter Treaty claims against Russia, and heading to trial in November before an arbitral panel chaired by L. Yves Fortier. The Spanish funds owned only a few Yukos shares, but through the Spanish-Russian investment treaty they were able to present a similar claim for expropriation.
