Vitaly Orlov succeeds as worldwide Freezing Order is quashed following reckless disregard of Alexander Tugushev of his duty to the Court

26 July 2019

26 July 2019

Vitaly Orlov succeeds as worldwide Freezing Order is quashed following reckless disregard of Alexander Tugushev of his duty to the Court

A High Court judge today refused to continue a worldwide freezing order against a successful Russian businessman in a hotly-defended claim being brought through the London Courts by a convicted Russian fraudster.

The Hon Mrs Justice Carr decided that the claimant, Mr Alexander Tugushev, had seriously failed in his duty of full and frank disclosure when making his application for a freezing injunction 12 months earlier.

The freezing order granted as a result of his ex parte application made in July 2018 will be discharged and Tugushev’s parallel application to domesticate the order in Russia has been declined.

The Honourable Mrs Justice Carr found that Tugushev recklessly disregarded his duty to the Court when he failed to investigate, or bring to the Court’s attention, evidence which was inconsistent with his case.  This was aggravated by a subsequent failure to respond properly to concerns raised by Mr Orlov that the Court was not receiving the full picture.  These failings were sufficiently serious to justify discharging the freezing order.

Having discharged the freezing order, the Honourable Mrs Justice Carr refused to regrant it, accepting that there was no real risk of Mr Orlov dissipating his assets.

A spokesman on behalf of the defendant, Vitaly Orlov, said “Mr Orlov is naturally pleased that the truth is at last emerging and that he will be able to get on with business without the constraints of the freezing order.  Mr Tugushev has fabricated claims in Russia and in England that his shares in Almor Atlantika were misappropriated by Mr Orlov which newly discovered documents clearly show did not happen.  As the judge recognised, Mr Tugushev now faces serious credibility issues with his claim. Mr Orlov still hopes that the Court of Appeal will grant permission to challenge the decision concerning jurisdiction.  This is undeniably an attempt by a Russian to bring unfounded claims against another Russian in relation to Russian assets.  It should be litigated in Russia rather than in London.  If, however, it does proceed in London, it will be defended more vigorously than ever”.

Another dimension of this claim which will now be revisited concerns those funding the action for Tugushev.  The substantial costs of the claim are being met by anonymous third parties, whose identity is being carefully protected. Those funders will now rightfully have to pay a significant proportion of Mr Orlov’s costs in discharging the freezing order or face being revealed.

Alexander Tugeshev -v- Vitaly Orlov et al
High Court of Justice, Commercial Court (QBD)
Claim no: CL-2018-000498