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Tuesday, May 24, 2011

Surprise, Surprise, Outrage, Outrage: Russian Supreme Court Upholds Khodorkovsky Conviction

The Russian Supreme Court today upheld former oil tycoon, Mikhail Khodorkovsky’s conviction to a second prison term. Khodorkovsky, now Russia’s most prominent political prisoner, will return to his Siberian jail cell. He will stay there at least until 2017, well into what is likely Putin’s fourth term as president. His court case out of the way, he will conveniently disappear from view. Khodorkovsky went to jail as a young man. He will emerge (if ever) an old man.

The Russian Supreme Court ignored that the Moscow court decision under appeal was dictated by the Kremlin. Two brave court insiders publicly testified to this fact. It also ignored that the charges against him had no credibility. In fact, they bordered on the ridiculous (Khodorkovsky was charged with stealing the entire output of his Yukos oil company).

Khodorkovsky committed two sins: He used his vast wealth to support democratic political parties, and he, unlike the other oligarchs who retained their wealth and empires, sought to turn his Yukos Company into a transparent Western-style company.

The Supreme Court ruling opens further distance between Putin and Russian President Medvedev. In Davos, Medvedev’s economic advisor acknowledged that the Khodorkovsky case will reduce the flow of needed foreign investment into Russia. Medvedev is also on record that Khodorkovsky’s release would pose no public danger.

Let us hope the Khodorkovsky case will not be forgotten outside of Russia. The Council of Europe, Freedom House, and Amnesty International have concluded that Khodorkovsky was charged and imprisoned in a process that did not follow the rule of law and was politically motivated.

The U.S. Senate’s Magnitsky Rule of Law Bill proposes to deny visas to Russian officials involved in the denial of human rights to Russian citizens. The bill was inspired by journalist Sergei Magnitsky, who died in a Russian prison after being denied medical treatment. The bill now includes the Khodorkovsky case as evoking “serious concerns about the right to a fair trial and the independence of the judiciary in the Russian Federation. The lack of credible charges, intimidation of witnesses, violations of due process and procedural norms, falsification or withholding of documents, denial of attorney-client privilege, and illegal detention in the Yukos case are highly troubling.”

Any company considering investing in Russia should think twice. Those companies who invested in good faith in Yukos lost everything. They were politically expropriated. Major international companies, such as Shell and BP, have suffered arbitrary treatment at the hands of Russian officials and have no recourse. Companies considering entering the Russian market are assured that such things will not happen to them. They should realize that anyone doing business in Russia could find themselves in Khodorkovsky’s shoes.

Let's face it. Khodorkovsky's only chance for release would be in the form of an act of bravery. Medvedev, as Russian President, has the power to pardon him. I doubt that Medvedev has the guts to do so.

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