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England and Wales High Court (Queen's Bench Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Rothschild v Associated Newspapers Ltd  EWHC 177 (QB) (10 February 2012)
Cite as:  EWHC 177 (QB)
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| THE HONOURABLE NATHANIEL PHILIP VICTOR JAMES ROTHSCHILD
|- and -
|ASSOCIATED NEWSPAPERS LIMITED
Andrew Caldecott QC and David Glen (instructed by Reynolds Porter Chamberlain LLP) for the Defendant
Hearing dates: 23, 24, 25 and 26 January 2012
Crown Copyright ©
Mr Justice Tugendhat :
THE PARTIES AND OTHERS NAMED IN THE ARTICLE
"The Treaty articles on the Commission make special reference to the complete independence enjoyed by Members of the Commission, who are required to discharge their duties in the general interest of the Community. In the performance of their duties they must neither seek nor take instructions from any government or from any other body.
In addition, the general interest requires that in their official and private lives Commissioners should behave in a manner that is in keeping with the dignity of their office. Ruling out all risks of a conflict of interests helps to guarantee their independence…"
OVERVIEW OF LIBEL AND THE COURSE OF THIS ACTION
THE WORDS COMPLAINED OF
[On the front page and page 2:]
"Mandelson, an oligarch and a £500m deal over dinner that cost 300 British jobs (headline – also substantially repeated in large letters on page 9)
Damning questions about Lord Mandelson's role in a controversial Russian oligarch's £500million deal which undermined British manufacturing jobs are raised today. (1)
The former Business Secretary was a 'valuable extra' as a dinner guest as billionaire Oleg Deripaska entertained American aluminium executives in Moscow. (2)
The meeting, also attended by British-born financier Nat Rothschild, resulted in a deal to sell two of Deripaska's giant Russian-based RUSAL factories to a U.S. firm, Alcoa. (3)
But the 2005 agreement had for hundreds of British jobs. (4)
Mandelson - who was the EU Trade Commissioner - was in a position to allay 'concerns' over tariffs on imports from Eastern Europe. Indeed, over the following three years, they were slashed. (5)
This prompted the dumping of cheap aluminium on the European market, forcing at least four British factories to the wall. (6) …
Questions were being asked last night about what exactly Mandelson told the Americans and Russians about EU tariffs. (9)
In the past, he has denied ever talking to Deripaska about aluminium or even meeting Deripaska before 2006. His presence at the private dinner has been confirmed to the Mail by eyewitness sources linked to both Alcoa and Rusal. Russian sources said he had been flown from Switzerland to Moscow in a private jet belonging to Deripaska's close adviser. Rothschild and Mandelson have been friends for years. (10)
The trip was 'unplanned' and made in such haste that Mandelson had no valid visa. A source close to Rusal said that it needed the intervention of the company's head of security, a former senior KGB officer, to secure his entry into Russia. (11)
'It was a big headache,' said the source last night. (12)
'But Peter Mandelson's presence at that dinner was a very valuable extra for Deripaska.' (13)
A source close to Alcoa said: 'We certainly didn't expect Mandelson at the dinner, and assumed it would just be folks from Rusal and Alcoa. 'Nat has known Oleg a long time, and he played match-maker.' (14)
[On pages 8 and 9]
Sunday was never the busiest night at Cantinetta Antinori, a fashionable Tuscan restaurant in Moscow. But this one crackled with the electricity that only powerful tycoons and a £500 million deal on the table can generate. (19)
Holding court in a private room upstairs was Oleg Deripaska, controversial oligarch owner of Russia's giant aluminium producer, Rusal. (20)
He had only just returned to Moscow from the World Economic Forum in Davos. And, according to sources, his dinner had hardly begun when two more people appeared, hotfoot from Switzerland. (21)
One of the new arrivals was financier Nat Rothschild, scion of the British banking dynasty and ultra-loyal special adviser to Deripaska. (22)
Rusal executives will tell you that Rothschild liked nothing more than to please his billionaire patron. And to that end Rothschild had brought with him a 'surprise' VIP guest; none other than the European Union's Trade Commissioner, Peter Mandelson. (23)
By bringing his friend halfway across Europe in his own private jet - and getting him into Russia without a valid visa in his passport - young Rothschild had pulled a very unexpected and also rather useful rabbit out of his hat. How useful we can explain here for the first time. (24)
The bare fact that Mandelson had dinner with Deripaska in Moscow that Sunday evening in January 2005 was first made public 18 months ago. He had wanted it kept secret. (25)
Until now, the soiree had been viewed, as with similar meals, as yet another example of Mandelson's fatal fascinations for the company and lifestyle of the super rich; an attraction which in the past has led him into errors of judgment that twice forced him to resign from British ministerial posts. (26)
But we can now reveal that there was much more at stake in the Cantinetta Antinori that night than the chance for Mandelson to break ciabatta with Deripaska. So important was it that Rothschild was prepared to cause what one former Rusal executive described to the Mail as a 'serious headache' by engineering Mandelson's visa-less arrival to Moscow. (27)
According to the same source, that headache was cured only by Rusal's head of security, a former senior KGB officer, pulling strings to get Mandelson through passport control. (10) …
Why the extraordinary efforts? (29)
Deripaska was dining with two of his closest cronies: Gulzhan Moldashanova, female chief executive of his Basic Element holding company and his Canadian friend and business partner, the gold magnate Peter Munk. (30)
But they were not the only people at that table that night. Eating with them were three senior executives from the American aluminium giant Alcoa. The presence of Alcoa chairman Alain Belda, executive vice-president Barbara Jeremiah and head of communications Jake Siewert, a former Press Secretary to President Clinton (and now an adviser at the U.S. Treasury) is enough to explain the real significance of Rothschild and Mandelson's helter-skelter trip across Europe. (31) …
Alcoa was about to sign a deal to pay £250 million in cash for Rusal's two Russian aluminium plants.(32) ..
… Alcoa, the world's biggest aluminium producer. … (35)
Under the Americans, the aluminium products would be exported around the world, including Europe. But another source said 'there were concerns' from Alcoa about the level of import tariffs levied by the EU on Russian aluminium. (38) …
As EU trade supremo, Peter Mandelson, president of think-tank Policy Network, … was a very welcome guest at the 'close of deal' dinner that night in Moscow. (41)
By his presence, Mandelson could, at the very least, bless the £500 million union of the metals giants. It also signalled that he was well disposed to their efforts, which were projected to make some £30 million annual profit under the Americans. (24)
In short, it is very hard to believe that by being there Mandelson had not done Deripaska an enormous business favour. Certainly, the Mail has been told, the Americans did not expect him to be there. It is hard to believe that tariffs were not discussed. (43)
Whose interests were Peter Mandelson representing that night? Neither of the companies at the table that night was EU owned (44) …
It was an infamous holiday on Corfu in the summer of 2008 that first drew public attention to the links between Mandelson and the Russian oligarch. (46)
The Rothschild family's holiday villa is on the island, and Deripaska's super-yacht was moored offshore. That August, Mandelson and the then Shadow Chancellor George Osborne enjoyed the hospitality of both. (47)…
Amid the claim and counter-claim, it became clear that the Mandelson Deripaska association predated Corfu by several years. (49)
But Mandelson did not want the world to know. (50)
His EU spokesman had first stated that the two men met 'at a few social gatherings in 2006 and 2007', but had never discussed aluminium. This was not true and, under pressure, Mandelson soon had to admit he first met the Russian in 2004 'to the best of my recollection'. (51)
Certainly the pair were seen together in Moscow in October 2004, just after Mandelson had been appointed EU Trade Commissioner but before he'd taken up the post. (52)
He officially entered office as EU Trade Commissioner on November 22, 2004. And EU records show that on November 23 his department began a review of the anti-dumping tariff imposed by the EU on Russian rolled aluminium imports – of the type which was being produced at the two plants Deripaska's Rusal was in the process of trying to sell to Alcoa. (53) …
The Cantinetta Antinori dinner which followed threw a fascinating light on the dynamics in the relationship between Deripaska, Rothschild and Mandelson. (57)
'The dinner was simply supposed to be a meeting of Rusal executives and their counterparts at Alcoa,' says the former Rusal executive. 'Nat Rothschild bringing the EU Trade Commissioner to the table was a very valuable extra for Deripaska. (40)
'Mandelson's sudden arrival was one of the games Rothschild played to impress Deripaska and keep him close. 'It was all about Nat. You have to see the event through the prism of Nat. Rusal was full of young, ambitious Russians and they did not like Nat taking all the glory. But Nat was literally dictating the colour of the loo paper at Rusal.' (59) …
Revealed: the astonishing story of the night Lord Mandelson was flown to Moscow by private jet to join a billionaire friend desperate to strike a deal that cost British jobs (sub-headline on p.9)
Left at the table was the complex Deripaska network of money and influence. (62)
As we have mentioned, there was Peter Munk, owner of Barrick Gold, the world's largest gold producer. (63)
Munk also sat on Rusal's international advisory board. Nat Rothschild sat on the equivalent board at Barrick Gold and Munk has reportedly invested heavily in Nat's Atticus hedge fund. (64)
Deripaska, Munk and Rothschild were also co-developing Porto Montenegro, a resort for the super rich near the town of Tivat. (65)
On January 31, 2005, fewer than 24 hours after the Moscow dinner attended by Mandelson, the Rusal-Alcoa deal was closed and triumphant press releases sent out. (68)
That night, Rusal and Alcoa executives went off to dine at the Cafe Pushkin, another of Moscow's high-end restaurants where Deripaska and Mandelson are known to have met in 2004. (69)
This time Mandelson was not present, according to one ex-Rusal executive. The Rothschild-choreographed favour had been done and the Trade Commissioner's use to Deripaska was at an end, for the moment. (70)
But over the next four years his department in Brussels was to make a series of decisions on tariffs which had huge benefits for those who attended the Cantinetta Antinori dinner. (53) …
A senior business figure who knows some of the parties present that night disputes that the relationship is without reward: 'I do not think there is some secret bank account where he has millions of pounds of under the table payments stashed away,' he said. (80)
But the people Mandelson seeks to mix with are able to equip the lifestyle he loves but cannot independently afford. They have the private jets, villas and yachts which they are prepared to put at his disposal. (81)
There is no evidence that Mandelson orchestrated these tariff reductions specifically to help his Russian friends, but he certainly has many questions to answer. (82)
Once again, his actions have brought his public offices and personal integrity into disrepute and exposed him to accusations of conflict of interest. (83)
By any standard, the desperate race to attend the Cantinetta Antinori dinner was another gross error of judgment. (84)"
LAW ON MEANING
"The legal principles relevant to meaning … may be summarised in this way: (1) The governing principle is reasonableness. (2) The hypothetical reasonable reader is not naïve but he is not unduly suspicious. He can read between the lines. He can read in an implication more readily than a lawyer and may indulge in a certain amount of loose thinking but he must be treated as being a man who is not avid for scandal and someone who does not, and should not, select one bad meaning where other non-defamatory meanings are available. (3) Over-elaborate analysis is best avoided. (4) The intention of the publisher is irrelevant. (5) The article must be read as a whole, and any "bane and antidote" taken together. (6) The hypothetical reader is taken to be representative of those who would read the publication in question. (7) … the court should rule out any meaning which, "can only emerge as the produce of some strained, or forced, or utterly unreasonable interpretation…" (8) It follows that "it is not enough to say that by some person or another the words might be understood in a defamatory sense".
THE CONTENTIONS OF THE PARTIES ON MEANING
"(1) That, for the purpose of ingratiating himself with Russian oligarch Oleg Deripaska [Mr Rothschild] took extraordinary steps to ensure the attendance of his friend, EU Trade Commissioner Lord Mandelson at a meeting between Oleg Deripaska and American aluminium executives which he must have known Lord Mandelson had no official reason for attending and which he must or ought to have foreseen would and did bring his friend's public offices and personal integrity into disrepute and exposed him to accusations of conflict of interest.
(2) That there were strong grounds to suspect that [Mr Rothschild] had facilitated the attendance of EU Trade Commissioner Lord Mandelson at meeting between Russian oligarch Oleg Deripaska and American aluminium executives so that Oleg Deripaska could close a £500 million deal by securing corrupt and improper disclosures and commitments concerning EU aluminium tariffs from Lord Mandelson"
"(1) [Mr Rothschild] facilitated the attendance of Lord Mandelson on a trip to Russia in 2005, which he had no official reason for taking,
at a dinner held at a Moscow restaurant for the purpose of closing a multimillion pound aluminium deal ('the Alcoa deal')in circumstances in which foreseeablyhe must or ought to have foreseen that he was exposing edLord Mandelson to accusations of conflict of interest between his relationship with the Claimant and Mr Deripaska (and Mr Deripaska's business interests, including Rusal) on the one hand and his duties as EU Trade Commissioner on the other in circumstances which were liable to bring Lord Mandelson and his office into disrepute but which were likely to further the Claimant's relationship with and impress Mr Deripaska;
(2) There are reasonable grounds for believing that Lord Mandelson, when EU Trade Commissioner, discussed aluminium tariffs with Mr Deripaska, on the trip referred to in (1) in terms which would be open to criticism as inappropriate,
before the closure of the Alcoa dealand that the Claimant facilitated and encouraged an inappropriate relationship between Lord Mandelson and Mr Deripaska in which that contact could occur."
FINDING ON MEANING
(a) Mr Rothschild flew Lord Mandelson (at that time the EU Trade Commissioner) in his private jet to Moscow in January 2005 when he had no official reason to go there, and where, unknown to EU officials, he and Mr Rothschild were to attend a business dinner held for the purpose of closing a multimillion pound deal ("the Alcoa deal") attended by representatives of Rusal and the American aluminium producer Alcoa, and by a gold magnate Mr Munk (another member of the advisory board of Rusal) ("the Alcoa dinner"), in circumstances in which he (Mr Rothschild) must or ought to have foreseen that this would (as in fact it did):
(1) bring Lord Mandelson's public offices and personal integrity into disrepute, and expose him to accusations of conflict between his duties as EU Trade Commissioner and his private interest in the enjoyment of private jets and other luxuries, and thus in pleasing those from whom he accepted such generous hospitality: and
(2) give rise to reasonable grounds for suspecting that Mr Rothschild had done this so that Lord Mandelson would engage, and that Lord Mandelson had engaged, in improper discussion with the representatives of Rusal and Alcoa about tariffs on aluminium imports from Russia into the EU, and thereby shown to Rusal and Alcoa that he was well disposed towards, and thus assisted in the closure of, a deal between them for the sale of two of Mr Deripaska's Russian based Rusal factories to Alcoa.
(b) This incident is an example of how Mr Rothschild sought to impress and keep close to him Mr Deripaska, the billionaire businessman who controlled the Russian aluminium producer Rusal, of whose advisory board Mr Rothschild is a member.
THE DEFENCE OF JUSTIFICATION OR TRUTH
"109. … English law is generally able to accommodate the policy factors underlying the Article 10 [the right to freedom of expression] jurisprudence by means of established common law principles; for example that a defamatory allegation need only be proved, on a balance of probabilities, to be substantially true. The court should not be too literal in its approach or insist upon proof of every detail where it is not essential to the sting of the article... So too the demands of a defence of justification are sometimes mitigated by the terms of section 5 of the Defamation Act 1952 (although not of relevance here).
110. Each case obviously depends on its own unique circumstances and the application of these considerations of public policy will to a large extent be a matter of impression. …
111. In deciding whether any given libel is substantially true, the court will have well in mind the requirement to allow for exaggeration, at the margins, and have regard in that context also to proportionality. In other words, one needs to consider whether the sting of a libel has been established having regard to its overall gravity and the relative significance of any elements of inaccuracy or exaggeration. Provided these criteria are applied, and the defence would otherwise succeed, it is no part of the court's function to penalise a defendant for sloppy journalism ... I must set all that to one side, … and focus only on substance."
"The [defendant]s wish to place before the court the material relating to [the other programme] …, on the basis that … the sting of the libel was therefore that the [claimant]s had been responsible for more than one fake programme or series of programmes."
AN OUTLINE OF WHAT FACTS ARE ADMITTED AND DENIED
i) this is agreed.
i) this is agreed.
i) ANL accepts that this is inaccurate, because the deal had already been effectively closed before the dinner.
i) It is agreed that before the Alcoa dinner Lord Mandelson greeted the people at that dinner, and that this was unknown to EU officials.
ii) It is also agreed that he did not attend that dinner, but that on the same evening he had a dinner (also unknown to EU officials), elsewhere in the same restaurant, with a Russian Minister, and that this dinner with the Minister had been arranged by Mr Rothschild with the assistance of Mr Deripaska or his office.
i) this is in dispute. See paras 78 to 103 below.
i) It is agreed that Lord Mandelson did not discuss tariffs on aluminium at the Alcoa dinner, and that he did not assist in the closure of the Alcoa deal.
ii) But it is also agreed that during the night the immediately after the Alcoa dinner Mr Deripaska, Mr Rothschild, Mr Munk, Lord Mandelson and Mr Taylor all flew to Siberia in Mr Deripaska's plane, where they were housed and entertained by Mr Deripaska and accompanied him on a visit to an aluminium plant (which, unknown to Mr Rothschild, happened to be one of the plants which was currently the subject of a review by Lord Mandelson's officials). Lord Mandelson returned to Brussels early on the Tuesday morning on Mr Rothschild's plane, while the others went on to Tajikistan and Kyrgyzstan to discuss projects for joint ventures between them, including one to acquire gold or silver mining rights in those two countries and to take over a Russian gold mining company.
iii) ANL contend, but Mr Rothschild disputes, that it is to be inferred that Lord Mandelson and Mr Deripaska probably talked about aluminium during the visit to the aluminium plant in Siberia, or that there are reasonable grounds to suspect that they did. See para 105 below.
i) this is agreed
i) this is disputed. See para 104 below.
"On 23 November 2004, the Commission announced its intention to conduct an interim review of Council Regulation (EC) 950/2001 by which an anti-dumping duty of 14.9% was imposed on imports of aluminium household foil from Russia. – At the time Regulation 950/2001 was adopted, the Commission accepted a number of concurrent undertakings from the principal Russian exporter US Siberian Aluminium pursuant to which it agreed that an aluminium foil manufacturing subsidiary, Sayan Foil, would only to export a certain volume of foil at or above specified price levels… In or around July 2004, notice was given to the Commission that Sayan Foil had been renamed as Rusal Sayanal. Sayanal formed part of the Rusal Group at all material times. The review announced by the Commission on 23 November 2004 was undertaken as a result of a request submitted by Sayanal itself… On 20 December 2005, Lord Mandelson signed a Commission Decision repealing the decision to require undertakings from Sayanal on the ground that those undertakings were no longer necessary".
"In a document signed off by Mandelson in December 2005, it was agreed the European Commission would scrap measures against Deripaska's company, Rusal Sayanal, controlled by Rusal, to prevent it dumping cheap aluminium foil in Europe. A year long investigation had cleared the company of this practice".
"Some people have formed the reasonable view… that my first meeting with [Mr Deripaska] was in 2006. This is not the case: to the best of my recollection we first met in 2004 and I met him several times subsequently… in managing my department's business as Secretary of State I will, of course, in line with the Ministerial code, ensure that no conflict of interest, or perception of such, arises from any of my past or indeed future contacts".
CHANGES IN THE EVIDENCE OF MR ROTHSCHILD
"Lord Mandelson travelled with [Mr Rothschild] to Moscow because on 29 January, while at Davos [attending the World Economic Forum], [Mr Rothschild] had informed him that he was planning to travel with Peter Munk of Barrick Gold Corporation to Moscow on 30 January 2005 and that they were then heading on to Siberia to view some facilities with Mr Deripaska as part of discussions in relation to a potential joint venture. [Mr Rothschild] was aware that Lord Mandelson had not been to Siberia and was keen to visit it, and accordingly had invited him along. Lord Mandelson agreed to go and in addition asked [Mr Rothschild] to arrange for him to meet a Russian Government Minister…"
i) The nature of the joint venture: "For some time leading up to the WEF in January 2005 I had been in discussion with Mr Munk and Mr Deripaska about a potential gold joint venture in Russia and the former Soviet States" (para 13); "we stayed in Dushanbe [Tajikistan] for most of the morning [of Tuesday 1 February 2005] in meetings regarding the proposed joint venture and then we travelled on to Bishtek, Kyrgyzstan for more meetings relating to the proposed joint venture… Ultimately Messrs Munk, Deripaska and I agreed the joint and Barrick Gold, Basic Element and JNR made a joint bid for Polymetal, a leading Russian gold producer" (paras 40 and 41).
ii) The timing of the decision to travel to Russia: it was arranged at "short notice". The joint venture was discussed on 29 January 2005 at a dinner in Davos hosted by PM and attended by Mr Deripaska and Lord Mandelson (as well as Mr Belda of Alcoa) and that at the suggestion of Mr Deripaska the parties agreed to continue those discussions in Russia the following day (see paras 13-14 and 18)
iii) The stated reason for the joint venture parties' decision to travel to Russia: "During Mr Munk's event at the WEF the three of us had a conversation about the potential joint venture. We agreed to continue the discussions the following day. Mr Deripaska was returning to Moscow on 30 January 2005 and consequently he suggested that Mr Munk and I should travel to Russia the same day to continue our discussions and to view some relevant industrial plants in Siberia. As I was already planning on travelling to South East Asia from Davos, Moscow was a convenient stop to make en route" (para 14).
iv) The timing of Lord Mandelson's invitation to Russia: on the evening of 29 January 2005 after PM's dinner Mr Rothschild invited Lord Mandelson to join them on that trip to Abakan in Siberia (para 15).
v) The meeting with the Russian Minister: at Lord Mandelson's suggestion Mr Rothschild "was able to liaise with Mr Deripaska – who has close relationships with the Russian Government – and arrange for Lord Mandelson to have an informal dinner with the relevant Russian Minister on the evening of 30 January" (para 18).
vi) The Moscow evening: When Mr Rothschild reached his hotel in Moscow, Mr Deripaska called to invite him and Mr Munk for dinner at the same restaurant as that where Lord Mandelson was scheduled to meet the Russian Minister. Mr Rothschild suggested to Lord Mandelson that, while Lord Mandelson was at the restaurant waiting for the Minister, he should join Mr Deripaska and say hello to him. Mr Rothschild had not known in advance that Mr Deripaska's dinner would be attended by representatives of Alcoa, and he had no involvement in, and little knowledge of, the Alcoa deal. Lord Mandelson was only at the Alcoa dinner for about 10 minutes, while he was awaiting the arrival of the Russian Minister. Later in the evening Mr Deripaska and Mr Rothschild went to the room where Lord Mandelson was dining to greet the Russian Minister, which lasted no longer than 10 or 15 minutes. See paras 23-31.
vii) The timing of the decision to travel to Siberia overnight: "During the dinner Mr Deripaska, Mr Munk and [Mr Rothschild] had agreed that [they] would travel to Siberia later that evening and [Mr Rothschild] therefore advised Lord Mandelson of this" (para 32).
viii) The nature of the Siberian trip: The account given in the original Reply is set out in para 66 above. In his first witness statement Mr Rothschild said that in Siberia they visited "a couple of industrial plants which Mr Deripaska wanted to show to Mr Munk in relation to the proposed joint venture that we had been discussing" (this is in para 35 of the first witness statement). They all spent the night in Mr Deripaska's house. On the Tuesday all of them except Lord Mandelson went on to meetings in Tajikistan and Kyrgyzstan to discuss the proposed joint venture. It was ultimately agreed that BGC, Basic Element and JNR would make a joint bid for Polymetal "a leading Russian gold producer".
ix) Hospitality: They agreed to travel together on Mr Deripaska's plane because it made most sense to fly together. But Mr Rothschild had to have his own plane follow them so that it would be available the next day, due to the uncertainty as to Mr Deripaska's plans, and it was in fact available the next day to take Lord Mandelson back to Brussels (para 34).
i) The nature of the joint venture: the parties made a joint bid of about $900 million for Polymetal "a Russian gold and silver producer in 2005. The joint venture also focussed on Central Asia and the parties were considering acquiring a company called Jerooy which was located in Kyrgyzstan. It was for this end that Mr Deripaska, Mr Munk and I arranged to visit Central Asia in early 2005" (para 7).
ii) The timing of the decision to travel to Russia: Mr Deripaska was not present at Mr Munk's dinner on 29 January 2005. The trip was not made at short notice. It was before the WEF that Mr Rothschild, Mr Deripaska and Mr Munk had arranged to travel to Siberia and then on to Tajikistan and Kyrgyzstan. The stopover in Moscow was a change in plan, but Mr Rothschild could not remember when that was arranged. "Therefore paragraph 14 of my first witness statement is not correct" (para 10). "… there was already an arrangement to go to Siberia and Central Asia with Mr Munk, and … my previous recollection [about a visit to South East Asia] cannot have been right" (para 11).
iii) The stated reason for the joint venture parties' decision to travel to Russia: "the only visit to industrial plants we made on this occasion would have been to the smelter facility and museum in the Sayana-Shusanks power station… Mr Deripaska was extremely proud of the facility and … wanted to show it to Mr Munk as a fellow industrialist and as he was going to be Mr Munk's business partner, via the prestigious new venture he was entering into with Barrick. Paragraph 35 of my first witness statement needs to be corrected accordingly, as neither of these visits related to the proposed gold venture" (para 28). Further, the fact that Abakan was only 2 hours flying time to Dushanbe in Tajikistan made the whole trip easier for Mr Munk, who was aged over 70.
iv) The timing of Lord Mandelson's invitation to Russia: It was shortly before the WEF began that Mr Rothschild invited Lord Mandelson to visit Siberia with him. At the time the invitation was extended the plan was to go straight from Switzerland to Siberia. Mr Rothschild recalled Lord Mandelson told him that he would need to liaise with his Chef de Cabinet to confirm it was permissible to join the party on the trip to Siberia and that it fitted with his diary, and later advised Mr Rothschild that the trip was okay. The plan was changed to include a stop in Moscow. See paras 14-15.
v) The meeting with the Russian Minister: When Mr Rothschild told Lord Mandelson that the party would be stopping in Moscow, Lord Mandelson mentioned that it would be useful for him to meet a Russian Minister. Mr Rothschild knew the Russian Minister, and arranged the meeting himself through Mr Deripaska's office, and not with Mr Deripaska personally. See para 17
vi) The Moscow evening: Before leaving Switzerland Mr Rothschild and Mr Deripaska had arranged to have dinner in Moscow, but the details were not confirmed until after Mr Rothschild arrived in Moscow.
vii) The nature of the Siberian trip: "The decision to make this visit was not in any way influenced by the presence of Lord Mandelson or Mr Taylor… The only component of the trip that was even remotely about business was Mr Deripaska's desire to display his and Basic Element's industrial credentials to Barrick Gold and the fact that Abakan was close to Dushanbe (around two hours flight time) and this made the whole trip a lot easier for Mr Munk…" (para 31).
viii) Hospitality: Mr Rothschild said: "I simply did not apply my mind to what accommodation we would be staying in during our visit to Moscow or Siberia or who would pay for that accommodation. I was happy that my friends Lord Mandelson and Mr Taylor were coming on the trip as I knew that I would have a great time with them… the decision to fly on Mr Deripaska's plane was simply one of convenience… It therefore did not occur to me that the flight from Moscow to Abakan could be viewed as any sort of favour bestowed by Mr Deripaska on Lord Mandelson… Nor did occur to me that staying overnight at Mr Deripaska's chalet would be considered as a favour either. … [after visits and other entertainment we] played a friendly game of five a side football and a game of ice hockey under the floodlights (with some of the locals who worked for Mr Deripaska …), had dinner and were entertained by a Cossack band, had another banya, played some games of Russian billiards… As far as I was concerned this was a trip made with a group of friends, not an official business trip".
FINDINGS OF FACT
"15 Q. … Did you tell [Lord Mandelson], when you issued
16 him with the invitation, that he would be staying with
17 Mr Deripaska?
18 A. Yes, I'm sure I did. Yes.
19 Q. Did you tell him that you would be visiting an aluminium
20 plant in all likelihood with Mr Deripaska?
21 A. I don't recall.
22 Q. Did you tell that you would be flying in Mr Deripaska's
23 jet, or might well be?
24 A. I don't recall....
17 Q. What I want to explore with you is it's perfectly
18 possible that at this stage you didn't actually tell him
19 that he would be staying with Mr Deripaska.
20 A. I don't recall.
21 Q. I just want to ask you this. My learned friend has
22 produced a skeleton for this trial in which he says that
23 Lord Mandelson and others were a guest of the claimant
24 and not Mr Deripaska. That is a case that is made in my
25 learned friend's trial skeleton.
1 Is that the view that you then took, that
2 Lord Mandelson was your guest and not Mr Deripaska's
4 A. I think we were -- we were all friends, and we were
5 going on a fascinating trip. You know, I don't think
6 there's anything particularly profound about whose guest
7 he was or he wasn't.
8 Q. That's not quite an answer to my question. Did you
9 then, at the time, see him as being your guest rather
10 than Mr Deripaska's guest?
11 A. I was responsible for him, just like I was responsible
12 for Mr Munk....
16 A. ...
17 The whole point of the Siberia trip
18 was that we went there, we arrived, we spent
19 a nanosecond at this smelter. We then went, had the
20 most delightful banya, where we were beaten by a 25
21 year-old Russian banya keeper, man. You know, who
22 spends his entire life perfecting the art of the banya,
23 and then we got out and we jumped into ice cold water.
24 Even Mr Munk, I might say. Then we got into the banya.
25 We got out, we got back in, and it was just -- it's the
1 best way in the world to cure jetlag and everything
2 else, and it was -- you know, we had a wonderful time,
3 and it was incredibly enjoyable, and everyone, you know,
4 woke up the next day to go to Tajikistan feeling
5 revitalised and over the moon, and completely excited by
6 the fascinating day that we had spent in this wonderful
7 wilderness in the middle of nowhere…."
"The fact that he operated and owned, or owned and virtually operated, or vice versa, a major facility of such high efficiency and reputation, had a major part in the joint venture".
"5 Q. Mr Rothschild, we can all agree that the position of
6 Trade Commissioner is a very senior political position
7 within the EU. Wasn't it obvious to you -- it must have
8 been obvious to you -- that Mr Deripaska would have
9 obvious reasons for developing a relationship with
10 Mr Mandelson?
11 A. Look, Deripaska was my friend and Mandelson was my
12 friend, and this was a recreational trip, and Munk was
13 there, and you know, I think that Deripaska's desire to
14 develop a relationship with Mandelson was because
15 Mandelson was an interesting and highly intelligent and,
16 you know, fantastic guy. That's the way I look at it.
17 Q. Mr Deripaska has developed relations with many
18 politicians in the Russian Government. We know he has
19 considerable political influence. I'm not disputing
20 that Lord Mandelson can be very good company, and that
21 may have been one of the reasons. But an obvious reason
22 for Mr Deripaska to develop relations with
23 Lord Mandelson is because he has trade and business
25 A. That was nothing to do with the relationship between
1 Deripaska and Mandelson.
2 Q. How do you know that?
3 A. Because I watched, you know, with great happiness as
4 they got to know each other, and that was -- they had
5 a relationship based on friendship."
FINDING ON JUSTIFICATION OR TRUTH
i) Lord Mandelson's dinner with the Russian Minister in Moscow, which he arranged either through Mr Deripaska (as he said in his first witness statement) or through Mr Deripaska's office (as he said in his second witness statement);
ii) the hospitality provided to Lord Mandelson by Mr Deripaska, including the flight in his luxurious private jet from Moscow to Abakan, and the entertaining at his chalet near Abakan;
iii) Lord Mandelson's presence on a trip which, for the main participants Mr Rothschild, Mr Munk and Mr Deripaska, was a business trip to advance one or more of their proposed joint ventures, even if (as is accepted) Lord Mandelson did not take part in business discussions;
iv) Lord Mandelson's taking part in the visit, which he had expected to take place, to the aluminium smelter and Sayanal foil plant.