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Russian Aluminum

November 26, 2003

Zhivilo Companies Withdraw $2.4 Billion In Claims Against Russian Aluminum

Moscow, 26 November’2003 - The United States Court of Appeals in New York approved  the withdrawal of claims by Base Metal Trading S.A. and Alucoal Holdings Ltd. against Novokuznetsk Aluminum factory (NKAZ) and RUSAL.

In March 2003 the New York City South District Federal Court deviated the suit of several trading companies controlled by Zhivilo brothers on account of forum non-conviniens, or 'inconvenient place for reviewing the case'. The initial claim was directed to the New York City South District Federal Court in December 2000 in accordance with the US Racketeer Influenced and Corrupt Organizations Act. After having their case dismissed the plaintiffs submitted a concise appeal in May 2003.

The defendants were charged with alleged collusion to take over NKAZ. Zhivilo, the former director and major shareholder in NKAZ, was seeking about US$900 million in losses.  In the United States, the RICO statute allows plaintiffs to claim triple damages.
The claims withdrawn by Base Metal Trading S.A. and Alucoal Holdings Ltd. total $2.4 billion.
Two other companies controlled by Zhivilo, MIKOM and Base Metal Trading Ltd. are continuing the appeal.  The claims of those two companies, however, total less than US$40 million.

RUSAL's Chairman, Oleg Deripaska, said in a statement today, "This is the ultimate vindication.  Not only has the case been dismissed by the Federal Court in New York, but now even plaintiffs themselves are afraid to go through with the appeal process. More than 90% of the case has been withdrawn. It proves that the plaintiffs had no case to begin with and that they filed in New York only to publish defamatory statements in an effort to extort a considerable sum of money from RUSAL.  The Plaintiffs’ tactic was to sue us in many jurisdictions, generate adverse publicity and cause us to incur huge legal costs," said Deripaska.  "Nevertheless, we defended ourselves and we will continue to win wherever they sue us."

RUSAL's lead counsel, Michael Burrows, said the RICO case, "From the beginning was a transparent attempt to grab headlines and generate negative publicity.  Plaintiffs' lurid descriptions of corruption, money laundering and mafia involvement are false and were made without a shred of evidence to support them.  The Plaintiffs came to the United States only after they had been defeated in numerous legal actions in Russia," Burrows added. 


RUSAL, a world leader in aluminium production was formed in March 2000 from the merger of a number of the largest smelters and other aluminium producers located in the CIS. The company accounts for 75% of Russia's primary aluminium output and 10% of the global primary aluminium output. RUSAL is a fully vertically integrated company with a complete production cycle from bauxite mining and the production of raw materials, to the production of primary metal, semi-products and aluminium-based end products. RUSAL is headquartered in Moscow.

For further information:
Eugenia Harrison, Moscow, +7 095 720 5170, or; Fred Harrison, London, +44 (0) 20 7431 7517, or; Stan Neve, New York, +1 212 333 3810, or





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