Kazakhstan Secures Partial Victory against Statis in Hard-Fought Washington, DC Discovery Dispute

In an Order issued August 11, 2020 by the U.S. District Court for the District of Columbia, the Republic of Kazakhstan obtained important limitations on the ability of the Statis to obtain further discovery from Kazakhstan. The court stated on the record that the Statis’ litigation tactics were “very troubling” and constituted “foolishness” and that “the Stati lawyers should not be smiling right now.”

The Statis are two Moldovan nationals, Anatolie and Gabriel Stati, and companies they control.

The Washington proceedings arise out of the arbitral award the Statis obtained in December 2013.  The Washington Court confirmed this award in March 2018 after denying Kazakhstan the opportunity to present evidence that it was obtained by fraud, and despite the fact that another court – the English High Court of Justice – determined in June 2017 that this same evidence showed prima facie that “the Award was obtained by fraud” and that the Statis committed a “fraud on the Tribunal.”^[1]  Criminal proceedings are now ongoing against the Statis in Luxembourg. 

The present court order concerns the Statis’ request that Kazakhstan produce certain documents.  Originally, in May 2018, the Statis served 182 document requests on Kazakhstan.  Because the requests violated the rules of court, Kazakhstan exercised its right to object.  In August 2019, after a court order, the Statis proposed 40 revised requests but these too violated the rules so Kazakhstan again exercised its right to object.  In the present Order, the supervising judge, after reviewing Kazakhstan’s objections, further limited the Statis’ requests, observing that many are “overbroad as written.”

In the Order, the Washington court expressly did not determine that any property of Kazakhstan is subject to attachment or execution by the Statis; it only further limited the scope of documents that Kazakhstan should produce.

Commenting on the ruling, Minister of Justice of the Republic of Kazakhstan, Marat Beketayev, said:

“Even though the Statis obtained the underlying arbitral award by fraud, Kazakhstan stands ready to provide any discovery that is required under the court rules.  We objected to the Stati document requests because they violated those rules. As a result, the original 182 Stati requests were reduced to 40 and now have been further limited by the court.  We welcome these important limitations, and are carefully reviewing the entire order. Kazakhstan will continue to protect its legal rights to the full extent permitted by applicable law, particularly when litigating against criminals such as the Statis.”