Yermek Alimov v Abdumalik Mirakhmedov & Ors
| Court | Queen's Bench Division (Commercial Court) |
| Judge | SIMON BIRT KC |
| Neutral Citation | [2024] EWHC 3322 (Comm) |
| Date | 20 December 2024 |
| Year | 2024 |
| Counsel | Charles Samek Kc,Alexander Halban,Edward Cumming Kc,Neil Kitchener Kc,David Caplan,Sonia Tolaney Kc,Adam Rushworth |
Neutral Citation Number: [2024] EWHC 3322 (Comm)
Case No: CL-2023-000262
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
KING'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Date: 20 December 2024
Before :
SIMON BIRT KC
(Sitting as a Deputy Judge of the High Court)
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Between :
Yermek Alimov Claimant
- and -
(1) Abdumalik Mirakhmedov
(2) Rashit Makhat
(3) Andrey Kim
(4) Genesis Digital Assets Limited
(a company incorporated in Cyprus) Defendants
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Charles Samek KC and Alexander Halban (instructed by Sterling Lawyers Ltd) for the
Claimant
Edward Cumming KC (instructed by Withers LLP) for the First and Third Defendants
Neil Kitchener KC and David Caplan (instructed by Mishcon de Reya LLP) for the Second
Defendant
Sonia Tolaney KC and Adam Rushworth (instructed by Latham & Watkins (London)
LLP) for the Fourth Defendant
Hearing dates: 15 and 16 October 2024
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Approved Judgment
This judgment was handed down remotely at 10.30am on 20 December 2024 by circulation
to the parties or their representatives by e-mail and by release to the National Archives.
.............................
SIMON BIRT KC SITTING AS A DEPUTY JUDGE OF THE HIGH COURT
SIMON BIRT KC
Approved Judgment
Alimov v Mirakhmedov and others
Simon Birt KC:
Introduction
1. The dispute between the parties in this litigation relates to a bitcoin mining business
which is operated in Kazakhstan. These applications constitute the jurisdiction battle
between the parties. In short, the Claimant contends the dispute should be heard in
England; the Defendants contend it should be heard in Kazakhstan.
Factual background to the dispute
2. The Claimant, Mr Alimov, and the three individual Defendants are all businessmen
with substantial links to Kazakhstan.
3. The Claimant contends that (until he moved to England, which he says was in August
2018) he was a leading specialist in the energy sector in Kazakhstan, and the former
head of (a) AstanaEnergoServis JSC (the public holding company which owned all
the power companies in Astana), and (b) Karaganda EnergoTsentr LLP (a private
energy company which owned the Karagandinskaya TETs 3 power station and
provided energy to the city of Karaganda).
4. The three individual defendants are also businessmen of Kazakhstani origin (albeit the
First Defendant (“D1”) was born in Uzbekistan), although they do not currently live
there. The Second Defendant (“D2”) was resident in Kazakhstan until 2020 and now
lives in the UAE (though still also retains a residence in Kazakhstan). The Third
Defendant (“D3”) has been resident in the UAE since 2012, but until 2020 spent most
of his time in Kazakhstan (where his family and business activities were based) and
still manages the office of D1-D3 in Kazakhstan. D1 lives in the UAE and/or the UK
(this is a contentious issue which I deal with below). All three continue to have
substantial business interests in Kazakhstan.
5. The Fourth Defendant (“D4”) is a company incorporated in Cyprus which the
Claimant describes as “one of the world’s largest bitcoin-mining companies and
operates (through its subsidiaries) from facilities in Kazakhstan and elsewhere.” At
one time, between them, the 3 individual defendants owned 50% of the shares in D4.
6. The factual background is highly contentious between the parties, with numerous
issues of fact between them, and allegations on both sides that the other is not giving
an accurate or truthful account. There are also allegations of attempts to distort or
manufacture the evidential picture. There is little that is common ground between the
parties.
7. I summarise below the Claimant’s case on the background and the facts, taken from
his Particulars of Claim and evidence filed for these applications, but noting that
much of it is controversial between the parties, and also that the Defendants
emphasised that parts of this case were different from the case presented on the
Claimant’s behalf in his detailed letter before action.
8. In summary, the Claimant says that:
i) In around April 2017, there was an agreement between a cryptocurrency and
cloud mining company called Genesis Mining Limited (“GM”) and D1-D3 by
SIMON BIRT KC
Approved Judgment
Alimov v Mirakhmedov and others
way of a joint venture to develop bitcoin mining in Kazakhstan, with the aim
of GM owning 50% and D1-D3 owning 50% of the ultimate business (the
Claimant referred to this as the “GM JV”). D1-D3 were to find a cheap source
of energy, find and acquire land and buildings near the energy source, and
prepare that land and buildings for bitcoin mining on a turn-key basis
(specifically, arranging for full repair and completion of all necessary
infrastructure including an internet connection). GM was to install bitcoin
mining machines, cooling machines, internal power transformers and other
necessary technological equipment for bitcoin mining, and incorporate the new
bitcoin mining factories in Kazakhstan into its existing bitcoin mining
infrastructure in Europe.
ii) In seeking to find a cheap source of energy, in around May 2017 D2 and D3
contacted the Claimant. This contact was made on the recommendation of Mr
Kairat Satybaldy, who the Claimant described as one of the most influential
businessmen in Kazakhstan at the time, who had substantial influence over the
then Kazakh government and who could provide “krysha” (protection). The
Claimant said that both he and D2 had long-standing connections with Mr
Satybaldy.
iii) In May 2017, there were a series of meetings in Kazakhstan, largely it appears
at the Radisson hotel in Astana, between the Claimant and D1-D3 at which
D1-D3 explained what they wanted and the Claimant said he would help them.
The Claimant said he owned some assets which might be suitable, namely (a)
the Stal electrical sub-station 110/10 (“Stal”) in the city of Karaganda, and (b)
a factory near Stal (the “Vtorprom Factory”) and a group of surrounding
buildings (the “ABK Buildings”) together with further land. He said these
assets were owned by a Kazakh limited liability partnership called KKS
Karagandy LLP (“KKS Karagandy”) which in turn was owned by a BVI
company called KPC System Solutions Limited.
iv) On 10 June 2017, the Claimant met D1 in London, and (the Claimant alleges)
reached the oral agreement on which his claim is (largely) based. The
circumstances of the meeting are heavily disputed. I will deal with it in greater
detail later in this judgment. Suffice to say for now that the meeting took place
at a house at 27 Ingram Avenue, London (a house at which the Claimant
contends D1 was residing with his family) on an occasion at which the
Claimant and his family had been invited to share an Iftar meal with D1 and
his family (Iftar is the meal eaten after sunset, during the religious festival of
Ramadan to break the fast that is kept during the hours of sunlight). The
Claimant contends that he and D1 reached an agreement (which he pleads as
the “London Agreement”) in the following detailed terms (which I take from
paragraphs 27-28 of the Particulars of Claim, in which he used the
abbreviation “MMK” to refer collectively to D1-D3):
“27. At the Ingram Avenue Meeting, Mr Alimov [the Claimant]
and Mr Mirakhmedov [D1] (acting on behalf of MMK) reached
the following agreement orally (the "London Agreement"):
(a) Mr Alimov would ensure that:
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1 cases
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Yermek Alimov v Abdumalik Mirakhmedov
...abroad are excluded from the Charging Orders Act 1979, unless the register is kept in England and Wales: see section 2(2)(b)[2024] EWHC 3322 (Comm) Simon Birt KC (Sitting as a Deputy Judge of the High Court) Case No: CL-2023-000262 IN THE HIGH COURT OF JUSTICE BUSINESS AND PROPERTY COURTS O......
