A recent Law 360 story by Christopher Crosby, “Legal Fees To Top £5M in Credit Suisse Espionage Suit,” reports that legal fees are expected to top more than £5 million ($6.9 million) as a former Credit Suisse employee heads to trial seeking £60.3 million from the lender after he was imprisoned in Romania on charges of espionage over his work. Judge Roger ter Haar QC signed off the costs in a short judgment at the High Court, approving hourly rates of £780 for top-tier barristers and £515 for their lieutenants.
Credit Suisse had budgeted some £3.8 million in time and costs for defending itself against allegations by Vadim Benyatov that the bank is liable to cover his lost earnings and costs arising from his conviction in 2013 by Romanian authorities. He was sentenced to 10 years in prison on charges of espionage and establishing an organized criminal group.
Benyatov, meanwhile, has estimated spending in excess of £2.3 million for the lawsuit. But despite the complexity and "considerable skill" involved in the case the judge trimmed the bank's budget for costs nearer to £3.1 million and Benyatov's to £2.1 million. There are "big issues" with the disparity between the two estimates, the judge told the court.
Most of the trimming — more than £300,000 — came from the Swiss bank's preparation and budget for trial, which is expected to begin in late April. Benyatov, who ran the lender's emerging markets desk in Europe, inflated the size of the dispute to £60.3 million from £39 million in November, when Judge ter Haar said he could add 10 years onto his projected retirement age.
At the time, the former banker had also sought to amend his 2018 lawsuit against Credit Suisse Securities (Europe) Ltd. He was prevented from adding claims that the bank breached its duty to undertake a risk assessment on work in Romania.
However the judge allowed him to claim loss over the Financial Conduct Authority's decision to revoke his authorization in 2013. Judge ter Haar rejected the Swiss bank's attempt to strike out the allegations, saying in December that it had applied the wrong legal test.
The former director worked for the bank from around 2005 on the proposed privatization of a Romanian state-owned energy producer by an Italian company. He alleges that Romanian officials were concerned about potential Russian influence in its energy sector and scrutinized him because of his Russian family name and birth place inside the former Soviet Union.
Benyatov also claims that the bank should have tipped off Romania's intelligence services about its business plans. He said after he was arrested in 2006 that Credit Suisse paid for his legal expenses but failed to cover his "enormous losses." The bank disputes Benyatov's claim for repayment, and has said there is no obligation for it to indemnify him simply because his work for the lender led to his arrest.
The case is Vadim Don Benyatov v. Credit Suisse Securities (Europe) Ltd., case number QB-2018-001043, in the Queen's Bench Division, the High Court of Justice of England and Wales.