IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

JOINT STOCK COMPANY 

COMMERCIAL BANK PRIVATBANK,

 Plaintiff,

 v.

IGOR VALERYEVICH KOLOMOISKY; 

GENNADIY BORISOVICH

BOGOLYUBOV; MORDECHAI KORF; 

CHAIM SCHOCHET; URIEL TZVI 

LABER; CHEMSTAR PRODUCTS LLC; 

GEORGIAN AMERICAN ALLOYS, 

INC.; OPTIMA ACQUISITIONS, LLC; 

STEEL ROLLING HOLDINGS, INC.; 

OPTIMA GROUP LLC; OPTIMA 

VENTURES LLC; OPTIMA 55 PUBLIC 

SQUARE, LLC; OPTIMA ONE 

CLEVELAND CENTER, LLC; OPTIMA 

1375, LLC; OPTIMA 1375 II, LLC; 

OPTIMA 1300, LLC; OPTIMA 777, LLC; 

OPTIMA STEMMONS, LLC; OPTIMA 

7171, LLC; OPTIMA 500, LLC; OPTIMA 

925, LLC; WARREN STEEL 

HOLDINGS, LLC; OPTIMA 

INTERNATIONAL OF MIAMI, INC.; 

FELMAN TRADING, INC.; VERONI 

ALLOYS, LLC; DEMETER 

DIVERSIFIED LLC; EMPIRE 

CHEMICAL, LLC; TALBON 

ALLIANCE, LLC, 

 Defendants.

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 C.A. No. 2019-0377-JRS
MEMORANDUM OPINION

Date Submitted: July 21, 2021

Date Decided: August 23, 2021

Michael A. Barlow, Esquire of Abrams & Bayliss LLP, Wilmington, Delaware; 

William A. Burck, Esquire and Alexander J. Merton, Esquire of Quinn Emanuel 

Urquhart & Sullivan, LLP, Washington, DC; and Rollo C. Baker, Esquire of Quinn 

Emanuel Urquhart & Sullivan, LLP. New York, New York, Attorneys for Plaintiff 

Joint Stock Company Commercial Bank PrivatBank.

David J. Margules, Esquire and Elizabeth A. Sloan, Esquire of Ballard Spahr LLP, 

Wilmington, Delaware; Jason Cyrulnik, Esquire and Paul Fattaruso, Esquire of 

Roche Cyrulnik Freedman LLP, Brooklyn, New York; and Devin Freedman, 

Esquire of Roche Cyrulnik Freedman LLP, Miami, Florida, Attorneys for 

Defendants Georgian American Alloys, Inc., Optima Acquisitions, LLC, Steel 

Rolling Holdings Inc., Optima Group LLC, Optima Ventures LLC, Optima 55 

Public Square, LLC, Optima One Cleveland Center, LLC, Optima 1375, LLC, 

Optima 1300, LLC, Optima 777 LLC, Optima Stemmons, LLC, Optima 7171, LLC, 

Optima 500, LLC, Optima 925, LLC, Warren Steel Holdings, LLC and Felman 

Trading, Inc. (the “Optima Defendants”).

Raymond J. DiCamillo, Esquire, Daniel E. Kaprow, Esquire and Megan E. 

O’Connor, Esquire of Richards, Layton & Finger, P.A., Wilmington, Delaware and 

Marc E. Kasowitz, Esquire, Daniel R. Benson, Esquire, Mark P. Ressler, Esquire, 

Sarmad M. Khojasteh, Esquire and Joshua N. Paul, Esquire of Kasowitz Benson 

Torres LLP, New York, New York, Attorneys for Defendants Mordechai Korf, 

Chaim Schochet, Uriel Tzvi Laber, Optima 1375 II, LLC and Optima International 

of Miami, Inc.

Albert H. Manwaring, IV, Esquire and Albert J. Carroll, Esquire of Morris James 

LLP, Wilmington, Delaware and Dane H. Butswinkas, Esquire, David S. Blatt, 

Esquire, Matthew B. Nicholson, Esquire and Tanya M. Abrams, Esquire of 

Williams & Connolly LLP, Washington, DC, Attorneys for Defendant Gennadiy 

Borisovich Bogolyubov.

SLIGHTS, Vice Chancellor
1

Defendants, Igor Valeryevich Kolomoisky and Gennadiy Borisovich 

Bogolyubov (together the “Ultimate Beneficial Owners,” or “UBOs”), have been the 

majority and controlling stockholders of Plaintiff,Joint Stock Company Commercial 

Bank PrivatBank (“PrivatBank”), since at least 2006, overseeing its growth into one 

of the largest commercial banks in Ukraine. In 2016, the Ukrainian government 

uncovered accounting irregularities in PrivatBank’s loan book. Because of 

PrivatBank’s systemic importance to Ukraine’s financial system, the government 

nationalized the bank. Litigation ensued in Cyprus, Israel, the United Kingdom and 

Ukraine concerning the propriety of both PrivatBank’s commercial loan book and 

the government’s seizure. 

This action concerns claims that Delaware entities controlled by the UBOs

acquired hundreds of millions of dollars’ worth of United States assets by laundering 

and misappropriating wrongfully procured commercial loans issued by PrivatBank 

(the “Optima Scheme”). In this decision, I address the limited question of whether 

this action should be dismissed or stayed in favor of any or all of the relevant actions 

pending in various foreign courts. 

For reasons explained below, the motion to stay this action in favor of certain 

actions pending in Ukraine is granted, but with conditions. Specifically, 

notwithstanding the stay, the Court will continue to address certain procedural issues 

still in dispute to ensure this action moves as expeditiously as possible should rulings 
2

in Ukraine justify a lift of the stay. Those issues include whether process was 

effectively served, whether this Court has personal jurisdiction over certain 

Defendants and the preclusive effect of certain Ukrainian judicial decrees or 

judgments.

1

 

I. BACKGROUND

I have drawn the facts from well-pled allegations in the Verified Second 

Amended Complaint (the “Complaint”)2 and documents properly incorporated by 

reference or integral to that pleading.3

 Those well-pled facts, unless otherwise 

stated, are assumed to be true.4

 

1 See Def. Gennadiy Bogolyubov’s Opening Br. in Supp. of Mot. to Dismiss Pl.’s Verified 

Am. Compl. (D.I. 133) (“DBOB”) at 5–20; Opening Br. in Supp. of Optima Defs.’ Mot. to 

Dismiss Pl.’s Verified Am. Compl. (D.I. 134) (“DOB”) at 40; Defs. Korf, Laber, Schochet, 

Optima 1375 II, LLC, and Optima Int’l of Miami, Inc.’s Opening Br. in Supp. of Mot. to 

Dismiss Pl.’s Verified Am. Compl. (D.I. 135) (“DKLSOB”) at 11–17.

2 D.I. 146 (“Compl.”).

3 See Wal-Mart Stores, Inc. v. AIG Life Ins. Co., 860 A.2d 312, 320 (Del. 2004) (noting 

that on a motion to dismiss, the Court may consider documents that are “incorporated by 

reference” or “integral” to the complaint). 

4 See Kofron v. Amoco Chem. Corp., 441 A.2d 226, 227 (Del. 1982). I note that the motion 

before the Court is not brought under Chancery Rule 12(b)(6) and, therefore, the Court 

could move beyond the pleadings to decide it. See Simon v. Navellier Series Fund, 

2000 WL 1597890, at *5 n.22 (Del. Ch. Oct. 19, 2000) (noting that the court may consider 

matters beyond the pleadings when deciding whether to stay a proceeding under Chancery 

Rule 12(b)(3)). For the most part, however, I have chosen not to, mindful that these parties 

are litigating on multiple fronts and there may be an inclination among the parties to cite 

my factual recitations here as adjudicated findings of fact(s) before another tribunal. To be 

clear, I have adjudicated no facts in this Opinion other than facts regarding the pendency 

and nature of related litigation elsewhere as relevant to the procedural rulings made here. 
3

A. The Parties

Plaintiff, PrivatBank, is one of the largest commercial banks in Ukraine with 

headquarters in Dnipro, south-east Ukraine.5

Defendants, Kolomoisky and Bogolyubov, founded PrivatBank and were, 

directly and indirectly, the majority and controlling stockholders of PrivatBank from 

at least 2006 through December 2016.6

 They are both Ukrainian-born businessmen 

who are reputed to hold Ukrainian, Israeli and Cypriot citizenships, and both

maintain (or have recently maintained) a residence in Switzerland. 7

Defendant, Mordechai Korf, resides in Miami, Florida and has, over the last 

decade, worked closely with and at the direction of the UBOs.8

 Korf jointly owns 

various United States entities with the UBOs. These entities include Defendants 

Optima Acquisitions, LLC, Optima Ventures, LLC and Optima International of 

Miami, Inc. (“Optima International”).9

 Korf also currently is, or at one time was, 

Any other “facts” are drawn from allegations in the pleadings and are recounted only for 

background and context. 

5 Compl. ¶ 7

6 Compl. ¶ 11.

7 Compl. ¶¶ 8, 10.

8 Compl. ¶ 12.

9 Id.
4

the manager, director, organizer and/or president of the Delaware entities that hold 

(or held) the UBOs’ commercial properties in Cleveland, Ohio and Dallas, Texas.10

Defendant, Chaim Schochet, resides in Miami, Florida, manages Defendants

Optima Ventures LLC and Optima One Cleveland Center LLC, and reports to his 

brother-in-law Korf and the UBOs11 It is alleged that Schochet has been the UBOs’

front man in the purchase and management of the commercial real estate in 

Cleveland, Ohio and throughout the United States in furtherance of the Optima 

Scheme.

12

Defendant, Uriel Tzvi Laber (together with Kolomoisky, Bogolyubov, Korf

and Schochet, the “Individual Defendants”), resides in Miami, Florida and jointly 

owns various United States entities with the UBOs and/or Korf.

13 Laber currently 

is, or at one time was, a director, manager, partner, advisor, and/or officer of various 

entities owned or controlled by the UBOs.14 

The UBOs ultimately own or control the following Defendants, all of which 

are Delaware entities: Chemstar Products, LLC, Georgian American Alloys, Inc., 

10 Compl. ¶¶ 13–14.

11 Compl. ¶ 17.

12 Compl. ¶ 17.

13 Compl. ¶ 19.

14 Compl. ¶ 20.
5

Optima Acquisitions, LLC, Steel Rolling Holdings, Inc., Optima Group, LLC, 

Optima Ventures, LLC, Optima 55 Public Square, LLC, Optima One Cleveland 

Center, LLC, Optima 1375, LLC, Optima 1375 II, LLC, Optima 1300, LLC, 

Optima 777, LLC, Optima Stemmons, LLC, Optima 7171, LLC, Optima 500, LLC, 

Optima 925, LLC, Warren Steel Holdings, LLC, Demeter Diversified LLC, 

Empire Chemical, LLC, and Talbon Alliance, LLC (together, the “Defendant 

Delaware Entities”). Each of the Defendant Delaware Entities is either under the 

complete control and direction of the UBOs or is operated by individuals in the 

United States who are acting as agents for the UBOs.

15 

Defendant, Optima International, is a Florida limited liability company owned 

by Korf and Laber. Plaintiff alleges, however, upon information and belief, that the 

UBOs effectively control the entity.

16 Defendant, Felman Trading, Inc.,

a New Jersey Corporation and wholly owned subsidiary of Georgian American 

Alloys, is under the day-to-day management of Korf but is ultimately owned and 

controlled by the UBOs.

17 Defendant, Veroni Alloys LLC, is a limited liability 

15 Compl. ¶¶ 23–44. 

16 Compl. ¶ 46.

17 Compl. ¶ 47.
6

company organized under the laws of Oregon, and ultimately owned and/or 

controlled by the UBOs.18

B. PrivatBank is Nationalized

PrivatBank is and has been at all relevant times one of Ukraine’s largest banks

and of systemic importance to the Ukrainian financial system since at least 2015.

19 

The UBOs were the majority and controlling stockholders of PrivatBank from at 

least 2006 through December 2016.20

PrivatBank’s principal asset is its commercial loan book.21 From 2006 to 

2016, that asset increased by over 700% (in Ukraine Hryvnia (“UAH”) terms) from 

UAH 27 billion (USD 5.3 billion) in December 2006 to UAH 195 billion 

(USD 8.1 billion) on December 31, 2015.22 During the same period, PrivatBank’s 

total liabilities relating to its customer accounts increased eight-fold (in UAH terms)

from UAH 24 billion (USD 4.8 billion) to UAH 192 billion (USD 8 billion).23

18 Compl. ¶ 48.

19 Compl. ¶ 56.

20 Compl. ¶ 2. The UBOs and their associates controlled PrivatBank’s Supervisory Board, 

and thus controlled PrivatBank’s significant decisions, including all significant commercial 

lending decisions. Compl. ¶ 57.

21 Compl. ¶ 58.

22 Id.

23 Id.
7

PrivatBank relied predominantly on public debt issuances to fund its loans,

attracting new deposits domestically from both retail and commercial customers.24 

To attract deposits, PrivatBank offered high interest rates on its USD and Euro 

deposit accounts in Ukraine.25 These deposits allegedly were used to fund hundreds 

of millions of dollars of illegitimate commercial loans to entities set up by the UBOs 

and their lieutenants through false and inaccurate loan documentation without 

adequate collateral.26 Those entities would subsequently engage in a series of 

transfers to other shell entities to obfuscate the source of the loans until, eventually, 

the funds would wind up in the coffers of an entity abroad that would use 

PrivatBank’s funds to acquire assets worldwide, some of which were located in the 

United States (the “Optima Scheme Loans”).

27 Subsequent customer deposits would 

make their way back to earlier borrowers, who would use those funds to repay the 

principal and interest of PrivatBank’s initial loan, thereby giving the appearance to 

PrivatBank’s auditors that those loans were getting paid off on paper when, in 

24 Compl. ¶ 59.

25 Id.

26 Compl. ¶¶ 61, 65. Plaintiff alleges that, to facilitate and fraudulently conceal the scheme, 

the UBOs created and used a secretive business unit within PrivatBank’s operations 

(the “Shadow Bank”) to fund the fraudulent loans and launder those loan proceeds through 

a sophisticated money laundering system. Compl. ¶ 3.

27 Compl. ¶¶ 61–62, 64–87, 205–19.
8

reality, PrivatBank was funding its own loans and increasing its outstanding 

liabilities in the process.

28

In October 2016, after an initial period of inspection, the Ukrainian banking 

regulator, the National Bank of Ukraine (the “NBU”), commenced an inspection of 

PrivatBank to monitor the bank’s capital position.29 The NBU became concerned

that, among other things, many commercial loans appeared to be inadequately

collateralized and/or made to entities affiliated with the UBOs.

30 In December 2016, 

PrivatBank experienced a sharp decline in liquidity and the NBU declared 

PrivatBank insolvent.

31 To protect PrivatBank’s 20 million customers and 

“preserv[e] the stability of the financial system” in the country, the Ukrainian State 

started taking the necessary steps to nationalize PrivatBank.32 This process 

culminated later in December 2016, when liabilities owed to certain creditors of 

PrivatBank were bailed-in and the shares in PrivatBank were sold to the Ukrainian 

State (the Ministry of Finance of Ukraine) for UAH 1.33 Following nationalization, 

28 Compl. ¶¶ 62, 85–87, 205–19.

29 Compl. ¶ 220.

30 Id.

31 Compl. ¶ 222.

32 Compl. ¶¶ 56, 222.

33 Compl. ¶ 222.
9

PrivatBank’s recapitalization was implemented through the contribution of treasury 

bonds on behalf of the Ukrainian State. Despite the nationalization and 

recapitalization, the losses suffered by the bank were substantial.34

C. Litigation Ensues and the Anti-Kolomoisky Law is Passed

As might be expected, the state of PrivatBank’s loan book and its subsequent 

nationalization prompted the filing of numerous lawsuits around the world. What 

follows is a summary of the relevant pending actions, organized (roughly) by 

geography.35

The Ukrainian Litigation

Various actions have been filed in Ukraine related to the UBOs’ alleged fraud 

and its fallout.

34 Compl. ¶ 223.

35 Beyond the actions in Ukraine and London detailed here, there are actions pending in 

Israel, Cyprus and Switzerland that, while related generally to the events leading up to and 

arising from PrivatBank’s nationalization, are not identified by the parties as relevant to 

the motion sub judice. DOB, Ex. B (Translated 12/18/19 Stmt. of Claim) ¶¶ 40, 57, 65, 92 

(detailing the Israeli actions against the UBOs); PrivatBank Brings New US$5.5 Billion 

Claim in Cyprus Against its Former Owners (Apr. 3, 2020), 

https://en.privatbank.ua/news/2020/4/3/1170 (detailing the Cyprus action); Ukraine’s 

Central Bank Files Swiss Court Claim Against PrivatBank’s Former Owner, Reuters 

(Dec. 19, 2018), https://uk.reuters.com/article/ukraine-privatbank/ukraines-central-bankfiles-swiss-court-claim-against-privatbanks-former-owner-idUKL8N1YO270 (detailing 

the action in Switzerland).
10

a. The Nationalization Action and the Anti-Kolomoisky Action

In June 2017, Kolomoisky filed suit in Ukraine seeking an order declaring the 

nationalization of PrivatBank invalid (the “Nationalization Action”).

36 

In April 2019, a three-judge panel of the Kyiv District Administrative Court 

(the “KDAC”) ruled that the NBU’s nationalization of PrivatBank was “null and 

void from the time of its execution” and voided the forced sale of Plaintiff’s stock.37 

After the NBU appealed that decision, the Sixth Administrative Appellate Court 

stayed the appeal pending the Ukraine Supreme Court’s review of a related case filed 

by other former shareholders of PrivatBank in which Ukrainian courts also found 

the nationalization unlawful.38 

On May 13, 2020, following the KDAC’s ruling in the Nationalization Action, 

the Ukrainian parliament passed Law No. 590-IX, known colloquially as the “AntiKolomoisky Statute,” which purported to alter remedies available to former 

shareholders of an illegally nationalized bank.39 In summary, the Anti-Kolomoisky 

Statute provides that, if a court determines the government illegally nationalized a 

36 DBOB, Ex. 4 (“Marchenko Decl.”) ¶ 18.

37 D.I. 135 (First Decl. of Dmytro Marchukov) (“Marchukov Decl.”) ¶ 74; D.I. 235 (Defs.’

Supplemental Reply Br. on Forum Non Conveniens) (“DSB”) Ex. 67 (D.I. 224)

(Court Press Release).

38 Id.

39 DSB Ex. 68 (statute).
11

bank, the court may not “invalid[ate]” the nationalization or “restore” ownership to 

the former shareholders; the “only” available remedy in such circumstances is 

damages.40 The statute is written to apply retroactively to cases initiated before its 

enactment.41

On June 11, 2020, 64 members of the Ukrainian parliament filed a petition in 

the Constitutional Court of Ukraine (the “CCU”) to challenge the Anti-Kolomoisky 

Statute as unconstitutional (the “Anti-Kolomoisky Action”).

42 These members 

argue, inter alia, that the legislature adopted the statute in violation of constitutional 

procedures43 and that its remedial limitations unconstitutionally deprive former bank 

shareholders of an effective remedy.44 They also contend that the statute’s 

retroactive application is unconstitutional.45

On March 2, 2021, the appellate court stayed further proceedings in the 

Nationalization Action pending the CCU’s ruling in the Anti-Kolomoisky Action.46 

40 Id. at 3.

41 Id. at 24.

42 DSB Ex. 69 (Petition).

43 Id. at 4–9.

44 Id. at 9–20.

45 Id. at 50–53.

46 DSB Ex. 70 (news report).
12

On June 2, 2021, in a separate case, the Commercial Court of Kyiv relied on the 

Anti-Kolomoisky Statute to reject a claim by a former PrivatBank shareholder 

seeking an order declaring the nationalization of PrivatBank invalid.47 This ruling, 

too, is currently on appeal.48 On June 15, 2021, the Commercial Court of Kyiv 

suspended proceedings in a case similar to the action filed on June 2, 2021, pending 

resolution of the constitutional challenge.49

On March 27, 2021, the President of Ukraine issued an order purporting to 

revoke prior decrees appointing two judges to the CCU on national security 

grounds.50 Though the CCU still has 14 judges and may conduct proceedings so 

long as 12 judges sit on the court, the parties dispute whether, and the extent to 

which, this development will disrupt the CCU’s past practice of deciding petitions 

within six months of filing.

51 

47 D.I. 242 (Decl. of Oleh Beketov) ¶¶ 6–8.

48 Id. at 3 n.1. Defendants’ expert on foreign law submitted a supplemental declaration 

stating that the case is “a non-representative example of the application of the [AntiKolomoisky] law.” D.I. 243 Ex. A (Fourth Supplemental Decl. and Report of Roman 

Marchenko) (“Fourth Marchenko Decl.”) ¶ 4. Plaintiff’s expert disagrees. D.I. 245, Ex. A 

(Supplemental Decl. of Oleh Beketov) ¶ 17.

49 Fourth Marchenko Decl. ¶ 16 & n.3.

50 D.I. 238 (Supplemental Decl. of Oleh Beketov Regarding Developments to the 

Constitutional Court of Ukraine) ¶¶ 6.

51 Compare id. ¶ 7 (Plaintiff’s foreign law expert arguing that the judges’ removal may 

result in a delay of over four years), with D.I. 240, Ex. A (Third Supplemental Decl. of 
13

b. The Defamation Action

In November 2017, Kolomoisky filed a defamation action in Ukraine 

(the “Defamation Action”). Plaintiff and the NBU are defendants; Bogolyubov is a 

third-party participant.52 In the Defamation Action, Kolomoisky alleges the NBU 

and Plaintiff falsely accused Bogolyubov of engaging in a “fraudulent scheme” to 

make loans under “fake agreements” to companies he and Bogolyubov controlled.53

c. The Borrower Actions

Since September 2017, PrivatBank and its borrowers have filed numerous 

lawsuits in Ukraine, including lawsuits over loans that allegedly were used to repay 

other outstanding loans extended by PrivatBank (the “Borrower Actions”).

54 Many 

of the Borrower Actions involve borrowers seeking declarations that PrivatBank has 

no right to demand repayment of the original loans because other borrowers repaid 

them.

55 Indeed, the Borrower Actions involve 56 of the 75 loans identified by 

Roman Marchenko) ¶¶ 4–14 (Defendants’ foreign law expert arguing there will be no 

resulting delay).

52 Marchenko Decl. ¶¶ 24–29.

53 Id. ¶¶ 28.4, 28.5.

54 See id. ¶¶ 37, 39–41. The Borrower Actions, Nationalization Action and the Defamation 

Action shall together be referred to as the “Ukrainian Litigation.” 

55 Id.
14

PrivatBank in this case.

56 For example, one borrower featured prominently in the 

Complaint, Joint Stock company Nikopol Ferroalloy Plant (“Nikopol”),

57 sued 

PrivatBank in the Economic Court of Kyiv concerning 33 loans, including all 30 

Nikopol loans at issue in this action.

58 Nikopol claimed in each suit that 

PrivatBank’s Delaware lawsuit failed to recognize that Nikopol fulfilled all of its 

obligations under the loan agreements when PrivatBank alleged that Nikopol 

misused loan proceeds.

59 

56 Compl. at 55, 59, 60, 62–63, 69, 80, 82, 87, 88, 90, 91, 94, 122, 123 (charts of loans); 

DSB at 2; PSB at 3. Although PrivatBank did not name these borrowers as defendants in 

this action, it alleges they engaged in misconduct concerning the loans, claiming the 

borrowers did not use the loans for their stated purposes of financing “current business 

activities” or “current operations.” Compl. ¶¶ 110–11, 114–22, 130–32, 148–49, 152–53, 

160–63, 166–67, 174–75. Rather, PrivatBank alleges loan proceeds were transferred to 

other entities, including entities organized under Delaware law, and were used to purchase 

assets in other U.S. states. Id. PrivatBank further alleges the Ukrainian borrowers never 

“validly repaid” the loans because they repaid them using funds from “new” loans. 

Compl. ¶¶ 212–19.

57 Compl. ¶¶ 68, 110–11 (alleging Nikopol drew down loans for the purported purpose of 

“financing current business activities of the entity” when, in reality, “the loan proceeds 

were not used for their stated purposes.”).

58 DSB Exs. 1–33 (Stmts. of Claim).

59 Id. Ex. 1 at 2–3. Nikopol pointed to PrivatBank’s allegations in this case that Nikopol 

misused loan proceeds and failed to repay loans. Id. at 3–4, 7–8. In other Borrower 

Actions, the plaintiff(s) allege that, by suing in Delaware, PrivatBank failed to recognize 

that the borrowers properly performed their obligations under the loan agreements. See id.

Ex. 40, at 1–3 (Zaporizhzhia Stmt. Of Claim); see also Exs. 40–65 (Stmts. of Claim & 

Prelim. Orders).
15

After Nikopol’s several cases were consolidated into six actions (before 

different judges), and Nikopol submitted evidence, including “detailed accounting 

source documents regarding the exact purpose for which the loan proceeds were 

used” and “bank statements and other official documents” confirming repayment,

60

the courts held hearings and issued rulings against PrivatBank in all six actions 

rejecting its allegations that Nikopol misused loan proceeds and failed properly to 

repay loans.61 Applying Ukrainian law, each judge held that, by suing in Delaware, 

PrivatBank failed to “recognize [Nikopol’s] proper fulfillment of [the] loan 

agreements,”62 holding that Nikopol used loan proceeds “for the purpose provided 

for in the [relevant] loan agreements, which is the financing of [its] current 

activities.”63 While several judges noted the loan agreements “did not define the 

source of funds from which [Nikopol] would repay the loan[s],”64 the judges 

60 See DSB Ex. 34, at 7, 9 (Baranov).

61 Id. Ex. A; id. Ex. 34 (Baranov); id. Ex. 35 (Marchenko); id. Ex. 36 (Gulevets); id. Ex. 37 

(Usatenko); id. Ex. 38 (Spychak); id. Ex. 39 (Nechai).

62 DSB Ex. 35 at 17 (Marchenko); accord id. Ex. 34 at 10 (Baranov); id. Ex. 36 at 14 

(Gulevets); id. Ex. 37 at 23 (Usatenko); id. Ex. 38 at 16 (Spychak); id. Ex. 39 at 17 

(Nechai).

63 DSB Ex. 35 at 19 (Marchenko); accord id. Ex. 34 at 12 (Baranov); id. Ex. 36 at 17 

(Gulevets); id. Ex. 37 at 22 (Usatenko); id. Ex. 38 at 23 (Spychak); id. Ex. 39 at 9 (Nechai). 

As noted above, this directly contradicts the allegations in the Complaint. Compl. ¶¶ 110–

11.

64 DSB Ex. 36, at 9 (Gulevets); accord id. Ex. 34, at 6-7 (Baranov); id. Ex. 37, at 14 

(Usatenko); id. Ex. 38, at 11 (Spychak); id. Ex. 39, at 8 (Nechai).
16

nonetheless found that Nikopol repaid certain loans “at the expense of funds received 

by [Nikopol] from business activities, at the expense of the Guarantor and not at the 

expense of other loan proceeds, which were received by [Nikopol] under other loan 

agreements,”65 while other loans were repaid using “funds obtained from business 

activities and at the expense of the Guarantor, as well as at the expense of other loan 

funds obtained by [Nikopol] under other loan agreements.”66

On April 14, 2021, the Court of Appeals upheld the Kyiv Economic Court’s 

decision and dismissed PrivatBank’s appeal.67 Relevant here, the Court of Appeals 

upheld the Economic Court’s factual findings that, contrary to PrivatBank’s 

allegations in this Delaware case, Nikopol (a) properly used the loan proceeds to 

finance its current business activities, (b) fully repaid the loan and (c) properly repaid 

the loan with funds received from the company’s economic activities or the 

guarantor.68 

65 DSB Ex. 34, at 12-13 (Baranov); accord id. Ex. 35, at 19 (Marchenko); id. Ex. 36, at 10 

(Gulevets); id. Ex. 38, at 14 (Spychak); id. Ex. 39, at 9 (Nechai).

66 DSB Ex. 35, at 19 (Marchenko); accord id. Ex. 36, at 10 (Gulevets); id. Ex. 37, at 14 

(Usatenko).

67 D.I. 241, Ex. A.

68 See id. at 9–11, 15.
17

The London Litigation

In December 2017, Plaintiff commenced an action in the High Court of Justice 

in London against Kolomoisky, Bogolyubov and six companies incorporated in the 

United Kingdom or the British Virgin Islands purportedly under the UBOs’

ownership or control (the “London Litigation”).69 The London Litigation involves 

claims brought by Plaintiff under Ukrainian law for, inter alia, unjust enrichment 

arising from loans issued to 46 Ukrainian companies as part of the same allegedly 

fraudulent scheme at issue in this action.70

In 2018, the London court dismissed all claims against Kolomoisky and 

Bogolyubov for lack of personal jurisdiction, and held that, in any event, the case 

should be stayed pending resolution of the Defamation Action.

71 In 2019, the 

appellate court reversed and remanded, holding in part that a stay in favor of the 

Defamation Action was not warranted because the court of first instance in Ukraine 

stated that the cause of action was frivolous.72 The London Litigation is ongoing.

69 Marchukov Decl. ¶ 82.

70 Id. ¶¶ 84–86.

71 Id. ¶ 88.

72 PAB, Ex. H ¶ 208.
18

D. Procedural History

On May 21, 2019, PrivatBank filed its initial complaint in this Court.

73 

On July 14, 2020, PrivatBank filed the amended operative Complaint, asserting eight 

counts including unjust enrichment, fraudulent transfer, violations of Ohio’s RICO 

statute, conspiracy to violate Ohio’s RICO statute and civil conspiracy.74 

PrivatBank seeks damages from all Defendants (including on a veil-piercing theory), 

costs, an accounting of Defendants’ assets, and a constructive trust over assets 

located throughout the United States, among other relief.75

On July 28, 2020, Defendants filed their motions to dismiss the Complaint on 

various grounds, including forum non conveniens.

76 On November 13, 2020—the 

parties’ deadline for agreeing upon a proposed schedule for briefing the motions to 

dismiss—Defendants filed a Motion to Bifurcate Briefing on Motions to Dismiss 

and Stay Jurisdictional Discovery.77 The Court granted Defendants’ bifurcation 

motion six days later, on November 19, 2020, and directed PrivatBank to answer the 

73 D.I. 1.

74 Compl. ¶¶ 226–305.

75 Id. The Complaint is detailed, spanning 305 paragraphs and roughly 150 pages. 

See generally Compl.

76 See generally DOB.

77 D.I. 164.
19

forum non conveniens portion of Defendants’ motions to dismiss or stay on or before 

December 16, 2020.78 The Court heard argument on the motion on January 22, 

2021.

79 The parties subsequently filed supplemental submissions regarding 

developments that post-dated Defendants’ reply brief.

80 Since then, the parties have 

submitted multiple letters updating the Court on various Ukrainian decisions 

relevant to this motion, along with further expert affidavits regarding how those 

developments should impact the Court’s determination regarding whether to stay or 

dismiss this action.

81

II. ANALYSIS

Defendants seek to dismiss or stay this action in favor of the Ukrainian 

Litigation, the London Litigation or both.

82 In the event the Court decides to stay 

the action, the parties submitted competing status quo orders. For reasons explained 

below, a partial stay of this action is justified as a matter of efficient case 

management and as a matter of convenience for the affected parties.

78 D.I. 167.

79 D.I. 195. Defendants replied on January 6, 2021. D.I. 184 (Defs.’ Reply Br. in Supp. of 

their Mots. to Dismiss for Forum Non Conveniens) (“DRB”).

80 D.I. 231 (Pl.’s Supplemental Submission in Opp’n to Defs.’ Mots. to Dismiss for Forum 

Non Conveniens) (“PSB”); D.I. 235 (DSB).

81 D.I. 235–41.

82 DOB at 31.
20

A. A Stay Is Justified as a Matter of Efficient Case Management

“Under McWane, this Court may, in the exercise of its discretion, stay an 

action ‘when there is a prior action pending elsewhere, in a court capable of doing 

prompt and complete justice, involving the same parties and the same issues.’”83 

Where, however, another action is not first-filed, “[t]he plaintiff’s choice of forum 

is accorded [] more weight.”84 In that situation, the court will consider the motion 

“under the traditional forum non conveniens framework set out in Cryo-Maid,

without regard to a McWane-type preference of one action over the other.”85 While 

McWane and Cryo-Maid lay out the factors to be considered when a court is 

confronted with an application to dismiss or stay an action on forum non conveniens

grounds, as explained below, these are not the only bases upon which a stay of 

litigation may be justified. 

83 In re Citigroup Inc. S’holder Deriv. Litig., 964 A.2d 106, 116 (Del. Ch. 2009) (quoting 

McWane v. McDowell-Wellman Eng. Co., 263 A.2d 281, 283 (Del. 1970)).

84 Mar-Land Indus. Contractors, Inc. v. Caribbean Petroleum Ref., L.P., 777 A.2d 774, 

778 (Del. 2001).

85 In re The Bear Stearns Cos. S’holder Litig., 2008 WL 95992, at *5 (Del. Ch. Apr. 9, 

2008) (quoting Rapoport v. The Litig. Tr. of MDIP Inc., 2005 WL 3277911, at *2 (Del. Ch. 

Nov. 23, 2005) (citing General Foods Corp. v. Cryo-Maid, Inc., 198 A.2d 781 

(Del. 1964))); see also Mar-Land, 777 A.2d at 778 (“A plaintiff seeking to litigate in 

Delaware is afforded the presumption that its choice of forum is proper and a defendant 

who attempts to obtain dismissal based on grounds of forum non conveniens bears a heavy 

burden.”).
21

There is no dispute that the Nationalization Action, the Defamation Action,

and the London Litigation were first-filed.86 For its part, the London Litigation is

irrelevant to the forum analysis as it concerns a separate endpoint for separate

loans—wrongdoing distinct from the Optima Scheme at issue here.

87 As for the 

other flagged actions, none involve the Defendant Delaware Entities or any of the 

Individual Defendants except the UBOs (i.e., Korf, Laber and Schochet). Indeed,

Defendants admitted at oral argument that PrivatBank could not litigate the Optima 

Scheme anywhere else, underscoring how the issues in this Court differ from those 

being litigated abroad.88 Such circumstances, in my view, militate strongly against 

an outright dismissal of Plaintiff’s claims here.89 These claims will have to be 

litigated at some point; the question is when they should be litigated in relation to 

the other pending actions.

86 See PAB at 16; DOB at 31–32.

87 Though Defendants argue this case should be dismissed or stayed in favor of the London 

Litigation, the loans and the named Defendants here (except the UBOs and PrivatBank) 

differ from those in the London Litigation. See Decl. of Oleh Beketov in Response to 

Defs.’ Mot. to Dismiss (D.I. 179) (“Beketov Decl.”) ¶ 32. 

88 D.I. 210 (Oral Arg. on Defs.’ Mots to Dismiss for Forum Non Conveniens) 75:24–80:12.

89 See Aranda v. Philip Morris USA, 183 A.3d 1245, 1251–52 (Del. 2004) (explaining that 

the availability of another forum should be considered as a factor (albeit not a dispositive 

one) under Cryo-Maid).
22

Plaintiff’s theory of the case is predicated on proving that the Optima Scheme 

Loans were illegitimately sourced in Ukraine; in other words, there is no way to 

excise the question of whether these loans were proper from this Delaware action 

without gutting Plaintiff’s claims. The Ukrainian Litigation is proceeding apace on 

all fronts, and those cases implicate many of the underlying issues of foreign law 

that are front and center in this case. The Nationalization Action will determine 

whether the Ukrainian government lacks standing to bring an action through 

PrivatBank in the first instance (here or elsewhere) because its nationalization of the 

bank was unlawful and the UBOs should have remained in control of PrivatBank

(as Defendants argue on brief).

90 As part of that inquiry, Ukrainian courts are set to 

decide the propriety of PrivatBank’s loan practices and the constitutionality of the 

Anti-Kolomoisky Statute as matters of Ukrainian law.

91 Were this Court to move 

forward with this case now, it would be forced to adjudicate these issues of Ukrainian 

law at the same time those issues are being litigated before judges expert in that 

90 DBOB at 24 (“PrivatBank lacks standing to sue because a Ukrainian court has declared 

its nationalization void.”). 

91 DRB Ex. 2 (“Marchenko Reply Decl.”) ¶ 9. PrivatBank does not appear to contest 

Marchenko’s assertion that the Nationalization Action will address whether the bank’s 

loans were “inadequately secured” and therefore unlawful under Ukrainian law. That issue 

bears directly on whether the UBOs caused the bank to issue “illegitimate, inadequatelysecured loans.” Compl. ¶ 3. Moreover, if the Ukrainian appellate courts ultimately 

invalidate the nationalization, the Ukrainian State will lack standing to sue on PrivatBank’s 

behalf. DKLSOB at 5–6; DBOB at 24. 
23

law.92 The risk of inconsistent judgments is high.93 Our Supreme Court has 

recognized that, in such circumstances, “our courts must acknowledge that important 

and novel issues of other sovereigns are best determined by their courts where 

practicable.”94 

92 DBOB at 24 (“PrivatBank lacks standing to sue because a Ukrainian court has declared 

its nationalization void.”).

93 In this sense, this case presents a hybrid factual scenario where a stay in Delaware to 

allow adjudication of related issues by a foreign court may be warranted as a matter of case 

sequencing and efficient management. See Davis Ins. Gp., Inc. v. Ins. Assocs., Inc., 

1998 WL 892623, at *2 (Del. Ch. Dec. 3, 1998) (“It is possible a case will not fit neatly 

into either [McWane or Cryo-Maid] because it shares attributes of both. When faced with 

such a case, the Court must determine whether the case’s attributes of a first-filed action 

with the same parties and issues outweighs the case’s attributes supporting a denial of a 

stay on the basis of a forum non conveniens analysis.”); Martinez v. E.I. DuPont 

de Nemours and Co., Inc., 86 A.3d 1102, 1113 (Del. 2014) (reasoning that, just as plaintiffs 

have a “substantial interest in having important open questions of Delaware law decided 

by [Delaware] courts,” defendants have a “reciprocal” interest in “having important issues 

of foreign law decided by the courts whose law governs the case.”).

94 Id. at 1110. Plaintiff has submitted expert testimony that the CCU is “in crisis” because 

the president of Ukraine issued an order, on national security grounds, that purports to 

revoke prior decrees appointing two judges to Ukraine’s Constitutional Court, increasing 

the odds that a decision on the constitutionality of the Anti-Kolomoisky Statute would 

“remain[] undecided for 4 years or longer.” D.I. 238 (Supplemental Decl. of Oleh Beketov 

Regarding Developments to the Constitutional Court of Ukraine) ¶¶ 5–7. According to 

Defendants’ expert, however, this situation is not unprecedented, the CCU still has 14 

judges and may conduct proceedings so long as it consists of at least 12, judges can be 

replaced quickly, the CCU has a practice of deciding petitions within six months, and a 

high-profile case is typically resolved in a shorter timeframe. D.I. 240, Ex. A (Third 

Supplemental Decl. of Roman Marchenko) ¶¶ 4–14. Common sense would counsel that 

Ukrainian courts will move quickly to adjudicate the fate of what Plaintiff alleges to be a 

national bank of systemic import in Ukraine. Compl. ¶ 56. In any event, the stay ordered 

here is a partial stay that will permit briefing on certain predicate matters to proceed and 

will allow the Court to reassess the stay upon adjudication of those threshold issues if it is 

evident the relevant Ukrainian actions are not moving with sufficient speed.
24

The Borrower Actions similarly concern important issues of foreign law and 

bear directly on the substance of PrivatBank’s allegations.95 It would be useful to 

allow Ukrainian courts to sort through those issues of Ukrainian law before the Court 

confronts those issues here. Whether first-filed or not, “[t]his sort of coordination 

in case management more readily falls within the Court’s broad discretion in 

controlling its docket effectively and is not necessarily driven by . . . the forum non 

conveniens analytical context.”96

95 Compl. ¶¶ 110–11, 114–22, 130–32, 148–49, 152–53, 160–63, 166–67, 174–75 (alleging 

the borrowers did not use the loans for their stated purposes of financing “current business 

activities” or “current operations,” but instead transferred those loans to Defendant entities 

to purchase assets in the United States); Compl. ¶¶ 212–19 (alleging the Ukrainian 

borrowers never “validly repaid” the loans because they repaid them using funds from 

“new” loans). To be sure, the propriety of the majority of the Optima Scheme Loans are 

directly at issue in the Borrower Actions. In those cases, the courts will address 

PrivatBank’s allegations in this case that the Optima Scheme Loans were inappropriately 

sourced; the foreign law experts dispute whether the Borrower Actions could give rise to 

issue or claim preclusion; and Ukrainian courts are expeditiously adjudicating those 

disputes (and have, in certain instances, held in favor of the borrowers). See D.I. 239 

(Defendants updating Court via letter that, on April 14, 2021, the Ukrainian appellate court 

upheld the trial court’s January 1, 2021, ruling on certain Nikopol loans at issue in this 

litigation); D.I. 241 (Defendants updating the Court via letter regarding an April 14 opinion 

entering judgment against PrivatBank concerning a Nikopol loan); PSB at 8 (emphasizing 

that the Borrower Actions would not have preclusive effect on the Delaware action); 

DSB at 9 n.4 (arguing the opposite). Though later-filed, the propriety of loans issued by 

PrivatBank at the direction of the UBOs are inarguably of great import to Ukraine, again 

implicating our Supreme Court’s admonition that trial courts “must give [ ] weight to a 

defendant’s interest in having important issues of foreign law decided by the courts whose 

law governs the case.” Martinez, 86 A.3d at 1110. 

96 IMO Ronald J. Mount 2012 Irrevocable Dynasty Tr. U/A/D Dec. 5, 2012, 

2016 WL 297655, at *3 (Del. Ch. Jan. 16, 2016); see also Ins. Co. of N. Am. v, Steigler, 

300 A.2d 16 (Del. Super. Ct. 1972) (holding that the “court has the inherent power to stay 

proceedings in control of its docket”); Paolino v. Mace Sec. Int’l, Inc., 985 A.2d 392,

(Del. Ch. 2009) (“This Court possesses the inherent power to manage its own docket 
25

B. Traditional Forum Non Conveniens Factors Justify a Stay

In the best case for Plaintiff, the Court would give no deference to the firstfiled foreign actions, would ignore its inherent power to stay for the sake of efficient 

case management, and would decide the matter, instead, strictly under Cryo-Maid. 

Even under that plaintiff-friendly analysis, however, the result is the same. 

“When a Delaware court is confronted with the question of whether to stay an 

action in favor of another action, it considers the [Cryo-Maid] factors”:

97

(1) the relative ease of access to proof; (2) the availability of 

compulsory process for witnesses; (3) the possibility of the view of the 

premises; (4) whether the controversy is dependent upon the 

application of Delaware law which the courts of this State more 

properly should decide than those of another jurisdiction; (5) the 

pendency or nonpendency of a similar action or actions in another 

jurisdiction; and (6) all other practical problems that would make the 

trial of the case easy, expeditious and inexpensive.98

Each of these factors, as relevant, counsel in favor of staying this case.

1. Relative Ease of Access to Proof

The discovery and development of relevant facts will be easier in Ukraine 

because that is where the allegedly unlawful loans at issue here originated. Though 

including the power to stay litigation on the basis of comity, efficiency, or simple common 

sense.”). 

97 IMO Ronald J. Mount 2012 Irrevocable Dynasty Tr. U/A/D Dec. 5, 2012, 2016 

WL 297655, at *3.

98 Taylor v. LSI Logic Corp., 689 A.2d 1196, 1198–99 (Del. 1997) (citing Cryo-Maid, 

198 A.2d 618).
26

PrivatBank asserts that “much of the relevant documentary evidence . . . is located 

in the U.S.,” or is in the “Delaware Defendants’ possession,” the Complaint 

affirmatively pleads that certain Ukrainian defendants directed Ukrainian borrowers 

fraudulently to apply for loans from a Ukrainian bank and moved those Ukrainian 

proceeds through accounts in Ukraine and Cyprus.99 While the actions of the 

Delaware entities are part of that story, they constitute the ultimate (or perhaps 

penultimate) chapter; as the Complaint makes clear, the story begins in Ukraine, and 

that is where much of the proof will reside.100 

Making matters more difficult, Ukraine’s reservation to Article 23 of the 

Hague Evidence Convention means that Ukraine “will not execute letters of request 

issued for the purpose of obtaining pre-trial discovery of documents as known in 

99 Compl. ¶¶ 2–3, 64–68. PrivatBank asserts that Ukrainian procedures for discovery are 

sufficient to facilitate fact-gathering in this action—a position in some conflict with its 

position in its motion for alternative service where it argued that Ukrainian procedures 

were “not working and may be delayed indefinitely.” D.I. 172 (Pl.’s Mot. for Alternative 

Method of Service) ¶ 14. 

100 See VTB Bank v. Navitron Projects Corp., 2014 WL 1691250, at *8 (Del. Ch. Apr. 28, 

2014) (“VTB I”) (finding this factor weighed in favor of defendant where the “vast 

majority” of evidence “would not be in Delaware but rather in Ukraine”). I note the alleged 

asset acquisitions occurred in states outside Delaware, such as Ohio, Texas, West Virginia 

and Kentucky, and the forum non conveniens analysis typically focuses on evidence in the 

forum state. Compl. ¶¶ 4–5; Schmidt v. Washington Newspaper Publ’g Co., 2019 WL 

4785560, at *7 (Del. Super. Ct. Sept. 30, 2019) (finding this factor favored defendant where 

the “overwhelming majority of evidence . . . [is] in California and none is located in 

Delaware”); Abrahamsen v. ConocoPhillips Co., 2014 WL 2884870, at *2 (Del. Super Ct. 

May 30, 2014) (same).
27

common law countries.”101 According to Defendants’ expert, pre-trial discovery of 

documents in Ukraine will not occur “unless the request is sufficiently substantiated 

and contains information sufficient to specifically identify the requested 

documents.”102 That reservation undeniably complicates access to proof, militating 

in favor of a stay pending the progress of the Borrower Actions and Nationalization 

Action, where discovery of evidence in Ukraine will be more efficient and 

effective.

103

2. Availability of Witnesses

While Plaintiff is likely correct that significant evidence concerning the 

Optima Scheme Loans resides in the United States, Plaintiff’s own Complaint 

includes allegations detailing the involvement of “other conspirators,” “senior-level 

managers and other PrivatBank employees,” “Cypriot law firms,” and Cypriot 

101 Marchukov Decl. ¶¶ 42, 62; Marchenko Decl. ¶ 95.2; VTB I, 2014 1691250, at *8 

(explaining that Ukraine “has ‘filed a reservation’ regarding its authority to reject pre-trial 

discovery requests” requiring that “oral examination of witnesses take place before a 

Ukrainian judicial officer and then be summarized by court personnel”); see also 

Abrahamsen, 2014 WL 2884870, at *3 (“Norway may not comply with . . . requests 

because Norway has adopted reservations to . . . Article 23 . . .”); Margulis v. Stryker Corp., 

2019 WL 6830209, at *6 (D.N.J. Nov. 12, 2019), adopted, 2019 WL 6828175 

(D.N.J. Dec. 12, 2019) (finding Argentina’s Article 23 reservation “strongly” favored 

defendant in its bid to dismiss the complaint on forum grounds). Though Plaintiff argues 

VTB I is of limited utility because the court there relied on an “unrebutted affidavit,” it does 

not challenge that Ukraine has, in fact, submitted a reservation to Article 23. See PAB 

at 31.

102 Marchenko Decl. ¶ 95.2.

103 See VTB I, 2014 WL 1691250, at *8 (finding Ukrainian reservation favored dismissal).
28

“officers and directors” of intermediary companies.104 “Common sense would 

indicate that [foreign] witnesses would not be available to testify in Delaware.”105 

And Plaintiffs’ own allegations undermine their contention that Defendants control 

some of the key witnesses, having pled such employees were “dismissed” from the 

bank upon nationalization, suggesting that no party controls them.106 These 

witnesses are outside the Court’s subpoena power and Defendants have no means of 

compelling their appearance in Delaware.107 This burden would be meaningfully

104 Compl. ¶¶ 62, 64, 71–72. Though PrivatBank argues Defendants have not identified 

such witnesses with sufficient specificity, Delaware courts have held in similar 

circumstances that identifying the “kinds of important, third-party witnesses [who] are 

likely not subject to the Court’s compulsory powers,” as Defendants have done here, is 

sufficient. VTB I, 2014 WL 1691250, at *9 (emphasis added); but see Lee ex rel. Lee v. 

Choice Hotels Int’l Inc., 2006 WL 1418755, at *5 (Del. Super. Ct. Mar. 21, 2006)

(“Delaware law requires that [Defendant] identify specifically the witnesses not subject to 

compulsory process and the specific substance of their testimony.”). In any event, as noted, 

Plaintiff itself has identified specific witnesses that it alleges were integral to the purported 

misconduct alleged in its Complaint who reside beyond the Court’s subpoena power. 

Compl. ¶¶ 62, 64, 71–72.

105 Ward v. Tishman Hotel & Realty, L.P., 2010 WL 5313549, at *3 (Del. Super. Ct. 

Nov. 30, 2010) (“It is not necessary to prove that witnesses without a stake in a particular 

litigation would not voluntarily travel to a foreign jurisdiction to provide testimony in order 

to demonstrate an overwhelming hardship.”).

106 Compl. ¶ 65. 

107 See VTB I, 2014 WL 1691250, at *9 (finding court lacked compulsory process over 

Ukrainian witnesses). Though Plaintiff contends that Ukraine “provides mechanisms for 

foreign parties to compel discovery” from third parties, its expert does not refute that such 

mechanisms are dependent upon witness cooperation, do not assure examination by 

defense counsel, and are potentially time-consuming. See DRB Ex. 1 (“Marchukov Reply 

Decl.”) ¶¶ 44–53; Marchenko Reply Decl. ¶¶ 37–38. 
29

reduced if this action was stayed pending discovery in, and resolution of, the

Nationalization Action and Borrower Actions.

3. Possibility of the View of the Premises

Neither party has argued that this factor is relevant here. 

4. Governing Law

While I need not definitively decide the issue, it would appear that Ukrainian 

law will apply to many if not all of PrivatBank’s claims. “Delaware resolves choice 

of law questions for both tort and contract using the ‘most significant relationship’

test from the Restatement (Second) of Conflicts [the “Restatement”].”108 Those 

factors are laid out in Restatement Section 145: “(a) the place where the injury 

occurred, (b) the place where the conduct causing the injury occurred, (c) the 

domicile, residence, nationality, place of incorporation and place of business of the 

parties, and (d) the place where the relationship, if any, between the parties is 

centered.”109 These factors likely support the application of Ukrainian law.110 

108 IM2 Merch. & Mfg., Inc. v. Tirex Corp., 2000 WL 1664168, at *10 n.49 (Del. Ch. 

Nov. 2, 2000)

109 VTB I, 2014 WL 1691250, at *9 n.90 (applying Ukrainian law to claims for unjust 

enrichment and fraudulent transfer).

110 I note that Plaintiff did not dispute that Ukrainian law applied in the London Litigation, 

which involves similar allegations of a scheme concerning separate loans originating in 

Ukraine. DOB Margules Decl., Ex. A ¶ 21 (Judgment).
30

First, “a corporation sustains its injuries where it is incorporated and where it 

has its principal place of business,”111 and Plaintiff is a company headquartered in, 

and incorporated under the laws of, Ukraine.112 

Second, the allegedly injurious conduct, at its source, was the improper

issuing of the Optima Scheme Loans, which also took place in Ukraine.113 Though 

Delaware entities ultimately took possession of the allegedly ill-begotten loans, their 

coffers were among the last links in an alleged chain of events that were, according 

111 TrustCo Bank v. Mathews, 2015 WL 2953373, at *10 (Del. Ch. Jan. 22, 2015).

112 Compl. ¶ 7.

113 Compl. ¶¶ 2–3, 62–66; see Aranda, 183 A.3d at 1253 (holding claims arising from 

herbicides used on Argentinian farms constituted “conduct occurring in Argentina” despite 

defendants’ intent that the fruit of the crops be consumed in America); Integral Res. (PVT) 

Ltd. v. Istil Gp., Inc., 155 F. App’x 69, 70, 75 (3d Cir. 2005) (holding conspiracy claim 

governed by Ukrainian law because the alleged “plotting, conspiracy and machinations”

occurred in Ukraine). Plaintiff’s citation to City of Almaty v. Sater is unavailing, as the 

court there was deciding between application of English or New York law to a Kazakhstanbased bank’s laundering scheme where the essence of the wrongdoing was the disregard 

of a court order. 2020 WL 7027566, at *1–4, *8 (S.D.N.Y. Nov. 30, 2020) (holding 

New York law applied over English law because the defendants’ conspiracy to evade the 

English court’s freezing order occurred in New York, not England).

Remainder of Page Intentionally Left Blank
31

to the Complaint, unlawful at their inception.114 Based on the Complaint’s 

allegations, then, this factor favors the application of Ukrainian law.115

Third, Plaintiff and the UBOs are all linked to Ukraine without any 

meaningful connection to Delaware, while Korf, Schochet and Laber are all from 

states outside Delaware. The only Delaware contact flows through the entities’

114 GTE Mobilnet Inc. v. Nehalem Cellular, Inc., 1994 WL 116194, at *3 (Del. Ch. Mar. 17, 

1994) (applying Oregon law notwithstanding “all parties” being “incorporated in 

Delaware”); Johnson v. Warner Bros. Entm’t, Inc., 2017 WL 588714, at *4 (D. Del. 

Feb. 14, 2017) (rejecting argument that Delaware law applies because “a majority of 

Defendants are incorporated in Delaware”). Though Plaintiff quotes Callaway Golf Co. v. 

Dunlop Slazenger Gp. Ams., Inc. for the proposition that, “[w]here the claim to restitution 

[for unjust enrichment] does not stem from any [direct] relationship between the parties, 

the factor . . . of greatest importance [in the choice-of-law analysis] is the place where the 

benefit of enrichment was received,” in this case, there is clearly a “direct relationship”

between the UBOs and PrivatBank. 29 F. Supp. 2d 430, 434–35 (D. Del. 2003).

115 See VTB I, 2014 WL 1691250, at *9–10 (finding this factor favored application of 

Ukrainian law in the context of a money-laundering scheme implicating United States 

entities); Aranda, 183 A.3d at 1253 (applying Argentinian law under similar 

circumstances). Plaintiff relies heavily on City of Almaty v. Sater to argue that this factor 

favors application of Delaware law. 2020 WL 7027566 (S.D.N.Y. Nov. 30, 2020). Again, 

that case is inapposite, as it addressed a Kazakhstan-based bank citing English law to sue 

New York defendants for conspiring to “launder money” stolen from the plaintiff-bank and 

subject to an English court’s freezing order. Id. at *1–4, *8. Unlike this case, the bank’s

founder was not named as a defendant and the plaintiff did not seek redress for the 

founder’s earlier misappropriation. Compare Almaty, 2020 WL 7027566, at *1, *4 

(bank’s founder not a defendant) with Compl. ¶ 1 (naming the UBOs as Defendants). 

Accordingly, there was no predicate question of whether misappropriating loan proceeds 

in a foreign country was lawful; instead, the issue was whether New York (where 

defendants were domiciled and the conduct occurred) or English law (where the freezing 

order issued) applied to plaintiff’s claim for conspiracy to avoid the freezing order—

conduct distinct from the underlying, earlier Kazakhstan-based scheme. Almaty, 2020 

WL 7027566, at *8.
32

incorporation in Delaware and, as our courts have held, that contact is not dispositive

in the choice of law or choice of forum analyses.

116 

Fourth, the principal relationship in the Complaint is the one between 

PrivatBank and the UBOs, and that relationship is centered in Ukraine.

117 As for the 

Ohio RICO claims, those claims would likely turn on underlying questions of 

Ukrainian (not Delaware) law.118 While the application of foreign law may not be 

dispositive of these claims, the Court may nonetheless weigh “a defendant’s interest 

in having important issues of foreign law decided by the courts whose law governs 

the case.”119

116 See VTB I, 2014 WL 1691250, at *9–10; see also IM2 Merch., 2000 WL 1664168, 

at *9–10 (applying Canadian law where defendant’s “only connection to Delaware” was 

place of incorporation).

117 Compl. ¶¶ 2–4.

118 For example, the predicate offense of Ohio money-laundering would require proof that 

the loan proceeds were the product of “unlawful activity,” a determination that reverts to 

Ukrainian law. Ohio Rev. Code Ann. (“RCA”) §§ 1315.51(O), 1315.55(A)(2); 

Compl. ¶ 258. Likewise, Plaintiff’s claim of federal money laundering requires proof of 

“an offense against a foreign nation”—in this case, Ukraine. 18 U.S.C. §1956(a)(7)(B); 

Compl. ¶ 258. Though Defendants raised this argument on brief, Plaintiff did not 

meaningfully respond. Compare DOB at 26 & n.14 (making the foregoing arguments) 

with PAB at 35–40 (failing to dispute Defendants’ assertions as to the operation of the 

statutes governing Ohio and federal money-laundering).

119 Martinez, 86 A.3d at 1110 (citing IM2 Merchandising, 2000 WL 1664168, at *10 

(“A due respect for the presumed capability of the courts of other nations and states to 

fairly adjudicate cases, however, counsels that this consideration be accorded some worth, 

even when no prior action is pending in their courts.”)).
33

As a final fallback, Plaintiff is left to argue the choice-of-law analysis is moot

because there is no difference between Ukrainian and Delaware law on the subjects

at issue. Specifically, after briefing its position on the conflict-of-law analysis 

(which, I note, addressed only one of the four choice-of-law factors),120 PrivatBank 

asserted that the analysis is unnecessary because “Ukrainian law provides for 

corresponding causes of action as those asserted in the [Complaint] for unjust 

enrichment, fraudulent transfer, and civil conspiracy.”121 Though PrivatBank cites 

to its expert’s affidavit as support for the mootness argument, that assertion is 

contradicted not only by Defendants’ experts but also a past decision of this court 

finding that “[t]he Civil Code of Ukraine contains no direct counterpart to 

Delaware’s unjust enrichment and fraudulent transfer laws.”122 In any event, 

uncertainty about Ukrainian law (as evidenced by disagreement among experts) 

signals that Ukrainian courts should decide these predicate matters in the first 

instance.

123 

120 PAB at 35–36.

121 Id. at 39 (citing Beketov Decl. ¶¶ 12, 33–44).

122 VTB Bank v. Navitron Projects Corp., 2015 WL 9581538, at *6 (Del. Ch. Dec. 29, 2015) 

(“VTB II”); DRB at 18 (citing Marchukov Reply Decl. ¶¶ 11–13, 15–33; Marchenko Reply 

Decl. ¶¶ 20–36).

123 VTB II, 2015 WL 9581538, at *6.
34

5. The Pendency of Similar Actions

For reasons explained, the Nationalization Action and the Borrower Actions 

will address issues of foreign law that also must be addressed in this action. More 

specifically, the Borrower Actions will adjudicate the propriety of roughly 75% of 

the loans at issue here, several of which have already been addressed at both the trial 

court and appellate levels in Ukraine.

124 In the Nationalization Action, the matters 

decided by the Ukrainian courts will have a direct bearing on whether Plaintiff has

standing to sue Defendants. While neither action involves the exact claims 

prosecuted here, such that a dismissal of this action might be justified, both actions 

will yield decisions on foreign law that will inform the resolution of this action. This 

dynamic favors a stay of this action in favor of the Nationalization Action and the 

Borrower Actions. 

6. “All Other Practical Problems”

Finally, numerous practical considerations favor staying this action pending 

resolution of the Borrower Action and the Nationalization Action. First, there will 

be significant costs associated with translating Ukrainian evidence and law. Given

124 DSB at 2 (characterizing the number of Optima Scheme Loans under adjudication in 

the Borrower Action); PSB at 3 (agreeing with that characterization).
35

the breadth of this case, the time and resources necessary for that undertaking will 

be significant, as the relevant documents are sure to encompass voluminous loan 

applications, internal Ukrainian bank records concerning the approval of those loans, 

communications among Ukrainian members of the “Shadow Bank” that allegedly 

facilitated Defendants’ money laundering scheme, communications between bank 

employees, and wire transfer and other bank information written in Ukrainian and 

Greek (the primary language of Cyprus). Key witnesses to the alleged events will 

likely speak Ukrainian natively and, to a lesser extent, Greek. This process will 

“be cumbersome, inefficient, and extremely difficult,”125 but that burden may not be 

necessary depending on rulings in Ukraine.

126 

According to PrivatBank, this factor actually favors denial of the motion on 

several grounds. First, it argues this Court ought to have an interest in adjudicating 

this dispute promptly because Delaware entities allegedly have been used as 

125 VTB I, 2014 WL 1691250, at *8 (holding this factor supported dismissal where 

documentary evidence is “most likely written in Ukrainian” as translation of all relevant 

evidence “would be cumbersome, inefficient, and extremely difficult”); see also Hupan v. 

Alliance One Int’l, Inc., 2015 WL 7776659, at *5 (Del. Super. Ct. Nov. 30, 2015) (holding 

this factor supported dismissal where key evidence was “in another language, which will 

require translation”).

126 VTB II, 2015 WL 9581538, at *6; Martinez, 86 A.3d at 1110.
36

instruments to facilitate an unlawful scheme.127 While I agree that a Delaware entity 

engaging in (or used to facilitate) fraud or other wrongdoing should expect that it 

can be held to account in Delaware courts,128 a partial stay will preserve

PrivatBank’s claims against these Delaware entities while allowing the Ukrainian 

courts to decide predicate issues of Ukrainian law. PrivatBank’s concern that 

deference to the Ukrainian courts will result in undue delay in Delaware is belied by 

the docket in this action; that docket reflects the Court has received nearly monthly 

updates from both parties on the steady progress of both the Nationalization Action

and the Borrower Actions.

129 Though it is difficult to predict whether these actions 

127 PAB at 41 (citing Certain Underwriters at Lloyds Severally Subscribing Policy 

No. DP359504 v. Tyson Foods, Inc., 2008 WL 660485, at *5 (Del. Super. Ct. Mar. 7, 

2008)).

128 See NACCO Indus., Inc. v. Applica Inc., 997 A.2d 1, 26 (Del. Ch. 2009); see also 

Hamilton P’rs, L.P. v. England, 11 A.3d 1180, 1213 (Del. Ch. 2010) (explaining 

Delaware’s interest in policing the use of Delaware entities as vehicles for fraud “militates 

powerfully in favor of retaining jurisdiction”); VTB I, 2014 WL 1691250, at *11 

(“Employing a Delaware entity in fraudulent conduct can be considered an abuse of the 

laws of Delaware that is hard for this Court to ignore.”).

129 See, e.g., D.I. 239 (Defendants updating Court via letter that, on April 14, 2021, the 

Ukrainian appellate court upheld the trial court’s January 1, 2021 ruling on certain Nikopol 

loans at issue in this litigation); D.I. 241 (Defendants updating Court via letter with an 

opinion from Ukraine regarding the April 14 judgment against PrivatBank concerning a 

Nikopol loan); D.I. 242 (Plaintiff updating the Court on a ruling applying the AntiKolomoisky Law to limit former stockholders of PrivatBank to money damages); D.I. 243 

(Defendants submitting a declaration detailing other lower court decisions on the AntiKolomoisky Law); D.I. 244 (Defendants updating the Court on a recently issued decision 

by a Ukrainian appellate court rejecting PrivatBank’s appeal on a judgment concerning a 

Nikopol loan); D.I. 245 (letter dated August 13, 2021 providing updated declaration from 
37

will continue to progress apace, a temporary stay to be revisited following this 

Court’s adjudication of certain threshold procedural issues will properly account for 

the risk that the Ukrainian Litigation stalls.

Finally, PrivatBank lists as a practical consideration the Ukrainian courts’

inability to impose a “constructive trust” over United States assets.

130 The parties 

agree, however, that this Court has authority to enter a properly tailored status quo 

order requiring judicial approval before specific United States assets owned by the 

Defendant Delaware Entities over which PrivatBank seeks a constructive trust may 

be sold or encumbered.

131 Provided that the order is effectively tailored, 

PrivatBank’s concern should be neutralized. To that end, the parties have submitted 

competing status quo orders.

132 Upon review, Defendants’ proposal would unduly 

limit the scope of the status quo order to encumbered assets with massive debt and 

little equity value.133 For example, Defendants represented to the Court that they 

expected the sale of 55 Public Square to net “millions of dollars in net proceeds”

Plaintiff’s foreign law expert and a copy of a recent decision of the Commercial Court of 

Kyiv).

130 PAB at 43 (citing Beketov Decl. ¶ 38); Marchenko Reply Decl. ¶ 26 (accepting 

Beketov’s assertion that a constructive trust is unavailable).

131 DSB at 13; PSB at 12–13.

132 D.I. 235 (Defs.’ Proposed Status Quo Order); D.I. 231 (Pl.’s Proposed Status Quo 

Order).

133 D.I. 235 (Defs.’ Proposed Status Quo Order).
38

when, in reality, it netted only $660,449.

134 Plaintiff’s more comprehensive status 

quo order is warranted to provide Plaintiff proper security for the more than $600 

million in damages it seeks in this action.

Further, to ensure this action proceeds as expeditiously as possible should the 

determination of predicate Ukrainian law issues reveal that the stay should be lifted, 

the Court will allow for further litigation to proceed regarding the following

preliminary procedural issues as raised by the parties (the “Identified Issues”): 

(1) the implications of Plaintiff’s alleged failure properly to serve Kolomoisky and 

Bogolyubov; (2) this Court’s personal jurisdiction over Laber, Korf, Schochet, 

Optima International and Bogolyubov; and (3) as raised by PrivatBank in its 

supplemental brief, whether the Borrower Actions will have a preclusive effect on 

this action as a matter of Delaware law.

135 The parties shall confer and submit a 

proposed schedule to present these issues to the Court. Depending on the outcome 

of some or all of these issues, and the pace at which the Ukrainian Litigation 

proceeds in the interim, the Court may revisit its decision to stay these proceedings.

134 PSB Ex. 9.

135 DOB at 31–40; DBOB at 5–22; DKLSOB at 11–18; PSB at 9.
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III. CONCLUSION

Defendants’ motion to dismiss under the doctrine of forum non conveniens is 

DENIED; the motion to stay this action pending adjudication of the Borrower 

Actions and the Nationalization Action is GRANTED. Plaintiff’s application for the 

entry of a status quo order is GRANTED. The parties shall submit a proposed form 

of Order for further proceedings relating to the Identified Issues within ten (10) days. 

IT IS SO ORDERED.