Lake Holding & Finance S.A.

Filing 43

MEMORANDUM AND ORDER granting 1 Motion for Discovery. For the foregoing reasons, the petitioner's application for discovery pursuant to 28 U.S.C. § 1782, Docket Entry No.1, is granted. SO ORDERED. (Signed by Magistrate Judge Kevin Nathaniel Fox on 6/23/2021) (va)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------------------------------X
IN RE APPLICATION OF
:
LAKE HOLDING & FINANCE S.A.,
:
Petitioner.
:
-----------------------------------------------------X
KEVIN NATHANIEL FOX
UNITED STATES MAGISTRATE JUDGE

MEMORANDUM AND ORDER
20-MC-652 (RA) (KNF)

Before the Court is Lake Holding & Finance S.A.’s application for “an Order pursuant to
28 U.S.C. § 1782 to obtain discovery in the form of subpoenas to be served on” the following
banks: “UBS AG; Societe Generale / SG Private Bank; Banque Lombard Odier & Cie AG (aka
Lambert Odier Darier Hentsch & Cie); CIM Banque SA; Kookmin Bank (Korea); Credit Suisse;
PJSC Sberbank; Bank of America, N.A.; Citibank, N.A.; Merrill Lynch Capital Corporation;
Union Bancaire Privee CBI-TDB, Geneva; and BSI SA, Lugano, Switzerland (collectively, the
‘Banks’).” The application is opposed by Mikhail Belyak, Anastasia Belyak, and Margarita
Beliak (“Belyak respondents”), Igor Rempel, Garri Rempel, Yulia Rempel and Larisa Rempel
(“Rempel respondents”).
PETITIONER’S CONTENTIONS
The petitioner asserts that “discovery is sought with respect to documents located in the
United States in this judicial district for use in the following pending proceeding(s)”:
(i)

Lake Holding’s pending judgment recognition and enforcement proceedings in
Cyprus which include orders protecting (a) the assets of Respondents BTR Group
(“BTR”), Mikhail Belyak (“Belyak”), Igor Rempel (“Rempel”), Anastasia Belyak
(“Anastasia”), Garri Rempel (“Garri”), and the Cyprus-based Respondents
(collectively, the “Defendants”) (who are named for the purpose of safeguarding
assets and records, for discovery purposes and for asset tracing orders, into the
hands of persons and entities other than BTR, Belyak and Rempel) and/or (b) the
assets of any person or entity holding them on behalf of BTR, Belyak and Rempel,
to enforce the Moscow Court Judgments, listed in the Melnichenko Declaration

1

(ii)
(iii)

(iv)

(v)
(vi)
(vii)

(collectively, the “Judgments”) in favor of Lake Holding and against BTR, Belyak
and Rempel;
attachment and garnishment proceedings in Cyprus, France, Monaco or any other
jurisdiction in which Defendants’ assets may be located; and
the Cyprus, French and Monegasque proceedings, and any other potential
proceedings, which require adjudication of ownership issues related to assets, in
personam jurisdiction, fraudulent transfers and alter ego liability. As set forth in
the supporting Declarations of Vladimir Melnichenko and George Benaur,
Defendants have set up a complex scheme of companies across different
jurisdictions that include the U.S., BVI, Cyprus, France, Monaco, Russia, Belize
and potentially other places, and have created a series of complex mosaics and
ownership structures that need to be unraveled through international discovery;
because the Cyprus court has already issued Interim Freezing Orders (see Benaur
Decl., Exhibit J, Melnichenko Decl. Exhibit 3, Nicolaou Decl., Exhibit 2), which
apply worldwide against Defendants, the requested discovery is also needed to
determine whether the Defendants have complied with such orders, or as suspected,
they have not;
additional contemplated litigation against Anastasia, Margarita Belyak
(“Margarita”), Garri and others who assisted the judgment debtors in their
fraudulent schemes and likely conversions (see Melnichenko Decl., ¶ 10);
further potential asset tracing litigation in Switzerland consequent upon the
disclosures of account information made by, for example, UBS (as defined below)
and Credit Suisse; and
further proceedings in Russia, principally claims for interest on the debts, as set
forth in the Melnichenko Decl, ¶ 23.

The petitioner contends that “[r]equests for transfer records from intermediary banks are routine
and rarely opposed by such banks.” The petitioner seeks discovery from the banks “through or
from which funds have been transferred by Defendants and their controlled companies from the
date the Lake Holding made the first loan to the date hereof. The discovery will assist in
determining the use of the Lake Holding’s loan proceeds and the potential diversion of the
security and repayment funds that were to have been used to repay the Lake Holding’s loans, as
well as any fraudulent transfers made when the loans were in default.” According to the
petitioner, the foreign proceedings are “on-going and the discovery sought here is for use in
those proceedings and other foreign actions Lake Holding anticipates will be brought.”
Specifically, the subpoenas seek:

2

1. Copies of any orders, instructions or wire transfers received from any person
or entity (including but not limited to, any payor/transferor bank to a
payee/transferee bank) for the benefit or credit of, or with any reference to any
of the following entities and persons (hereinafter, the “Transferees”):
• Mikhail Belyak
• Anastasia Belyak
• Igor Rempel
• Garri Rempel
• BTR Build To Rent Group Limited
• Related Party or Related Parties
• Cyprus-based Respondents or Respondents
in which the Bank has acted as either as direct transfer bank or as the
intermediary or correspondent bank, together with any electronic and/or paper
records thereof for the period beginning January 1, 2012 to the present.
2. Copies of any other documents in the possession of the Bank relating to the
Transferees, including all documents to be produced pursuant to the annexed
Order Granting Lake Holding’s Section 1782 Application.
The petitioner asserts that it is an “interested person under Section 1782 because it is the
claimant in the foreign proceedings or will be a party to foreign proceedings.” The petitioner
“has no intention to seek the recovery of more than 100% of the judgments obtained against
BTR, Belyak and Rempel together with any further sums properly due, principally interest under
Russian law or the law of the places where the judgments have been recognized.” The banks to
be subpoenaed are found or reside within this judicial district and discovery is sought for use in
the foreign proceedings, which are or will be held before one or more foreign tribunals, including
in Cypriot court proceedings, where interim freezing orders are in place. In enforcing the
judgments, the proceedings will likely require the foreign courts to adjudicate ownership issues
related to assets in personam jurisdictional issues related to the judgment-debtors’ presence in a
particular jurisdiction and whether certain assets have been fraudulently conveyed or can be
attached or turned over to satisfy the judgments. The petitioner “shall seek discovery to assess
whether to seek an adjudication as to whether defendants already violated the Interim Freezing

3

Orders.” The petitioner maintains that no other factors exist which would weigh against
allowing discovery.
Moreover, “the four discretionary factors set out by the United States Supreme Court in
Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264-65 (2004) weigh in favor of
granting Applicant’s application.” None of the banks that will be subpoenaed will be parties to
or participate in the foreign proceedings and it has not been possible to obtain documents from
those banks in any proceedings held to date in Russia or Cyprus. The nature of the foreign
proceedings does not implicate any factor or policy that would weigh against discovery. The
petitioner asserts that the information sought would also be used in commencing targeted actions
rather than in the pre-trial discovery phase of a dispute on the merits and granting the application
will not offend any foreign jurisdiction. The petitioner seeks discovery concerning:
i.
ii.
iii.
iv.
v.
vi.

vii.

viii.
ix.
x.

locating Defendants’ bank accounts;
locating Defendants’ assets;
locating Defendants’ counterparties and relevant third parties assisting
them;
locating Defendants’ trading partners;
identifying whether Defendants have conveyed its or their assets to one or
more of the Related Parties (or any other persons or entities) before or
during the pendency of the Foreign Proceedings;
identifying whether one or more of the Related Parties (or any other persons
or entities) have succeeded Defendants in dealing with Defendants’
counterparties and/or trading partners, or are acting functionally as
Defendants’ paying and/or payment agent for the transaction of Defendants’
business before or during the pendency of the Foreign Proceedings;
identifying whether one or more of the Related Parties (or any other persons
or entities) have received Defendants’ assets under circumstances which
suggest that Defendants has [sic] been controlled and/or dominated by (or
conversely controls and/or dominates) one or more of the Related Parties
before or during the pendency of the Foreign Proceedings;
locating the Related Parties’ bank accounts or those of any connected
persons or entities;
locating the Related Parties’ assets or those of any connected persons or
entities;
locating the Related Parties’ counterparties or those of any connected
persons or entities; and
4

xi.

locating the Related Parties’ trading partners or those of any connected
persons or entities.

In support of its application, the petitioner submitted declarations by: (i) Vladimir Vasilyevich
Melnichenko (“Melnichenko”), the sole beneficial owner of Lake Holding & Finance S.A., with
exhibits; (ii) George Benaur (“Benaur”), the petitioner’s attorney, with exhibits; and (iii)
Chrysostomos Nicolau (“Nicolau”), the petitioner’s attorney in Cyprus, with exhibits.
BELYAK RESPONDENTS’ OPPOSITION
The Belyak respondents assert that “[t]he Second Circuit has made clear that discovery
under 28 U.S.C. §1782 is not available in support of foreign post-judgment enforcement
proceedings. See Euromepa, S.A. v. R. Esmerian, Inc., 154 F.3d 24, 28 (2d Cir. 1998). That is
exactly what Lake Holding is improperly attempting to obtain with its application” seeking
discovery in support of several judgment enforcement proceedings alleged as pending in Cyprus,
France and Monaco.
These various foreign collection proceedings seek the enforcement of a series of
judgments entered by a Moscow court in favor of Lake Holding and against Mikhail
Belyak, a Russian citizen and Moscow resident (the “Moscow Judgments”). Id. By
its own admission, therefore, Lake Holdings’ Section 1782 Application must be
denied under Euromepa and its progeny because the discovery is not being sought
for use in an adjudicative proceeding as defined under the statute and case law
interpreting the statute. Further, the Section 1782 Application is nothing more than
a veiled effort to circumvent two actions commenced by Lake Holding in the State
of Florida. In these two actions, the alleged liability on and domestication and
enforceability of the Moscow Judgments is being litigated, among other things, and
a protective order prohibiting Lake Holding from improperly obtaining the
underlying financial information that is the basis of the Section 1782 Application
has been issued on the record by the Florida Court (the “Protective Order”). The
confidentiality mandate of the Protective Order is a basis for the denial of the
Section 1782 Application on its own because, as the Second Circuit has noted, there
is no procedure to enforce the confidentiality of discovery obtained pursuant to
Section 1782. Kiobel ex rel Samkalden v. Cravath, Swaine & Moore LLP, 895 F.3d
238 (2d Cir. 2018), cert. denied, 139 S. Ct. 852 (2019).

5

The Belyak respondents contend that the application fails to satisfy the mandatory statutory
requirements because it seeks discovery to be used in support of post-judgment proceedings, not
in a foreign adjudicative proceeding, as required in this circuit. As “[t]here is nothing
adjudicative in nature about Lake Holding’s purported plans to seek recognition and enforcement
of the Moscow Judgments in other jurisdictions,” the post-judgment proceedings alleged to be
pending in other jurisdictions show that the instant application is barred by Euromepa.
Moreover, “the Cypriot Court has purportedly issued Interim Freezing Orders, Section
1782 Application, at 2 n. 3; therefore, there are no ‘contested factual and legal questions’
pending or even contemplated to be pending before any foreign tribunal.” The petitioner’s
conclusory and speculative assertion, without any explanation, that “in enforcing the judgment,
the proceedings likely will require the foreign court to examine and adjudicate ownership issues
related to assets” is not sufficient to satisfy the requirement that discovery is for use in an
adjudicative proceeding.
The Belyak respondents contend that the application does not satisfy the Intel
discretionary factors because they “are parties to one or more of the subject foreign proceedings
in Russia, Cyprus and Monaco; therefore, Lake Holding can ostensibly – and must properly be
required to – obtain all of the discovery it seeks from them in those proceedings since they are
parties”; thus, this factor weighs against the application. With respect to whether the courts in
the purported pending or contemplated foreign proceedings will be receptive to a United States
court’s interference, the petitioner “failed to provide sufficient information or law from the
jurisdictions where the purported pending and/or contemplated foreign proceedings are taking
place for the Court to analyze this factor.” The petitioner “appears to be intentionally
obfuscating the character of the purported pending or contemplated proceedings in those

6

jurisdictions, and, while seeking relief from this Court, thereby prevents the Court from
performing a complete analysis of all of the Intel factors.”
Furthermore, the petitioner did not show that it has first attempted to obtain discovery in
the foreign jurisdictions. Rather, the petitioner asserts that “it has gathered information and
discovery through the Florida Proceedings” but does not state “whether it has requested
discovery in the purported pending foreign cases or whether it can.” The petitioner “is asking
this Court to step into the shoes of the judges in each of the purported foreign proceedings, to
apply U.S. discovery principles to matters pending in these foreign tribunals, and to – in effect –
govern the discovery proceedings in each of those actions,” and the application is devoid of any
showing that the petitioner attempted to obtain discovery from the Belyak respondents in the
foreign proceedings. The petitioner’s lack of interest in pursuing discovery in the foreign
proceedings shows an attempt to circumvent the rules of the foreign tribunals.
The Belyak respondents assert that the petitioner seeks overly broad discovery consisting
of “every document which might be in existence to aid it in locating, inter alia, all of the
respondents’ bank accounts, their assets, all counterparties and relevant third parties assisting
them, their trading partners, all of the related parties’ bank accounts and those of any connected
persons or entities.” Seeking “essentially every document conceivably related to the Belyak
Parties, including privileged financial documents and asset information of the Belyak Parties and
unrelated third parties” is unduly intrusive and burdensome. The Belyak respondents maintain
that all four Intel factors weigh against granting the application. Alternatively, the court should
abstain from exercising jurisdiction in favor of the Florida proceeding under “Colorado River
Water Conservation District v. United States, 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483
(1976)” because the “Moscow Judgments are the basis of two pending Florida state court

7

proceedings brought by Lake Holding over one year before Lake Holding initiated this
proceeding, one of which has given rise to a pending Florida appellate court proceeding.” “One
of the issues in those proceedings is allegations of fraud by Lake Holding in the recognition and
domestication process; another issue is whether Lake Holding may enforce those judgments
against A. Belyak and Margarita. Surgeon Decl. ¶¶ 8, Ex. 5 at 1-3.” “[T]he issue of whether the
Moscow Judgments that are the subject of the foreign garnishment and enforcement actions
referenced in the Section 1782 Application and the extent to which those Moscow Judgments can
reach assets of A. Belyak and Margarita can be recognized is presently being litigated in the
Florida court system.” In support of their opposition, the Belyak respondents submitted a
declaration by their attorney Naim S. Surgeon (“Surgeon”) with exhibits.
REPLY TO BELYAK RESPONDENTS’ OPPOSITION
The petitioner contends that the Belyak respondents “created a series of complex mosaics
and ownership structures that need to be unraveled – quite likely with court orders that
transactions should be set aside as frauds on creditors – to determine true ownership and also to
determine whether steps have been taken to place assets beyond reach, the propriety of which
must be challenged” and the petitioner “should be permitted to seek evidence in order to
prosecute claims for violation of court orders, especially the worldwide freezing orders granted
in Cyprus a year ago.” “The nature of the Cyprus proceedings as adjudicative proceedings is
discussed at length and confirmed by Mr. Nicolaou” in his declaration. The petitioner filed
requests for discovery in Cyprus, which should not be justification for denying the application.
The Belyak respondents failed to provide any valid ground for denying the petition and they
failed to present any evidentiary support for their argument that none of the pending and
contemplated proceedings is adjudicative. The opposing declaration by Surgeon, “a U.S. lawyer

8

with no involvement in Cyprus, Monaco, Russia, BVI, Belize or Canada proceedings, is not
based on any personal knowledge of whether those proceedings shall be or are ‘adjudicative’”
and his “protestations, absent support from the Belyaks’ Cyprus counsel, are baseless.” The
Court should accept the declaration by Nicolaou in which he “states the issues which arise for
determination in the Cyprus proceedings.” According to the petitioner,
Euromepa should not be interpreted as applying an additional requirement for
Section 1782 that is not found in the text of the statute. Euromepa does not per se
prohibit discovery in aid of foreign proceedings concerning the recognition and
enforcement of a foreign (Russian) judgment. Other courts in this district have
granted Section 1782 applications for discovery in aid of recognition and
enforcement of judgments and arbitration awards. See, e.g. In re Clerici, 481 F.3d
1324 (11th Cir. 2007); JSC MCC EuroChem v. Chauhan, 2018 WL 3872197, 17mc 00005, *11- 12 (M.D.Tenn. Aug. 8, 2018); In re Stati, 2018 WL 474999, 15mc-91059 (D. Mass. Jan. 18, 2018); See, e.g., In re Frontline Shipping Ltd., 17-mc174 (S.D.N.Y. May 26, 2017) (Dkt. No. 5); In re DS-Rendite Fonds Nr. 108 VLCC
Ashna GMBH&Co. Tankschiff KG, 17-mc-00276 (S.D.N.Y. Sept. 5, 2017) (Dkt.
No. 11); In re New India Assurance Co. Ltd., 18-mc-00178 (S.D.N.Y. May 2, 2018)
(Dkt. No. 7); see Benaur Decl., Exhibit M, including In re Application of Galaxy
Energy and Resources., Civil Action No. 19-MC-287-LTS (SDNY 2019). Here,
the contemplated foreign proceedings (as in many of the cases cited above) relate
to the recognition and enforcement of foreign judgments, and, in enforcing the
judgments, the proceedings likely will require the foreign court to examine and
adjudicate ownership issues related to assets, in personam jurisdictional issues
related to the judgment-debtor’s presence in a particular jurisdiction, and other
issues related whether certain assets have been fraudulently conveyed or can be
attached or turned over to satisfy the award. Indeed, in support of its petition, Lake
Holding noted that discovery in this district is needed not only to locate and identify
assets, but also to, amongst other things fraudulent transfers, conversion, violation
of freezing orders entered by the foreign court, and other matters.
The Belyak respondents do not contest that the banks at issue are present in this district,
discovery at present cannot be obtained from those banks in other jurisdictions, and the
transactions at issue involved U.S. currency. Moreover, “[t]here is no basis to substantiate that
Cyprus, Monaco, BVI or Russian courts will not be receptive to the evidence gathered in the
U.S. or that Lake Holding has not been diligent in pursuing discovery worldwide. On the
contrary, the Nicolau Declaration stands unrebutted on this Petition.” The Belyak respondents
9

failed to support with any evidence their assertion that the subpoenas are unduly burdensome.
The petitioner contends that the Florida proceedings, are different from current Cyrpus, Monaco
and Russian proceedings, and are not a basis to abstain from exercising jurisdiction concurrently
with the foreign court. Furthermore, no exceptional circumstances were demonstrated for the
abstention doctrine to apply, relying on “Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746 (1971).”
The instant petition “is broader and seeks discovery in connection with machinations that
occurred worldwide through the U.S. financial system and the Banks, for Rempel, BTR, the
Related Parties and the Belyaks.” According to the petitioner, “[t]his case involves a complex
scheme of companies worldwide, loans made to BTR, Rempel and Belyaks to the UBS account
in Switzerland, with funds then moved around through various structures worldwide. The
Florida litigation is only one piece of this mosaic that respondents have tried to hide.”
REMPEL RESPONDENTS’ OPPOSITION
The Rempel respondents contend that, despite the fact that “the Russian Judgments are
solely against BTR, Igor Rempel and Mikhail Belyak, Lake Holding seeks widely intrusive and
far-reaching discovery relating to individuals who are neither debtors nor parties to any of the
foreign proceedings, including Garri Rempel, Yulia Rempel and Larisa Rempel (the ‘Rempel
Parties’) (and, for that matter, Margarita Beliak and Anastasia Belyak).” The petitioner offered
nothing more than a familial relationship of the parties against whom it has no judgments,
making discovery “patently improper.” According to the Rempel respondents, the persons from
whom discovery is sought are not in this district, rather, they are foreign institutions such as
“Banque Lombard Odier & Cie AG; Union Bancaire Privee CBI TDB, Geneva; Kookmin Bank
(Korea); and BSI SA, Lugano, Switzerland.” The requested discovery is not for use in a
proceeding before a foreign tribunal since “[t]here is nothing adjudicative in nature about Lake

10

Holding’s purported plans to seek recognition and enforcement of the Moscow Judgments in
other jurisdictions, and the post-judgment proceedings that are represented by Lake Holding as
pending in other jurisdictions establish that its Section 1782 Application is barred by Euromepa.”
Given that the Cypriot court allegedly issued interim freezing orders, no contested factual or
legal questions are pending or contemplated to be pending before the foreign tribunal. The
petitioner seeks broad and intrusive information about members of Igor Rempel’s family in the
absence of any proceedings against them and potential actions are not sufficient to satisfy the
requirement that the discovery be for use in a foreign proceeding. The petitioner’s threat to use
discovery in aid of a criminal prosecution is improper use of civil process. Additionally, the
Rempel respondents rely on the Belyak respondents’ argument that the petitioner does not satisfy
the Intel discretionary factors, and the discovery request is unduly burdensome and intrusive.
REPLY TO REMPEL RESPONDENTS’ OPPOSITION
The petitioner asserts that the Rempel respondents’ opposition is meritless and not
supported by any evidence. The petitioner “should be permitted to seek evidence in order to
prosecute claims for violation of court orders, especially the worldwide freezing orders granted
in Cyprus a year ago. In such proceedings, the defaulting defendants can be punished for
contempt of court, and they can even be deprived of the right to defend Lake Holding’s
proceedings and their conduct could be deemed to be criminal in nature.” The nature of the
Cyprus proceedings is adjudicative, as explained by Nicolaou in his declaration, and “[a]n
interim order has been issued as a holding measure pending a full inter partes hearing.” The
Rempel respondents did not submit evidence from their Cyprus counsel supporting the argument
that the Cyprus proceedings are not adjudicative and “Euromepa does not per se prohibit
discovery in aid of foreign proceedings concerning the recognition and enforcement of a foreign

11

(Russian) judgment.” The contemplated proceedings relate to the recognition and enforcement
of foreign judgments, which will require courts likely to adjudicate ownership issues related to
assets. The Rempel respondents do not contest that the banks at issue are present in this district
and discovery cannot be obtained from them in other jurisdictions. Moreover, the Rempel
correspondents and their associated entities have numerous connections to the banks at issue.
“There is no basis to substantiate that Cyprus, Monaco, BVI or Russian courts will not be
receptive to the evidence gathered in the U.S. or that Lake Holding has not been diligent in
pursuing discovery worldwide” or that the subpoenas are unduly burdensome or overly broad.
LEGAL STANDARD
“The district court of the district in which a person resides or is found may order him to
give his testimony or statement or to produce a document or other thing for use in a proceeding
in a foreign or international tribunal, including criminal investigations conducted before formal
accusation.” 28 U.S.C.A. § 1782(a). The Second Circuit
has held that § 1782 requires that a three part test must be met prior to its invocation:
(1) that the person from whom discovery is sought reside (or be found) in the district
of the district court to which the application is made, (2) that the discovery be for
use in a proceeding before a foreign tribunal, and (3) that the application be made
by a foreign or international tribunal or “any interested person.” Esses, 101 F.3d at
875 (quoting Gianoli Aldunate, 3 F.3d at 58). In analyzing the second element of
this test, . . . we have, . . . previously focused on two questions: (1) whether a
foreign proceeding is adjudicative in nature; and (2) when there is actually a foreign
proceeding. . . . [T]he district court need not satisfy itself that the discovery sought
in the petition is of information that would be discoverable under the laws of the
foreign jurisdiction in which the proceeding is pending.
Euromepa, S.A. v. R. Esmerian, Inc., 154 F.3d 24, 27-28 (2d Cir. 1998).
[T]he planned proceedings must be within reasonable contemplation. In other
words, the applicant must have more than a subjective intent to undertake some
legal action, and instead must provide some objective indicium that the action is
being contemplated. . . . [T]he Supreme Court’s inclusion of the word “reasonable”
in the “within reasonable contemplation” formulation indicates that the proceedings
12

cannot be merely speculative. At a minimum, a § 1782 applicant must present to
the district court some concrete basis from which it can determine that the
contemplated proceeding is more than just a twinkle in counsel’s eye.
Certain Funds, Accts. &/or Inv. Vehicles v. KPMG, L.L.P., 798 F.3d 113, 123-24
(2d Cir. 2015).
[A] district court is not required to grant a § 1782(a) discovery application simply
because it has the authority to do so. . . . [N]onparticipants in the foreign
proceeding may be outside the foreign tribunal’s jurisdictional reach; hence, their
evidence, available in the United States, may be unobtainable absent § 1782(a) aid.
. . . [A] court presented with a § 1782(a) request may take into account the nature
of the foreign tribunal, the character of the proceedings underway abroad, and the
receptivity of the foreign government or the court or agency abroad to U.S. federalcourt judicial assistance. . . . [A] district court could consider whether the § 1782(a)
request conceals an attempt to circumvent foreign proof-gathering restrictions or
other policies of a foreign country or the United States. Also, unduly intrusive or
burdensome requests may be rejected or trimmed.
Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264-65, 124 S. Ct.
2466, 2482-83 (2004) (citations omitted).
Abstention from the exercise of federal jurisdiction is the exception, not the rule.
“The doctrine of abstention, under which a District Court may decline to exercise
or postpone the exercise of its jurisdiction, is an extraordinary and narrow exception
to the duty of a District Court to adjudicate a controversy properly before it.
Abdication of the obligation to decide cases can be justified under this doctrine only
in the exceptional circumstances where the order to the parties to repair to the state
court would clearly serve an important countervailing interest.” County of
Allegheny v. Frank Mashuda Co., 360 U.S. 185, 188-189, 79 S.Ct. 1060, 1063, 3
L.Ed.2d 1163, 1166 (1959).
Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 813, 96
S. Ct. 1236, 1244 (1976).
The principles of Colorado River are to be applied only in situations “involving the
contemporaneous exercise of concurrent jurisdictions.” Therefore, a finding that
the concurrent proceedings are “parallel” is a necessary prerequisite to abstention
under Colorado River. See Alliance of American Insurers v. Cuomo, 854 F.2d 591,
603 (2d Cir.1988); Day v. Union Mines Inc., 862 F.2d 652, 655 (7th Cir.1988)
(“Suits are parallel when substantially the same parties are contemporaneously
litigating substantially the same issue in another forum.” (internal quotation marks
omitted)).

13

Dittmer v. County of Suffolk, 146 F.3d 113, 117-18 (2d Cir. 1998) (citations
omitted).
In determining whether this exception is applicable, the court should consider (1)
whether the controversy involves a res over which one of the courts has assumed
jurisdiction; (2) whether the federal forum is less inconvenient than the other for
the parties; (3) whether staying or dismissing the federal action will avoid
piecemeal litigation; (4) the order in which the actions were filed, and whether
proceedings have advanced more in one forum than in the other; (5) whether federal
law provides the rule of decision; and (6) whether the state procedures are adequate
to protect the plaintiff's federal rights.
Woodford v. Cmty. Action Agency of Greene County, Inc., 239 F.3d 517, 522 (2d
Cir. 2001) (internal citations omitted). .
APPLICATION OF LEGAL STANDARD
The Statutory Requirements
That the Person from Whom Discovery Is Sought Reside (or Be Found) in the
District of the District Court to which the Application Is Made
The respondent asserts that “each bank has an office in the District and maintains the
records requested. Benaur Decl., ¶3.” The Belyak respondents do not challenge the first
statutory requirement, namely, that the person from whom discovery is sought reside or be found
in the district of the court to which the application is made. The Rempel respondents assert that
the petitioner does not address the first statutory requirement in its application.
In paragraph No. 3 of his declaration, made under penalty of perjury, Benaur states:
To the best of my knowledge, information, and belief, based on my investigation
of the facts surrounding this dispute and of the entities and individuals, the
following entities from which discovery is sought (collectively, the “Banks”) either
reside or are found in the Southern District of New York: UBS AG; Societe
Generale / SG Private Bank; Banque Lombard Odier & Cie AG (aka Lambert Odier
Darier Hentsch & Cie); CIM Banque SA; Kookmin Bank (Korea); Credit Suisse;
PJSC Sberbank; Bank of America, N.A.; Merrill Lynch Capital Corporation and
Citibank, N.A.; Union Bancaire Privee CBI-TDB, Geneva and BSI SA, Lugano,
Switzerland.

14

In a footnote appended to the above sentence, Benaur asserted: “Information on Union Bancaire
and BSI SA, Lugano, Switzerland was just received today (see Exhibit N). I am still
investigating whether BSI SA has a presence in New York.” Benaur stated that Exhibit N
contains “true and correct screenshots of an excel file titled ‘WIRES’ produced by Bank of
America in response to the subpoena served on the bank in the Florida Domestication Action,
received and taken on December 2, 2020.” Assuming that “Union Bancaire” in Benaur’s
footnote is the same entity identified as “Union Bancaire Privee CBI-TDB” referenced in
paragraph No. 3 of Benaur’s declaration, Exhibit N does not indicate anywhere that “Union
Bancaire Privee CBI-TDB” resides or is found in this judicial district, nor did Benaur identify
any portion of Exhibit N in support of his assertion that “Union Bancaire” resides or is found in
this judicial district. Thus, no evidence is presented by the petitioner that “Union Bancaire
Privee CBI-TDB” resides or is found in this judicial district. Benaur stated in a footnote to
paragraph No. 3 that “I am still investigating whether BSI SA has a presence in New York.”
Assuming that “BSI SA” referenced in Benaur’s footnote is the same entity identified as “BSI
SA, Lugano, Switzerland” in paragraph No. 3 of Benaur’s declaration, no evidence is presented
by the petitioner that “BSI SA, Lugano, Switzerland” resides or is found in this judicial district.
With respect to the banks referenced in paragraph No. 3 of Benaur’s declaration, other
than “Union Bancaire Privee CBI-TDB” and “BSI SA, Lugano, Switzerland,” Benaur stated that
“[t]o the best of my knowledge, information, and belief, based on my investigation of the facts
surrounding this dispute and of the entities and individuals, the following entities from which
discovery is sought . . . either reside or are found in the Southern District of New York.”
Benaur’s declaration in paragraph No. 3 of his declaration with respect to banks, other than
“Union Bancaire Privee CBI-TDB” and “BSI SA, Lugano, Switzerland,” is not rebutted.

15

The Court finds that the petitioner: (1) established that “UBS AG; Societe Generale / SG
Private Bank; Banque Lombard Odier & Cie AG (aka Lambert Odier Darier Hentsch & Cie);
CIM Banque SA; Kookmin Bank (Korea); Credit Suisse; PJSC Sberbank; Bank of America,
N.A.; Merrill Lynch Capital Corporation and Citibank, N.A.” reside or are found in this judicial
district; and (2) failed to establish that “Union Bancaire Privee CBI-TDB, Geneva and BSI SA,
Lugano, Switzerland” reside or are found in this judicial district.
That the Application Be Made by a Foreign or International Tribunal or “Any
Interested Person”
The petitioner asserts that it “is the petitioner and claimant in the Foreign Proceedings,
including but not limited to the Cyprus proceedings,” “is, or will be, a party to all and any
Foreign Proceedings, it is clearly an ‘interested person,’” and “[a]s the Melnichenko Decl. states
(see ¶ 23) Lake Holding has no intention to seek the recovery of more than 100% of the
judgments obtained against BTR, Belyak and Rempel.” Neither the Belyak respondents nor the
Rempel respondents challenge the third statutory requirement, namely, that the application be
made by a foreign international tribunal or “any interested person.”
In paragraph No. 23, of the declaration Melnichenko stated: “I next turn to the evidence
of entities and physical persons having accounts and/or banking connections with various banks
outside the United States.” Thus, Melnichenko did not state in paragraph No. 23, as the
petitioner asserts, that “Lake Holding has no intention to seek the recovery of more than 100% of
the judgments obtained against BTR, Belyak and Rempel.” In paragraph No. 3 of his
declaration, Melnichenko stated:
Lake Holding has brought proceedings in Cyprus against BTR [BTR Build To Rent
Group Limited], Mr. Belyak and Mr. Rempel to enforce Russian Judgments against
BTR to recover principal indebtedness and against the two individuals as guarantors
of the majority of BTR’s indebtedness. The Russian proceedings are described in
an opinion letter from Lake Holding’s lawyers, Yustina, dated February 29, 2020.
16

See Exhibit 2 hereto. See also Benaur MTD Decl. ¶¶ 3 to 19 for descriptions of the
history and the proceedings. In various proceedings outside Russia, Lake Holding
seeks the recognition and enforcement of the Russian Judgments which it has
obtained (which are final and conclusive) and various other forms of relief which
are sought against entities connected with BTR, Mr. Belyak and Mr. Rempel and
relatives of those two guarantors including Mr. Belyak’s daughter, Anastasia
Belyak (“Anastasia”), and Mr. Rempel’s father, Garri Rempel (“Garri”). See
Benaur MTD Decl. ¶ 20.
Benaur stated in paragraph Nos. 5-8 of his declaration:
5. On November 7, 2019, Lake Holding commenced an action in the U.S. District
Court, Southern District of Florida (Case No. 19-cv-24629-PCH) asserting claims
against Defendants Mikhail Belyak, together with his wife Margarita and daughter
Anastasia, and certain companies that they formed in Florida (MFCVSSAR, LP,
MB Wall LLC, MB PDT 1901 LLC), for judgment recognition under Florida’s
Foreign Money Judgments Recognitions Act, fraud, fraudulent and other related
claims. Once challenged on the basis of subject matter jurisdiction by the Belyak
defendants (who filed declarations averring not to be residents in Florida), the
federal court action was withdrawn and two cases were refiled in Florida state court
in late November and early December 2019.
6. In the first Florida state court action (Case No. 2019-035235-CA-01), Lake
Holding filed certain judgments that Lake Holding obtained in Moscow, Russia
against Mikhail Belyak for domestication under Fla. Stat. 55, Foreign Money
Judgment Recognitions Act (the “Domestication Action”). In the second state court
action (Case No. 2019-035660-CA-01 (44)), Lake Holding asserts claims for
fraudulent transfer, alter ego liability, unjust enrichment and related civil claims
against Mikhail, Anastasia and Margarita Belyak, and certain companies that they
own in Florida, through which they collectively purchased over $22 million in real
estate in Florida in 2015 and 2016 (the “Fraudulent Transfer Action”). See Exhibit
A hereto (Amended and Supplemental Complaint).
7. On October 6, 2020, the Florida state court entered Final Judgment against
Mikhail Belyak in the Domestication Action in the total amount of $36,140,573.95.
See Exhibit B. The Fraudulent Transfer Action is currently proceeding in state
court, and Defendants are asserting lack of jurisdiction and forum non conveniens
defenses, among others, in their motions to dismiss. The parties are scheduled to
argue over various cross-motions on December 11, 2020. My Declaration in the
Fraudulent Transfer Action in opposition to the Defendants’ Motions to Dismiss
(the “Benaur MTD Declaration”) is attached as Exhibit C (without exhibits, save
for the orders for disclosure of documents made in the BVI, Canada and Belize,
Exhibits O, P and Q and ¶¶ 21, 23 and 24). A copy of the text only of the
Declaration of Vladimir Vasilyevich Melnichenko, the sole owner of Lake Holding,
in opposition to the Defendants’ Motions to Dismiss (the “Melnichenko MTD
Declaration”) is attached to his declaration as Exhibit 1.
8. To date, Lake Holding has not pursued any claims in the United States against
BTR or Igor Rempel or any of the other Defendants cited above due to lack of
17

sufficient evidence, at present, to successfully establish personal jurisdiction,
thereby, in part, necessitating this application. See also, Melnichenko Decl. ¶ 32.
Benaur stated in paragraph No. 15 of his declaration:
An English translation of Interim Freezing Order entered by the Cypriot Court is
annexed as Exhibit K3. For a detailed discussion of this Order, the proceedings in
Cyprus, and the subsequent gagging and disclosure orders made in BVI and Belize
(see id.) I refer to the Benaur MTD Declaration as well as the Nicolau Declaration
filed herewith.
Nicolaou stated in paragraph No. 1 of his declaration that he represents the petitioner “in its three
proceedings in Cyprus to enforce various Russian judgments against BTR Build To Ret Group
Liited (‘BTR’- a company incorporated in Cyprus) and Mikhail Borisovich Belyak (‘Mr.
Belyak’) and Mr. Igor Garrievich Rempel (‘Mr. Rempel’), and against certain other defendants.”
Nicolaou stated that, on March 10, 2020, the petitioner commenced proceedings in the District
Court of Nicosia seeking “recognition and enforcement of the Russian judgments pursuant to the
‘Treaty between the Republic of Cyprus and the Union of Soviet Republics on Legal Assistance
in Civil and Criminal Matters’” and “the Law Concerning Foreign Judgments.” Nicolaou
asserted that “the Russian Judgments” the petitioner obtained “are final and conclusive.” On
March 27 and 30, 2020, based on the petitioner’s ex parte application, the District Court of
Nicosia issued orders which “operate as worldwide freezing orders.” The petitioner also made
“the inter partes applications for disclosure and asset tracing orders,” but those applications “are
not expected to be heard for several months.” The Court finds that the petitioner established that
it is an interested person for the purpose of the instant application.
That the Discovery Be for Use in a Proceeding Before a Foreign Tribunal
The petitioner asserts that “the Cyprus Actions are ongoing adjudicatory proceedings”
because

18

enforcing the judgments, the proceedings likely will require the foreign court to
examine and adjudicate ownership issues related to assets, in personam
jurisdictional issues related to the judgment-debtors’ presence in a particular
jurisdiction, and other issues related whether certain assets have been fraudulently
conveyed or can be attached or turned over to satisfy the judgments. In addition,
Lake Holding shall seek discovery to assess whether to seek an adjudication as to
whether defendants already violated the Interim Freezing Orders (Benaur Decl.,
Exhibit K).
Moreover, the petitioner “may well initiate further actions in other jurisdictions after obtaining
sufficient discovery from the Banks.” The petitioner asserts that discovery sought
will be used to determine whether, how and where Defendants have violated the
existing Interim Freezing Orders from the Cyprus Court and also to adjudicate (in
other jurisdictions) the imposition of nominee and alter ego liability on various third
parties who have assisted and are assisting defendants in hiding assets and
absconding with over $36 million which should have been used to repay Lake
Holding.
The Belyak respondents assert that discovery sought is not for use in a proceeding before foreign
tribunal because Euromepa “establishes that Section 1782 discovery is not available for postjudgment proceedings where the merits have been fully adjudicated – which is exactly the case
here,” and “[t]here is nothing adjudicative in nature about Lake Holding’s purported plans to
seek recognition and enforcement of the Moscow Judgments in other jurisdictions.” The Rempel
respondents assert that discovery sought is not for use in a proceeding before a foreign tribunal
because “the post-judgment proceedings that are represented by Lake Holding as pending
in other jurisdictions establish that its Section 1782 Application is barred by Euromepa,” and
“[t]here is nothing adjudicative in nature about Lake Holding’s purported plans to seek
recognition and enforcement of the Moscow Judgments in other jurisdictions.”
Whether a Foreign Proceeding Is Adjudicative in Nature
The court explained the procedural history in Euromepa as follows:

19

The French Trial Court found in favor of Esmerian, and issued a judgment of
approximately $10 million in favor of Esmerian and against the Petitioners. The
French Trial Court held that Esmerian and the Petitioners were equally at fault for
the loss, and that the loss should therefore be split evenly between them. Following
this ruling, and after perfecting their appeal therefrom, Petitioners filed a § 1782
petition (the “Petition”), by order to show cause, in the Southern District of New
York, seeking discovery of Esmerian regarding, among other things, proof of
ownership of the jewelry, prior insurance of the jewelry, agreements between
Esmerian and its affiliates, and substantiation of the jewelry lost. Petitioners sought
this discovery for use in the appeal of the French Trial Court's judgment.1 The
district court denied the Petition in a Memorandum and Order, dated May 10, 1994.
Application of Euromepa, S.A., 155 F.R.D. 80 (S.D.N.Y.1994). In doing so, the
district court focused largely on the French system of discovery, and concluded that
granting the Petition might constitute an affront to the French system. Id. at 82–84.
Petitioners timely appealed to this Court.
After the Petitioners' appeal was argued in this Court, but before this Court rendered
a decision, the Court of Appeal of Versailles (the “French Court of Appeal”)
affirmed the judgment of the French Trial Court, and amended that judgment in a
manner favorable to Esmerian. The French Court of Appeal held that “[Esmerian]
did not itself commit any misconduct ... [and] due to the failure to carry out its
duties as consultant and the blatant fraud on [Euromepa's] part, the responsibility
cannot be split with the insured party.” The French Court of Appeal accordingly
entered a judgment holding Euromepa liable for the entire $20 million loss.
Immediately following this judgment, Euromepa filed a petition seeking French
bankruptcy protection (the “French Bankruptcy Proceeding”).
On March 9, 1995, Esmerian filed a motion in this Court seeking to have
Petitioners' appeal dismissed as moot on the basis of the ruling of the French Court
of Appeal. Esmerian argued that the appeal was moot because there was no longer
any foreign action pending in which the discovery could be used. On March 20,
1995, this Court, without addressing the motion to dismiss the appeal, issued an
opinion reversing the district court, and remanding the case for further proceedings.
Euromepa, S.A. v. R. Esmerian, Inc., 51 F.3d 1095 (2d Cir.1995) (“Euromepa I ”).
Later that month, on March 27, 1995, Petitioners perfected their appeal of the
judgment of the French Court of Appeal to the French Cour de Cassation (the
“French Supreme Court”).
In response to Esmerian's March 9 motion to dismiss the appeal, this Court (on
March 29, 1995) issued an order which construed Esmerian's motion to dismiss the
appeal as a motion to withdraw an opinion, stayed the issuance of the mandate, and
requested additional briefing as to why the parties did not “advise this Court
promptly of the circumstances alleged to have mooted this appeal.” Subsequently,
on April 11, 1995, this Court denied the motion to withdraw the opinion, noting
that we were doing so “without prejudice to any consideration of the intervening
developments by the district court.”
On remand, Esmerian filed a motion to dismiss the Petition as moot in the district
court. The parties completed briefing on the motion to dismiss in June of 1995. The

20

district court, however, took no action on the motion despite a series of letters for
Euromepa, and responses from Esmerian, which sought a ruling.
Finally, in February of 1997, the French Supreme Court affirmed the judgment of
the French Court of Appeal. The French Supreme Court found Petitioners' appeal
to it to be an abuse of process, and sanctioned the liquidator of Euromepa for
pursuing that appeal. Immediately after this ruling, the district court entered the
endorsement order dismissing the Petition as moot because the final judgment of
the French Supreme Court eliminated all pending proceedings in which Petitioners
sought to use the discovery. This appeal followed.
Euromepa, S.A. v. R. Esmerian, Inc., 154 F.3d 24, 25–26 (2d Cir. 1998).
In analyzing whether a foreign proceeding is adjudicative in nature, the court relied on “In re
Letters Rogatory Issued by Director of Inspection of Government of India, 385 F.2d 1017 (2d
Cir.1967),” in which the court concluded that “the tax assessment proceeding in question was not
a proceeding before a ‘tribunal’ because the role of the government in the administrative
proceeding was more akin to a prosecutorial decision to bring a case than to that of a neutral
arbitrator, and therefore the proceeding was not adjudicative,” and Fonseca v. Blumenthal,
620 F.2d 322, 323–24 (2d Cir.1980) (analyzing the function of the Superintendent of Exchange
Control under Colombian law).” Euromepa, 154 F.3d at 27. The court noted in its previous
holdings “that competency proceedings, [Foden v. Gianoli Aldunate, 3 F.3d 54, 62 (2d Cir.
1993)], and bankruptcy proceedings, Lancaster Factoring Co. v. Mangone, 90 F.3d 38, 42 ([2d
Cir.] 1996), may constitute adjudicative proceedings for purposes of § 1782.” Id. The court also
noted, in connection with the “pendency question,” its previous holding “that a proceeding need
not actually be pending, but rather that a proceeding must be ‘imminent—very likely to occur
and very soon to occur.’” Id. at 28 (quoting In re International Judicial Assistance (Letter
Rogatory) for the Federative Republic of Brazil, 936 F.2d 702, 706 (2d Cir.1991)). Moreover,
the court noted its previous holding “that there is no requirement of discoverability implied in the
statute; that is, the district court need not satisfy itself that the discovery sought in the petition is
21

of information that would be discoverable under the laws of the foreign jurisdiction in which the
proceeding is pending.” Id. The court instructed that “[i]n the exercise of its discretion, the
district court should not attempt to conduct a detailed analysis of foreign law, but should focus
primarily on fostering these twin aims.” Id. In its discussion of the applicable legal standard, the
court stated:
Petitioners argue that the district court erred in failing to consider the pending
French Bankruptcy Proceeding, and a potential motion to reopen the judgment of
the French Court of Appeal as proper predicate adjudicative proceedings in
dismissing the Petition as moot. Petitioners also argue that the district court failed
to accord this Court's opinion in Euromepa I due deference, and that the district
abused its discretion in failing to promptly rule on the Petition, or at least on the
motion to dismiss, following remand from this Court. The application of the above
stated principles to this case shows that the Petitioners' arguments must fail, and
that the district court was correct in dismissing the Petition as moot because the
requirements of the statute were not satisfied, and there was thus no foreign
proceeding in which the discovery could be used.
Id.
The court concluded:
While it is clear that a bankruptcy proceeding may, in some instances, be an
adjudicative proceeding within the meaning of the statute, see Lancaster Factoring
Co., 90 F.3d at 42, we hold that the French Bankruptcy Proceeding in this instance
is not an adjudicative proceeding within the meaning of the statute for the following
reasons. The merits of the dispute between Esmerian and Euromepa have already
been adjudicated and will not be considered in the French Bankruptcy Proceeding.
As a matter of French law, the judgment of the French Supreme Court acts as res
judicata with respect to the merits of the dispute in the French Bankruptcy
Proceeding. Thus, in the French Bankruptcy Proceeding, nothing is being
adjudicated; the already extant judgment is merely being enforced (to the extent
permitted by the assets of the bankruptcy estate). Petitioners' second contention,
that the potential reopening of the French Court of Appeal action by a motion based
on newly discovered evidence constitutes a “proceeding” under the statute, is
meritless. Brazil clearly holds that a proceeding must be “imminent—very likely to
occur and very soon to occur” in order to satisfy the statutory requirements. 936
F.2d at 706. In this case, as conceded by Petitioners, such a motion to reopen will
not even be made, let alone granted, absent newly discovered evidence. The motion
to reopen is thus neither very likely to occur nor very soon to occur. Section 1782
is designed to provide discovery in aid of foreign litigation, not to provide discovery
22

to justify the reopening of already completed foreign litigation. The motion to
reopen the proceedings in the French Court of Appeal thus cannot serve as a
predicate foreign proceeding for the Petition. Accordingly, because neither the
French Bankruptcy Proceeding nor the potential motion to reopen may properly be
considered as the predicate foreign action, the district court was correct in
dismissing the Petition as moot because at that time there were no foreign
proceedings, within the meaning of the statute, in which the discovery could be
used. . . . After this Court remanded the Petition to the district court, and up until
the time the district court issued its endorsement order, Petitioners' appeal in the
French Supreme Court was pending. If that appeal could have provided the
predicate foreign action for the Petition, thus providing a live controversy, then
Petitioners' argument that the district court abused its discretion and ignored this
Court's mandate in failing to act during the pendency of that appeal might have
some merit. However, because that appeal again fails to meet the second element
of the Gianoli Aldunate test—“that the discovery be for use in a proceeding before
a foreign tribunal,” 3 F.3d at 58—Petitioners' argument fails.
Id. at 28-29.
In considering whether discovery is “for use” in a foreign tribunal, the court concluded that “the
discovery certainly could not be “for use in” the French Supreme Court appeal if that court does
not take and hear new evidence,” and “the affidavits and other material submitted by the parties
show that the French Supreme Court does not, in fact, take and hear new evidence.” Id. at 29.
This case does not involve, as Euromepa does, bankruptcy proceedings or a potential
motion to reopen the proceedings in a foreign court of appeal, nor does it involve administrative
or competency proceedings involved in the cases upon which the court relied in Euromepa for its
analysis. The foreign proceedings at issue in this case, as Nicolaou stated in his declaration, are
the proceedings commenced by the petitioner, on March 10, 2020, in the District Court of
Nicosia seeking “recognition and enforcement of the Russian judgments pursuant to the ‘Treaty
between the Republic of Cyprus and the Union of Soviet Republics on Legal Assistance in Civil
and Criminal Matters’” and “the Law Concerning Foreign Judgments.” Nicolaou also stated
that: (i) on March 27 and 30, 2020, based on the petitioner’s ex parte application, the District
Court of Nicosia issued orders which “operate as worldwide freezing orders”; and (ii) the
23

petitioner made “the inter partes applications for disclosure and asset tracing orders,” but those
applications “are not expected to be heard for several months.” The unrebutted evidence
submitted by the petitioner demonstrates that the proceedings in the District Court of Nicosia are
pending, the “worldwide freezing orders” have been issued and the petitioner’s “inter partes
applications for disclosure and asset tracing orders” are pending and “expected to be heard.”
The Euromepa court held “that the French Bankruptcy Proceeding in this instance is not
an adjudicative proceeding within the meaning of the statute” because: (a) “[t]he merits of the
dispute between Esmerian and Euromepa have already been adjudicated and will not be
considered in the French Bankruptcy Proceeding”; (b) “the judgment of the French Supreme
Court acts as res judicata with respect to the merits of the dispute in the French Bankruptcy
Proceeding”; and (c) “in the French Bankruptcy Proceeding, nothing is being adjudicated; the
already extant judgment is merely being enforced (to the extent permitted by the assets of the
bankruptcy estate).” Here, the petitioner commenced administrative proceedings before the
Moscow Region Arbitration Court (“MRAC”) against BTR Build To Rent Group Limited to
recovering money due under three loan agreements and the proceedings were completed and
became final in favor of the petitioner; thus, the merits of the three loan agreement disputes were
resolved and will not be considered by the District Court in Nicosia, which is asked to recognize
and enforce the Russian judgments. Nicolaou did not state and no evidence was presented by the
petitioner explaining whether, if the Russian judgments are recognized by the District Court in
Nicosia, such judgments will act as res judicata with respect to the merits of the dispute in the
enforcement proceedings in the District Court in Nicosia. Even assuming that the Russian
judgments, if recognized by the District Court in Nicosia, will act as res judicata with respect to
the merits of the dispute in the enforcement proceedings in the District Court in Nicosia, here,

24

unlike in Euromepa, no bankruptcy proceeding exists in which “nothing is being adjudicated; the
already extant judgment is merely being enforced (to the extent permitted by the assets of the
bankruptcy estate).” Here, the petitioner seeks to recognize and enforce the judgments in its
favor and the close universe of “the assets of the bankruptcy estate” that existed in Euromepa
does not exist. The District Court of Nicosia issued orders which “operate as worldwide freezing
orders” and the petitioner made “the inter partes applications for disclosure and asset tracing
orders,” which “are not expected to be heard for several months.” Unlike the bankruptcy
proceeding in Euromepa, in which “nothing is being adjudicated,” the judgments recognition and
enforcement proceedings in Cyprus are adjudicative in nature, as the petitioner’s evidence
shows. The petitioner’s “inter partes applications for disclosure and asset tracing orders” will be
heard by the District Court in Nicosia, which means that the court will take and hear evidence in
order to determine facts and to apply the law to those particular facts found by the court. Thus,
the District Court in Nicosia will necessarily have to perform an adjudicative function by
adjudicating the facts in connection with the petitioner’s “disclosure and asset tracing”
applications. “[A]djudicative facts,” are “‘facts about the parties and their activities, businesses,
and properties,’ as distinguished from ‘general facts which help the tribunal decide questions of
law and policy and discretion.’” Langevin v. Chenango Court, Inc., 447 F.2d 296, 300 (2d Cir.
1971). The issues of asset identification and ownership are examples of adjudicative facts that
the District Court in Nicosia will have to determine in the Cyprus judgments recognition and
enforcement proceedings. Thus, a live controversy appears to exist in the District Court in
Nicosia at minimum with respect to: (a) the identity of any assets to which the petitioner is
entitled based on the Russian judgments; and (b) the ownership of any assets to which the

25

petitioner is entitled based on the Russian judgments, necessitating adjudication by the District
Court in Nicosia.
The Belyak respondents, as well as the Rempel respondents, assert that Euromepa
“establishes that Section 1782 discovery is not available for post-judgment proceedings where
the merits have been fully adjudicated,” relying on
• In re MT Baltic Soul, No. 15-mc-319 (LTS), 2015 WL 5824505, at *2 (S.D.N.Y.
Oct. 6, 2015) (denying an application for discovery that “would only be in relation
to a contemplated post-judgment action, which Euromepa holds is not a ‘foreign
proceeding’ within the meaning of section 1782”);
• In re Asia Mar. Pac. Ltd., 253 F. Supp. 3d 701, 706-07 (S.D.N.Y. 2015) (denying
an application for discovery to assist with obtaining a pre-judgment attachment);
• Jiangsu Steamship Co., No. 14 Civ. 9997(CM), 2015 WL 3439220, at *1
(S.D.N.Y. Feb. 5, 2015) (denying an application for discovery to “locate ... entities’
assets” in New York banks to assist with obtaining a pre-judgment attachment).
The In re MT Baltic Soul court concluded, without any analysis, that
the discovery Petitioners seek is precluded by the Second Circuit's decision in
Euromepa, 154 F.3d at 27 (2d Cir.1998), because the liability of Tadema and
Taleveras Group has already been conclusively established by the English court
action. Any discovery as to Tadema and Taleveras Group would only be in relation
to a contemplated post-judgment action, which Euromepa holds is not a “foreign
proceeding” within the meaning of section 1782.
In re MT Baltic Soul, 2015 WL 5824505, at *2.
The Court is not convinced by the In re MT Baltic Soul court’s conclusory assertion that
Euromepa precludes Section 1782 discovery in a “post-judgment action” where the court did not
conduct any factual analysis of the particular circumstances of that case, including any analysis
of whether the “post-judgment action” in that case is adjudicative in nature. The Belyak and
Rempel respondents’ reliance on In re Asia Mar. Pac. Ltd. is misplaced because that case is
inapposite, as the Belyak respondents acknowledge, involving “discovery to assist with obtaining
a pre-judgment attachment,” not discovery to be used in judgment enforcement proceedings.

26

The Belyak and Rempel respondents also rely on Jiangsu Steampship Co., in which the court
found the language from Euromepa, namely, (i) “[t]he merits of the dispute between Esmerian
and Euromepa have already been adjudicated” and (ii) “in the French Bankruptcy proceeding,
nothing is being adjudicated; the already extant judgment is merely being enforced (to the extent
permitted by the assets of the bankruptcy estate),” applicable in that case because
Jiangsu does not seek this discovery in order to help decide the “merits of the
dispute” between it and SSL; it wants the information about SSL's and Mingli's
assets so it can easily obtain advance security for such a judgment (assuming that
there is a foreign jurisdiction that, like the United States of America, has a prejudgment attachment procedure) or enforce whatever judgment it might obtain in
the as-yet-to-be-brought London arbitration. However, neither pre-judgment
attachment nor post-judgment enforcement proceedings are “adjudicative” in
nature; indeed, the latter is the explicit holding of Euromepa, and if an enforcement
proceeding is not adjudicative in nature, I fail to see (and Jiangsu does not suggest)
how a pre-judgment security proceeding could possibly so qualify.
Jiangsu Steamship Co., 2015 WL 3439220, at *4.
The Court is not convinced that Euromepa held, as the Jiangsu Steamship Co. court stated, that
“post-judgment enforcement proceedings are [not] ‘adjudicative’ in nature” because the
proceedings at issue in Euromepa were bankruptcy proceedings, not judgment recognition and
enforcement proceedings. The Court finds that the petitioner established that the foreign
proceedings in Cyprus for “recognition and enforcement of the Russian judgments” are
adjudicative in nature.
Whether a Foreign Proceeding Is Within Reasonable Contemplation
The Supreme Court explained that an adjudicative proceeding need not “be ‘pending’ or
‘imminent’ for an applicant to invoke § 1782(a) successfully.” Intel Corp. 524 U.S. at 253-54,
124 S. ct. at 2476-77. The Supreme Court held that Ҥ 1782(a) requires only that a dispositive
ruling by the Commission, reviewable by the European courts, be within reasonable

27

contemplation.” Id., at 259, 124 S. Ct. at 2480. The Court finds that the petitioner established
more than “reasonable contemplation” of a foreign proceeding required by Intel Corp., namely, it
established that a foreign proceeding is ongoing in the District Court in Nicosia.
The petitioner having presented evidence that discovery is for use in the “recognition
and enforcement of the Russian Judgments” proceedings pending before the District Court in
Nicosia and that the District Court in Nicosia will hear evidence and adjudicate facts in those
proceedings, the Court is satisfied that the petitioner established that the discovery is for use in a
proceeding before a foreign tribunal.
The Discretionary Factors
Whether Nonparticipants in the Foreign Proceeding May be Outside the Foreign Tribunal’s
Jurisdiction and their Evidence, Available in the United States, May Be Unobtainable
Absent Section 1782(a) Aid
The petitioner asserts that none of the banks will be parties or participants in the foreign
proceedings, and “[t]o date, it has not been possible to obtain the subject bank documents as part
of any proceedings to date held in Russia, Cyprus or elsewhere.” The Belyak respondents, on
whose arguments the Rempel respondents rely, contend that the first Intel factor weighs against
discovery because “M. Belyak, A. Belyak, and Margarita are parties to one or more of the
subject foreign proceedings in Russia, Cyprus and Monaco; therefore, Lake Holding can
ostensibly – and must properly be required to – obtain all of the discovery it seeks from them in
those proceedings since they are parties.” The Belyak respondents’ reliance on Schmitz v.
Bernstein Liebhard & Lifshitz, LLP., 376 F.3d 79 (2d Cir. 2004), is misplaced because that case
is inapposite. In Schmitz, discovery under Section 1782 was sought from Deutsche Telecom
AG’s (“DT”) counsel Cravath, Swaine & Moore (“Cravath”) for use in German lawsuits the
petitioners commenced against DT. The district court determined that “the German government
28

was obviously unreceptive to the judicial assistance of an American federal court” based on
evidence, including “specific requests from the German Ministry of Justice and the Bonn
Prosecutor to deny petitioners the discovery they sought at this time. The German authorities
expressed concerns that granting discovery would jeopardize the ongoing German criminal
investigation of DT and ‘jeopardize German sovereign rights.’” Id. at 84. The district court also
determined in that case that “granting the request here ‘would in fact encourage foreign countries
to potentially disregard the sovereignty concerns of the United States and generally discourage
future assistance to our courts.’” Id. at 84-85. The Second Circuit found that the district court
did not abuse its discretion when determining the first Intel factor:
Although technically the respondent in the district court was Cravath, for all intents
and purposes petitioners are seeking discovery from DT, their opponent in the
German litigation. Intel suggests that because DT is a participant in the German
litigation subject to German court jurisdiction, petitioner's need for § 1782 help “is
not as apparent as it ordinarily is when evidence is sought from a nonparticipant in
the matter arising abroad.” Intel, 542 U.S. at ––––, 124 S.Ct. at 2483.
Id. at 85.
Unlike in Schmitz, the banks at issue here from whom Section 1782 discovery is sought are
neither participants in the Cyprus proceedings, as was DT in German proceedings in Schmitz,
nor the agents of the participants in the Cyprus proceedings, as was DT’s counsel Cravath.
Unlike in Schmitz, no evidence was submitted by the Belyak respondents and the Rempel
respondents in support of their opposition to the petition showing specific requests from the
Cyprus authorities to deny petitioner the discovery sought or expressing concerns that granting
discovery would jeopardize any ongoing criminal investigation in Cyprus or jeopardize
sovereign rights of the Republic of Cyprus. The Belyak respondents and the Rempel
respondents failed to submit any evidence showing that granting the request here “would in fact

29

encourage foreign countries to potentially disregard the sovereignty concerns of the United
States and generally discourage future assistance to our courts,” as was the case in Schmitz.
The Belyak respondents make citation to Kiobel v. Cravath, Swaine & Moore LLP,
895 F.3d 238, 245 (2d Cir. 2018), arguing that “‘under existing precedent in this Circuit,
when the real party from whom documents are sought . . . is involved in foreign proceedings, the
first Intel factor counsels against granting a Section 1782 petition seeking documents’ through a
proceeding in the United States.” In Kiobel
Petitioner-Appellee Esther Kiobel filed a petition in the United States District Court
for the Southern District of New York to subpoena documents under 28 U.S.C. §
1782 from Respondent-Appellant Cravath, Swaine & Moore LLP (“Cravath”), in
aid of her lawsuit against Royal Dutch Shell (“Shell”) in the Netherlands. Cravath
is holding the documents because it represented Shell in prior litigation brought by
Kiobel against Shell in that district.
Id. at 240.
The Second Court found it was an abuse of discretion to grant the petition for discovery under
Section 1782 because “an order compelling American counsel to deliver documents that would
not be discoverable abroad, and that are in counsel’s hands solely because they were sent to the
United States for the purpose of American litigation, would jeopardize ‘the policy of promoting
open communications between lawyers and their clients.’” Id. at 241. The Second Circuit relied
on Schmitz in reviewing the district court’s analysis, stating that, “when the real party from
whom documents are sought (here, Shell) is involved in foreign proceedings, the first Intel factor
counsels against granting a Section 1782 petition seeking documents from U.S. counsel for the
foreign company.” Kiobel, 895 F.3d at 245 (citing Schmitz, 376 F.3d at 85). Here, the petitioner
does not seek discovery from counsel to the Belyak respondents and counsel to the Rempel
respondents, no attorney-client privilege or other privilege identified by the Belyak and Rempel
respondents is involved and no evidence exists that the petitioner seeks documents that the
30

Belyak respondents and the Rempel respondents already produced to the banks in some other
proceeding or pursuant to a confidentiality order from another proceeding barring the instant
discovery request; thus, unlike in Kiobel and Schmitz, the Belyak respondents and the Rempel
respondents are not “the real party from whom documents are sought” in this petition. The
petitioner submitted evidence showing it seeks documents available in the United States from the
banks within this judicial district who are nonparticipants in the Cyprus proceedings and not
subject to jurisdiction in the Cyprus proceeding, which would otherwise be unobtainable absent
Section 1782 aid. The Court finds that the first Intel factor favors granting the request for
discovery pursuant to Section 1782.
The Nature of the Foreign Tribunal, the Character of the Proceedings Underway Abroad,
and the Receptivity of the Foreign Government or the Court or Agency Abroad to U.S.
Federal-Court Judicial Assistance
The petitioner contends that the nature of the foreign proceedings and contemplated
future actions weigh in favor of the petitioner’s request because granting the request will not
offend any foreign jurisdiction and the petitioner seeks assistance to locate the assets of the
defendants who are actively seeking to preclude the petitioner’s enforcement efforts. The Belyak
respondents, on whose arguments the Rempel respondents rely, assert that the petitioner “failed
to provide sufficient information or law from the jurisdictions where the purported pending
and/or contemplated foreign proceedings are taking place for the Court to analyze this factor”
and “appears to be intentionally obfuscating the character of the purported pending or
contemplated proceedings in those jurisdictions.” The conclusory and self-serving assertion that
the petitioner “appears to be intentionally obfuscating the character of the purported pending or
contemplated proceedings” without citation to any evidence is rejected as unsupported and
meritless. The petitioner submitted evidence describing the nature of the proceeding in the
31

District Court in Nicosia, the character of the Russian judgment recognition and enforcement
proceedings in Cyprus, the relevant law applicable in the ongoing Cyprus proceedings, as well as
the procedural posture in the Cyprus proceedings. Nicolaou stated in his declaration that nothing
in the Cypriot law or the rules of the Cypriot Court “forbid the uses in Cyprus of the relevant
information that” the petitioner seeks in its petition. The Court finds that the second Intel factor
favors granting the request for discovery pursuant to Section 1782.
Whether the § 1782(a) Request Conceals an Attempt to Circumvent Foreign ProofGathering Restrictions or Other Policies of a Foreign Country or the United States
The petitioner asserts that the defendants and others identified to have made payments on
behalf of the defendants “have set up structures consisting in ‘smoke and mirrors’ over the years
both before and after defaults” preventing the petitioner from recovering on its judgments. The
Belyak respondents, on whose arguments the Rempel respondents rely, assert that the petitioner
“has not been forthcoming as to whether it has requested discovery in the purported pending
foreign cases or whether it can” and the petitioner’s “lack of interest on the part of an applicant
in pursuing any discovery under the laws governing the proceedings in other forums indicates an
attempt to circumvent those rules.” The Belyak respondents and the Rempel respondents fail to
make citation to any binding authority in support of their arguments that the: (i) petitioner’s
“lack of interest … in pursuing any discovery under the laws governing the proceedings in other
forums indicates an attempt to circumvent those rules”; and (ii) petitioner is required to pursue
discovery in the Cyprus proceedings before making the instant application. The petitioner
submitted evidence detailing its international attempts to recover on the Russian judgments and
various acts and omissions by the judgments debtors and their affiliates preventing the petitioner
from pursuing recovery on its Russian judgments. The Court finds that the petitioner’s Section
1782 request does not conceal an attempt to circumvent foreign proof-gathering restrictions or
32

other policies of a foreign country or the United States. The Court finds that the third Intel factor
favors granting the request for discovery pursuant to Section 1782.
Whether Requests Are Unduly Intrusive or Burdensome
The petitioner contends the requests are not unduly burdensome because the information
relevant to the foreign proceedings is in this district and the banks store such information, not
available to the petitioner, as a matter of course. The Belyak respondents, on whose arguments
the Rempel respondents rely, contend that the petitioner “seeks essentially every document
conceivably related to the Belyak Parties, including privileged financial documents and asset
information of the Belyak Parties and unrelated third parties,” making “[s]uch a vast intrusion
into potential communications and financial information” inappropriate. The Belyak
respondents and the Rempel respondents do not make citation to any evidence in support of their
argument that the discovery requests are unduly intrusive or burdensome and they failed to
identify the nature and extent of any intrusion or the burden they assert. The petitioner submitted
evidence of its efforts to identify entities which have made payments on the defendants’ behalf
and to investigate the “manipulation of assets ownership and control and fraudulent transactions”
calculated to immunize the assets from the execution of the judgments the petitioner obtained.
Since the petitioner seeks relevant information electronically stored by the banks, the Court
presumes, without finding at this stage of the proceeding, that gathering and producing such
information by the banks are not unduly intrusive or burdensome exercises. The Court finds that
the fourth Intel factor does not militate against granting the request for discovery pursuant to
Section 1782.

33

Colorado River Abstention
The Belyak respondents, but not the Rempel respondents, assert that the court should
abstain from exercising jurisdiction in favor of the Florida proceedings under “Colorado River
Water Conservation District v. United States, 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483
(1976)” because the “Moscow Judgments are the basis of two pending Florida state court
proceedings brought by Lake Holding over one year before Lake Holding initiated this
proceeding, one of which has given rise to a pending Florida appellate court proceeding.” The
petitioner asserts that no exceptional circumstances were demonstrated for the abstention
doctrine to apply, relying on “Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746 (1971).” The Belyak
respondents do not seek abstention under Younger, which provides that federal courts must
decline to exercise jurisdiction in three exceptional circumstances: (1) to preclude “federal
intrusion into ongoing state criminal prosecutions”; (2) in “certain civil enforcement
proceedings”; and (3) to preclude interfering with pending civil proceedings involving certain
orders uniquely in furtherance of the state courts' ability to perform their judicial functions.”
Trump v. Vance, 941 F.3d 631, 637 (2d Cir.). Rather, they seek abstention under Colorado
River.
Whether Concurrent Proceedings Are Parallel
The Belyak respondents assert that two pending Florida state-court proceedings brought
by the petitioner concern the Moscow judgments and “[o]ne of the issues in those proceedings is
allegations of fraud by Lake Holding in the recognition and domestication process; another issue
is whether Lake Holding may enforce those judgments against A. Belyak and Margarita.
Surgeon Decl. ¶¶ 8, Ex. 5 at 1-3.” Surgeon stated in his declaration that “the Initial Brief of
Appellant, Mikhail Borisovich Belyak, dated December 7, 2020, which was filed in the Third

34

District Court of Appeal, State of Florida, is attached hereto as Exhibit 5.” Exhibit 5 indicates
that it is an initial brief in the action captioned Mikhail Borisovich Belyak, Appellant vs. Lake
Holding & Finance S.A., Appellee, “DCA Case No. 3D20-1013 L.T. Case No. 19-35235-CA01,” filed in the District Court of Appeal Third District, State of Florida. The appellant asserts in
that document:
This appeal arises from efforts by Lake Holding, a British Virgin Islands
corporation, to domesticate and enforce three Russian judgments totaling over
$36,000,000, entered by a Moscow court in favor of Lake Holding and against
Belyak, a Russian citizen and Moscow resident. (the "Moscow Judgments"). The
trial court erred by domesticating the judgments, because the court failed to follow
the plain language of the relevant statute: the Florida Uniform Out-of Country
Foreign Money-Judgment Recognition Act, sections 55.601-.607, Florida Statutes
(the "Act"). Under established precedent, a statute of this type must be strictly
complied with. The trial court failed to apply the Act as written.
The parties in the Florida state-court proceedings are the petitioner and only one of the three
Belyak respondents, Mikhail Borisovich Belyak. According to the appellant’s assertion in
Exhibit 5, the issue litigated in the Florida court is whether the trial court “erred by
domesticating the [Moscow] judgments” against the appellant.” However, this action does not
involve litigation of the issue being litigated in the Florida court because the matter before the
Court is an application for discovery pursuant to 28 U.S.C. § 1782, which does not encompass
litigation respecting “domesticating the [Moscow] judgments.”
The Court finds that the Florida proceedings and this action are not parallel because they
do not involve substantially the same parties who are contemporaneously litigating substantially
the same issue in another forum. Accordingly, the necessary prerequisite to abstention under
Colorado River is not met by the Belyak respondents. See Dittmer, 146 F.3d at 118.

35

CONCLUSION
For the foregoing reasons, the petitioner’s application for discovery pursuant to 28 U.S.C.
§ 1782, Docket Entry No.1, is granted.
Dated:

New York, New York
June 23, 2021

SO ORDERED:

36