A Washington federal judge yesterday dismissed a racketeering lawsuit against a D.C.-based consultant accused of plotting with the daughter of Kazakhstan's president to seize assets from two businessmen.
U.S. District Senior Judge Thomas Hogan dismisseddismissed the case without addressing the heart of the allegations. He found the plaintiffs failed to show the alleged pattern of racketeering activity had sufficient ties to the U.S. to sue under federal law.
The plaintiffs, Devincci and Issam Hourani, who are brothers, sued Alexander Mirtchev in U.S. District Court for the District of Columbia in September 2010. Although the Hourani brothers' original complaint accused Mirtchev of being part of a much larger scheme involving Kazakh President Nursultan Nazarbayev, they later amended their claims to focus only on his daughter, Dariga Nazarbayev, who was not a defendant.
Mirtchev is president of Krull Corp., USA, a Washington-based company that, according to his website, is a "global strategic solutions provider." In the complaint, the Hourani brothers claimed Dariga Nazarbayev paid Mirtchev to help her force the brothers into signing over shares in two media companies, KTK Television and Alma Media. They also claimed Mirtchev played a role in having defamatory statements about the brothers posted on the Kazakh Embassy's website.
Mirtchev, in pleadings, said he was the target of a "smear campaign" and accused the Hourani brothers of "bombarding this court with outlandish and unfounded claims." He claimed the brothers were acting as proxies for a former Kazakh official with an agenda against the government. Besides moving for dismissal, Mirtchev asked Hogan to levy sanctions against the brothers for filing what he argued was an amended complaint that conflicted with facts in the original complaint.
In yesterday's decision, Hogan focused on whether the brothers could pursue their racketeering claims in the U.S. court, given the international nature of the case. Noting Congress didn't intend to criminalize foreign racketeering activity, Hogan said the Hourani brothers failed to draw a connection between the alleged racketeering activity—as opposed to the actors—and the United States.
"In sum, the predicate acts that proximately caused Plaintiffs' injury – namely, the extortion in Kazakhstan by a Kazakh actor of Plaintiffs' Kazakhstan-based assets—were squarely extraterritorial and therefore outside of RICO's reach," Hogan wrote (emphasis in original).
Hogan dismissed the defamation claim, finding the Hourani brothers weren't specific enough in tying Mirtchev to the alleged conspiracy. Finally, Hogan denied Mirtchev's motion for sanctions. He wrote that although the plaintiffs contradicted certain facts between the original complaint and the amended version, he decided against finding they acted in bad faith because he already dismissed their complaint with prejudice, meaning they couldn't file again.
Lead counsel for Mirtchev, Richard Beckler of Bracewell & Giuliani, said in a statement he and his clients were pleased with the decision and believed it would "put an end to the harassment and smear campaign against our client and prevent any further misuse of our U.S. legal system to do so."
The Hourani brothers' lead attorney, Crowell & Moring's Stuart Newberger, could not be reached for comment.