Ongoing fight for Olainfarm Shares: ninth Loss for Black Duck in Latvian and Czech Courts
Attempts by Black Duck Invest to register rights to shares in Olainfarm, which is owned by SIA Olmafarm, have suffered their ninth defeat in Latvian and Czech courts. In addition, manipulations in Black Duck’s assertions about the circumstances of the signing of the share purchase contract have been brought to light by two internationally recognized companies – PwC auditors and the Sorainen international business law firm.
Olainfarm is the leading manufacturer in the chemical and pharmaceutical sector of the Baltic States which exports its product portfolio in more than 50 countries worldwide.
On the 30th of August, the City of Rīga’s Pārdaugava Court once again rejected Black Duck’s application to lift the temporary protective measures which had been applied to SIA Olmafarm. As a consequence, Black Duck’s multiple attempts to influence the actions of Olmafarm and to interfere with the use of the voting rights which belong to it have once again proven to be unsuccessful. The court’s decision cannot be appealed.
Black Duck’s unfavourable court decisions* consistently confirmed the doubtful nature of Black Duck’s assertions about the purchase of Olainfarm shares, but now the opinions of two internationally recognized companies have also been added to the court decisions. They overturn what was stated by Black Duck representative Vojtek Kačena at the 4th August 2021 press conference and in the press release, that the preparation of the Olainfarm share purchase transaction was a long process, in which Olmafarm was represented by PriceWaterCoopers, the Czech bank by Sorainen, and the BHM Group company Black Duck by Walles legal experts. However, both PriceWaterCoopers, as well as Sorainen categorically deny their participation in the preparation of this transaction.
PricewaterhouseCoopers and PricewaterhouseCoopers Legal have informed Olmafarm, that in contrast to V. Kačena’s assertions, they have not represented Olmafarm, either in relation to the possible divestiture of shares, or any other transaction. Similarly, PricewaterhouseCoopers does not have information at its disposal that some other company in the PwC company group has provided any kind of services to Olmafarm.
The Sorainen business law firm also categorically rejects V. Kačena’s assertions, that they had undertaken a due diligence process or had represented the Czech bank involved in the transaction, as being false.
“As a consequence, Black Duck’s announcements about the circumstances of the signing of the ostensible transaction have proven to be untruthful, and this has also been correspondingly assessed as such by the courts. Despite multiple attempts to influence the result with the assistance of public and institutional pressure, the courts have consistently rejected Black Duck’s applications,” commented Olmafarm Board member and Olainfarm Council member Pēteris Rubenis.
As previously announced, on the night of 27th April, Olmafarm Board Member Milana Beleviča who had just been removed from her position just 24 hours previously, signed a contract of sale for Olainfarm shares with the BHM Group company Black Duck Invest.
Milana Beleviča was not in possession of a mandate to implement the sale of shares to Black Duck, as this did not conform with the will of the co-legatees. It was the obvious breaches of the law and proposals which were incompatible with the interests of the shareholders that were the reasons why the co-legatees united unanimously on the removal of Milana Beleviča, with Beleviča herself having also been advised of this on the 26th July. Beleviča is currently attempting to conceal this fact.
Her further actions, in individually signing an ill-prepared, incomplete and erroneous document-like contract under cover of night, clearly showed that Beleviča, who had lost her mandate, tried to use the final hours after her removal, of which she had been notified, and at a time when this had not yet been publicly registered. It is not only the late hours of the night in which Beleviča, who had been released from her position, had signed the contract, which is inconsistent with a transaction of this scale, but also the fact that the Czech party signed a completely different document already on the following day. A notary has confirmed the signature of the representative of the Czech company on it, and the date stamp confirms that this had taken place on the 27th April.
Therefore, Black Duck is attempting to base its property rights to the Olainfarm shares, by submitting two differing copies of contracts, on the basis of which Beleviča has been removed in one, and the second – the signatures of the purchasers, Black Duck, who were undesirable to, and rejected by, the shareholders. In addition, both of these differing documents were signed on the 27th April, when Milana Beleviča no longer had any legal connection with Olmafarm, as her mandate as a board member had indisputably been terminated already on 26th April.
“These activities by the Black Duck whose source of investments are of unknown origin and Milana Beleviča, in attempting to defraud Olainfarm shares, is a mind blowing example of raiderism. This is why complaints by these persons about law enforcement institutions and attacks on the rule of law in the Latvian state are even more surprising,” commented Olmafarm Board member Pēteris Rubenis.
* The list of matters in which Black Duck, Milana Beļeviča and a persons associated with them (Agris Auce) have submitted applications to the court, which have all been rejected:
Case No. 1
2.6.2021 BLACK DUCK INVEST a/s’ application to the City of Rīga Vidzeme District Court against possible respondent SIA OLMAFARM, regarding its application to secure a claim prior to bringing an action – the application was rejected by a decision of the City of Rīga Vidzeme District Court on 3.6.2021.
10.6.2021 BLACK DUCK INVEST a/s’ ancillary claim regarding the mentioned decision in the Rīga Regional Court – a decision of the Rīga Regional Court on 29.6.2021 rejected the institution of appeal proceedings in relation to the submitted ancillary claim.
Case No. 2
3.6.2021 BLACK DUCK INVEST a/s’ application to the court in Czechia against the respondent SIA OLMAFARM – there is no information about the progress of the matter, and as understood, the court in Czechia has not made any decision now for 3 months already.
Case No. 3
21.6.2021 BLACK DUCK INVEST a/s’ application to the City of Rīga Vidzeme District Court about its application to secure a claim against SIA OLMAFARM (in relation to the application submitted in Czechia) – a decision of the City of Rīga Vidzeme District Court on 28.6.2021 rejected the application.
8.7.2021 BLACK DUCK INVEST a/s’ ancillary claim regarding the mentioned decision in the Rīga Regional Court – a decision of the Rīga Regional Court on 30.7.2021 rejected the ancillary claim, and the decision of the City of Rīga Vidzeme District Court was left unchanged.
Case No. 4
14.6.2021 Milana Beļeviča’s application in the Economic Affairs Court against SIA OLMAFARM – the 28.6.2021 application was rejected.
8.7.2021 – Milana Beļeviča’s ancillary claim in the Senate of the Supreme Court of the Republic of Latvia – on 18.8.2021, Senate of the Supreme Court of the Republic of Latvia decided not to accept Milana Beļeviča’s ancillary claim in relation to the 28.6.2021 decision of the Economic Affairs Court.
Case No. 5
15.6.2021 Agris Auce’s application in the Economic Affairs Court against SIA OLMAFARM and several other respondents – on 28.6.2021, the statement of claims was rejected.
Case No. 6
3.6.2021 SIA OLMAFARM’s application to the City of Rīga Pārdaugava Court in relation to temporary protection prior to bringing an action against possible respondents Milana Beļeviča and BLACK DUCK INVEST a/s – a decision of the City of Rīga Pārdaugava Court on 11.6.2021 satisfied the application for temporary protection.
15.7.2021 the City of Rīga Pārdaugava Court considered BLACK DUCK INVEST a/s’ 28th June 2021 application for the lifting of the applied temporary protection measures – a decision of the City of Rīga Pārdaugava Court on 19.7.2021 terminated the legal proceedings in BLACK DUCK INVEST a/s’ application for the lifting of temporary protection measures in relation to the fact that Black Duckdoes not have the right to lodge an application about the lifting of applied temporary protection measures prior to bringing an action, the decision cannot be appealed and the legal proceedings have been terminated.
28.7.2021 – BLACK DUCK INVEST a/s’ again lodged an application for the lifting of temporary protection – on 30.8.2021 – the City of Rīga Pārdaugava Court decided that BLACK DUCK INVEST a/s’ application should be rejected, the decision cannot be appealed.
Case No. 7
11.6.2021 The Czechia Court rejected the first application by BLACK DUCK INVEST a/s for its application to secure a claim against SIA OLMAFARM.
28.6.2021 By a decision of the Prague Municipal Court on 28th June 2021, BLACK DUCK INVEST a/s’ second application for its application to secure a claim was rejected.
Case No. 8
4.8.2021 BLACK DUCK INVEST a/s appealed the decision of the Prague Municipal Court in the Prague High Court and was once again unsuccessful. From the decision of the Prague High Court on 4.8.2021, it follows that in examining BLACK DUCK INVEST a/s’ grievance, the court recognized it as being unfounded and that it should be rejected. Further appeals on the matter are not possible.
Therefore, it can be seen that courts in both Latvia and Czechia have consistently rejectedBlack Duck’s attempts to achieve the satisfaction of its demands, regarding that its statements of claims cannot, prima facie, be satisfied (therefore, in essence, Black Duck has not been correct in the matter), whereas SIA OLMAFARM’s application, to the contrary, has been satisfied, and regards that SIA OLMAFARM’s basic claim against Milana Beļeviča and Black Duck prima facie could be justified.
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