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. Last Updated: 07/27/2016

Defense Seeks Khodorkovsky's Acquittal

Lawyers for Mikhail Khodorkovsky on Thursday called on judges to acquit the former Yukos CEO on all charges as they wrapped up their closing arguments in the nine-month trial of Khodorkovsky and his business partner Platon Lebedev.

"I hope that on the day when the verdict is delivered, true justice will prevail and that on your order the guards will set both defendants free right here," Genrikh Padva, Khodorkovsky's chief defense lawyer, told the judges as he concluded his three-day argument in Moscow's Meshchansky district court.

Khodorkovsky and Lebedev face up to 10 years in prison on charges of tax evasion, fraud, embezzlement and falsifying documents. In his closing argument last week, state prosecutor Dmitry Shokhin demanded maximum 10-year sentences for both men.

The trial of Khodorkovsky and Lebedev has been a key element in the Kremlin's two-year struggle to tame Khodorkovsky and his Yukos allies, whose power bid threatened President Vladimir Putin's hold on national politics. The verdict is likely to be a key indicator of, among other things, how angry the Kremlin still is with Khodorkovsky -- and offers clues as to how secure the Kremlin feels in its control over the oligarchs.

On Thursday, Khodorkovsky's lawyers argued that their client had not committed any crimes, that the prosecutors' case was riddled with inconsistencies and contradictions, and that prosecutors had not presented any credible proof of the charges.

In the small and stuffy courtroom, packed with defense lawyers, relatives of the defendants, and the press, Padva and his team spent three days deconstructing the prosecutors' case point by point.

On the charge that companies controlled by Khodorkovsky fraudulently acquired a 20 percent stake in the Apatit fertilizer producer in 1994, Padva argued that more than $280 million had been paid for the stake. So even if there had been any unfair behavior on behalf of the buyers, he argued, it was only connected to "cutting in line."

"It's like at the cinema. If somebody cut in line to buy a ticket, would you say they stole it? They still paid money for it," Padva said.

Addressing another charge, Padva attacked prosecutors over what he said were inconsistencies in their claims that Khodorkovsky had used a chain of fictitious companies to conduct acquisitions in the mid-1990s. If the companies were fake, Padva asked, why had the prosecution not charged anyone with fake entrepreneurship? After all, the companies in question still exist and are officially recognized by the state as valid businesses, he said.

"And if Khodorkovsky has been involved in fake entrepreneurship, charge him," Padva argued passionately.

"One charge more, one charge less," Khodorkovsky said, shrugging, from the defendants' cage he has shared with Lebedev.

Apart from that one comment, Lebedev and Khodorkovsky appeared calm and almost indifferent toward events in the courtroom. Lebedev appeared, as usual, engrossed in Japanese crosswords, while Khodorkovsky was drawing something in a notebook. Both men exchanged glances with their relatives, who came into the court for the afternoon session.

After Padva, another leading defense lawyer, Yury Shmidt, attacked the charge that Khodorkovsky had evaded $4 million in personal income tax.

Apart from pointing to what he said were a range of inconsistencies in the charges, Shmidt said that it simply made no sense for Khodorkovsky, who until Yukos' battle with the state unfolded was estimated to have a fortune of $15 billion, to dodge paying taxes equivalent to a few million dollars.

"Do you really see the man who spent hundreds of millions of dollars on charity trying to come up with some scams to save on some petty taxes?" Shmidt said.

He asked the judges not to view Khodorkovsky's huge income as something out of the ordinary for a man of his business stature.

"There are stars like Paul McCartney, or tenor Luciano Pavarotti, or stars in tennis. In the business world Mikhail Khodorkovsky is this kind of star, so his income should not be a surprise to anyone," Shmidt said.

Shmidt also told the court that the verdict would be a litmus test for the country's judicial system.

"As we look into the future, we don't want to see the ruins of the judicial system ahead of us," he said.

The presiding judge, Irina Kolesnikova, and the two other female judges listened to the defense's remarks with interest. They took notes and barely managed to hide their smiles when Padva or Shmidt delivered a particularly pithy comment or punchy one-liner.

"What gives us hope is that the judges are listening with a great deal of attention, they are taking a lot of notes," Padva said during a break in court proceedings. "And their facial expressions often give away the fact that they understand what we are talking about. Sometimes people pay attention so they can dismiss every single argument afterward, but sometimes they do it to make an objective ruling. In any case, it's better this way than when everybody in the courtroom does not care."

Khodorkovsky and Lebedev are expected to make final statements to the court Friday, or Monday at the latest. After that, Kolesnikova is expected to announce a break to consider verdicts.

Sources familiar with the case said Thursday that they did not expect the verdicts until after the May 9 Victory Day holiday, when dozens of world leaders are to visit Moscow for the 60th anniversary of the end of World War II, they said. Explaining guilty verdicts and lengthy prison sentences to foreign leaders could be difficult for the Kremlin, they said.

n The Finance Ministry may not accept a payment of about $5 million offered by allies of Khodorkovsky and Lebedev to compensate for the alleged personal income tax evasion, Interfax reported Thursday, citing a source close to the ministry.

Lebedev's lawyer Yevgeny Baru, however, said Thursday that the payment of the claim was not a priority issue for Khodorkovsky, Lebedev or their defense teams.

"We are focusing here on whether any crimes have been committed at all. And besides, Khodorkovsky has said before that it wasn't his initiative and he considers himself innocent," Baru said.

 Yukos owner Group Menatep said Thursday that it planned to sell all of its non-oil assets in Russia and invest more in Israel and Ukraine, Bloomberg reported.

"We're looking to liquidate everything else because Russia is not really a place we want to be now," said Tim Osborne, the group's director.

Khodorkovsky ally Leonid Nevzlin, the group's majority shareholder, said Menatep would invest more in Israel and Eastern European countries such as Ukraine, Interfax reported.