Subject: Base Metals v. OJSC
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked], [email-masked]
Date: Fri, 13 Oct 2000 04:00:00 -0700 (PDT)

PRIVILEGED AND CONFIDENTIAL: ATTORNEY-CLIENT COMMUNICATION, ATTORNEY WORK 
PRODUCT

Martin,

Here's the latest.

The Court recently advised that it wishes to have a telephone conference on 
this case either Monday or Tuesday of next week, depending on the Court's 
trial schedule at that time.  Tim Mullin believes that it will be solely a 
status conference to determine whether all briefing has been done, whether 
anyone wants a hearing, etc.; he does not expect a hearing on the substantive 
issues at that time.  Mullin sees it as a good sign that the Court is paying 
attention to this case.

Although we do not need to make this decision before the telephone 
conference, we may need to retain a Russian lawyer to give us a legal 
opinion, as a result of Base Metal's recently-filed reply to our motion on 
the late service by Base Metals on OJSC, the defendant in the underlying 
case.  

You may recall that Base Metals was supposed to serve OJSC within 60 days 
after the attachment.  After we complained about the lack of evidence of such 
service, Base Metals alleged it had completed such service, by DHL.  We then 
filed a motion stating that such service was inadequate under applicable 
federal law.

Base Metals has done an end-run around our previously-filed motion on the 
service issue by obtaining an affidavit from a Russian lawyer that makes two 
points:  first, that service by DHL would be proper if this matter was filed 
in a court of general jurisdiction in Russia, and second, that there is no 
prohibition under Russian law to this sort of service, even if the underlying 
lawsuit was filed outside Russia.

If we do not respond with our own affidavit, then the Court will probably 
rule against us on the service issue.  The importance of the service issue is 
that it is a relatively "quick out" for the Court to consider, the other 
being that MG Metals is so solvent that no attachment is needed.  What we 
want to avoid is some protracted litigation on the merits concerning the 
fraudulent tranfer allegations, as Base Metals can more cheaply and easily 
develop its evidence on this points from its Russian sources than we can.

Parethentically, there is a recent New York Times article that looks like it 
was written by Base Metal's lawyers, and that uses what happened to OJSC in 
Russian bankruptcy as an example of how easy it is to use Russian bankruptcy 
for unlawful ends.  I'll send anyone a copy who wants one.

I'll report further after the telephone conference with the Court next week.

Britt