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Warrant issued for Russian vodka tycoon

Published:  23 July, 2008

RUSSIA: Moscow steps up its fight to claim back the overseas rights to Stolichnaya vodka

A Moscow court has issued an arrest warrant for a fugitive vodka tycoon, prosecutors have said.

The warrant is the latest in a long-running drive by the Russian Government to take back the overseas rights to the iconic Stolichnaya vodka brand.

The Basmanny District Court has upheld prosecutors' request for Yury Shefler, the head of the SPI group of companies, to be arrested, reports by Russian RIA-Novosti news agency said.

He will face charges that include using violence against an official and trademark violations, prosecutors said in a statement posted on their website.

Lawyers for Soyuzplodoimport, a state-controlled company that controls the rights in Russia to the Stolichnaya brand and other Soviet-era favorites, have alleged that Shefler forged and destroyed documents in order to snap up Stolichnaya and other popular Soviet era brands at a tiny fraction of their market value in a murky insider deal in the mid 1990s.

They say the brands' previous owner a Soviet food and drink importer had been wrongly privatised and had no right to sell what Soyuzplodoimport general director Vladimir Loginov has called "an important part of Russia's national heritage."

When the Russian Government launched a successful, but disputed campaign to recapture the domestic rights to the vodka labels in 2001, Shefler said the move was tantamount to re-nationalisation and argued that Russia's state patents and trademark agency had signed the labels over to the Government without the necessary court ruling.

In 2002, the case took a dramatic turn when Russian prosecutors opened a criminal investigation into Shefler for allegedly threatening to kill Loginov, once a deputy agriculture minister, during a telephone conversation. At the time, an international warrant was issued for his arrest.

Shefler called those charges ludicrous, but has since moved his company's operations out of Russia to Latvia, where he reportedly spends much of his time.

So far, Soyuzplodoimport has been unsuccessful in tackling the trademarks' registration overseas.

SPI Group has said Stolichnaya is the world's best-selling vodka, with US$500 million in consumer retail sales in export markets.