Rustavi 2 TV Hearing Ends in Appellate Court

A three-judge panel of the Tbilisi Court of Appeals wrapped up on June 7 hearing into Rustavi 2 TV ownership dispute after seven sessions, which were often marred by noisy verbal disputes, leveling of fines against lawyers representing Rustavi 2 and its current owners, with some of them being expelled from the courtroom.

No date for announcing the ruling has yet been set and judges told the parties that they would be notified about the date later.

The appellate court’s decision can be appealed, if the parties in the case decide so, and the final decision, before the verdict is enforced, will be up to the Supreme Court.

The court case was initiated in August, 2015 by Kibar Khalvashi, who seeks to reclaim his shares in Georgia’s most-watched broadcaster Rustavi 2, which he owned about a decade ago and in which 91% of shares are now held by brothers Giorgi and Levan Karamanishvili, ex-president Mikheil Saakashvili’s close associates.

Rustavi 2 TV and many of the opposition parties say that the court case is an attempt by the authorities, and specifically by ex-PM Bidzina Ivanishvili, who is widely considered to be still wielding much influence on government, to silence the television station critical of government’s policies.

In early November, 2015 a judge of Tbilisi City Court ruled in favor of plaintiff Kibar Khalvashi, but the ruling was taken by Rustavi 2’s current owners to the Court of Appeals.

Also in November the same judge ordered as an interim injunction to replace Rustavi 2’s top management, including its director general Nika Gvaramia, with temporary managers. The decision triggered international condemnation with the U.S. and the EU saying that this decision was raising “serious questions about the independence of the judiciary and the actual degree of freedom of the media in Georgia.”

A week later, on November 12, 2015 judge overturned his earlier decision and reinstated Rustavi 2’s top management, including its director Nika Gvaramia, who held senior government posts in ex-president Saakashvili’s administration.

Ivanishvili: Change of Rustavi 2 Management Ahead of Elections ‘Undesirable’

Billionaire ex-PM Bidzina Ivanishvili, who sat down for a two-and-a-half hour interview with Georgian television channels on June 7 and who denies any involvement in the ongoing Rustavi 2 ownership dispute, said that he would like to see the current management of Rustavi 2 remain in place in the lead up to the October 8 parliamentary elections as it would be damaging for the country if the TV channel changes its editorial policy during the electoral period.

He also said that if the legal battle over Rustavi 2 TV ownership is over before the elections, including in the court of last resort, in favor of Khalvashi, he would ask the latter to wait and not to change television station’s management before the end of elections. He also said that he would pay Khalvashi to compensate for any financial losses.

“Personally for me, for the political process and for the country the change of management in [Rustavi 2] television is completely unacceptable; it would be undesirable,” Ivanishvili said.

“Four months are left before the elections and replacement of Gvaramia and of the management is undesirable, because no one in Europe and the United States will understand it correctly,” Ivanishvili said.

He said that change of hand of Rustavi 2 TV would not spark any major street protests in Georgia, but internationally it would have “very negative” consequences for Georgia.

He said that there is a high probability that no final decision in the ongoing legal battle will be known before the elections as the case is likely to continue in the Supreme Court.

“But if the court proceedings are over before the elections and the decision is in [Khalvashi’s] favor, I would like to request him – and I am ready to personally act as a guarantor and to even cover all the financial losses that he may have – not to touch Gvaramia and not to touch the [Rustavi 2] management and [Khalvashi] can ask whatever he wants from me,” Ivanishvili said.

He also said that he agrees with U.S. ambassador to Georgia, Ian Kelly, who has said that any change of Rustavi 2’s management or its editorial policy in a pre-election period would be “very damaging to Georgia’s image and to Georgia’s democratic aspirations.” Ivanishvili also said that last time he met the U.S. ambassador was on June 6.

Appellate Hearings

During the hearing in the appellate court, lawyers of Rustavi 2 and its current owners have motioned for number of times, all in vain, recusal of the three-judge panel accusing it of bias in favor of the plaintiff and of being under the government’s control.

On June 1 Rustavi 2 director Nika Gvaramia, who was telling the judges that their verdict was already written in favor of the plaintiff, accused one of the three judges presiding over the case, Natia Gujabidze, of “swindle” and misspending public funds. He claimed that about two years ago the state, as envisaged by the law when assigning a judge to a city where he or she has no house, was paying for renting flat for judge Gujabidze in Tbilisi. But, Gvaramia said, the judge was in fact living in the house of her mother, who was a recipient of rent fee. Gvaramia claimed that the prosecutor’s office was aware of this alleged misspending case and was using it as a lever to exert influence on Gujabidze, who is a judge since 2005.

Parallels were drawn to the judge, who was adjudicating the same case in the Tbilisi City Court last year, and whose mother was facing criminal charges in connection to a domestic incident; at the time Rustavi 2 and its lawyers claimed that these charges were used by the authorities as a lever against the judge to exert pressure on him.

Although not denying the issue of house rent fee entirely, the High Council of Justice, body overseeing the judicial system, rejected that it found any wrongdoing in judge Gujabidze’s actions. At a court session on June 3, judge Gujabidze said that “false allegations” against her will not have any influence on her while taking decision on the case.

Lawyers representing Rustavi 2 TV and its current owners tried to file a motion to recuse judge Gujabidze, arguing that in the view of these allegations her objectivity was compromised.

The motion was deemed as inadmissible and was turned down without even being discussed by the judges, who claimed that the motion aimed at “dragging out” the hearings. It triggered lawyers’ angry reaction growing into verbal dispute with judges, who at first fined three lawyers and then expelled from the courtroom two lawyers, representing Rustavi 2 TV, for “disrespecting” the court; hearings, for rest of the sessions, continued with participation of three lawyers, representing Rustavi 2’s owners, brothers Karamanishvili; two of those lawyers were fined with GEL 500 each on June 7 for again engaging in argument with judges.

Rustavi 2 director Nika Gvaramia was expelled from the courtroom on May 31 for “disrespecting” the court after engaging in verbal dispute with judges and was not allowed to return for rest of the hearings. He was also ordered to leave the courtroom for the same reason when the case was adjudicated in the Tbilisi City Court last year.

Similar to hearings in the lower court, the appellate proceedings also focused mostly on one of the key pieces of evidence, which the plaintiff’s case is largely based on.

In his lawsuit, Khalvashi claims that he was coerced into selling Rustavi 2 TV channel by the then-leadership of the country in 2006.

Plaintiff’s key piece of evidence includes a report on the valuation of Rustavi 2 TV shares in 2005-2006 through which Khalvashi claims that the price for which he had to sell his shares were in fact far lower than actual value of the assets. Through this piece of evidence, Khalvashi tries to prove that he would not have sold the broadcaster for the stated price without having been pressured into it. The valuation, commissioned by the plaintiff, was done by an expert from the Georgian State Forensics Bureau based on inconclusive financial data provided by the plaintiff.

During the hearings at the lower court lawyers representing Rustavi 2 TV and its current shareholders sought in vain to exclude the report as invalid evidence on the grounds that it was based on dubious and inconclusive financial data. In the appellate court they kept on insisting on the same arguments and also saying that the report was not compiled based on the international valuation standards.

Rustavi 2 TV ownership changed for multiple times after Khalvashi sold his shares and before brothers Karamanishvili became majority shareholders in 2011. But Khalvashi claims that all those changes of ownership were in fact sham deals and brothers Karamanishvili are also nominal shareholders of the Rustavi 2, which he insists, is in fact under Saakashvili’s control.

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