SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK

NOREX PETROLEUM LIMITED, X ................................................................

Plaintiff,

vs.

ACCESS INDUSTRIES, INC.; RENOVA, INC.; LEONARD BLAVATNIK; VICTOR VEKSELBERG; ALFA GROUP CONSORTIUM; CROWN FINANCE FOUNDATION; CTF HOLDINGS LDT.; CROWN LUXEMBOURG HOLDINGS SARL; OAO TYUMEN OIL COMPANY; TNK INTERNATIONAL LTD.; SIMON KUKES; JOSEPH BAKALEYNIK; BP

TRUSTEES LIMITED, PLC; TNK-BP LIMITED; and ASTONS

: Index No. 650591/2011

: (Commercial Division)

: Hon. Eileen Bransten (Part -

Defendants.

PLAINTIFF’S MEMORANDUM OF LAW IN SUPPORT OF ITS APPLICATION FOR A PRELIMINARY INJUNCTION

Barry Ostrager Mary Kay Vyskocil Simpson Thacher & Bartlett LLP 425 Lexington Avenue New York, New York 10017 Attorneys fov Plaintiff Norex Petroleum Limited

FILED: NEW YORK COUNTY CLERK 05/27/2011 INDEX NO. 650591/2011

NYSCEF DOC. NO. 49 RECEIVED NYSCEF: 05/27/2011

TABLE OF CONTENTS

Page

PRELIMINARY STATEMENT .................................................................................................... 2

BACKGROUND ............................................................................................................................ 5

The Billionaire Oligarchs take Norex’s oil fields by force ..................................... 5 A .

B . Aware of the Billionaire Oligarchs’ forcible seizure of Yugraneft. BP nevertheless joins the conspiracy against Norex .................................................... 6

C . The Proposed Deal .................................................................................................. 7

ARGUMENT .................................................................................................................................. 8

A . Norex Is Likely To Succeed On The Merits ........................................................... 9

B .

C .

Norex Will Be Irreparably Harmed Absent Injunctive Relief .............................. 10

Balance of Equities ............................................................................................... 13

CONCLUSION ............................................................................................................................. 14

TABLE OF AUTHORITIES

Cases

Barouch Eaton Allen Cory. v. Int ' I Business Machines Corp., 1980 WL 4693 (N.Y. Sup. Ct. 1980) ............................................................................ 12

Brady v. Nut ' I Football League, No. 11-1 898,201 1 WL 1843832 (8th Cir. May 16, 201 1) ............................................................................................. 11

Brettschneider v. Bell, 10 Misc.3d 1062(A) (N.Y. Sup. Ct. Dec. 19, 2005) .......................................................................................................................... 12

Carlo v. Chui, 254 A.D.2d 191 (1st Dep't 1998) ......................................................................... 14

Casita, 17 Misc.3d at "9 ............................................................................................................... 13

Danae Art Intern. Inc. v. Stallone, 163 A.D.2d 8 1 (1 st Dep't 1990) ................................................................................................................................ 8

Destiny USA Holdings, LLC v. Citigroup Global Markets Realty Corp., 69 A.D.3d 212 (4th Dep't 2009) ........................................................................ 13

Doe v. Axelrod, 73 N.Y.2d 748 (N.Y. 1988) ............................................................................ 8, 10

Dong-Pyo Yang v. 75 Rockefeller Ca@ Corp., 50 A.D.3d 320 (1st Dep't 2008) ................................................................................................................ 13

Dynamic Solutions, Inc. v. Planning & Control, Inc., 646 F.Supp. 1329 (S.D.N.Y. 1986) ................................................................................................. 12

Gentile v. Spadaro, 28 Misc.3d 1218(A) (N.Y. Sup. Ct. July 27, 2010) ........................................................................................................................... 10

Kronos, Inc. v. AVX Corp., 81 N.Y.2d 90 (N.Y. 1993) .................................................................. 9

Laro Maintenance Corp. v. Culkin, 255 A.D.2d 560 (2d Dep't 1998) .............................................................................................................................. 13

Meese v. Miller, 79 A.D.2d 237 (4th Dep't 1981) .......................................................................... 9

Monex Financial Services Ltd. v. Dynamic Currency Conversion, Inc., 19 Misc.3d 11 13(A) (N.Y. Sup. Ct. Mar. 26, 2008) ............................................................................................................................ 9

Morrison v, Nat ' I Australia Bank, 130 S . Ct. 2869 (2010) ............................................................. 3

Norex Petroleum Ltd. v. Access Industries, Inc., 63 1 F.3d 29 (2d Cir. 20 10) ........................................................................................................................ 3

Plumitallo v. Hudson Atlantic Land Co., LLC, 74 A.D.3d 1038 (2d Dep’t 2010) ............................................................................................................... 10

Poling Transp. Corp. v. A& P Tanker Corp., 84 A.D.2d 796 (2d Dep’t 198 1) ................................................................................................................. 10

Rut v. Young Adult Institute, Inc., 74 A.D.3d 776 (2d Dep’t 2010) ........................................................................................................................................ 10

Schlosser v. United Presbyterian Home at Syosset, Inc., 56 A.D.2d 615 (2d Dep’t 1977) ...................................................................................................... 8

Sequoia Voting Sys., Inc. v. Ohio Secy. of State, 125 Ohio Misc.2d 7 (Ohio Ct. C1. 2003) .................................................................................................. 11

Terrell v. Terrell, 279 A.D.2d 301 (1st Dep’t 2001) ...................................................................... 9

Statutes

4 N.Y. PRAC., COM. LITIG. INNEW YORK STATE COURTS 3 17:9 (3d ed. 2010) ................................................................................................................. 11

67A N.Y. Jur. 2d Injunctions 6 33 ................................................................................................ 13

RUS. CIV CODE ART. 10 ........................................................................................................... 10

Rules

..................................................................................................................... N.Y. C.P.L.R. 6301 1 ,8

070653-0002-14337-Actwe. 12417 169.1

... 111

05/27/2011 7 5 0 AM

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK

NOREX PETROLEUM LIMITED, X ................................................................

Plaintiff, : Index No. 65059/2011

: (Commercial Division) ACCESS INDUSTRIES, INC.; RENOVA, INC.; : LEONARD BLAVATNIK; VICTOR : Hon. Eileen Bransten (Part _> VEKSELBERG; ALFA GROUP CONSORTIUM; : CROWN FINANCE FOUNDATION; CTF HOLDINGS LDT.; CROWN LUXEMBOURG HOLDINGS SARL; OAO TYLJMEN OIL COMPANY; TNK INTERNATIONAL LTD.; SIMON KUKES; JOSEPH BAKALEYNIK; BP

TRUSTEES LIMITED,

vs.

: PLC; TNK-BP LIMITED; and ASTONS

Defendants.

PLAINTIFF’S MEMORANDUM OF LAW IN SUPPORT OF ITS APPLICATION FOR A PRELIMINARY INJUNCTION

Plaintiff Norex Petroleum Limited (“Norex”) by its attorneys, Simpson Thacher

&L Bartlett LLP, respectfully submits this Memorandum of Law, pursuant to Section 6301 of the

Civil Practice Law and Rules, in support of its application for a preliminary injunction against

BP PLC (“BP”), Leonard Blavatnik and Victor Vekselberg (the “Billionaire Oligarchs”), and

their respective companies, Access Industries, Inc. and Renova, Inc. (collectively,

“Respondents” )-all of whom conspired to rob Norex of its valuable interest in the Yugraneft oil

fields of Western Siberia. Messrs. Blavatnik and Vekselberg are presently residents of New

York City. Norex seeks to enjoin Respondents fiom using its stolen property as consideration in

a proposed transaction with BP that would net the Respondents tens of billions of dollars and

other extremely valuable-though much less quantifiable-compensation, but from which Norex

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would derive zero benefit (the “Proposed Transaction”).

PRELIMINARY STATEMENT

The Billionaire Oligarchs-through TNK, an entity which they controlled-set in

motion a conspiracy to misappropriate Norex’s extraordinarily valuable interest in the Yugraneft

oil fields as early as 1998. They began by taking control of Norex’s minority partner in

Yugraneft by forcing it into bankruptcy in 1998. Compl. 77 36-37. Their fraudulent scheme

assumed greater urgency in 2001, after Yugraneft discovered oil deposits that would increase its

proven oil reserves by approximatelyfifty percent. Compl. 17 48-49. The Billionaire Oligarchs,

who are jointly and severally liable for this conspiracy, then determined that they would do

whatever was necessary-including using threats and physical force-to divest Norex of its

majority interest and take complete control of Yugraneft.

Shortly thereafter, in June 2001, sixteen TNK private militia members, wearing

military fatigues and carrying AK-47 machine guns, broke into Yugraneft’s corporate offices.

The armed men were there at the behest of the Billionaire Oligarchs as part of their years-long

conspiracy to divest Norex of its controlling interest in Yugraneft. Compl. flfi 56-58. The armed

militiamen falsely informed Yugraneft employees that the Billionaire Oligarchs had assumed

ownership of the company, causing many of its foreign workers to flee Russia. Compl. 77 56-58.

BP, with full knowledge of TNK’s illegal appropriation of Norex‘s majority

interest in Yugraneft’s oil fields, nevertheless opportunistically joined forces with the Billionaire

Oligarchs in 2003, becoming equal partners in a newly formed company, TNK-BP, which

assumed control over all of Yugraneft’s assets. BP and the Billionaire Oligarchs have since done

everything in their power to divert Yugraneft profits from Norex, its majority shareholder,

including refusing to pay any of the scores of millions of dollars in dividends to which Norex is,

and has been, entitled for the last ten years. By contrast, since its founding in 2003, TNK-BP has

2 070653-0002-14337-Active 12417169 1 05/27/20 1 1 7 50 AM

distributed more than $20 billion in dividends to its shareholders, not a penny of which Norex

has received, notwithstanding Respondents’ acknowledgement that Norex has, at a minimum, a

20% interest in the Yugraneft oil fields that TNK-BP now controls. Ostrager Aff., Ex. A (BP

website); Rotzang Aff. 7 12. Just as recently as this week, the TNK-BP board recommended a

fourth-quarter dividend of $2.13 billion. Ostrager Aff., Ex. B (TNK-BP Says Board Approves

$2.13 Billion Quarterly Dividend). Indeed, to the extraordinary benefit of the Billionaire

Oligarchs and BP, the Yugraneft oil fields have generated hundreds of millions of dollars in

profits for TNK-BP over the last eight years alone.

Thus, for the decade that Respondents have illegally controlled Yugraneft’s oil

fields, they have reaped enormous profits, but have not paid Plaintiff a single penny in

dividends.’ This stands in marked contrast to the regular dividends Norex received from 1991 ,

when it first created, and acquired a majority interest in, Yugraneft, until 200 1 , when the

Billionaire Oligarchs forcibly seized control of the company.

* * *

As part of the Proposed Transaction, BP and Rosneft, a Russian state-owned oil

company, would buy out the Billionaire Oligarchs’ 50% interest in TNK-BP-valued at over $62

billion-in exchange for, among other things, the very oil field assets that the Billionaire

Oligarchs stole from Plaintiff, It is widely reported that BP is committed to partnering with

Plaintiff initially challenged these actions in federal court many years ago in a RICO complaint, 1

but the federal complaint was recently dismissed-not on the merits-but because the Second Circuit held that there can be no extra-territorial application of the RICO statute based upon the Supreme Court’s holding in Morrison v. Nat’l AustraZia Bank, 130 S . Ct. 2869 (2010), which came down while Plaintiffs appeal was pending and overruled the Courts of Appeals of every federal circuit on this issue, thus necessitating the Second Circuit’s holding that RICO has no extraterritorial application. See Norex Petroleum Ltd. v. Access Industries, Inc. , 63 1 F.3d 29 (2d Cir. 20 10). Since the present complaint alleges common law conspiracy, fraud and conversion, this Court clearly has subject matter jurisdiction over these claims.

3 070653-0002-1 4337-Actwe.124 171 69.1 051271201 1 7 5 0 AM

Rosneft, the exclusive holder of the necessary licenses to enable BP‘s exploration project in the

Arctic. The area in question is thought to contain billions of barrels of oil and gas, access to

which BP executives have noted would “secure the [3 company’s future for decades.” Ostrager

Aff., Ex. E (“Some BP Investors Relieved”) (emphasis added). BP executives have accordingly

“waxed lyrical” about the idea of partnering with Rosneft, having presented the exploration plan

as proof to the public that it is on the road to recovery after last year’s disastrous Gulf of Mexico

oil spill. Ostrager Aff., Ex. F (“BP Arctic Deal on the Ropes”). An initial self-imposed May 16

deadline for BP to come to terms with Rosneft lapsed, however, based in large part on the

Billionaire Oligarchs’ demands for more and more concessions. In the meantime, Rosneft has

indicated that it will consider other suitors, as it refuses to wait indefinitely for BP to iron out its

differences with the Billionaire Oligarchs. This, of course, has only given BP greater impetus to

resolve those differences so that the contemplated transaction, which it has publicly touted as a

sign that it is “back in business,” may move forward. Ostrager Aff., Ex. G (WSJ, “BP Tries to

Salvage Russian

BP’s newfound sense of urgency will only serve to increase the intangible

negotiating power of the Billionaire Oligarchs to leverage Yugraneft’s assets as BP attempts to

quickly remove all obstacles preventing the closing of this epic deal. Once the Proposed

Transaction is finalized, BP will be the beneficial owner of Norex’s controlling interest in

Yugraneft, and the Billionaire Oligarchs will have succeeded in compounding by several orders

Even if the Proposed Transaction were ultimately to founder. Norex’s need for an injunction is 2

no less acute. Any substitute deal in which BP seeks to partner with a new joint venturer in Russia would still require that BP buy off the Billionaire Oligarchs because TNK-BP’s shareholder agreement makes TNK-BP the exclusive investment vehicle for all of BP’s oil investments in Russia. Thus, the same threat of irreparable harm exists for Norex irrespective of who BP’s new partner in Russia happens to be.

070653-0002-14337-Active. 124 17 169.1 4

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of magnitude their conversion of Norex’s assets to their own tremendous benefit and Plaintiffs

extraordinary detriment.

If the Proposed Transaction is permitted to go forward, Norex will be irreparably

harmed by being forever deprived of the opportunity to shape the negotiating environment of a

monumental transaction, of which it rightfully should be a part, but from which it has been

wrongfully and completely excluded. In fact, Norex’s interests are not even nominally

represented at the bargaining table, notwithstanding that its valuable assets are an integral part of

the deal’s consideration. To the contrary, Respondents are now attempting to exploit Norex’s

stolen property as leverage in a deal that would net the Billionaire Oligarchs many billions of

dollars in cash and other extremely valuable consideration, including shares in BP stock which

would make them the company’s largest single shareholder. Ostrager Aff., Ex. F (5/17/11 Wall

Street Journal article, BP Arctic Deal on the Ropes). They should not be permitted to do so.

Unless injunctive relief is granted, Norex will be irrevocably stripped of the

opportunity to advance its rights in the monumental Proposed Transaction, whose unprecedented

nature and scope make any calculation of monetary damages inherently unreliable. And because

Plaintiff is likely to prevail on the merits and the balance of equities cuts in its favor, Plaintiff

respectfully requests that the Court grant its request for a preliminary injunction.

BACKGROUND

A. The Billionaire Oligarchs take Norex’s oi1 fields by force.

On June 29, 2001, at the direction of the Billionaire Oligarchs, a TNK official

named Alexander Berman, six TNK attorneys, and sixteen TNK militia members dressed in

fatigues and carrying AK-47 machine guns forcibly entered Yugraneft’ s corporate offices,

falsely declared that Berman had been elected Yugraneft’s Director General, and inspected

Yugraneft’s oil fields. Compl. 11 56-58. TNK private armed militia members returned on July

5 070653-0002-1 4337-Actrve 1241 71 69 I 05/27/2011 7 50 AM

6,201 1 and, carrying machine guns, cut off Yugraneft’s phone and Internet service and occupied

Yugraneft’s oil field and field office, causing Yugraneft’s foreign employees to flee Russia.

B. Aware of the Billionaire Oligarchs’ forcible seizure of Yugraneft, BP nevertheless joins the conspiracy against Norex.

BP became 50-50 partners with the Billionaire Oligarchs in 2003, forming the

TNK-BP joint venture. At the time that BP joined the conspiracy, it was fully aware of the

Billionaire Oligarchs’ theft of Yugraneft’s oil fields from Norex and that the oligarchs did not in

fact have a legal right to the ownership and/or control of Yugraneft. Compl. T[ 70. Nevertheless,

recognizing the enormous value of Yugraneft’s oil reserves, and with the sole goal of further

enriching itself and solidifying its investment position in Russia, BP knowingly and voluntarily

entered into a joint venture with the Billionaire Oligarchs, which assumed control over all of

Yugraneft’s assets. BP and the Billionaire Oligarchs continue to be 50-50 partners in TNK-BP,

which has proven to be enormously profitable to this day. According to BP’s website, since

2003, TNK-BP has generated total income exceeding $25 billion and has paid more than $100

billion in duties and excise taxes. Ostrager Aff., Ex. I (BP website).

Notwithstanding that Norex continues to have an overwhelming majority

ownership interest in Yugraneft (despite sham Russian court proceedings purportedly reducing

Norex’s interest to 20%, see Compl. 77 59-60), since its inception, TNK-BP has sold vast

quantities of oil from Yugraneft’s oil fields, the profits of which it alone retains. Rotzang Aff. 7

10. Indeed, over the past decade, the Billionaire Oligarchs and BP have conspired to ensure that

Yugraneft refrains from paying hundreds of millions of dollars in annual dividends owed to

Norex. Ostrager Aff., Ex. C (12/15/04 letter from Rotzang to Dudley); Rotzang Aff. 10,12.

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C. The Proposed Deal

The Proposed Transaction involves BP’s buy-out of the Billionaire Oligarchs’

fifty percent interest in TNK-BP.3 The newly constituted company would then serve as the

investment vehicle through which BP would, through its new Russian partners’ licenses and

authorizations, have the exclusive right to “explore some of the most promising parts of the

Russian Arctic, one of the world’s last remaining unexplored basins.” Ostrager Aff., Ex. J

(Major Arctic Projects and Share Swap).

Notably, newly installed BP CEO Robert Dudley has a richly documented

checkered past with TNK-BP, of which he served as CEO until September 2008. That history

involves brazen examples of BP’s self-dealing at the expense of TNK-BP’s minority

shareholders. For instance, in 2008, a minority shareholder in TNK-BP brought suit against the

company for over $400 million based upon BP’s use of hundreds of BP foreign “specialists,”

which cost the company on average an astounding $700,000 per worker per year for work

Russian employees could have done at a fraction of the cost. The self-dealing payments

significantly diminished the profit available as dividends for TNK-BP’ s minority shareholders.

Ostrager Aff., Ex. K (5122108 St. Petersburg Times article). The case eventually settled after a

Siberian court granted an emergency injunction to enjoin the payments. Ostrager Aff., Ex. L

(5/13/08 Reuters Article).

Dudley was ultimately forced to flee Russia in July 2008, after he was denied a

work visa. A Moscow labor court subsequently disqualified him from holding corporate offce

TNK-BP is the most valuable oil producer in the BP group. TNK-BP’s oil production in 2009 amounted to 840,000 barrels per day, 33% of BP’s total output (by contrast, all of BP’s wells in the Gulf of Mexico contributed to less than half as much - 387,000 barrels per day). Ostrager Aff., Ex. M (BP Annual Report and Accounts 2009) at 27.

070653-0002-14337-Active.12417169.1 7

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in Russia for two years based upon his questionable use of foreign employees and his violations

of the Russian labor code.

As recently as May 12,201 1, another TNK-BP minority shareholder brought suit

in a Siberian Court seeking up to $10 billion in damages against BP, echoing the sentiments of

other aggrieved minority shareholders by claiming that his rights as a shareholder had been

“violated by TNK-BP and BP.” Ostrager Aff., Ex. N (5/12/11 AFP Article).

Consistent with its history of self-enrichment at the expense of others, including

its own minority shareholders, TNK-BP, through BP and the Billionaire Oligarchs, has conspired

for years to deprive Norex of its rightful share of the enormous profits from the Yugraneft oil

fields. Having illegally and forcibly annexed Norex’s assets and having denied Norex hundreds

of millions of dollars in dividends over the past decade, Respondents should not be permitted to

realize a windfall of billions of dollars by trading on these assets in a deci-billion dollar

transaction from which Norex is completely excluded.

ARGUMENT

Generally, a court will grant a preliminary injunction where the plaintiff

demonstrates: (i) a probability of success on the merits; (ii) danger of irreparable harm in the

absence of an injunction; and (iii) a balance of the equities in its favor. See N.Y. C.P.L.R. 6301;

Doe v. Axehod, 73 N.Y.2d 748, 750 (N.Y. 1988). Even where one of these factors appears to be

weak, courts may still grant injunctive relief. See Danae Art lntern. lnc. v. Stallone, 163 A.D.2d

8 1 (1 st Dep’t 1990) (granting a preliminary injunction where the existence of irreparable harm

was questionable but where plaintiff made a strong showing on the other two factors); Schlosser

v. United Presbyterian Home at Syosset, Inc., 56 A.D.2d 615,615 (2d Dep’t 1977) (granting a

preliminary injunction upon a finding that the balance of equities weighed in its favor despite

“grave doubts regarding the likelihood of plaintiffs’ success on the merits”).

8 070653-0002-14337-Active.12417169.1 05/27/2011 750 AM

A. Norex Is Likely To Succeed On The Merits

A plaintiff seeking injunctive relief need only make a prima facie showing of its

likelihood of prevailing on the merits. See Terrell v. Terrell, 279 A.D.2d 301, 303 (1st Dep’t

2001) (noting that actual proof of the case should be left to further court proceedings). Norex

has easily met this standard, having sufficiently made a prima facie showing on each of its

causes of action.

First Cause @Action: Plaintiff has made a prima facie showing of tortuous interference with a contract by establishing that it was part of a Yugraneft joint venture agreement, Defendants’ had knowledge of this agreement, Defendants’ frustrated the agreement by forcibly seizing control of Yugraneft, thereby causing damage to Norex. See Kronos, Inc. v. AVXCorp., 81 N.Y.2d 90, 94 (N.Y. 1993); Rotzang Aff. 71 7, 10, 11, 12, 13.

Second Cause ofAction: Norex has made a prima facie showing of tortuous interference with prospective business relations by establishing the existence of long-standing relationships involving Norex and its partner in the Yugraneft joint venture, that Defendants interfered with this relationship through the use of illegal activities, such as the armed seizure of the Yugraneft oil fields, and that Norex has sustained damages as a result. See Monex Financial Services Ltd. v. Dynamic Currency Conversion, Inc., 19 Misc.3d 1113(A), at “6 (N.Y. Sup. Ct. Mar. 26, 2008); Rotzang Aff. 77 7 , 10, 12, 13. Further, Defendants’ threats, violence, and retributive acts against Norex demonstrate clear malice and the intent to inflict injury beyond mere self- interest or other economic considerations. See id. 7 8.

Third Cause ofdction: Norex has demonstrated the likelihood of success on its underlying conversion claim by demonstrating that it owns a controlling interest in Yugraneft and corresponding entitlement to dividends due from that controlling interest, and that Defendants exercised an unauthorized dominion over those interests by annexing control of Yugraneft, and profiting from its assets while simultaneously depriving Norex of its rightful share of those profits. See Meese v. Miller, 79 A.D.2d 237, 242-43 (4th Dep’t 1981); Rotzang Aff. 71 7, 8, 10, 12.

* Fourth Cause of Action: Norex has made a prima facie showing of Defendants’ breach of fiduciary duty by demonstrating that a fiduciary relationship existed between Norex and its joint venture partner in Yugraneft (and its successors in interest). Plaintiff has also made a prima facie showing that Defendants breached this fiduciary duty when they caused armed militiamen to physically seize control of the Yugraneft oil fields and, after

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appropriating Norex’s controlling interest in Yugraneft, sold massive quantities of Yugraneft’s oil, the profits of which they alone retained. Further, Norex was undeniably directly damaged by these plain breaches. See Rut v. Young Adult Institute, Inc., 74 A.D.3d 776, 777 (2d Dep’t 2010); Plumitallo v. Hudson Atlantic Land Co., LLC, 74 A.D.3d 1038, 1039 (2d Dep’t 2010) (holding that “plaintiffs status as a[ ] partner in a joint venture gives rise to a fiduciary relationship”); Rotzang Aff. fT7 7, 10, 12, 13.

Fifth Cause of Action: Norex has unquestionably demonstrated that, through Defendants’ unlawful appropriation of the Yugraneft oil fields and their subsequent refusal to pay one penny of the hundreds of millions of dollars in dividends owed to Norex as Yugraneft’s majority shareholder, Defendants have been enormously and unjustly enriched at Norex’s extreme expense. See Rotzang Aff. fTfi 7, 8, 10, 11, 12. Further, it would fly in the face of equity and good conscience to permit Defendants to retain the extraordinary assets that they obtained through armed force and corruption. See Gentile v. Spadaro, 28 Misc.3d 1218(A), at * 4 (N.Y. Sup. Ct. July 27,2010).

Sixth and Seventh Causes of Action: Russian and the British Virgin Islands law prohibits people fiom undertaking any actions with the exclusive intent of inflicting damage on others. See RUS. CIV CODE ART. 10. Defendants’ use of physical force to “steamroli” any party standing in the way of their years- long conspiracy aimed at taking complete control of the Yugraneft oil fields fulfills the requirements of the Russian Civil Code. Plaintiff has also demonstrated that after Norex sought to reclaim its rightful interest in Yugraneft, Defendants employed a practice of retaliation against Norex, which included, among other things, depriving Norex of its rightful share of Yugraneft profits. See Rotzang Aff. 77 7, 8, 10, 11, 12, 13.

B. Norex Will Be Irreparably Harmed Absent Iniunctive Relief

Where a plaintiff demonstrates that irreparable injury will result if the injunctive

relief being sought is denied, a preliminary injunction may be granted. See Doe v. Axelrod, 73

N.Y.2d 748,748 (N.Y. 1988). Although the existence of an adequate remedy at law may

militate against a finding of irreparable injury, to be considered “adequate,” the legal remedy

must be “as complete, practicable and efficient as the equitable [remedy] .” Poling Transp. Corp.

v. A& P Tanker Corp., 84 A.D.2d 796,797 (2d Dep’t 1981). Additionally, the determination of

whether a plaintiff will be irreparably harmed should the request for injunctive relief be denied is

I wholly dependent on the facts of each individual case. 4 N.Y. PRAC., COM. LITIG. IN NEW YORK

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STATE COURTS 4 17:9 (3d ed. 2010) (noting that the question of “[wlhether a party will be

irreparably harmed if an injunction is granted is a very fact intensive determination and each case

is different”).

Norex will be irreparably harmed in three discrete ways if its application for

injunctive relief is denied: (1) Norex will lose the invaluable opportunity to take its righful place

at the negotiating table in this monumental transaction; (2) Respondents will leverage Norex’s

extraordinarily valuable interest in the Yugranefi oil fields-to which Respondents do not have

any legal right-and will unjustly recognize a windfall of billions of dollars as a result of its

further conversion of Norex’s assets; and (3) Norex will be unable to calculate its monetary

damages in light of the unprecedented nature of the Proposed Transaction, which will render any

attempts at determining monetary damages inherently unreliable and risky.

First, if the Proposed Transaction is permitted to proceed, Norex will forever be

deprived of the opportunity to negotiate in this landmark transaction and employ its unique

leverage, which constitutes an integral part of the Proposed Transaction’s consideration.

Jurisdictions across the country have found precisely this sort of opportunity cost to constitute an

irreparable harm for which no remedy at law will adequately compensate the plaintiff. See

Brad’ v. Nat’l Football League, No. 11-1898,2011 WL 1843832, at *7 (8th Cir. May 16,201 1)

(recognizing that irreparable harm may result based upon “the impossibility of recreating a

negotiating environment”) (citation omitted); Sequoia Voting S’x., Inc. v. Ohio Secy. of State,

125 Ohio Misc.2d 7 (Ohio Ct. C1.2003) (holding that the denial of the opportunity to participate

in face-to-face negotiations constitutes an irreparable harm for which there is no adequate

remedy at law); Dynamic Solutions, Inc. 11. Planning & Control, Inc., 646 F.Supp. 1329, 1337

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(S.D.N.Y. 1986) (finding irreparable harm and noting that “[tlhe monetary worth of [I leverage

in . . . negotiations would be difficult, at best, to determine”).

Having robbed Norex of its controlling interest in Yugraneft, and having denied

Norex hundreds of millions of dollars in dividends owed to it over the past decade, Respondents

now seek to leverage Plaintiffs valuable assets in this epic transaction, from which they stand to

net many billions of dollars in cash and other extremely valuable consideration. If this deal is

permitted to go forward, Norex will forever be denied the right to negotiate on its behalf,

suffering opportunity costs, the value of which will be “difficult, at best, to determine.”

Dynamic Sohtions, Inc., 646 F.Supp. at 1337. This rationale is, of course, amplified by the sheer

magnitude of the contemplated transaction, and thus assumes even greater persuasive force in

this context.

Second, if the Proposed Injunction is permitted to go forward, Plaintiff will be

irreparably harmed by the further conversion of its assests by Respondents. Such an inequitable

result cannot be allowed. See Brettschneider v. Bell, 10 Misc.3d 1062(A), at *4 (N.Y. Sup. Ct.

Dec. 19,2005) (finding irreparable harm “when injunctive relief is sought to prevent the

defendant from converting identifiable proceeds sought in the underlying action”); Barouch

Eaton Allen Corp. v. int ’I Business Machines Corp., 1980 WL 4693 (N.Y. Sup. Ct. 1980)

(granting preliminary injunction where preserving status quo would “give sanction to defendants

continuing wrongdoing” and noting that a court should interfere in the beginning instead of

allowing rights to continue to be violated).

Third, the unprecedented nature of the Proposed Transaction renders it impossible

to calculate monetary damages with any degree of reliability. The case law makes clear that

injunctive relief is appropriate where the “the unprecedented nature and scope” of a transaction

12 070653-0002-14337-Actrve.12417169.1 051271201 1 7 3 0 AM

“make[] it unique, so that . , . any damages sustained could not be calculated with reasonable

precision.” Destiny USA Holdings, LLC v. Citigroup Global Markets Realty Corp., 69 A.D.3d

212,221 (4th Dep’t 2009); see also Casita, 17 Misc.3d at “9 (finding irreparable harm where

monetary damages for the loss of voting and decision-making rights could not be calculated to a

reasonable degree of certainty). There is simply no way to quantify the value of Norex’s

negotiating position, leverage and ability to shape the negotiating environment, especially

considering its unique role as the rightful majority shareholder of a key asset of the target

company, with an expansive knowledge of the business and its future prospects. The Proposed

Transaction is also the epitome of a sui generis transaction in which monetary damages would be

inherently unreliabile. The sheer size and complexity of the Proposed Transaction is alone

enough to call into question the reliability of any calculation of damages. But the direct

involvement of the Russian government, including the public blessings of Prime Minister

Vladimir Putin and President Dmitry Medvedev, gives the Proposed Transaction an indisputably

singular character. In short, “the unprecedented nature and scope” of the Proposed Transaction

“makes it unique, so that . . . any damages sustained could not be calculated with reasonable

precision.” Destiny USA Holdings, 69 A.D.3d at 221.

C. Balance of Eauities

In balancing the equities, the court must weigh the harm each side will suffer in

the absence or imposition of injunctive relief. See Dong-Pyo Yang v. 75 Rockefeller Cafi Corp.,

50 A.D.3d 320 (1st Dep’t 2008).

Injunctive relief is justified where, as here, the harm that the plaintiff would suffer

without an injunction is far more than commensurate with the resulting inconvenience to the

defendant. See Laro Maintenance Gorp v. Culkin, 255 A.D.2d 560 (2d Dep’t 1998); 67A N.Y.

Jur. 2d Injunctions 6 33. As discussed at length above, Norex would suffer immediate and

13 070653-0002-1 4337-Active 1241 7169 1 05/27/2011 7 50 AM

irreparable harm in the absence of a preliminary injunction. It would forever lose the

opportunity to shape the negotiating environment of an epic transaction, resulting in the further

conversion of its interests in a manner which would render any calculation of damages inherently

unreliable. On the other hand, Defendants would merely be required to maintain the status quo.

See Carlo v. Chui, 254 A.D.2d 191, 192 (1st Dep’t 1998) (finding that when plaintiff faces

serious injuries, “the equities lie in favor of preserving the status quo”). Alternatively, if the

Proposed Transaction is permitted to go through, the Respondents will realize a tremendous

windfall as a result of their illegal appropriation of Norex’s interests at the direct expense of

Plaintiff.

CONCLUSION

For all of tl,e reasons set forth above, Plainti,, respectfully requests that the Court

enter an order preliminary enjoining Respondents from (i) executing the Proposed Transaction,

and (ii) participating in any negotiations that use Norex’s interest in Yugraneft as part of the

consideration, including but not limited to, those pertaining to the Proposed Transaction, without

Norex’s participation.

070653-0002-14337-Act1ve.12417169.1 14

05/27/2011 7 5 0 AM

Date: May 26,201 1 SIMPSON TWCH$& & BARTLETT LLP

425 LeSxgton Avenue New York, New York 1001 7 Tel: (212) 455-2000 Fax: (212) 455-2502

Attorneys for Plaintiff

NOREX PETROLEUM LIMITED

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