Turkey-based Palmali lawsuit against Lukoil's Litasco dismissed by UK court

LONDON (Reuters) -Turkey-based tanker operator Palmali on Friday lost its London lawsuit against the trading arm of Russian oil producer Lukoil over a purported deal to provide oil products.

Palmali, controlled by Azerbaijan-born businessman Mubariz Mansimov, first sued Lukoil's Swiss subsidiary Litasco at the High Court in 2017 and was initially seeking nearly $2 billion.

The value of Palmali's case was substantially reduced, however, after Litasco succeeded in having much of the lawsuit thrown out in 2020.

Palmali was, by the time of the trial earlier this year, seeking just over $120 million for Litasco's alleged breach of its obligations to supply up to 700,000 metric tons of cargoes a month.

But Judge Mark Pelling dismissed Palmali's lawsuit in a written ruling on Friday, saying its contract with Litasco was void because Litasco's then chief executive Valery Golovushkin had "a plain conflict of interest" when the contract was agreed.

The judge also upheld Litasco's counterclaim for the repayment of a loan and payments made to Palmali which were due to be paid on to third parties.

Litasco's lawyer Craig Morrison said the parties had agreed the value of the counterclaim at around $14.8 million, including interest.

Palmali and Litasco did not immediately respond to requests for comment.

(Reporting by Sam Tobin; Editing by Kirsten Donovan)