M/Y Luna Temporarily Seized in Dubai

18 April 2018 By Lauren Beck

Newsweek reports that 115-meter M/Y Luna has been temporarily seized in Dubai. A British court ruled that the vessel’s owner, billionaire Farkhad Akhmedov, owes his ex-wife Tatiana Mikhavilovna Akhmedova $567 million from a divorce settlement.

The British court’s representative petitioned the Dubai International Financial Centre (DIFC) Courts for control of the yacht, and the Dubai court ruled on February 8 to freeze the vessel — she was then seized in Dubai. According to Gulf News, “A further ‘enforcement order’ by the DIFC Courts is needed before Luna could be taken legally and auctioned off to collect proceeds for the divorce award.”

Gulf News reports that Akhmedov has argued that the divorce happened in Russia, and he questions the legitimacy of the UK’s involvement. Reuters reports that Akhmedov won the right to appeal for the vessel’s release from the Dubai authorities on April 10.

The trust managers are working on the vessel’s return and are providing for the 50 crewmembers currently on board in Dubai.

UPDATE: 4/20/2018
The London court has now ruled that Akhmedov must transfer ownership of M/Y Luna to his ex-wife. According to Bloomberg, Judge Charles Haddon-Cave claimed that Akhmedov attempted to hide his ownership of the vessel and moved the boat to Dubai, which he reportedly believed was “well beyond the reach of an English court judgment.” The judge apparently ordered Akhmedov to pay 41 percent of his assets to his wife in December 2016. She alleges that she has received nothing from the settlement yet.

Bloomberg also reports that, according to the ex-wife’s court documents, Akhmedov allegedly moved his modern art collection to Lichtenstein. The art collection was awarded to Akhmedova in the settlement. The transfer seemed to prompt the judge to move more quickly, due to Akhmedov’s willingness “to take rapid and multifarious steps to evade enforcement at every turn,” Bloomberg writes.

Akhmedov still disputes the London Court’s jurisdiction.

UPDATE: 8/6/2018
According to Arab News, Dubai’s judicial authorities have ruled that the case involving 115-meter M/Y Luna must be decided in a UAE Shariah court, not in the Dubai International Financial Center’s (DIFC) common-law courts system after a jurisdictional dispute.

According to Arab News, “The Shariah legal system is generally held to treat the husband more favorably in divorce cases than Western courts.” The ruling could dissolve the impound order.

Nautilus International stepped in to help the crew, who had their passports seized during the divorce proceedings “to prevent the superyacht from leaving Dubai,” said Nautilus International’s strategic organizer Danny McGowan in a press release. The crew were unable to leave the vessel or the country. Nautilus was able to intervene and worked with the vessel’s flag state to have the crew passports returned.

“Confiscating passports like this is a severe violation of the rights of seafarers, who are being treated as if they were chattels rather than maritime professionals,” said McGowan. “Yacht crew deserve the right to go to work without worrying about whether the owner is going through a divorce or — in the ongoing case of the superyacht Indian Empress — has their assets frozen whilst fighting extradition. Cases like this underline the need for decent treatment and effective representation of crews in this sector.”

UPDATE: 8/29/2018
Dubai courts have rejected the appeal by Farkhad Akhmedov to lift a freezing order on M/Y Luna and the order imposed by the London High Court has been upheld, according to Arabian Business. The court ruled that the yacht’s ownership be transferred to Tatiana Akhmedova.

In a statement to Arabian Business, a spokesperson for Akhmedova said, “We note the weekend’s decision and are pleased that this court has also seen fit to maintain the arrest of Luna. In line with the UK court order, we will continue to arrange the formal transferral of Luna’s ownership to Ms. Akhmedova,” adding that it is “only a matter of time” before ownership of the superyacht is handed over.

Her lawyers also said they will soon be able to engage with the “many potential buyers” and expect the sale of the vessel to be quick.

This month, Akhmedov refused to pay his ex-wife the $600 million divorce settlement imposed by a UK court, which led the court to place a worldwide freezing order on all his assets, including Luna.

UPDATE: 9/5/2018
Farkhad Akhmedov has filed another appeal to lift the freezing order on M/Y Luna days after the Dubai courts upheld the decision of the London High Court, which ruled that the vessel’s ownership be transferred to Tatiana Akhmedova, Arabian Business reports.

However, a spokesperson for Akhmedov said the claims of Luna being handed over to Akhmedova and sold quickly are a “pure fantasy,” and that it would take years before the Dubai full legal processes are exhausted.

Akhmedov has argued that a divorce awarded in Moscow in 2000 permits him to ignore the UK’s court proceedings, and he expects the Russian courts to rule on the validity of this original divorce over the next two months. “It is that divorce which fundamentally underlines the misguided decisions of the English High Court in awarding her a second divorce payout in 2016 and of the DIFC courts to seize Luna,” his legal team said in a statement.

UPDATE: 4/5/2019
In the long-running divorce proceedings between Russian businessman Farkhad Akhmedov and ex-wife Tatiana Ahkmedova, a Dubai appeals court has overruled an earlier decision to seize M/Y Luna from him, the BBC reports. A UK court had ordered him to pay his wife $600 million in a divorce settlement.

However, the Dubai court ruled that the decision was unenforceable in Dubai and the seizure of the vessel should be cancelled. On March 27, the court of appeal ruled that the Dubai lower courts’ order to impound Luna was wrong, allowing her to leave the port, Reuters reports.

According to Gulf News, a spokesman for Akhmedov said, “Mr. Akhmedov is delighted but not surprised by today's court decision in favor of the Akhmedov family trust.”

Lawyers for his former wife called the ruling a “procedural decision” and said the case had been referred to another Dubai court for a further hearing, according to Reuters. In a statement, the lawyers said Ahkmedova successfully obtained additional orders in the English Court to secure Luna.

She began divorce proceedings in Britain in 2012, but Akhmedov said they had already divorced in Russia in 2000, but various Russian and British courts have found no evidence to support this.