Ex-US law chief tells Russia to dismiss BoNY case

By Simon Shuster

MOSCOW, May 23 (Reuters) - Former U.S. Attorney General Richard Thornburgh has advised a Russian court to dismiss a $22.5 billion lawsuit that the Bank of New York Mellon (BK.N: Quote, Profile, Research) is facing in Moscow.

Since last May the Russian government has been seeking compensation after a former vice president at the bank, Lucy Edwards, helped launder more than $7 billion from Russia in the late 1990s through Bank of New York accounts and dummy companies.

Reviving the 10-year-old case, lawyers for the Russian side have based their claim on a U.S. law, which was passed in 1970 to combat the mafia -- the U.S. Racketeering Influenced and Corrupt Organisations Act, known as RICO.

Thornburgh, known for fighting organised and white-collar crime in the Justice Department under five U.S. presidents, confirmed on Thursday that he had told the Russian court its use of the law was invalid.

"There is no basis on which to conclude that Congress intended to vest in foreign courts power to entertain suits for damages under RICO," he said in the 24-page witness statement.

"Accordingly, Russian courts may not adjudicate a RICO claim."

Steven Marks, the Florida-based lawyer who helped design the case for the customs service, rejected Thornburgh's comments on Thursday.

"His conclusions are not based upon direct legal precedence and are contrary to any logical interpretation of the relevant statutes," Marks said in e-mailed comments.