RUSTAVI 2 BROADCASTING COMPANY LTD AND OTHERS v. GEORGIA

Communicated on 28 November 2017

FIFTH SECTION

Application no. 16812/17
RUSTAVI 2 BROADCASTING COMPANY LTD and Others
against Georgia
lodged on 3 March 2017

STATEMENT OF FACTS

1. The first applicant, Rustavi 2 Broadcasting Company Ltd (hereinafter “Rustavi 2”), is one of the most popular national television channels in Georgia and has been operating under this name since 27 August 1996, the date of its registration under Georgian corporate law. Its headquarters are situated in Tbilisi.

2. The second applicant, TV Company Sakartvelo Ltd (hereinafter “TV Sakartvelo”) is a media company registered in Georgia on 16 July 1997. TV Sakartvelo is owned by the third and fourth applicants (see paragraph 3 below). In particular, the second applicant is a 60% shareholder, whilst the third applicant owns 40% of the shares in the second applicant.

3. The third and fourth applicants, Mr Levan Karamanishvili and Mr Giorgi Karamanishvili, brothers, are Georgian nationals who were born on 21 October 1971 and 11 January 1966 respectively and live in Tbilisi.

4. All four applicants are represented by Ms T. Muradashvili and Mr D. Sadzaglishvili, lawyers practising in Tbilisi.

A. The circumstances of the case

5. The facts of the case, as submitted by the applicants, may be summarised as follows.

1. Chronology of the transfers of Rustavi 2 company shares, as indicated by the case file

6. As can be inferred from the information available in the case file, Rustavi 2 was established on 27 August 1996 by three founding members – D.D., J.A. and E.K. Originally, those three people apparently owned 100% of the company shares, with the exact distribution of those shares being unknown.

7. On unspecified dates, for unknown legal reasons, the three founding members ceased to be the owners of Rustavi 2, with the company still continuing to operate under the ownership of unknown third parties. It is not clear from the case file who owned the company until October 2004 and under what exact arrangements.

8. According to the case file, by 22 October 2004 at the latest, a certain businessman, K.K., and a limited liability company exclusively owned by K.K. (both the individual and the corporate entity will be hereinafter jointly referred to as “K.K.”) had taken ownership of 100% of the shares in Rustavi 2, on unknown legal grounds. In particular, K.K. and his company had become the owners of 60% and 40% of the shares respectively.

9. By a share purchase agreement of 26 December 2005, K.K. ceded 22% of his 60% of the shares in Rustavi 2 to a third party, H. Ltd.

10. On 13 September 2006 H. Ltd disposed of 22% of its Rustavi 2 shares by selling them to H.G.I.G. Ltd.

11. By two separate share purchase agreements dated 14 November 2006, K.K. ceded the remaining 38% of his personal shares in Rustavi 2 to another third party, G.-T. Ltd, whilst his company also ceded its 40% of the shares to G.-T. Ltd.

12. On 29 November 2006 G.-T. Ltd disposed of 23% of its newly obtained 78% of Rustavi 2 shares to the above-mentioned H.G.I.G. Ltd (see paragraphs 10 and 11 above).

13. On 1 December 2006 G.-T. Ltd ceded the remaining 55% of its shares in Rustavi 2 to an offshore company, D.R. Ltd. In that transaction, the latter company was represented by the third applicant.

14. On 2 February 2007 D.R. Ltd disposed of its newly acquired 55% of shares in Rustavi 2 to another company, G.G. Ltd.

15. On 10 October 2008 H.G.I.G. Ltd gifted 15% of its 45% of shares in Rustavi 2 to a certain individual, I.Ch. On the same day, and as another gift, I.Ch. also received 15% of the 55% of Rustavi 2 shares owned by G.G. Ltd at that time.

16. On 18 March 2009 G.G. Ltd gifted the remaining 40% of its shares in Rustavi 2 to yet another party, D. Ltd.

17. On the same day, 18 March 2009, I.Ch. (see paragraph 15 above) gifted 30% of his Rustavi 2 shares to the above-mentioned D. Ltd.

18. On 28 November 2011 H.G.I.G. Ltd ceded the remaining 30% of its Rustavi 2 company shares to Ch.I. Ltd, apparently free of charge.

19. On 6 December 2011 Ch.I. Ltd gifted its newly acquired shares in Rustavi 2 (30%) to the third applicant.

20. On 6 December 2011 D. Ltd (see paragraphs 16 and 17 above) gifted 60% of its shares to the third applicant and the remaining 10% to another individual, G.G.

21. On 4 October 2012 the third applicant ceded 40% of its 90% of shares in Rustavi 2 to M.G. Ltd.

22. On 9 October 2012 M.G. Ltd transferred its newly acquired shares in the company (40%) to the fourth applicant.

23. On 13 and 14 November 2012, by a decision of Rustavi 2’s board of shareholders, the company’s share capital was increased by an injection of additional real-property assets, and the second applicant, the company owned by the third and fourth applicants (see paragraph 2 above), was given 51% of the shares in Rustavi 2.

24. As a result of all the transfers of the Rustavi 2 company shares detailed above, by the time the civil proceedings in the present case were initiated on 4 August 2015 (see paragraphs 38 and 42 below), Rustavi 2 was owned by the second applicant (who owned 51% of the shares), the third applicant (who owned 22% of the shares), the fourth applicant (who owned 18% of the shares) and N. (who owned 9% of the shares). N. was the wife of G.G., who had inherited G.G.’s shares on an unspecified date following his death (see paragraphs 20 above and 42 below).

2. Chronology of the alleged State action against Rustavi 2, as submitted by the applicants

25. On 1 October 2012 a parliamentary election took place in Georgia. The Georgian Dream Coalition (the GDC), led by Mr B.I. (hereinafter “B.I.”), won the election with 54.07% of the votes, whilst the former ruling party, the United National Movement (the UNM), obtained 39.68% of the votes. As a result, the GDC formed the new Government and B.I. became the Prime Minister.

26. The 2012 parliamentary election campaign and the period afterwards were characterised by extreme polarisation. The GDC and its leaders voiced several threats against political opponents, with Rustavi 2 being a primary target. According to the applicants, in August 2012, that is prior to the parliamentary election, during one of his televised interviews, B.I. expressed his views about an ownership row over Rustavi 2 and the interests of E.K. (one of the founders and former owners of the channel, see paragraph 6 above) and K.K. (another former owner of the channel, see paragraph 8 above). In that interview, the leader of the then opposition, B.I., openly stated how he had a good opinion of K.K., and mentioned that E.K. had “disappointed” Rustavi 2’s two other co-founders.

27. On 5 October 2012 Rustavi 2’s two other co-founders, D.D. and J.A., who had founded the channel together with E.K. in 1996 (see paragraph 6 above), made a public announcement about their intention to institute legal proceedings to restore their title in respect of the company, which they had lost.

28. On 17 October 2012, during a televised interview on Maestro TV (another channel), K.K. stated the following, “My main goal is to salvage [Rustavi 2] from the hands of liars and abusers, so that this channel can start serving the interests of truth [and] the interests of the Georgian people rather than the interests of falsehood”. In the same interview, K.K. also stated that he was planning to claim back certain other business interests misappropriated from him by the former ruling forces, emphasising that “unlike Rustavi 2, those other companies were always profitable entities”.

29. On 15 November 2012 Mr N. Gv., who had served as Deputy Chief Public Prosecutor, Minister of Justice and Minister of Education under the UNM-formed Government (see paragraph 25 above), was appointed Director General of Rustavi 2 (hereinafter “N.Gv.”).

30. Shortly after his appointment, on 19 December 2012 a criminal case was instituted against N.Gv. for corruption offences allegedly committed in 2009, when he had held the position of Deputy Chief Public Prosecutor. He was released on bail pending trial. On 14 November 2013 the Tbilisi City Court cleared N.Gv. of all charges. The acquittal was then upheld in full by the appellate and cassation courts.

31. On 25 December 2012 E.K. (see paragraph 26 above) held a large news conference focusing on the details of the interview recorded back in August 2012. During that conference, E.K. publicly announced his interest in claiming back Rustavi 2. In particular, E.K. stated “If [D.D.] and [J.A.] are the rightful owners, then I am a rightful owner too ... If [K.K.] is right, then I have the right to claim too ... No court can determine this property dispute without me ... I also want to tell B.I. to look into my eyes when he talks about Rustavi 2, since both of us know many things which, if revealed, could harm a lot of people”.

32. In February 2014 the State Revenue Service commenced an inventory check of TV MR Georgia (hereinafter “TV MR”), the only company in Georgia which measured viewing figures at that time. Within the framework of that inventory, State auditors asked the company to reveal the addresses of all households across Georgia where so-called “people‑meters” – electronic devices connected to television sets to monitor people’s viewing behaviour – had been installed. The company’s management refused to comply with the request, referring to the fact that the information requested was strictly confidential in accordance with a contract between the company and the participants of the survey. The company was then fined for that refusal by the State Revenue Service.

33. On 19 March 2014 the Director General of Rustavi 2, N.Gv., publicly labelled the audit inspection of TV MR a campaign against private television channels which received income from advertising. N.Gv. claimed that if TV MR revealed which households had “people-meters”, the relevant equipment would then need to be relocated to different, anonymous households, which would be a time-consuming exercise. Rustavi 2’s budget would shrink by half if viewing figures were not measured, since the amount of private advertising on the channel was largely determined by those figures.

34. On 6 May 2014 Rustavi 2 announced publicly that the Government had been illegally wiretapping it, disseminating video material anonymously obtained from the Ministry of Internal Affairs as evidence. The video footage was a recording of a conversation between the channel’s Director General, N.Gv., and his Deputy. The Chief Public Prosecutor’s Office immediately launched an investigation into the matter. Subsequently, N.Gv. rejected the investigation’s preliminary version of events, which asserted that the surveillance equipment might have been installed by the former ruling Government. On the contrary, he accused the new Government of having illicitly installed hidden cameras on the premises of the television channel through its “confidants” employed by the company. Shortly after the incident, the chief and the deputy chief of Rustavi 2’s security service were dismissed by Mr N.Gv. for their purported role in the illicit wiretapping. According to the applicants, the fired security officers were later employed by the Government at various law-enforcement agencies.

35. According to the applicants, various representatives of the GDC and members of the Government intensified their verbal attacks against Rustavi 2 during that period. Thus, on 2 July 2014 the Deputy Prime Minister, Mr K. Ka. (hereinafter “K.Ka.”), made a public statement concerning a possible change of ownership at Rustavi 2, “The time will come when Rustavi 2 will be returned to its real owners”.

36. In an interview given to a newspaper on 14 July 2015, E.K. (see paragraphs 6, 26 and 31 above) commented on the Deputy Prime Minister’s above-mentioned statement and noted former Prime Minister B.I.’s intention to gain control over the media:

“The Government is trying to gain influence over Rustavi 2 by entertaining certain alliances with my former partners [D.D. and J.A.]. ... [K.Ka.’s] statement regarding Rustavi 2 is a very interesting detail in that respect. He said that the channel would go back to its owners ... I openly declare that if any decision is taken with regard to the ownership of Rustavi 2, it will be a purely political decision rather than a legal one.”

37. On 15 July 2015 E.K. was found dead in his car. A criminal investigation conducted by the Chief Public Prosecutor’s Office subsequently resulted in a finding that he had committed suicide. The results of the investigation were contested by the deceased’s family.

38. On 4 August 2015 K.K., one of the former owners of Rustavi 2 (see paragraphs 8 and 26 above), filed a civil action against all four applicants. Details about the relevant court proceedings are provided below (see paragraphs 42-47 below). According to the applicants, K.K. was not randomly chosen by the State to carry out a judicial battle over the ownership of the company, as he is a proxy of the current ruling forces (see also paragraph 139 below), and his close relatives are open supporters of and financial contributors to the GDC.

39. On 21 October 2015 the Director General of Rustavi 2, N.Gv., made a public statement saying that middlemen with links to the law-enforcement authorities had attempted to blackmail him by threatening the safety of his family members and to publish illegally obtained video-recordings allegedly depicting his private life if he refused to step down from the position of Director General. A criminal investigation was immediately launched into his allegations, but no definite results were ever produced.

40. In an extensive public interview given to a newspaper on 26 October 2015, one of the leading members of parliament from the GDC ruling coalition, G.T., referred to the court proceedings which had already been initiated at that time by K.K. in the following terms:

“[Rustavi 2] has not been an objective channel. It has been very partial. We have been in power for three years, we have done so much good for the country, and [Rustavi 2] has not said a single positive word about [our work] ... Only negative and subjective news ... It is natural that those in government are fed up with [this] misinterpretation of the facts ... They have found ... a true owner [who] has now appeared (“მონახეს ... გამოჩნდა რეალური მეპატრონე”) ... And it is only natural that the true owner is asking for a fair trial.”

41. On the following day, 27 October 2015, G.T. made another spontaneous statement before journalists, “Tomorrow, Rustavi 2 will not exist”.

3. Judicial determination of the property row over Rustavi 2

(a) Action brought by K.K.

42. As stated above, on 4 August 2015 K.K., who had been the proprietor of Rustavi 2 between 2004 and November 2006, lodged with the Tbilisi City Court an action against Rustavi 2, the first applicant, and its owners – the second, third and fourth applicants, as well as a certain N., who owned 9% of the company shares (see paragraphs 2, 3, 8 and 24 above). The two other respondents to the action were H. Ltd and G.‑T. Ltd, companies to which K.K. had ceded 100% of his shares in Rustavi 2 by virtue of share purchase agreements dated 26 December 2005 and 17 November 2006 (see paragraphs 9 and 11 above).

43. As regards the respondents H. Ltd and G.-T. Ltd, K.K. claimed that he had been coerced into selling his company shares to those companies by the leaders of the then ruling forces, UNM. He claimed that, being dissatisfied with the editorial policy of Rustavi 2, the then President S. had summoned him into his office and ordered him to cede his shares in the company to the two above-mentioned companies, which were owned by trusted people within the President’s entourage. President S. had threatened K.K. by saying that the State would create problems for him and his family in the event that he refused to cooperate. Subsequently, K.K. had met with a number of other high-ranking State officials, such as the Minister of the Interior and the Chief Public Prosecutor, but they had all told him to comply with the President’s instruction. Consequently, K.K. had had no other choice but to sell his company shares to the two companies under share purchase agreements dated 26 December 2005 and 17 November 2006 for the total price of 571,400 Georgian laris (GEL – approximately 214,000 euros (EUR)). That price, which had been imposed on K.K. by the State, had been far below the actual value of the television channel. In his claim, K.K. thus requested that the impugned agreements be declared null and void ab initio for having been concluded under duress, in accordance with Article 85 of the Civil Code (see paragraph 130 below).

44. In support of his allegation of having been coerced into ceding Rustavi 2 to other companies by President S., K.K. did not submit any documentary evidence. Rather, he referred to the fact that, after having disposed of Rustavi 2 and many of his other business interests in Georgia, he had been obliged to leave the country together with his family for fear of further political persecution, and had even been granted political asylum in Germany. In that respect, K.K. also claimed that, when residing in Germany, acting through lawyers, he had filed a criminal complaint with the Chief Public Prosecutor’s Office on 1 December 2008, exposing in detail all the circumstances surrounding the threats that he had received from President S. and certain other high-ranking State officials.

45. As regards the current owners of Rustavi 2, the second, third and fourth applicants and N., K.K. requested that, should the above-mentioned contracts of 26 December 2005 and 17 November 2006 be declared null and void, his misappropriated property – 100% of the shares in Rustavi 2 – should be retrieved from their wrongful possession and returned to him. K.K. also requested that the current owners pay him approximately 18 million United States dollars (USD) for loss of income.

46. In relation to the first applicant, the essence of K.K.’s claim was for him to be acknowledged as the creator of the channel’s logo and three of its entertainment shows – Fort Boyard, Geo-Bar and Last Hero. K.K. also requested damages from the first applicant in the amount of USD 500,000 (approximately EUR 449,000) for the misuse of his intellectual property.

47. Pending a decision in the examination of the merits of his action, and in order to secure the proper conduct of the civil proceedings, K.K. also made an application for a preliminary injunction to freeze both Rustavi 2’s own assets as well as the individual owners’ shares in the company, so that the four applicants and N. would be prevented from either disposing of the company or making any other decision which could affect the company’s capital or functioning.

48. All four applicants, as well as the two other respondents H. Ltd and N., filed their written comments in reply to K.K.’s action. Amongst many other points, two major arguments raised by all the respondents was that K.K.’s action under Article 85 of the Civil Code was clearly belated in accordance with Article 89 of the same Code (see paragraph 131 below). They also complained that the claimant had not submitted any evidence in support of his allegation of having been subjected to undue pressure by high-ranking State officials. The respondents emphasised that, whilst the only argument submitted by K.K. in support of his allegation of political persecution was reference to a criminal complaint which he had allegedly filed with the Chief Public Prosecutor’s Office on 1 December 2008 (see paragraph 44 above), he had not even taken the trouble to submit a copy of that complaint as an annex to his civil action. Furthermore, the respondents emphasised that lodging such a criminal complaint was not sufficient to turn the allegation of coercion into an established fact. The applicants also mentioned that the price stipulated in the share purchase agreements of 26 December 2005 and 17 November 2006 (see paragraph 43 above) had more or less corresponded to what K.K. had paid himself for acquiring the company shares in 2004 (see paragraphs 8 and 42 above). The second, third and fourth applicants also emphasised that they could not be considered as mala fide owners, as they had never had any direct financial dealings with K.K. over the company shares.

49. As to the remaining respondent, G.-T. Ltd, this company failed to submit any comments in reply to K.K.’s action.

(b) Proceedings before the court of first instance

50. Given that K.K.’s action of 4 August 2015 included, amongst other things, a copyright claim (see paragraph 46 above), it was assigned to Judge T.U., who, according to the applicants, was the only civil judge specialising in copyright disputes on duty at the Tbilisi City Court on that day.

(i) Procedural issues

(α) Interim injunction of 5 August 2015 – freezing order in respect of Rustavi 2

51. On 5 August 2015 Judge T.U., who was dealing with K.K.’s application for a preliminary injunction (see paragraph 47 above), ruled that both Rustavi 2’s corporate assets and all of the owners’ shares in the company should be frozen while the case was being examined. The company was thus prohibited from communicating with the banking sector for the purposes of taking out loans, and from selling or renting out any of its real and movable property, such as buildings, land, broadcasting equipment, vehicles, and so on. The company was also prohibited from entering into possible mergers and acquisitions or implementing any other changes affecting its corporate structure.

52. As regards the owners – the second, third and fourth applicants and N. – Judge T.U. specified that they should be prohibited from entering into any legal relations which could result in either the definitive or provisional disposal of their shares in the company, and that they should abstain from any acts which could have an impact on Rustavi 2’s financial sustainability and normal business activities.

53. In Judge T.U.’s opinion, those interim measures were necessary to ensure the proper administration of justice in the ongoing property row between K.K. and the current owners of the company over Rustavi 2’s shares.

(β) Other procedural issues

54. On 18 August 2015, under Article 26 of the Code of Civil Procedure, the respondent applicants requested that the case be referred from a judge sitting in a single-judge formation to a bench composed of three civil judges of the Tbilisi City Court. They referred to the exceptional sensitivity and complexity of the case as reasons for their application. By a ruling of 14 September 2015, Judge T.U. rejected the applicants’ application, reasoning that involving three judges in the examination of the case might result in unnecessary delays in the proceedings.

55. On 29 September 2015 the third and fourth applicants signed a sale contract with a relative of the former Minister of Defence, giving up their joint 100% of the shares in TV Sakartevelo for USD 400,000 (approximately EUR 358,000). In accordance with the terms of the contract, along with paying the agreed sum for the shares, the buyer undertook to invest USD 6 million into Rustavi 2, whose assets had been frozen since 5 August 2015.

56. The parties to the contract asked the Public Registry to effect the formal transfer of the shares in TV Sakartvelo on the same day, 29 September 2015. However, the registry, citing certain technical issues, postponed the registration.

57. On the following day, 30 September 2015, at around 2.30 p.m., K.K. filed an application with Judge T.U. for another preliminary injunction to freeze the assets of TV Sakartvelo as well. The application was granted by the judge at 5.39 p.m. on the same day, and at 9.35 p.m. the Public Registry made the necessary records to freeze the second applicant’s assets.

58. The Director General of Rustavi 2, N.Gv., immediately made a public statement saying that the second court injunction of 30 September 2015 made it impossible to enforce the sale contract of 29 September 2015 (see paragraph 55 above), and thus cut off vital investment for the broadcaster. N.Gv. accused Judge T.U. of being bribed by former Prime Minister B.I., and made statements in his address such as “soil will burn under the judge”, “he will never find a safe haven in this country” and, making reference to a Nazi connotation, he called Judge T.U. “a sonder judge”.

59. On 12 October 2015 Rustavi 2 aired a journalistic investigation into a criminal investigation against Judge T.U.’s mother which was allegedly ongoing. Journalists from the channel claimed to have discovered that the judge’s mother had injured her son-in-law, the husband of her late daughter, with an axe during a family dispute which had occurred on 7 January 2014. Immediately after the incident, the police had intervened and launched a criminal investigation. The injured person had been taken to hospital for medical assistance, but no charges had been brought against the judge’s mother at that point. According to Rustavi 2’s journalists, it was only on 24 September and 12 October 2015 respectively that the injured person had suddenly been declared a victim and the judge’s mother had been charged with the criminal offence of intentionally inflicting less serious bodily harm. Interviewed by Rustavi 2’s journalists, the injured party emphasised that Judge T.U. had tried to assist his mother by using his authority and connections in the immediate aftermath of the incident of 7 January 2014.

60. On 16 October 2015 the Deputy President of Parliament, a member of the ruling GDC coalition, made a public statement about the journalistic investigation aired by Rustavi 2 on 12 October 2015. She called upon Judge T.U. not to withdraw from the case. The Deputy President stated “if a judge is not able to sustain such pressure, [he or she] should not only withdraw from a case, but quit the judiciary altogether”. She added that Rustavi 2 was a politically biased television channel which had nothing in common with free speech.

61. On 19 October 2015 the applicants requested that Judge T.U. recuse himself from the case. The applicants first emphasised that there was a strong belief that the examination of the case had started with “forum shopping” (a process whereby a litigant “shops around” in order to have his or her case heard by a favourable court). Notably, being aware that Judge T.U. had been the only civil judge specialising in intellectual property disputes on duty at the Tbilisi City Court on 4 August 2015, K.K. had artificially included in his action a clearly unmeritorious copyright claim (see paragraph 46 and 50 above). The applicants then referred to the fact that Judge T.U.’s mother had been accused of a criminal offence. They argued that, from the perspective of an objective observer, it might look questionable that the criminal investigation had been revived and a charge formally preferred against the woman twenty-one months after the relevant incident, thus with a significant delay (see paragraph 59 above). Those dubious circumstances might lead people to think that, by renewing the criminal case against the judge’s mother after such an inexplicable delay, a delay which coincided with the commencement of the examination of the Rustavi 2 ownership dispute, the authorities had wished to obtain leverage over the examining judge.

62. As additional grounds for requesting that the judge recuse himself, the applicants referred to a number of public posts that Judge T.U.’s wife had posted on her Facebook account. Notably, on 13 August 2015, that is by the time her husband had already issued the preliminary injunction of 5 August 2015 freezing the television channel’s assets (see paragraphs 51-53 above), his wife, making allegorical references to Data Tutashkhia, a famous Georgian novel , had compared Rustavi 2 to Arkipo Seturi, a villain from that novel[1]. The relevant public Facebook post read as follows:

“‘On the contrary, Asineta, on the contrary’ – this is a well-known phrase of a well-known literary character ... The only thing is that today Rustavi 2 is our [Arkipo] Seturi, the Father-Breadwinner, whilst Asineta appears to be the mindless part of our society.” (“პირუქუ, ასინეთა, პირუქუ’ - ეს ცნობილი ლიტერატურული გმირის ცნობილი ფრაზაა ... უბრალოდ ახლა სეთური და მამა-მარჩენალი რუსთავი 2-ია, ასინეთა კი ქართული საზოგადოების უმეცარი ნაწილი.”)

63. In another public post on Facebook, on 2 October 2015 Judge T.U.’s wife had shared a video from a satirical Facebook page called “Property‑frozen Rustavi 2” (“ყადაღადადებული რუსთავი 2”). That video showed an interview given by the current Director General of Rustavi 2, N.Gv., back in 2007, when he had held the post of Deputy Chief Public Prosecutor. She had made the following comment on the shared video:

“Well, in comparison to the insane face he [N.Gv.] had yesterday, in that public appearance [in 2007] at least he had something of the exquisite villain [about him] ...” (“ნუ, გუშინდელ შეურაცხად სახესთან შედარებით, ეს გამოსვლა დახვეწილი არამზადას გამოსვლას მაინც ჰგავს...”)

64. Judge T.U. examined and dismissed the applicants’ request for him to recuse himself on the same day, 19 October 2015. As regards his wife’s Facebook publications, the judge stated that she was an ordinary individual who was free to have her own opinions on various matters, and that whilst she herself was not bound by judicial ethics, she had never agreed those publications with him. The judge emphasised that he had not been aware of the existence of those publications and that his wife, unlike himself, could not be considered limited in the right to exercise her freedom of speech. The judge further attached importance to the fact that one of his wife’s Facebook publications only concerned the Director General of the television channel, and not the channel as such. He also underlined that N.Gv. himself, in his various public statements, had never hidden his intention to provoke the examining judge into behaving in an unethical manner by proffering various insults (see paragraph 58 above).

65. As regards the circumstances surrounding his mother, Judge T.U. firstly stated that, “according to the Bangalore Principles of Judicial Conduct”, she could not be considered part of his family, because she lived separately from his household, at a different address, and was not economically dependent on him. He further stated that he had always distanced himself from the criminal proceedings against his mother. His personal curiosity in the case had been limited to soliciting information from his mother’s lawyers about the prospects of the case. According to information he had received from the lawyers, he knew that the impugned act had been committed by his mother as a result of justified emotional strain, since the victim, her son-in-law, had been verbally harassing her on a regular basis. He also knew that, given the petty nature of the offence in question, the proceedings would probably be concluded with a victim-offender mediation.

66. Judge T.U. concluded by saying that, since the Director General of Rustavi 2, N.Gv., had orchestrated the public campaign against him, he, as the examining judge of the complex and sensitive case, had a moral and professional obligation to stay firm, sustain the pressure and prove that he could act with the requisite independence and impartiality. With all this in mind, the judge ruled that the application for him to recuse himself from the case was not justifiable and should be dismissed. The judge’s decision was later confirmed by both the appellate and cassation courts (see paragraphs 97 and 120 below).

67. On 26 October 2015 the applicants lodged a constitutional complaint with the Constitutional Court to annul the relevant provisions in the Code of Civil Procedure which allowed a court of first instance in civil matters to order the immediate enforcement of a decision even if a further appeal would normally lie against that decision. The complaint was as a result of the applicants’ concern that K.K. could demand immediate enforcement of a first-instance court judgment in the event that he won the ownership dispute. On 2 November 2015, accepting the applicants’ constitutional complaint for examination, the Constitutional Court ordered the provisional suspension of the procedural provisions in question.

(ii) Judgment of 3 November 2015 on the merits of the case

68. Between 19 October and 3 November 2015, with the participation of both sides, Judge T.U. held eight full-day hearings during which the merits of the case were examined. On 3 November 2015 he delivered a judgment upholding the majority of K.K.’s claims.

69. In his judgment of 3 November 2015 the judge dismissed as unsubstantiated K.K.’s claims regarding his intellectual property in respect of the logo and the three entertainment shows used and broadcast by Rustavi 2. The judge noted that the claimant had not substantiated his claims by putting forward any evidence or argument at all. Consequently, the judge also rejected K.K.’s claim for damages in respect of the alleged breach of copyright (see paragraph 46 above).

70. On the other hand, Judge T.U. allowed K.K.’s claims in relation to H. Ltd, G.-T. Ltd and the current owners of Rustavi 2 – the second, third and fourth applicants and N. – by annulling the share purchase agreements of 26 December 2005 and 17 November 2006 as null and void ab initio, and reinstating the claimant’s ownership of 100% of the shares in Rustavi 2. In arriving at that conclusion, the judge relied on the following. Firstly, he noted that the claim for annulment of the impugned agreements had been lodged under Article 85 of the Civil Code on the basis of duress (see paragraphs 43 and 48 above). However, the judge observed that the claimant had failed to substantiate duress with any valid evidence whatsoever. Thus, although K.K. had lodged a criminal complaint on 1 December 2008 regarding the loss of his business interests as a result of alleged pressure from the then President of Georgia, the fact of lodging the complaint, without the investigation having established any concrete facts, could not be taken by the civil courts as proof of the duress. Judge T.U. thus concluded that the claimant had failed to prove his allegation regarding giving up company shares under duress.

71. On the other hand, reserving the right to re-characterise the facts of the case, Judge T.U. decided to assess the validity of the share purchase agreements of 26 December 2005 and 17 November 2006 under Article 54 of the Civil Code, that is by assessing whether or not the contracts could be found to be unenforceable on grounds of public policy (see paragraph 127 below). In that respect, the judge referred to a State auditor’s expert opinion dated 9 September 2015 which had established that, using an asset-based valuation method (“აქტივებზე დაფუძნებული მეთოდი”) the value of Rustavi 2, the enterprise as such together with all its assets and liabilities, in 2005-2006 had been approximately GEL 7,322,686 (approximately EUR 2,727,041). However, since the claimant had given up the company under the impugned share purchase agreements for as little as GEL 571,400 (approximately, EUR 212,766), almost 12.8 times less than the company’s actual value, that significant price difference itself meant that the contracts contradicted sound reason, ethical and equitable principles and public policy considerations.

72. The judge attached further significance to the fact that, after having acquired Rustavi 2 company shares by virtue of the above-mentioned share purchase agreements, G.-T. Ltd and H. Ltd had further disposed of those shares in very short periods of time, fourteen days and nine months respectively. All those circumstances clearly suggested that neither of the two purchasers had ever been genuinely interested in acquiring and running the television company, and moreover that media business had never formed part of their ordinary business activities. All in all, and particularly given the manifest difference between the value of the ceded property and the derisory payment received in exchange, the judge concluded that the share purchase agreements of 26 December 2005 and 17 November 2006 were illusory, entered into in disregard of various public considerations, and unenforceable under Article 54 of the Civil Code. That being so, those agreements were also void ab initio, which entailed the extinguishment of all possible legal consequences relating to the conclusion of the defective agreements, pursuant to Article 61 of the Civil Code (see paragraph 128 below). In the light of the above factual findings, and noting that there existed no specific statutory time-limits in relation to claims concerning ab initio void contracts, the judge decided to apply the general statute of limitation of ten years under Article 128 § 3 of the Civil Code.

73. The judge then continued by noting that it was legitimate for the company shares in the current owners’ possession to be retrieved in favour of K.K., given that they could not be considered bona fide purchasers. In that respect, the judge firstly noted that the third applicant, who had always run various businesses with his brother, the fourth applicant, had been the authorised representative of a company which had bought Rustavi 2 from G.‑T. Ltd on 1 December 2006, that is only fourteen days after G.‑T. Ltd had obtained the property from K.K. (see the preceding paragraph). In other words, the third and fourth applicants had known about the derisory price for which K.K. had given up the television company, and thus should have realised that they were acquiring property which was clearly tainted. In that respect, the judge relied on Article 187 § 2 of the Civil Code, in accordance with which a third-party acquirer of movable property, such as company shares, cannot be considered a bona fide owner if the property in question has been misappropriated from the original owner.

74. On the other hand, in the judge’s view, being a mala fide third-party acquirer was not enough to make the person in question responsible for providing reimbursement in respect of the profit earned by the television channel. Consequently, the judge dismissed K.K.’s claim against the applicants for loss of income (see paragraph 45 above) as ill-founded.

75. The parties could lodge an appeal against the judgment of 3 November 2015 within fourteen days of receiving a copy of its reasons.

(iii) Interim injunction of 5 November 2015

76. On 5 November 2015, granting an application by K.K., Judge T.U. ordered another injunction in relation to the dispute. Notably, he appointed temporary managers for Rustavi 2, thus replacing the broadcaster’s Director General, N.Gv., and its chief financial officer.

77. As one of his justifications for issuing the injunction, the judge stated that, under the current management, the broadcaster was “overly focused” on coverage of the on-going civil dispute, which could negatively affect the television station’s ordinary programming, resulting in a reduction in viewing figures. The judge also said that, in general, media outlets should be providing coverage on all issues “of public interest” and not “concentrating on only one issue”. Judge T.U. further suggested that “it was questionable” whether the reporting activities of Rustavi 2, under its current management, were “fair and objective”. Disregarding the duty to report in an objective manner “posed a danger to the main role and vocation of the media in a democratic society”.

78. On 13 November 2015 the Constitutional Court, accepting a second constitutional complaint by the applicants for examination, ordered the suspension of the application of the clauses in the Code of Civil Procedure by which Judge T.U had appointed temporary managers for Rustavi 2 on 5 November 2015.

79. On 27 November 2015 the Tbilisi Court of Appeal quashed Judge T.U.’s injunction decision of 5 November 2015.

(c) Proceedings before the Tbilisi Court of Appeal

(i) Injunction proceedings

80. On an unspecified date all four applicants lodged with the Tbilisi Court of Appeal an interlocutory appeal against the interim injunction of 5 August 2015 which had frozen Rustavi 2 (see paragraphs 51-53 above).

81. The case file does not contain a copy of that appeal. However, as can be inferred from various documents available (court decisions of 20 November and 2 March 2017, see paragraphs 82 and 101 below), the applicants mainly argued that Judge T.U., in his injunction order, had not sufficiently explained whether the freezing of the company’s own assets and the owners’ shares in that company had been truly necessary. The judge had not elaborated on why it had not been possible to proceed with an examination of the property dispute on the merits without applying such drastic measures against the company and its owners. The applicants complained regarding the disproportionate and sweeping nature of the interim measures applied, measures which had clearly interfered with their property interests. They feared that the actual result of the impugned measures would be the opposite of what the first-instance judge had allegedly pursued. Without being able to manage its various movable and immovable assets freely and fully, the television company could suffer serious financial setbacks, which would have an adverse impact on its ability to perform its media activities with the requisite independence. In that respect, the applicants specified certain particular aspects of doing business in the media sector, such as, for instance, the seasonality of media production, which created the need for maintaining permanent access to the banking sector. Citing the relevant case-law of the Constitutional Court of Georgia and the Court, all four applicants referred to both the company’s various proprietary interests as well as the first applicant’s right to impart information under Article 10 of the Convention.

82. The applicants’ interlocutory appeal was assigned to a civil chamber of the Tbilisi Court of Appeal, a chamber which differed from the one subsequently composed to examine the merits of the case (see paragraph 92 below). That chamber rejected the appeal in a decision of 20 November 2015, slightly amending the scope of the interim injunction of 5 August 2015.

83. In its reasoning, the appellate court began by noting that the standard of proof in interlocutory proceedings was always lower than that normally applied by a civil court to the merits of a property dispute. Thus, it was not necessary to address the necessity of the applied interim measures from the standpoint of preponderance of evidence. Rather, in the appellate court’s view, it was sufficient to establish that a prima facie situation existed militating in favour of an interim measure. In that respect, the Court of Appeal referred to the history of numerous transfers of Rustavi 2 company shares from one private party to another within very short periods of time (see paragraphs 6-24 above). Given the ease with which the television company had changed hands in the past, there was a prima facie risk that another change in ownership could occur whilst the proceedings on the merits were still ongoing, something which would unduly thwart the execution of a final court decision. It was stated that the legitimate aim pursued by the interim injunction of 5 August 2015 was the need to avoid the creation of any new barriers to the enforcement of a final court decision in the future.

84. The appellate court then addressed the question of whether all of the interim measures applied by Judge T.U. had been proportionate to the legitimate aim pursued. In that respect, the court stated that, whilst all the other freezing measures seemed reasonable, it could not comprehend the rationale behind restricting the company’s right to rent some of its various movable and immovable assets (see paragraph 51 above). That particular restriction, which did not have any relevance to the legitimate aim pursued, ought therefore to be lifted, and the company was allowed to rent a number of its assets for a limited but renewable period of time (thus, renting contracts should not exceed 3 months).

85. The appellate court also addressed the prohibition on Rustavi 2 entering into any mergers or acquisitions (see paragraph 51 above). In that respect, it explained that the restriction only targeted the company’s external corporate structure. However, the measure should not be understood as preventing the company from implementing any internal organisational change which its director deemed necessary to maintain cost optimisation. Thus, the company was free to implement any type of internal organisational changes, such as those relating to hierarchy, employment contracts and various administrative procedures.

86. All in all, whilst upholding the majority of the interim restrictions applied by the injunction of 5 August 2015, the Tbilisi Court of Appeal’s decision of 20 November 2015 slightly amended the previous order by allowing Rustavi 2 to rent out some of its various movable and immovable assets (see paragraph 84 above). The appellate decision also confirmed that the company remained free to implement internal organisational changes.

(ii) Proceedings on the merits of the property dispute

87. On 15 December 2015 K.K. lodged an appeal against the first‑instance court’s judgment of 3 November 2015 in so far as the copyright claim against the first applicant (see paragraphs 46 and 69 above) and the claim for loss of income against the second, third and fourth applicants were concerned.

88. On 17 December 2015 the second, third and fourth applicants lodged, together with H. Ltd and N., an appeal against the first-instance court’s judgment of 3 November 2015. Neither the first applicant nor G.‑T. Ltd, the two other respondents in the case, exercised their right to lodge an appeal.

89. Amongst a number of other procedural issues, the appellant applicants, in particular the second, third and fourth applicants (hereinafter “the appellant applicants”), called into question Judge T.U.’s refusal to recuse himself from the case despite the existence of serious circumstances calling into question, at least from an objective standpoint, his independence and impartiality. In support of their grievance about the lack of independence and impartiality, they referred to the relevant domestic and the Court’s case-law. The appellant applicants again referred to the fact that the criminal proceedings against the judge’s mother had suspiciously been reactivated at the time of the examination of the case, as well as the fact that the judge’s wife had publicly expressed her utterly negative attitude towards Rustavi 2. They also complained that the preliminary and interim injunctions issued by the first-instance court had been manifestly disproportionate, and had not only affected the company’s purely economic activities, but interfered with the channel’s editorial freedom. The appellant applicants also referred to a number of statements made by various high‑ranking State officials, including the Deputy President of Parliament (see paragraph 60 above), which represented, in their view, an encroachment upon the independence of Judge T.U.

90. As to the merits of the judgment of 3 November 2015, the appellant applicants mainly concentrated on calling into question the evidential weight of the State auditor’s expert opinion of 9 September 2015, which had assessed the value of Rustavi 2 company shares at the material time (see paragraph 71 above), as well as their inability to adduce various new documents into the case file. They further contested the application of Article 54 of the Civil Code to the circumstances of the case. The appellant applicants claimed that if the only grounds for annulling the share purchase agreements had been the alleged discrepancy between the prices determined by those agreements and the actual value of the property in question, then the issue ought to be decided under Article 55 instead. The appellant applicants also complained that Judge T.U.’s reading of Article 187 § 2 of the Civil Code, on which basis he had refused them bona fide owners’ protection, had been inaccurate.

91. On 7 June 2016 K.K. withdrew his appeal of 15 December 2015 (see paragraph 87 above). Despite that fact, and the consequential result of the first applicant no longer being a co-respondent in the proceedings, the lawyers of Rustavi 2 still continued with raising various procedural requests which were then addressed by the appellate and cassation courts (see paragraphs 93-95 and 98 below).

92. The appellant applicants’ appeal was assigned to a civil chamber of the Tbilisi Court of Appeal composed of three judges – Judge N.N., Judge Sh.K., and Judge N.G.

93. On 27 April 2016 all four applicants applied for one of the appellate judges, Judge N.G., to withdraw from the case for lack of impartiality. In that respect, they referred to two statements dated 31 August and 20 October 2015 made by a non-governmental organisation, the Union of Judges of Georgia (“the NGO”), an organisation which had been founded by, amongst other people, Judge N.G. In those statements, amongst other things, the NGO had reproached the Director General of Rustavi 2, N.Gv., for having insulted Judge T.U. (see paragraph 58 above), and had called upon people to allow that particular judge and the Georgian judiciary in general to proceed with the examination of the case in a respectful and calm environment. The appellant applicants argued that, since the NGO had explicitly expressed support for Judge T.U., Judge N.G., as one of the founders of the NGO, had a clear conflict of interest.

94. All four applicants’ application for Judge N.G.’s recusal was examined and dismissed by the appellate court, with Judge N.G. sitting on the bench, on the same day, 27 April 2016. The chamber ruled that the circumstances referred to in the application were insufficient for questioning Judge N.G.’s impartiality.

95. On 7 and 9 June 2016 all four applicants made another request for recusal, Judge N.G., and also challenged another judge of the chamber, Judge Sh.K., for lack of independence and impartiality. With regard to Judge N.G., their application referred to the fact that a disciplinary inquiry into a breach of judicial ethics and law had been opened against her. The applicants thus feared that the authorities might use the ongoing disciplinary proceedings as leverage to manipulate Judge N.G. As to Judge Sh.K., noting that she specialised in criminal law, the applicants claimed that it was suspicious to have a criminal judge sitting in a civil case. For various procedural reasons, those two additional applications for recusal were left without examination.

96. On 10 June 2016 the Tbilisi Court of Appeal delivered a decision, rejecting the appellant applicants’ appeal of 17 December 2015 and upholding the first-instance court’s judgment of 3 November 2015 in full. The judgment did not list the first applicant, Rustavi 2, as a party to the proceedings. The appellate court gave detailed explanations as to why the State auditor’s expert opinion of 9 September 2015 was a decisive piece of evidence, and why the respondents, despite a number of counter-arguments and submissions, had failed to refute that evidence in an effective manner. Applying the standard of proof of the balance of probabilities, the appellate court thus confirmed the existence of a manifest discrepancy between the price determined by the share purchase agreements of 26 December 2005 and 17 November 2006 and the actual value of Rustavi 2 at the material time. The appellate court further confirmed the appropriateness of Judge T.U.’s decision to apply Article 54 of the Civil Code and the general ten‑year statute of limitation (Article 128 § 3 of the Civil Code) to the facts of the case, and agreed that the current owners of Rustavi 2 could not be considered bona fide third-party acquirers (see paragraphs 72 and 73 above).

97. Furthermore, albeit it did not contain an explicit answer in respect of the applicants’ relevant complaint, the appellate court’s decision of 10 June 2016 confirmed in substance Judge T.U.’s decision of 19 October 2015 not to withdraw from the case (see paragraphs 64-66 above).

(d) Proceedings before the cassation court

(i) Injunction proceedings

98. On 17 November 2016 all four applicants filed with the Supreme Court an interlocutory application against the Tbilisi Court of Appeal’s decision of 20 November 2015. The applicants argued that the interim injunction of 5 August 2015 freezing Rustavi 2’s corporate assets and the owners’ shares in the company had been unlawful and disproportionate and should be lifted or replaced with a less stringent interim measure (see paragraphs 80, 82 and 86 above).

99. With respect to the alleged unlawfulness, the applicants referred to the fact that K.K. had withdrawn his appeal in respect of his claims against the first applicant on 7 June 2016 (see paragraph 91 above). Consequently, the first-instance court’s judgment of 3 November 2015, whereby K.K.’s claim against Rustavi 2 had been dismissed, had become final on 7 June 2016. However, given that Article 198 and Article 199(1) of the Code of Civil Procedure only provided for the possibility to apply or maintain an interim injunction against an actual party to proceedings (see paragraph 137 below), the continued application of the freezing order against Rustavi 2 had become unlawful on 7 June 2016.

100. As to the allegedly disproportionate nature of the freezing order of 5 August 2015, the four applicants argued that the continued application of the interim measure unduly interfered with the first applicant’s ability to act as a successful and independent media outlet. As a consequence, the owners of the company, including the first, second and third applicants, had sustained pecuniary loss. The freezing order had had a damaging impact on the television company’s financial sustainability, which could lead to its insolvency and the cessation of its broadcasting activities.

101. On 2 March 2017, after delivering a final judgment on the merits of the property dispute (see paragraph 112 below), the Grand Chamber of the Supreme Court issued a separate ruling rejecting the four applicants’ application to lift the preliminary injunction of 5 August 2015. In that ruling, the Grand Chamber briefly stated that, since it had already determined the subject matter of the property dispute over the company shares by way of a final judgment, in accordance with Article 199(1) of the Code of Civil Procedure, it was no longer appropriate to address the applicants’ application to lift the already extinguished interim measure.

(ii) Proceedings on the merits of the property dispute

102. On an unidentified date in either August or September 2016 the three appellant applicants, together with H. Ltd and N., lodged an appeal on points of law against the Tbilisi Court of Appeal’s decision of 10 June 2016. The arguments made in that appeal mainly reiterated those made in the appeal of 17 December 2015. The three applicants also challenged the various procedural decisions made by the appellate court, including those relating to their applications for the judges’ recusal (see paragraphs 88‑90 above).

103. On 9 September 2016 a civil affairs chamber of the Supreme Court declared the three appellant applicants’ appeal on points of law admissible. On 21 November 2016 the chamber referred the case to the Grand Chamber of the Supreme Court for examination.

104. On an unspecified date in either late November or early December 2016 K.K. submitted his written comments in reply to the appellant applicants’ appeal on points of law.

105. On 28 November 2016 all four applicants filed an application for the recusal of the President of the Supreme Court and another judge of the Supreme Court, Judge M.T., in relation to their sitting as part of the Grand Chamber. With regard to the President of the Supreme Court, the applicants referred to the fact that she might feel prejudiced against the Director General of Rustavi 2, N.Gv., since it was he who had pressed disciplinary charges against her back in 2006 while he had been a member of the High Council of Justice – disciplinary proceedings which had resulted in her being dismissed from her judicial post at that time.

106. As to Judge M.T., all four applicants referred to the fact that, prior to being elected to the Supreme Court, she had worked as the head of the legal department of a bank owned by the former Prime Minister and the informal leader of the GDC ruling party, B.I. (see paragraph 24 above). The applicants also submitted proof that Judge M.T. had donated GEL 34,000 (approximately EUR 10,600) to the GDC between 2012 and 2014, a fact which proved that she had clear political sympathies for the current ruling party. However, given the political sensitivity surrounding the dispute over Rustavi 2, it was inappropriate for a judge with a clear political orientation to sit in the case.

107. According to the official version of events, on 1 December 2016 a nine-member composition of the Grand Chamber was formed and the case material was served on the relevant judges. At that time, the parties were not informed about the composition which had been formed. According to the applicants, however, the composition of the Grand Chamber was formed no earlier than 27 February 2017 (see paragraph 109 below).

108. On 6 and 17 February 2017 the appellant applicants inquired with the Registry of the Supreme Court about the composition of the Grand Chamber. The Registry did not disclose that information at that time.

109. On 27 February 2017 the Supreme Court officially informed the parties about the composition of the Grand Chamber, specifying that the case would be examined on 2 March 2017. It turned out that both the President of the Supreme Court and Judge M.T., whose recusal had been requested by the appellant applicants (see paragraphs 105 and 106 above), were sitting in the announced composition.

110. On 2 March 2017, in addition to its separate ruling concerning all four applicants’ complaint about the interim injunction of 5 August 2015 (see paragraph 101 above), the Grand Chamber of the Supreme Court delivered another ruling addressing a number of procedural applications made by them (see paragraph 105 and 106 above). The Grand Chamber delivered that ruling prior to its final judgment on the merits of the case (see paragraph 112 below). Amongst other things, the Grand Chamber dismissed the applicants’ application of 28 November 2016 for the recusal of the two judges. It stated that the grounds referred to by the applicants were insufficient for calling into question the judges’ impartiality and independence under either the subjective or objective tests under Article 6 § 1 of the Convention.

111. Dispensing with an oral hearing, the Grand Chamber also delivered a final judgment on the merits of the case on the same day.

(iii) Judgment of 2 March 2017

112. By a judgment of 2 March 2017, the Grand Chamber of the Supreme Court quashed the Tbilisi Court of Appeal’s decision of 10 June 2016 and decided the case anew. In its judgment, the first applicant, Rustavi 2, was not listed as a party to the proceedings.

113. The Grand Chamber reproached the two lower courts for having decided the civil dispute by applying irrelevant provisions from the Civil Code. Notably, it ruled that, given the particular factual circumstances, the dispute should not have been examined with reference to Article 54 of the Civil Code, which the lower courts had referred to (see paragraphs 71, 72 and 96 above), but rather in accordance with Article 85 of the Civil Code. Indeed, the essence of K.K.’s civil claim was proving that he had been coerced into giving up the television channel by signing the share purchase agreements of 26 December 2005 and 17 November 2006 because of threats from high-ranking State officials, such as the President of Georgia, the Minister of the Interior and the Chief Public Prosecutor (see paragraph 43 above).

114. As to the statute of limitations applicable to claims for the annulment of contracts made under duress under Article 89 of the Civil Code, a statute which set out a period of one year, the Grand Chamber noted that, in accordance with the above-mentioned provision, the relevant period should have started to run from the moment the situation constituting duress had ceased to exist. In K.K.’s case, since the duress had been the pressure exerted upon him by high-ranking State officials of the former UNM Government, such a situation had lasted until the change in the ruling forces brought about by the results of the parliamentary election of October 2012. However, even prior to the change in the ruling forces, a fact which could trigger the running of a statutory period of one year under Article 89 of the Civil Code in terms of limitation, K.K. had already exercised his right to repudiate as void the relevant share purchase agreements by lodging a criminal complaint on 1 December 2008 regarding the misappropriation of his property by the high-ranking State officials (see paragraph 44 above).

115. The Grand Chamber also developed an alternative line of reasoning with regard to the question of whether or not K.K.’s claim was time-barred. It suggested that, under Article 85 of the Civil Code, a claim to annul a contract resulting from coercion could also be lodged within three years under the statute of limitations applicable to civil wrongs under Article 1008 of the Civil Code (see paragraph 135 below). However, the Grand Chamber also reiterated that, under the general provisions of the Civil Code governing all types of statutory time-limits, notably Article 138 § 3 of the Civil Code, the running of a statutory time-limit could be interrupted by lodging either a court action or any other complaint claiming a pecuniary interest (see paragraph 133 below). That being so, the Grand Chamber concluded that, by lodging the criminal complaint regarding the misappropriation of his property by the State machinery with the prosecuting authority on 1 December 2008, K.K. had done nothing else but voice his claim to Rustavi 2. Consequently, it had been on 1 December 2008 that K.K. had interrupted the running of the statutory time-limit of three years normally applicable to civil wrongs with his claim pertaining to contractual liability.

116. The Grand Chamber emphasised that provisions allowing claims for the annulment of contracts as null and void ab initio, of which Article 85 of the Civil Code (on contracts resulting from coercion) was an example, should be treated with the utmost care. This was because the annulment of such a contract would result in the nullification of all legal consequences associated with the civil contract, which was prejudicial in respect of the principle of legal certainty. To that end, the Grand Chamber quoted the legal commentary of a leading Georgian specialist on civil law on the issue of voidable contracts:

“... that a contract is null and void does not only concern the unilateral termination of the contract, but [also] all the relevant contractual obligations being rendered inexistent from the very outset. Therefore, such a claim is considered to be an extremely powerful tool to influence legal relations in society, and the exercise of this right cannot be left unrestrained. Otherwise, there will be a high risk of legal uncertainty. The existence of this risk has been duly acknowledged by the legislator, who has placed the right to claim that a contract is null and void within very tight procedural restraints.”

117. As to the circumstances which proved that pressure had been exerted on K.K. by high-ranking State officials, the Grand Chamber listed the following:

(i) the fact that K.K. had lodged a criminal complaint with the Chief Public Prosecutor’s Office on 1 December 2008;

(ii) the fact that on 21 April 2009 K.K., who by that time had left Georgia for fear of persecution by the State, had been granted political asylum in Germany;

(iii) the fact that K.K.’s alleged persecution had been mentioned in the 2009 Country Report on Human Rights Practices issued by the United States Department of State (see paragraph 138 below);

(iv) the fact that, after the change in government in October 2012, the Parliament of Georgia had on 5 December 2012 granted K.K. the status of a person persecuted for political reasons by the previous regime.

118. The Grand Chamber then stated that K.K.’s reference to all those facts in his civil action was sufficient for a prima facie assumption that he had been subjected to pressure by the State when giving up Rustavi 2 in 2005 and 2006. That being so, the burden of proving that his allegations were untrue shifted onto the respondents, who, in their written submissions, had failed to effectively rebut the claimant’s allegations. In that respect, the Grand Chamber emphasised that one of the main respondents, G.-T. Ltd, had waived its right to submit written comments in reply to K.K.’s initial claim, whilst the written submissions of H. Ltd, another main respondent, remained silent on all the above-mentioned four factual circumstances referred to by K.K. in support of his claim of duress.

119. Finally, espousing the relevant part of the reasoning given by the two lower courts, the Grand Chamber confirmed that none of the current owners, particularly the third and fourth applicants and TV Sakartvelo, which the former owned, could be considered bona fide third-party acquirers and owners of Rustavi 2. By listing the sequence and the circumstances of various financial transactions which had occurred after K.K. had ceded the company to H. Ltd and G.-T. Ltd on 26 December 2005 and 17 November 2006, the Grand Chamber found it established that the third and fourth applicants had been aware from the very outset of the unfair and coercive financial obligations imposed upon K.K.

120. In its judgment of 2 March 2017, the Grand Chamber, amongst other procedural issues, also addressed the applicants’ complaints regarding the involvement of judges allegedly lacking independence and impartiality in the examination of the case, both at first-instance and appellate level. Those procedural complaints were rejected as ill-founded, with the highest cassation court confirming that both the first-instance judge, Judge T.U., and the appellate judge, Judge N.G., had been correct in their decisions not to withdraw from the case.

121. The operative part of the Supreme Court’s judgment of 2 March 2017 was announced to the parties on the same day. A copy of that judgment containing full reasons was served on the appellant applicants on 2 April 2017.

B. Proceedings before the Court under Rule 39 of the Rules of Court

122. On 3 March 2017, invoking Rule 39 of the Rules of Court, the applicants requested that the Court indicate the following interim measures to the respondent Government:

“i. to abstain from enforcement of the Supreme Court’s judgment of 2 March 2017;

ii. to abstain from closing, facilitating or condoning the closure of Rustavi 2 or interfering with its broadcasting in whatever form;

iii. to not replace, directly or through its agents and/or affiliates, the management and/or editorial board of the company.”

123. As to the grounds for the request, the applicants referred to the first applicant’s right under Article 10 of the Convention. Even if, on the surface, the case looked like an ordinary civil dispute between private parties, in the applicants’ view, the chronology of the alleged campaign orchestrated by the State against Rustavi 2 (see paragraphs 25-41 above) suggested that political interests were at stake. Being virtually the only opposition television channel in the country whose editorial policy was beyond the control of the current ruling forces, the applicants claimed that the State machinery had used K.K.’s otherwise clearly unmeritorious civil claim to achieve its hidden goal of silencing the free media outlet.

124. On 3 March 2017 the Court (the duty judge) applied Rule 39 of the Rules of Court and indicated to the respondent Government that “in the interests of the parties and the proper conduct of the proceedings before it, the enforcement of the Supreme Court decision of 2 March 2017 should be suspended, and that the authorities should abstain from interfering with the applicant company’s editorial policy in any manner.” The interim measure lasted until 8 March 2017.

125. On 7 March 2017 the Court (a Chamber constituted within Section IV) decided unanimously to confirm until further notice the interim measure previously indicated on 3 March 2017.

C. Relevant domestic law and international documents

1. The Civil Code, as in force at the material time

(a) Chapter on contract law

126. A separate chapter in the Civil Code, consisting of Articles 50-114, was dedicated to issues pertaining to contract law.

127. Article 54, Article 55 § 1 and Article 61 § 1 of the Civil Code read as follows:

Article 54 – Contracts contravening legal order and good morals

“A contract that contravenes rules and prohibitions determined by law, or the public order and principles of good morals, is void.”

Article 55 – Contracts made by abuse of power are void

“1. A contract can be declared void if the difference between the assumed undertakings and the compensation proposed in exchange is strikingly disproportionate, and the contract has only been made because one of the parties has abused his or her market power or maliciously exploited the other party’s hardship or naivety.”

128. Pursuant to Article 61 § 1 of the Civil Code, a void contract is considered null from the moment it is made.

129. Sub-chapter II, consisting of Articles 72-89, addressed three particular types of voidable contracts – contracts made by mistake or fraud, and those made under duress. Specific provisions in this sub-chapter further provided for special statutes of limitation in relation to repudiation of each of the three types of contract.

130. As regards an avoidable contract made under duress, Article 85 of the Civil Code defined the concept as follows:

Article 85 – Contract made under duress

“The use of duress (force or the threat of force) for the purpose of inducing a person to enter into a contract entitles the latter to repudiate the contract as void.”

131. However, Article 89 prescribed a specific statute of limitation in respect of exercising the right to repudiate a contract made under duress, within the meaning of Article 85. This provision read as follows:

Article 89 – Limitation period for repudiation of a contract made under duress

“Repudiation of a contract made under duress is possible within one year of the situation constituting duress ceasing to exist.”

(b) Chapter on movable assets

132. Article 187 § 2 of the Civil Code, which formed part of a chapter dedicated to regulating ownership of movable assets (consisting of Articles 186-197), read as follows:

Article 187 – Bona fide third-party acquirer

“2. A third-party acquirer of movable assets cannot be considered an acquirer in good faith if the original owner has lost the assets in question, [if the assets] have been misappropriated, or [if the acquirer has been] otherwise dispossessed against his will, or if the third-party acquirer has obtained those assets free of charge. These restrictions cannot apply with regard to money, financial securities and/or assets disposed of through a public auction.”

(c) Chapter on the calculation of time-limits

133. A separate chapter of the Civil Code, consisting of Articles 121‑146, was dedicated to general principles governing the calculation of various time-limits provided for in the Civil Code. In particular, Article 138 read as follows:

Article 138 – Interrupting a limitation period by lodging an action

“The running of a limitation period is interrupted when the entitled person lodges an action with a court or otherwise voices a claim by applying with a request or statement to a competent State agency ...”

(d) Chapter on tort law

134. Another separate chapter of the Civil Code, consisting of Articles 992-1016, related to civil wrongs. Article 992 defined tort as follows:

Article 992 – Notion of tort

“A person who causes loss or harm either by unlawful, intentional or negligent conduct must provide compensation in respect of the damage.”

135. Article 1008 provided for a specific statute of limitations for tort:

Article 1008 – Time-limit for claiming damages

“Damages in respect of a civil wrong can be claimed within three years of the injured party becoming aware of the existence of the harm or the identity of the wrongdoer.”

2. The Code of Civil Procedure, as in force at the material time

136. Articles 88-92 of the Code of Civil Procedure regulated how third parties could become involved in civil proceedings. In particular, the provisions differentiated between two sub-categories of third parties: “a third party with an independent claim over the subject matter of a civil dispute” (Article 88), and “a third party without an independent claim over the subject matter of a civil dispute” (Articles 89-91). The legal provisions which referred to the latter sub-category read as follows:

Article 89 – A third party without an independent claim

“Any interested person who does not make an independent claim over the subject matter of the civil dispute at stake may apply for leave to intervene in the civil proceedings as a third party on behalf of either the claimant or the respondent if the outcome of these proceedings could affect [his or her] rights and responsibilities vis‑à‑vis either of the two parties (the claimant or the respondent). After hearing the two parties’ observations on the matter, the court shall decide whether or not the application is to be granted.”

Article 90 – Involvement of a third party [without an independent claim] at the request of either of the parties to the proceedings

“1. Either of the parties to the civil proceedings (the claimant or the respondent) shall have the right to ask the court to involve a person without an independent claim over the subject matter of the civil dispute as a third party. Such an application can be made either in writing or orally, and must contain reasons. The court will then, after hearing both parties’ observations on the matter, deliver a ruling either granting or rejecting the application.

2. The court’s ruling on the question of a third party’s involvement at the request of either the claimant or respondent can be challenged before a higher court together with a judgment on the merits.”

Article 91 – Procedural rights of a third party [without an independent claim]

“A third party without an independent claim over the subject matter of the civil dispute shall have the benefit of all the procedural rights and be expected to respect all the procedural duties normally reserved for an ordinary party to the proceedings (a claimant or a respondent), except for the following procedural rights: [the right] to increase, reduce or change the subject matter of the dispute, to concede a claim, to withdraw an action or claim, to reach a friendly settlement, to file a counterclaim and to initiate enforcement proceedings on the basis of a final court decision.”

137. Article 198 § 2 (a) and Article 199(1), provisions which concerned interim injunctions, read as follows;

Article 198 – Interim injunctions

“1. The question of exactly what type of interim injunction should be applied in a given case will be decided by the court on the basis of an application by the claimant containing reasons.

2. The following interim injunctions [that can be applied in civil proceedings] exist:

(a) Freezing the property, money or other financial securities owned by the respondent ...”

Article 199(1) – Lifting an interim measure

“An interim injunction that has been applied with respect to a civil claim must be lifted by the court if the claim has been rejected, dismissed or left unexamined by the courts, or if the underlying civil proceedings have been discontinued in any other manner. The court’s ruling to lift the interim measure in question may be appealed to a higher court in accordance with a procedure prescribed by law. The interim measure must also be lifted if the parties have reached a friendly settlement, unless the parties themselves have agreed on another course of action.”

3. Country Report on Human Rights Practices in Georgia, released by the US Department of State on 11 March 2010

138. An excerpt from the above-mentioned report by the US Department of State concerning the property row over Rustavi 2 read as follows:

“The privately owned national stations Rustavi 2 and Imedi, the country’s two most popular television stations, and the country’s public television station, were all generally considered to have a pro-government editorial policy.

In November 2008 Rustavi-2’s founder and former owner, [E.K.], alleged that authorities seized the television station from him in 2004. In December 2008 the next Rustavi 2 owner, [K.K.], filed a letter of complaint with the Prosecutor’s Office and Parliament alleging he was forced to give up his ownership of the station in 2006 under pressure from government officials. No action was taken on the letter.”

COMPLAINTS

A. The injunction proceedings

139. The first applicant complains under Article 6 § 1 and Article 10 of the Convention and Article 1 of Protocol No. 1 to the Convention – the last two provisions cited both separately and in conjunction with Article 18 of the Convention – that the continued application of the interim injunction of 5 August 2015 freezing its various company assets was an arbitrary decision which disproportionately interfered with its property rights, had an adverse effect on its editorial independence, and represented a hidden attempt to silence the channel. In that respect, the first applicant further complains that after it ceased to be a respondent in the main proceedings over the property row (see paragraph 91 above), there was no legal basis for maintaining the injunction in force against it, and the domestic courts should therefore have lifted it immediately. According to the first applicant, the State machinery intentionally misused the civil proceedings initiated by their proxy, K.K., in order to close down the independent media outlet which was critical of those currently in power.

140. The first applicant also complains that, in the light of certain circumstances, the involvement of Judge T.U., the President of the Supreme Court and Judge M.T. of the Supreme Court in the relevant injunction proceedings at the first and the final levels of jurisdiction amounted to a breach of the independence and impartiality principles provided for under Article 6 § 1 of the Convention.

B. The main proceedings

141. The second, third and fourth applicants complain that several judges from the first-instance court, the Tbilisi Court of Appeal and the Supreme Court should have withdrawn from their civil dispute, as circumstances existed which tainted their independence and impartiality, in breach of the relevant principles under Article 6 § 1 of the Convention.

142. The above-mentioned three applicants further complain under Article 6 § 1 of the Convention that the civil proceedings were unfair because at the very last stage the Supreme Court unexpectedly altered the whole legal structure of the dispute which had been developed during the proceedings in the lower courts, and did so without at least holding an oral hearing or otherwise giving the applicants sufficient opportunity to rebut the clearly unsubstantiated allegations made by the other party. As a consequence, the factual and legal findings that the Supreme Court set out in its final judgment of 2 March 2017 appeared to be arbitrary.

143. The second, third and fourth applicants also complain under Article 1 of Protocol No. 1 that the outcome of the civil dispute arbitrarily interfered with their various property interests.

144. Lastly, referring to Article 18 of the Convention, in conjunction with Article 1 of Protocol No. 1, the second, third and fourth applicants reiterate in substance the first applicant’s complaint regarding the State’s abuse of the whole judicial determination of the property dispute for the hidden purpose of silencing Rustavi 2 ( see paragraph 139 above).

QUESTIONS TO THE PARTIES

A. The complaints lodged by the first applicant with respect to the injunction proceedings

1. After K.K. had withdrawn his appeal against the first applicant on 7 June 2016, the latter apparently lost its standing as a respondent in the main proceedings (the ownership dispute) and the interim measure affecting its interests was thus extinguished (see Article 199(1) of the Code of Civil Procedure cited in paragraph 137 of the Statement of Facts). Having regard to these facts, for the purposes of its various complaints under Articles 6, 10 and 18 of the Convention and Article 1 of Protocol No. 1 with respect to the injunction proceedings, can the first applicant be considered to be a victim and be said to have exhausted all effective domestic remedies, as required by Article 34 and Article 35 § 1 of the Convention?

1.1 In this respect, under the relevant domestic law, was it possible to appeal against only the injunction order of 5 August 2015 without being a party to the main proceedings?

1.2 Has the first applicant requested, either before the Tbilisi Court of Appeal or the Supreme Court, to be involved in the main proceedings (the ownership dispute) as a third party intervener, under Articles 88-92 of the Code of Civil Procedure of Georgia?

2. Can Article 6 § 1 of the Convention, under its civil limb, be said to apply to the injunction proceedings (see Micallef v. Malta [GC], no. 17056/06, §§ 83-86, ECHR 2009)?

2.1 If so, were the injunction proceedings conducted with the requisite procedural fairness, in accordance with Article 6 § 1 of the Convention?

2.2 In particular, having regard to the first applicant’s relevant allegations, can Judge T.U. (at the first-instance court), the President of the Supreme Court, and Judge M.T. of the Supreme Court be said to have been independent and impartial when examining the injunction proceedings, as required by Article 6 § 1 of the Convention?

3. With regard to the injunction proceedings, has there been a violation of the first applicant’s right to freedom of expression, in particular its right to impart information and ideas, contrary to Article 10 of the Convention?

3.1 In particular, can a proven link be said to exist between the injunction proceedings and the State’s alleged attempt to restrict the first applicant’s editorial independence? Did the freezing of Rustavi 2’s assets, allegedly constituting a major setback for its financial sustainability, interfere with the channel’s freedom to impart information and ideas?

4. Did the freezing of Rustavi 2’s assets represent an interference with the first applicant’s right to the peaceful enjoyment of its possessions within the meaning of Article 1 of Protocol No. 1? If so, was that interference necessary to control the use of property in accordance with the general interest?

4.1 Having regard to Articles 198 and 199(1) of the Code of Civil Procedure, was it lawful to continue to freeze Rustavi 2’s assets after it had ceased to be a respondent in the proceedings?

5. Having regard to the nature of Article 1 of Protocol No. 1, in particular the question of the existence of either explicit or implied restrictions within that provision, can the scope of the application of Article 18 be extended to cover the former provision?

5.1 If so, and in relation to the injunction proceedings, what purpose or purposes did the authorities pursue with respect to the restrictions allegedly imposed by the State under Article 10 of the Convention and Article 1 of Protocol No. 1? More specifically, were any of the purposes of the restrictions different from those permitted by the latter provisions? If the authorities pursued more than one purpose, which one was dominant? Has there been a breach of Article 18 taken in conjunction with either Article 10 of the Convention and/or Article 1 of Protocol No. 1?

B. The complaints lodged by the second, third and fourth applicants with respect to the main set of civil proceedings

1. Did the second, third and fourth applicants have a fair hearing in the determination of their civil rights and obligations, in accordance with Article 6 § 1 of the Convention?

1.1 In particular, were the principles of equality of arms and/or adversarial proceedings respected as regards the fact that, whilst the civil dispute had been examined by the first-instance court and the Tbilisi Court of Appeal along only one line of legal reasoning and factual argument (the contracts being void for contravening legal order and good morals under Article 54 of the Civil Code), the Supreme Court examined the case with reference to Article 85 of the Civil Code, the provision originally referred to in K.K.’s action?

1.2 Given the judicial inquiry’s change in approach at the last level of the proceedings, could the second, third and fourth applicants be said to have had sufficient opportunity to have knowledge of and comment on all evidence adduced or observations filed, with a view to influencing the court’s decision (see, amongst many others, Trančíková v. Slovakia, no. 17127/12, § 39, 13 January 2015)? In the light of the same circumstances, and in relation to the applicants’ right to be afforded a reasonable opportunity to present their case and not to be placed at a substantial disadvantage vis-à-vis their opponent (compare, mutatis mutandis, with Súsanna Rós Westlund v. Iceland, no. 42628/04, §§ 40-41, 6 December 2007), what was the significance, if any, of the fact that the proceedings before the Supreme Court were conducted without a public hearing?

1.3 Did the judges of the Grand Chamber of the Supreme Court themselves respect the principle of adversarial proceedings when they decided to reject the second, third and fourth applicants’ appeal on points of law on legal grounds which were different from those relied on by the first-instance court and the Tbilisi Court of Appeal (see, for instance, Skondrianos v. Greece, nos. 63000/00 and 2 others, §§ 29-30, 18 December 2003, and Clinique des Acacias and Others v. France, nos. 65399/01 and 3 others, § 38, 13 October 2005)?

1.4 Were the reasons put forward by the Supreme Court for its judgment of 2 March 2017 devoid of arbitrariness (see, for instance, Donadze v. Georgia, no. 74644/01, §§ 31-36, 7 March 2006; Dulaurans v. France, no. 34553/97, §§ 33-34 and 38, 21 March 2000; and Khamidov v. Russia, no. 72118/01, § 170, 15 November 2007)?

- In particular, did the Supreme Court sufficiently explain, in reply to the appellant applicants’ objection, why the application of Article 85 of the Civil Code to the circumstances of the case was not time-barred under the statute of limitation contained in Article 89, the latter provision being a lex specialis in relation to Article 85? Was the Supreme Court’s position in that particular respect consistent with its previous case-law on the matter? The parties are invited to submit copies of the relevant judicial precedents.

- Did the Supreme Court sufficiently explain, in reply to the appellant applicants’ objection, exactly which pieces of evidence established, on the balance of probabilities, the fact that K.K. had been coerced into signing the share purchase agreements of 26 December 2005 and 17 November 2006 against his will?

- Did the criminal complaint filed by K.K. with the prosecuting authority on 1 December 2008, in which he described the circumstances surrounding the unlawful pressure allegedly exerted on him in relation to Rustavi 2 (the document referred to by the Supreme Court in its judgment of 2 March 2017, see paragraph 115 in the Statement of Facts), form part of the civil case file examined by the Supreme Court? The Government are invited to submit a copy of that piece of evidence.

2. For the purpose of their complaints under Article 6 § 1 of the Convention concerning the lack of independence and impartiality of Judge N.G., in so far as the second recusal request on the ground of the allegedly on-going disciplinary proceedings against that judge was concerned, and of Judge Sh.K. at the Tbilisi Court of Appeal, can the second, third and fourth applicants be said to have exhausted all effective domestic remedies, as required by Article 35 § 1 of the Convention?

2.1 Having regard to the second, third and fourth applicants’ relevant allegations, can Judge T.U. (at the first-instance court), Judges N.G. and Sh.K. (at the Tbilisi Court of Appeal), the President of the Supreme Court and Judge M.T. of the Supreme Court be said to have been independent and impartial when examining the civil dispute in question, as required by Article 6 § 1 of the Convention?

3. Does the outcome of the domestic civil proceedings represent an interference with the second, third and fourth applicants’ right to the peaceful enjoyment of their possessions, within the meaning of Article 1 of Protocol No. 1? If so, was that interference justified and devoid of arbitrariness?

3.1 Who were the owners of Rustavi 2 between its establishment in 1996 and October 2004, when K.K. and his company became the owners of 100% of the shares in the company? The information provided should clarify the legal grounds on which the various former owners first obtained and then gave up their shares in the company.

4. Having regard to the nature of Article 1 of Protocol No. 1, in particular the question of the existence of either explicit or implied restrictions within that provision, can the scope of the application of Article 18 be extended to cover the former provision?

4.1 If so, and with regard to the main proceedings (the ownership dispute), what purpose or purposes did the authorities pursue with respect to the restrictions allegedly imposed by the State under Article 1 of Protocol No. 1? More specifically, were any of the purposes of the restrictions different from those permitted under the latter provision? If the authorities pursued more than one purpose, which one was dominant? To what extent is there evidence on these matters? Has there been a breach of Article 18 taken in conjunction with Article 1 of Protocol No. 1?

[1] Note by the Registry: in colloquial Georgian, the literary character of “Arkipo Seturi” or “the Father-Breadwinner” has become a synonym for a type of “Big Brother” totalitarian ruler who uses the tools of total surveillance, disinformation, intimidation and manipulation to govern people, making them to adhere to the cult of the leader’s personality as a guiding ideology. “Asineta” is the personal name of a female character in the same novel.

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