Slidstvo.Info journalists have uncovered cases of manipulation of the automatic distribution of cases in the Kharkiv District Administrative Court in favour of judge Olena Zaichko. Usually, such methods are used to find the ‘right’ judge who will make the ‘right’ decision in a case. A total of 6 such cases were found, in one of which the judge ordered the state to pay the MP’s company more than half a billion hryvnias.
This was reported by Slidstvo.Info.
In the summer of 2018, the Kharkiv District Administrative Court received a lawsuit from the MP’s metallurgical plant, in which he asked the court to order the state to return the company’s allegedly overpaid tax — more than half a billion hryvnias. This lawsuit is followed by another, absolutely identical one, and then another, and so on until there are 22 of them.
So many lawsuits are usually filed to circumvent the automatic distribution of cases and to have the case heard by the ‘right’ judge who will make the ‘right’ decision. As a result, while other judges dismiss the lawsuit, only one judge opens the case and in the process obliges the state to pay the MP UAH 582.2 million.
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THE ‘RIGHT’ JUDGE
In early June 2024, the competition for the position of a member of the High Council of Justice ended. The competition was conducted by the Ethics Council, and among the 13 participants was judge Olena Zaichko of the Kharkiv District Administrative Court.
Judge Olena Zaichko
Slidstvo.Info journalists have already written about this judge. Zaichko could have asked her colleagues to spoil a disc with a recording of a court hearing in order to change her decision to the opposite. As a result, the local businesswoman did not pay almost UAH 7.5 million in taxes to the budget.
One of the stages of the HCJ selection process is an interview with the Ethics Council, where candidates often answer uncomfortable questions. For Zaichko, such a topic was, in particular, the manipulation of the automatic system of auto-allocation in favour of a judge.
The automatic distribution of cases among judges is an important part of the judicial system. Before this system was introduced, heads of courts used to solely assign cases to judges, which created corruption schemes whereby it was possible to buy the ‘right’ judge for money. In 2010, this changed, as a system was introduced that uses certain algorithms to determine the judge who will hear the case. It became harder to negotiate with this system than with the head of the court.
Although the approach has changed, the request to select the right judge has not disappeared, so schemes have been invented to circumvent this algorithm since the auto-allocation was introduced. For example, ‘unnecessary’ judges can allegedly go on holiday or fall ill before the auto-allocation, thus leaving the system to select only one ‘necessary’ judge.
Another scheme is to file a lot of lawsuits so that the ‘right’ judge will definitely receive your lawsuit and open a case. Members of the Ethics Council found at least 6 cases where plaintiffs manipulated the auto-allocation system so that Judge Zaichko would hear the case in the Kharkiv District Administrative Court. During the interview, the judge was asked about only one such case, in which the plaintiff wanted to recover more than half a billion hryvnias from the state budget.
A HALF-BILLION SCHEME
In July 2018, the Alchevsk Metallurgical Plant Private Joint Stock Company filed a lawsuit with the Kharkiv District Administrative Court, asking it to order the state to refund the company’s overpaid tax of UAH 582.2 million. The company is owned by the family of Serhiy Taruta, a member of the Batkivshchyna party.
Serhiy Taruta / photo www.slovoidilo.ua
Within two weeks, the plant filed 22 absolutely identical lawsuits in court. In one case, the case was not opened because the plaintiff did not pay the court fee; in three cases, a judge of the Kharkiv District Administrative Court refused to open the case because the plant, in the judge’s opinion, was suing the state without any grounds; in 17 cases, judges did not open the case because there were already identical lawsuits in court; and only Olena Zaichko opened the case on the plant’s claim.
Subsequently, the judge ruled to satisfy Alchevsk Metallurgical Plant‘s claim and ordered the state to return more than half a billion hryvnias. Ukraine won an appeal against the judge’s decision.
The story does not end there. Alchevsk Metallurgical Plant did not give up and six months later filed a new lawsuit with the Kharkiv District Administrative Court with the same demands, asking for judicial control over the execution of the court’s decision.
The scheme repeats itself: 25 identical lawsuits are filed with the court within nine days, and all judges, except Zaichko, do not open the case. During the consideration of the lawsuit, one judge even notes that the plant is abusing its rights by filing many lawsuits.
Zaichko begins to hear the case, grants the plant’s claim, but by the time the decision is executed, the appeal cancels it.
‘I cannot be responsible for the plaintiff’s actions. I do not know what the plaintiff was guided by when he took certain actions,’ Zaichko comments on this situation during an interview with the Ethics Council. The judge also says that she did not know about other identical lawsuits.
‘As can be seen from the rulings of Zaichko’s colleagues, they checked whether a similar claim had been filed with the court in the Specialised Court Case Management programme and then returned it to the plaintiff. Therefore, we should be sceptical about the judge’s explanation that she was unaware of identical claims,’ says Yelyzaveta Karachentseva, a lawyer at DEJURE Foundation.
Bankruptcy proceedings have now been initiated against Alchevsk Metallurgical Plant. According to the YouControl analytical system, this company is headed by Taras Shevchenko. In a comment to Slidstvo.Info journalists, he said that he did not know about the above-mentioned lawsuits because he had just stopped heading the plant, and despite this, Shevchenko could not say who had replaced him.
According to information from YouControl, the Alchevsk Metallurgical Plant is owned by ISD Corporation, of which Serhiy Taruta is a member. The journalists of Slidstvo.Info called him to find out the MP’s opinion on the lawsuits filed in court.
‘In 2014, I became the head of the Donetsk Regional State Administration and since then I have had nothing to do with this plant and ISD Corporation. If I still have a legal stake, it does not mean that I am involved in the business. Moreover, the business is in bankruptcy proceedings and there are no shareholders‘ meetings,’ Taruta says.
MILLIONS OF TAX, CANCELLED DECISIONS AND PENSION
Slidstvo.Info journalists managed to identify four more cases mentioned by the Ethics Council, when plaintiffs manipulated the auto-distribution system so that their case was considered by Judge Zaichko.
One of these cases also concerned the refund of allegedly overpaid tax and also the company of MP Taruta’s family. In 2018, PJSC Alchevsk Coke Plant filed a lawsuit with the court, asking for a refund of the overpaid tax, but this time for a smaller amount of UAH 14.1 million.
In total, the plant filed 15 identical lawsuits, one of which was used by Zaichko to open the case when other judges did not. The appeal also cancelled the judge’s decision.
The plaintiffs also manipulated the auto-distribution system to get Zaichko to suspend the order of the head of the Kharkiv Regional State Administration, to get the notary to restore access to the State Register of Real Property Rights, or to overturn the Pension Fund’s decision.
In all of these cases, the plaintiffs were not companies but ordinary people who filed between 23 and 15 identical lawsuits, and only Zaichko opened court cases and satisfied their claims. The Court of Appeal did not cancel the judge’s decision in only one case – when the judge cancelled the decision of the Pension Fund and ordered to pay the plaintiff a pension for years of service.
DEJURE Foundation lawyer Yelyzaveta Karachentseva says that in all these cases, the plaintiffs used the so-called ‘fan’ lawsuits to circumvent the system of automatic distribution of court cases.
‘The plaintiffs filed identical lawsuits until the case came to Zaichko. This is evident from the dates of filing claims, as there were about 10 identical claims in a short period of time. It can be seen that the plaintiffs themselves were not interested in having their case heard by other judges. For example, the plaintiffs did not pay the court fee, did not correct the deficiencies of the application, and withdrew the claim,’ says the DEJURE Foundation lawyer.
Yelyzaveta Karachentseva also emphasises that Zaichko’s colleagues almost always did not open a case because the court already had identical claims and there were judges who directly stated that the plaintiffs were abusing their right.
‘Zaichko has access to the court’s case management software and is able to check the history of lawsuits. Since there are all the signs of manipulation of the automated distribution, she should have prevented it. Moreover, the judge issued rulings pointing out similar abuses and even imposed fines,’ says Yelyzaveta Karachentseva.
A MARK FOR THE JUDGE
There is a tendency that participants in competitions from the Ethics Council, who feel that they will receive a negative opinion from this body, simply withdraw their candidacy.
The Ethics Council told Slidstvo.Info journalists that a total of 157 participants took part in their competitions, 44 of whom decided to withdraw early.
‘The overwhelming majority of candidates (25 people) who submitted such applications did not indicate the reasons for terminating their participation in the competition. Other candidates gave various reasons (for family reasons, due to being in the Armed Forces, due to health reasons, etc.),’ the Ethics Council responded to a journalist’s request.
The DEJURE lawyer says that contestants perceive negative decisions from the Ethics Council as a recognition of their dishonesty. In Zaichko’s case, such a decision would have become a ‘mark’ for the judge, reminding everyone that she had participated in cases with signs of manipulation of the autodistribution. But the judge avoided this by withdrawing her candidacy from the competition.
Unfortunately, this is the only punishment that Olena Zaichko faces, as all the detected cases of manipulation of the auto-distribution took place in 2018-2020. The time when Zaichko could be punished for this is already over.
