Company Allegedly Trying to Gain Control Over Lawsuits Regarding Contested Paintings, Claims Family
In a significant legal dispute, Prince Castro Ben Leon is taking LitFin Capital and its CEO, Maros Kravec, to court. The prince is accusing the Prague-based litigation funder of breaching a funding agreement and attempting to marginalize his family's involvement in the recovery of stolen Russian avant-garde paintings.
The paintings, estimated to be worth $323 million, include works attributed to El Lizzitsky, Kazimir Malevich, and Wassily Kandinsky. The 135 paintings are part of a 1,778-work collection of paintings supposedly by heavyweight Russian modernists. Prince Castro is suing Mozes Frisch in Germany for the return of the stolen works or $323 million.
The dispute began when Khatib's son, Prince Castro Ben Leon, sued Frisch for allegedly stealing the paintings. LitFin Capital started financing the Khatibs' litigation at the end of 2023 and agreed to cover a total of almost $10 million. However, the prince claims that LitFin refused to pay for further legal costs in late 2024, having spent $4.3 million on the Khatibs' claims up until that point.
Under their agreement, LitFin was due to be paid after the paintings were returned to Castro and sold. However, the prince accuses LitFin of violating their funding agreement by refusing to pay legal bills unless it took control of the lawsuits.
LitFin Capital specializes in antitrust cases, insolvency, and arbitration. The company manages a portfolio worth $5.8 billion in claim value across more than 25 major international disputes.
In a twist of events, ArtAnalysis, a Paris-based art authenticators, seized the paintings by a Paris court in January. ArtAnalysis's owner, Laurette Thomas, along with Frisch and art collector Olivia Amar, are now suing Khatib for the return of the works held in Paris, along with an additional $30.5 million in damages.
Despite the ongoing proceedings, Maros Kravec, the CEO of LitFin, did not comment on the matter when approached by a website. Uthman Khatib, the businessman at the centre of the case, passed away in July.
The Khatibs and LitFin previously had a good relationship, with the Khatibs praising the firm after the seizure of the 135 paintings by French authorities. However, the legal battle over these valuable artworks continues, with both parties presenting their cases in court.
In a separate development, Dentons, the law firm representing the Khatibs, hired UK-based Doerr Dallas Valuations to appraise the disputed paintings for insurance purposes. Doerr Dallas assigned a valuation of $208 million to the paintings. LitFin agreed to pay the $2.3 million in unpaid fees to Dentons only if the new conditions were met. The appraisal from Doerr Dallas came with a "caveat," but the content of the caveat was not discussed.
This is a developing story and more updates will follow as the case progresses.
- The modern Russian avant-garde paintings, estimated to be worth $323 million and allegedly stolen, are currently at the center of a legal dispute between Prince Castro Ben Leon and various parties, including art collector Olivia Amar, Laurette Thomas of ArtAnalysis, and Maros Kravec, the CEO of LitFin Capital.
- Initially, LitFin Capital financed the litigation of the Khatibs, agreeing to cover close to $10 million, but the prince later accused LitFin of breaching their agreement by refusing to pay for further legal costs and demanding control of the lawsuits.
- ArtFinance, a subsidiary of LitFin Capital that specializes in financing art-related business opportunities and acquisitions, could potentially be involved in the recovery and sale of the paintings, given the funding agreement between the parties.
