Patton Boggs Secures Acquittal in Rare White Collar Prosecution in Kosovo

Jul 17, 2013, 11:44 ET from Patton Boggs LLP

WASHINGTON, July 17, 2013 /PRNewswire/ -- A three-judge Trial Panel in Kosovo has acquitted the owners and business manager of a telecommunications company of all charges in a white collar criminal prosecution alleging fraud and "harmful" contracts related to a Mobile Virtual Network Operator (MVNO) telecommunications company that does business with Kosovo's government-owned telecommunications operator, Post and Telecom of Kosovo (PTK). The defendants were represented at trial by Andrew Friedman and Benjamin Chew of the international law firm of Patton Boggs LLP.


In Blerim Devolli, et. al., Basic Court of Pristina, Kosovo, Patton Boggs represented brothers Blerim and Shkelqim Devolli of the Devolli Group. In 2008, a consortium of the Devolli Group and Unitel Company of New York created a company, Dardafone, which obtained a license from Kosovo's Telecommunications Regulatory Authority (TRA) to operate a MVNO.  They then negotiated a contract with PTK to operate as an MVNO using PTK's infrastructure and to share revenue with PTK.  Disputes between Dardafone's owners resulted in a civil settlement in which the Devollis bought out Unitel's shares in the MVNO.  Meanwhile, the MVNO, ZMobile, quickly became a substantial player in Kosovo's wireless telecommunications market and provided millions of Euro in revenue to PTK.     

The indictment was brought by EULEX, a European mission to Kosovo that provides prosecutors and judges to handle complex cases.  The indictment claimed that the Devollis and their business manager defrauded the U.S. business partner and misled PTK, and that the Devollis had effectively operated as an organized crime enterprise.  The indictment implicated two current or former PTK officials, charging them with mis-using their authority and exposing PTK to substantial economic damage.  PTK is one of the largest revenue-producing businesses in Kosovo. 

The Patton Boggs team secured dismissal of two of five charges in a preliminary hearing, including the count that alleged organized crime. The trial on the remaining counts began in October 2012.  After nine weeks of testimony and a number of delays, Presiding Judge Vitor Pardal announced that the Trial Panel had unanimously acquitted the Devollis, their business manager, and the government officials of all remaining charges against them.  The Court found it notable that despite having no burden of proof, the defense took the lead in providing and highlighting the most useful testimony and evidence at trial. 

Judge Pardal also affirmed a central theme of Patton Boggs' defense strategy, stating in his oral verdict that the matter should have been resolved by the civil settlement, not through a criminal trial.  Though Patton Boggs did not represent the government officials, the Patton Boggs defense team aided the officials' defense by working with a prominent European telecommunications expert and submitting an expert report that fully explained and justified the economics of the MVNO contract.  

Benjamin Chew co-chairs Patton Boggs' Commercial Litigation and Antitrust practice group, and Andrew Friedman is a member of the firm's Government Investigations and White Collar practice.  Of Counsel Graham G. Wisner and Associate Mary Moore contributed to the defense effort. 

The win underscores the firm's increasing role as an international problem solver, particularly in this region of the world. Members of the firm have played important roles at key moments in Kosovo's recent history: Foreign Affairs Advisor and Former Ambassador Frank G. Wisner had a crucial role in negotiating Kosovo's independence as the United States' special representative to the Kosovo Status Talks in 2005.

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