RUSSIA: Smirnov to the fore as violence continues to dominate Russian vodka

By just-drinks.com editorial team | 7 November 2000

Riot police battered down the door and broke into one of Russia's more notorious distilleries this weekend in another demonstration of how boardroom brawls are dominating one of Russia's most profitable industries.Police were called to the headquarters of the Smirnov family vodka company as new owners attempted to oust the old. Within the walls of the distillery, the original owner Boris Smirnov is refusing to hand over control to Sergei Yuzefov, who represents the new controlling company Alfa Eko. Both parties own 50% of the company.The dispute has stemmed from the purchase this August of 50% of the company by Alfa Eko, a trading company that is part of the Alfa Group, one of Russia's larger financial-industrial conglomerates.The new owners want to boost production from 200,000 - 300,000 bottles a month to over one million. However Smirnov refused to yield to the authority of Alfa Eko. According to Russian press reports, Smirnov also demanded that his shares be bought out and he be appointed general director for life.In response, Alfa Eko proceeded to choose Yuzefov as acting general director and tried to abolish Smirnov's post. Alfa Eko then won a court ruling allowing it to enter the distillery offices. When Smirnov's security forces barred the way the riot police were called in.In a separate case Boris Smirnov has been fighting a case with drinks giant Diageo over the Smirnov/Smirnoff trademark. Diageo, which owns the brand Smirnoff claims it has the legal rights to the name after its predecessor Heublin bought the brand name from one of the sons of founder Piotr Smirnov in 1939 and then went on to register the worldwide rights.Boris Smirnov, however, a former KGB man, says he is the descendent of another of Piotr's sons. He dismisses Diageo's version of events claiming he is the real owner of the rights through a business called "Trading house of the descendants of the supplier to the court of the Tsar, P Smirnov".

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Riot police battered down the door and broke into one of Russia's more notorious distilleries this weekend in another demonstration of how boardroom brawls are dominating one of Russia's most profitable industries.Police were called to the headquarters of the Smirnov family vodka company as new owners attempted to oust the old. Within the walls of the distillery, the original owner Boris Smirnov is refusing to hand over control to Sergei Yuzefov, who represents the new controlling company Alfa Eko. Both parties own 50% of the company.The dispute has stemmed from the purchase this August of 50% of the company by Alfa Eko, a trading company that is part of the Alfa Group, one of Russia's larger financial-industrial conglomerates.The new owners want to boost production from 200,000 - 300,000 bottles a month to over one million. However Smirnov refused to yield to the authority of Alfa Eko. According to Russian press reports, Smirnov also demanded that his shares be bought out and he be appointed general director for life.In response, Alfa Eko proceeded to choose Yuzefov as acting general director and tried to abolish Smirnov's post. Alfa Eko then won a court ruling allowing it to enter the distillery offices. When Smirnov's security forces barred the way the riot police were called in.In a separate case Boris Smirnov has been fighting a case with drinks giant Diageo over the Smirnov/Smirnoff trademark. Diageo, which owns the brand Smirnoff claims it has the legal rights to the name after its predecessor Heublin bought the brand name from one of the sons of founder Piotr Smirnov in 1939 and then went on to register the worldwide rights.Boris Smirnov, however, a former KGB man, says he is the descendent of another of Piotr's sons. He dismisses Diageo's version of events claiming he is the real owner of the rights through a business called "Trading house of the descendants of the supplier to the court of the Tsar, P Smirnov".

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