Reversing Habit of 'Legal Nihilism'; Healthier System Needed in Both Economy and Politics

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President Obama and Russian President Dmitry Medvedev will meet Wednesday on the sidelines at the Group of 20 summit. Ironically, that's one day after the trial of former Russian oilman Mikhail Khodorkovsky opens in Moscow. This trial symbolizes the deterioration of the rule of law in Russia.

While the two leaders - both former law professors - will have their hands full with economic and security matters, the rule of law also should figure prominently on their bilateral agenda. A healthy legal system is necessary to protect the rights of foreign and domestic investors and to facilitate the development of civil society and human rights.

Russia's track record under communism was abysmal, and even before that it was problematic. Under Mr. Medvedev, who is attempting to turn the fight against corruption into a personal crusade, there may be changes for the better.

During the Boris Yeltsin presidency, the Russian courts, despite their corrupt practices and lack of judicial sophistication, slowly inched toward more independence. In 2002-03, however, a reversal began. The rulers increasingly use telephone justice - senior state officials call upon judges and tell them how to decide cases under the guise of protecting paramount state interests.

The siloviki - bosses of security services - increasingly have been involved in hostile takeovers, including of intellectual property such as lucrative trademarks like Stoli vodka. Most of all, they have been going after oil, metals and minerals.

The 2003-05 Yukos case was a watershed. The most successful and transparent Russian oil company was taken over under the pretext of multibillion-ruble tax arrears. Yet many government officials clearly stated that its owner, Mr. Khodorkovsky, was perceived as a political threat because of his support of liberal political parties and civil society.

The persecution of Yukos undermined the notion of justice being universal because it selectively targeted a politically inconvenient opponent. Loyal Russian oligarchs - though involved in unsavory business practices - were not prosecuted. The oligarchs and politicians quickly got the message that, in the words of the Borg in Star Trek, "Resistance is futile."

After the Yukos affair, Russian and Western oil companies came under tremendous pressure from the Russian government, which used the state bureaucracy to renegotiate earlier contracts or to boot competitors out of the country. The victims included Exxon, Shell, British Petroleum, Hermitage Capital and the Russian companies Rusneft and Mechel.

Mr. Khodorkovsky was sentenced in 2005 and was eligible for parole last year. …