‘Personal, vindictive, inflammatory’: Epstein-linked legal battle ratchets up

With Ghislaine Maxwell's criminal conviction working its way toward an appeal, and Virginia Giuffre's civil case against Prince Andrew caught up in arguments over evidence and depositions, another high-profile case linked to the convicted sex trafficker Jeffrey Epstein is working through the New York court system.

It too is dragging in some of the biggest names in elite New York society, in this case sending shockwaves through the rarefied world of Manhattan finance.

Leon Black, one of New York's wealthiest men with an estimated net worth of $13.2bn, according to the Bloomberg Billionaires Index, and formerly chief of Apollo Global Management and chairman of the Museum of Modern Art (Moma), is locked in a bitter dispute with Guzel Ganieva, a Russian model and former mistress who accused him of sexual violence and claims she was pressured by Black to engage in sex acts with Epstein.

Over recent months, the dispute between Black, 70, and Ganieva has escalated with a series of back-and-forth lawsuits in which the accusations have grown ever more serious, and spiraled out to draw in figures from some of Manhattan's most powerful social circles.

Ganieva's initial allegations of defamation, intentional infliction of emotional distress, gender-motivated violence and retaliation, were first revealed in tweets early last year, and followed revelations about $158m in payments Black made to Epstein for tax advice and financial services that precipitated his stepping down from Apollo and Moma.

In June, Ganieva sued Black in New York state court, described above, claiming he forced her to sign a 2015 non-disclosure agreement about their six-and-a-half-year relationship, and had defamed her by claiming she tried to extort him by threatening to go public with their relationship.

Lawyers for Black have said Ganieva's lawsuit is "a work of fiction" and said he made payments only to secure her silence about their relationship.

Black has said he refused Ganieva's initial demand for $100m, but reached an agreement that in exchange for a confidentiality deal he would forgive $1m in loans and pay her $100,000 a month for 15 years. He also gave her $2.75m to help her obtain a British visa or passport.

Now the dispute has become even more acrimonious.

After Ganieva accused him of sexual abuse, Black did not merely reject Ganieva's accusations or counter-sue in New York civil court - the same jurisdiction that she sued him - but filed a US federal lawsuit under conspiracy and racketeering statutes normally used for busting mobsters and drug traffickers.

Ganieva's complaints "are shams", Black's attorneys countered in the federal case, and though they said his relationship with Ganieva was "regrettable", they said her claims were "fraudulently designed to mislead the New York state court and (more directly) to defame and bully Mr Black into adding to the extortionate payments he already has made to prevent Ms Ganieva from further destroying him".

In the lawsuit, Black claimed that Ganieva and her lawyers at Wigdor - a firm that has been at the forefront of civil settlements with men accused of sexual misconduct during the #MeToo era, such as the disgraced mogul Harvey Weinstein - conspired with others to extort him and destroy his reputation.

Black's lawyers said in the complaint: "They waged war on multiple fronts and had multiple goals - among them, to get more money through extortion or a fraudulently induced litigation award; to destroy the reputation of Mr Black and his business; to undermine his career; to interfere with his business relationships; and to raise concerns about his leadership of the company he created and nurtured for the last 30 years."

Black's attorney in the federal action is Susan Estrich, a legal scholar who became known as manager of Michael Dukakis's 1988 presidential campaign and later defended the former Fox News executive Roger Ailes against claims of sexual harassment.

In court papers, filed in Manhattan, Estrich has described Ganieva and her lawyers at Wigdor as perpetrators of a wide-ranging extortion scheme "to try to get even more from Mr Black - or destroy him in the process".

The defendants "duped and manipulated the media and the courts, using the mails and the wires, to orchestrate an assassination of Mr Black on every level", according to Black's lawyers.

But Estrich has also alleged that the conspiracy includes unnamed co-conspirators or "John Does", that include two "flacks", or PR specialists, and a financial backer with deep pockets to "go head-to-head with a billionaire".

Black's lawyers have also said they plan to find out who is paying Wigdor's fees in Ganieva's action against him. Ganieva has agreed to pay Wigdor 38% of any money she received from Black, according to an agreement letter filed in the case.

Ganieva and Wigdor deny the claims against them.

Wigdor filed a motion to dismiss, calling the action "frivolous as a matter of law" and arguing that "Black and his counsel know that there is no evidentiary support or good-faith basis for their contrived and defective 'Rico' [Racketeer Influenced and Corrupt Organizations Act] and 'defamation' claims."

Lawyers for the financier say an amended complaint will be filed in the coming days that will further expose the alleged conspiracy against Black.

Recent court disclosures offer a clue to which direction that may be headed.

Black's lawyers have requested that the presiding judge allow them access to private records involving some of New York's most prominent businessmen, including his partner at Apollo, Josh Harris, the owner of the Premier League football club Crystal Palace, who agitated for Black to step down after Black's payments to Epstein were revealed.

Jonathan Rosen, an attorney for Harris, described Black's insinuations as "desperate and absurd" and denied any connection between Harris and Ganieva or her lawyers.

"Mr Harris has nothing whatsoever to do with the deeply troubling situation Mr Black finds himself in, and any statement or implication otherwise is unhinged at best," Rosen told the Guardian.

Others included in Black's Rico action are Steven Rubenstein, the New York public relations executive whose clients have included Rupert Murdoch, Bill Gates and Donald Trump; and Michael Rubin, a sports merchandise billionaire and co-owner, with Harris, of the NBA's Philadelphia 76ers.

According to court documents, Black's attorneys wanted to know of any contact that Rubenstein had with nine named individuals, including Ganieva, her attorneys and reporters. Rubenstein and Rubin have also objected to being dragged into the case.

Rubenstein's attorneys said in court filings that "any private citizen should be aghast that [a bystander to a lawsuit] could be made the subject of a subpoena calling for all their telephone records simply at the whim of a litigant."

Jeanne Christensen, a lawyer at Wigdor named in the action, believes that instead of filing a counter-claim in Ganieva's original state court claim against the financier, Black had filed a new case in federal court that potentially moves faster.

"He's basically just trying to intimidate our client by filing a separate lawsuit against her," Christensen told the Guardian. "It's a tactic to cause potential division between her and her lawyers. He's hitting her from as many sides as he can. It's pretty bad."

Bennett Gershman, a former prosecutor in the New York state anti-corruption office who teaches law at Pace University, said he could not think of another civil sexual harassment case that has been returned in another court with a Rico complaint.

"This is well beyond what you usually see," Gershman told the Guardian.

"I've never seen a litigant bring a Rico action against a woman who we thought had settled to the tune of a million dollars a year. It's spinning out of control in terms of being personal, vindictive and inflammatory. US litigation is often adversarial and contentious, but this is well beyond that. They're going at it tooth and nail."