Mansion Group Gains Ground in Legal Battle with Former CEO

A recent judgement of the Supreme Court of Gibraltar dismissed the former CEO's request to amend his defense while also rejecting allegations about unlawful conductImage Source: Shutterstock.com

The legal battle between the defunct Mansion Groupand its former CEO, Karel Manasco, reached a new chapter after a judgment from the Supreme Court of Gibraltarfrom last week. The two parties clashed together in a legal battle last year.

Several months ahead of the shutdown of Mansion Group, the Supreme Court of Gibraltar issued a £5 million($6.4 million) asset freeze orderagainst the company’s former CEO. Manasco had previously left the company late in 2021after an internal investigation.

Manson Group accused its former boss of using corporate finances for personal expenditures. Moreover, the company alleged Manasco benefitted from bonus payments without authorization, while also alleging he completed unauthorized financial transactions.

However, the former CEO responded to the accusations and filed counterclaims. Manasco alleged Mansion Group engaged in unlawful gambling activitiesin a number of jurisdictions, offering its services in violation of regulations. The former boss claimed that the company didn’t hold a license in jurisdictions such as Germany, Austriaand Belgium, among other countries, but still supplied its services.

In the most recent chapter of the legal battle, the Supreme Court of Gibraltar resorted to applying an exception of the usual confidentiality of settlement negotiations, also known as “without prejudice (WP) privilege.” What’s notable about the case is that this exception, often referred to as “unambiguous impropriety,” is rarely usedand recognizes that certain threats made by the defendant against Mansion Group fell outside of the scope of the WP protection.

The Legal Battle Continues

The Supreme Court effectively acknowledged that while some claims are protected under the WP privilege, the defendant submitted claims that fell outside of that scope. Generally speaking, the WP privilege enables parties to settle their dispute without fears about their claims or information being used against them.

“That in all those circumstances the WP Letter far exceeds what is proper and permissible in litigation and clearly abused the without prejudice rule to cloak what amounts to clear unambiguous impropriety,“

reads a judgment by the Supreme Court of Gibraltar

An exception to the WP privilege is claims or communication that suggests blackmail, perjury or other unlawful actions. In other words, some of the threats made by Manasco against Mansion Group were serious enough not to fall under the exclusion from WP protection.

The Supreme Court of Gibraltar moved to dismiss the former CEO’s request to amend his defense. The Court also dismissed the allegations against Mansion Group for unlawful conductrecognizing them as “bare assertions,” which are “not supported by contemporaneous documents.”

While the latest judgment marks a small victory for Mansion Group, the legal battle continues.