Raphael Gregorian is hardly the portrait of a victorious man. He works out of a windowless basement office. His small company, which once had sales of about $10 million, didn't even break the $600,000 mark last year. And all 24 of his employees are gone.
Gregorian is the U.S. exporter who sued the USSR for libel after a Soviet government newspaper accused him of being a spy and selling shoddy equipment (see "The CEO Who Came in from the Cold," INC., Jaunary 1986). Gregorian's company, California International Trade Corp., sold medical equipment to the USSR for 14 years. He was mysteriously expelled in 1984 shortly before the Izvestia article appeared, all but ruining his company.
Last June, Gregorian won the first libel judgment against the Soviets in U.S. history. A federal judge ordered the Russians to pay Gregorian $250,000 for injury to his reputation and about $163,000 plus interest for medical equipment that he delivered but was never paid for.
Moscow ignored Gregorian's suit, forcing Gregorian's attorney, Jerry Kroll, to face an unusual dilemma: how could he force the world's largest country to fork over roughly $456,000?
Last August, with the California judgment in hand, Kroll lined up attorneys in the other 49 states to register copies of it. That meant that he could seize and then auction any Soviet assets in the United States to satisfy the judgment. "Their intransigence gave us no choice," says Kroll, who has visited the Soviet Union and written to several Russian officials -- including the Communist Party secretary-general, Mikhail Gorbachev -- about the case. He got no direct response until October, when the Soviets brought on Martin Popper, a New York attorney, to meet with Kroll. "To us," recalls Gregorian, "it was an indication that they were going to do something about it."
But Popper, who has represented the Soviets in the United States for many years, kept stalling. The Soviets have no assets in the United States, he claimed. All Kroll could do, he said, was sit and wait. Dissatisfied, Kroll embarked on a game he calls "pin the tail on the asset." With the help of a private investigator, he came up with plenty of potential targets. They included bank accounts, a giant New York trading concern, and a small Milwaukee tractor company. He took the first step in early November. With two federal marshals, Kroll went to the office of Leonid Koryavin, Izvestia's Washington correspondent. They attached about $5,000 in office equipment, including desks and filing cabinets, and seized a Russian-language typewriter. Kroll also froze the assets in two Soviet bank accounts. "We'll do something every week," warns Kroll. "It won't stop until we've got the money."
As for Gregorian, he would prefer that the lawsuit end on a less hostile note. "Even now, I would be happy if the Soviet Union came forward and handed me a check," says the native-born Russian. "I'll forget everything. They can go their way, and I'll go mine."