The Moscow Arbitration Court heard opening arguments today regarding the Russian Federation's $22.5 billion claim against The Bank of New York, Inc., now the Bank of New York Mellon Corporation , for money laundering activities the Bank had previously admitted.

"We believe it is offensive and an arrogant slap in the face to the judge, the court and The Russian Federation that the Bank of New York would fail to show to a hearing they were well aware of," said Maxim Smal, a Moscow-based attorney representing Russia's Federal Customs Service.

"We feel confident in the validity and strength of Russia's claim as well as our prospective to prevail in court with or without the defendant," he said. The next hearing is scheduled for Tuesday, July 10 at noon in Moscow.

"The United States District Court for the Southern District of New York ruled last week, consistent with prior precedent, that the Russian judicial system is legitimate and honest such that any award in Russia should be fully collectible in the U.S. where the Bank of New York does business. Therefore, the Federation remains confident not only as to receiving a successful outcome, but also with obtaining complete satisfaction of the damages sought, especially now that the merger has created a company capable of satisfying any judgment awarded," said Smal.

On May 17, the Federal Customs Service for the Russian Federation filed a lawsuit with the Moscow Arbitration Court against the Bank of New York, the world's second-largest custodian of investor assets.

The lawsuit stems from a 2005 U.S. Department of Justice investigation that ended with a non-prosecution agreement forcing the Bank to pay $38 million to the U.S. government to settle two criminal probes and admitting it failed to report $7.5 billion in illegal Russian transactions.

Federal investigators determined several accounts that existed at the Bank were part of an illegal network that allowed Russian businesses to defraud their government of customs duties and tax revenues by transferring funds in and out of Russia in violation of currency controls.

Although the suit is being heard in a Russian court, it will be tried in accordance with U.S. law. Under accepted and clear legal principles, the Bank of New York has already made signed admissions to its criminal responsibility and its officers have been criminally convicted.