A British financier’s voting rights at a Luxembourg company linked to Novalpina Capital, whose fund owns a majority stake in the spyware firm NSO Group, will remain suspended, a Luxembourg court has ruled. Though this may not be permanent, the decision appears to mark a setback for the financier, Stephen Peel, a former Olympic rower, in a bitter legal dispute that has erupted between him and his two longtime business partners, Stefan Kowski and Bastian Lueken. At stake is the future ownership and control of one of Novalpina’s key investments: NSO Group, an Israeli surveillance company whose technology is alleged to have been used against journalists, activists and human rights defenders around the world. Leaked WhatsApp messages seen by the Guardian show that the increasingly fractious battle appeared to have started in August 2019. Disagreements between the partners over a legal claim against the Guardian, which was brought against the newspaper by Peel’s wife, Yana Peel, appeared to set off an argument about Novalpina’s complex corporate structure. According to the messages the heart of the disagreement was Peel’s contention that a Luxembourg entity called Novalpina Capital Group Sarl (NCG Sarl) ought only to be used moving forward as a “passive investment vehicle in deals/funds”. Requests by Peel to reorganise the structure of the company against the backdrop of the litigation , the messages suggest, created tensions between the three men, and ultimately led Peel to conclude that the firm ought to be wound up. In the WhatsApp messages on 20 August 2019 to his two business partners, Peel said: “Pls no emails re Sarl. We have litigation with Guardian around it and it could be subject to disclosure.” He later wrote: “Bastian, pls tell (chief financial officer) to delete the email about the Sarl being the forup [sic] holding co and having 100% control.” The term “forup” is believed by the Guardian to refer to “formal holding company”. It is not known if any action was taken. “It doesn’t work for me having the Sarl owning vehicles in which it has any role except passive investment. We need another solution,” Peel wrote. Lueken pushed back on Peel. “I think we also need to discuss the Sarl,” he wrote. “You probably know there are agreements in place that describe exactly how the Sar [sic] is actively managing the Novalpina group. It simply isn’t a passive investment vehicle, as a plain matter of fact.” He continued and said, in reference to the Guardian litigation: “With all the evidence in the articles and agreements, etc. that the Sarl is not a passive investment vehicle and was never intended to be, I simply don’t understand where you are going with this.” When the chat turned to ways to possibly restructure the organisation of the company, which has entities in the UK and Luxembourg and other jurisdictions, Lueken appeared initially to reject a suggestion that the partners create a new entity in the Cayman Islands in order to fulfill Peel’s call to use the “Sarl” only as a passive investment vehicle. Public records in the Cayman Islands show that an entity called Novalpina Vision Limited was created a few weeks after the exchange, on 16 September 2019. The Guardian put a series of questions to the Peels about the WhatsApp conversation. Lawyers for Yana Peel said that she was not a recipient or author of the exchanges and had no knowledge of them, nor of any emails or messages exchanged between Peel and his partners. The lawyers said the WhatsApp messages seen by the Guardian were “highly ambiguous excerpts” of “supposed exchanges”. They questioned whether the messages were sent and said Stephen Peel did not have a record of them. They also said any suggestion that he had breached or interfered with any disclosure obligation was false and grossly defamatory. The Guardian reported this year that hundreds of thousands of euros of Yana Peel’s legal bills were expensed to the NSO Group by her husband – another move that apparently angered his partners. Stephen Peel’s lawyers said at that time that the “manner” in which the legal fees were paid had been approved by Kowski and Lueken, and he strongly disputed the suggestion that the payment of the expense claims was a source of disagreement between the partners. Peel, Lueken and Kowski are all now involved in a legal dispute over the future ownership of the firm they created. In January 2021 six voting managers at NCG Sarl, including Kowski and Lueken, suspended Peel’s voting rights. The action was taken, a document seen by the Guardian stated, in light of an alleged “breach” of Peel’s contractual obligations and alleged actions “against the company’s interests”. Lawyers for Peel said any allegations against him were “entirely without merit”. This week, after Peel initially won an injunction to block the suspension of his rights, a court in Luxembourg agreed for the injunction to be repealed, effectively allowing the suspension to stand, while proceedings between the partners continued in the court. That litigation could take years. In a letter to the limited partners of Novalpina Capital Partners sent after the decision, Kowski and Lueken wrote that the court order would not affect Peel’s “decision rights” in his capacity as a managing member of the investment advisers. Lawyers for Peel said: “The judgment simply relays the position of each of the parties and ultimately makes a finding about the procedure followed by Mr Peel.” Peel strenuously denies that he ever acted contrary to the companies’ interests. Kowski declined to comment on the WhatsApp exchange and the shareholder dispute. Lueken did not respond to a request for comment.