One of Russia's richest men, Alisher Usmanov, is suing opposition leader Alexei Navalny over a video alleging that one of Mr Usmanov's property deals amounted to a bribe.
Mr Usmanov, a steel and telecoms tycoon and part-owner of Arsenal football club, accuses Mr Navalny of libel.
Mr Navalny's YouTube video went viral - millions have watched it.
It alleges that a foundation with links to Prime Minister Dmitry Medvedev received a mansion from Mr Usmanov.
Mr Usmanov told Russia's Vedomosti business daily that he gave the Moscow mansion and grounds to the Sotsgosproyekt Foundation in exchange for land it owned. "This is no bribe!" he insisted, arguing that in each case the property was worth about $50m (£40m), so it was a swap.
Mr Navalny, a lawyer who plans to run as a presidential candidate next year, reacted defiantly on Twitter, saying he would call Prime Minister Medvedev as a witness.
The video released by the campaigner last month fuelled big opposition protests in several Russian cities.
Mr Navalny claims the prime minister has concealed a vast fortune - including luxury villas and yachts - by using a complex, shadowy network of close friends and not-for-profit organisations.
Mr Medvedev - a key Putin ally - has dismissed the allegations as politically-motivated. The Forbes business website estimates Mr Usmanov's fortune to be $14.7bn.
In recent years Mr Navalny has been targeted by numerous legal cases, which he says are politically motivated. In a re-trial in February he was convicted of fraud, which could bar him from standing in elections.