New York, April 8: A U.S. court has accepted the petition from billionaire industrialist Gautam Adani, requesting a hearing to dismiss the alleged fraud case brought by the U.S. Securities and Exchange Commission (SEC). The petition argues that the case is an improper extraterritorial application of U.S. law and that the SEC has failed to establish actionable claims under American securities laws.
The Eastern District Court of New York stated, “The court has received a letter from the defendants requesting a pre-motion conference regarding their potential motion to dismiss the complaint. The court grants this request and directs the parties to schedule a meeting for the pre-motion conference.”
Gautam Adani serves as the chairman of the Adani Group, while Sagar Adani is the executive director of Adani Green Energy.
The court’s decision to allow the hearing gives the Adani family an opportunity to argue that the regulatory complaint should be dismissed at an early stage, thereby avoiding a lengthy investigation and trial.
In a criminal complaint filed by the SEC and the U.S. Department of Justice in November 2024, it is alleged that the Adani family attempted to bribe Indian officials with over $250 million to secure solar energy contracts while concealing this scheme from American investors and banks.
Lawyers for Gautam Adani and his nephew Sagar argued in court that there is no credible evidence supporting the alleged bribery scheme. They contended that the SEC lacks jurisdiction over both individuals and that the alleged false statements forming the basis of the case are not actionable.
The Adani Group has denied all allegations, stating that no entity or officer has been charged under the U.S. Foreign Corrupt Practices Act, and that Adani Green Energy, the company involved in raising funds, is not a party to this action.
In their petition, Adani’s legal team argued that there is insufficient basis for jurisdiction in this case and that the SEC has failed to establish actionable claims under U.S. securities laws.
The petition also contended that the SEC’s claims regarding the bond sale conducted by Adani Green Energy in 2021 are legally flawed on multiple grounds.
They noted that the $750 million bond sale was conducted outside the United States under Rule 144A and Regulation S exemptions, with securities sold to non-U.S. underwriters and later partially resold to qualified institutional buyers.
The Adani family argued that the SEC lacks personal jurisdiction, claiming that none of them had sufficient contacts with the U.S. nor direct involvement in the bond sale.
The petition stated that the complaint does not allege that Gautam Adani approved the bond issuance, participated in significant meetings, or directed any activities targeting U.S. investors.
It further noted, “The SEC does not allege that investors suffered any loss, and in fact, no loss occurred. The bonds have matured, and Adani Green has repaid investors the full amount, including principal and interest, in 2024.”
The petition also argued that the SEC’s case is improperly extraterritorial, as the securities were not listed in the United States, the issuer is Indian, and the alleged misconduct occurred entirely in India.
Citing a previous ruling by the U.S. Supreme Court, Adani stated that the SEC has failed to prove “domestic transactions,” which is a necessary condition for enforcing U.S. securities laws.
The petition further stated that the SEC’s allegations against Adani do not specify where any irreparable liability arose, and the fact that some downstream investors were located in the U.S. is irrelevant to this case.
The petition concluded, “The SEC’s claims relate solely to Indian defendants, an Indian issuer, securities not registered with the SEC, and underlying conduct that allegedly occurred in India. Therefore, this case is clearly outside the scope of U.S. securities laws.”
The defendants also pointed out that the SEC does not allege any investor losses, emphasizing that the bonds matured and were fully repaid in 2024, including interest.
They denied the bribery allegations, asserting that there is no credible evidence to support such claims.
The petition stated, “The alleged bribery case relates to a solar energy project for renewable energy supply in India. There is no allegation that any U.S. company bid for the project or that any U.S. customer purchased energy from the project. In fact, there was no involvement of the U.S. at all.”
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My name is Bhupendra Singh Chundawat. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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