According to a court filing in a federal court in Brooklyn, New York, billionaire industrialist Gautam Adani and his nephew Sagar Adani have consented to have legal notice served against them in a civil securities fraud action against them by the United States Securities and Exchange Commission. The contract is amenable to court.
The expansion would be a major procedural milestone in a case that has dragged on well beyond a year due to the fact that the defendants based in India had not been properly served yet.
Consenting to have their lawyers in the United States of America handle their services has eliminated the necessity of the court to determine alternative ways of delivering the legal documents.
The lawsuit was filed in November 2024, claiming that Gautam Adani and Sagar Adani had breached the U.S. securities laws, by making false and misleading statements to investors about Adani Green Energy Limited.
According to the regulator, investors were not appropriately informed of an alleged bribery scheme relating to securing solar power contracts in India. The Adani Group and other promoter family members have consistently refuted all the allegations.
Besides the civil action taken by the SEC, federal prosecutors in Brooklyn have charged the Adanis and others in a different case about an alleged 265 million dollar bribery -related scheme.
The company, however, has indicated that the two directors are not accused of a violation of the U.S. Foreign Corrupt Practices Act and they have not been accused of bribery or corruption by them under the act. The actions of the SEC are civil cases.
Adani Green Energy Limited, in a filing in the stock exchange, indicated the acceptance of the complaint by Gautam Adani and Sagar Adani is a formal step.
The filing stated that the defendants would seek to have the complaint filed by the SEC dismissed or to file their formal response within the time limits imposed by the court. The Adanis would have a 90-day time to file a motion to dismiss or defence under the proposed schedule. The SEC would then apply 60 days to reply and the defendants 45 days to reply.
The company further made it clear that it is not a party to the proceedings and no charges have been filed against Adani Green Energy Limited as such. It pointed out that the two individual directors are solely the parties to the SEC action and that business operations in all the jurisdictions proceed as normal.
According to court documents, the SEC had previously sought the assistance of the Ministry of Law and Justice in India under the Hague Convention in order to serve legal papers, which had not been done yet.
The regulator requested the court to allow it to make use of alternative means, such as service with U.S. counsel and business email addresses, last week. Soon after, the U.S. attorneys of the Adanis accepted service on behalf of the latter, which did not necessitate a court decision on the matter.
In the filing, the defendants are also preserving all legal defenses, including the objections to personal jurisdiction, even though the defendants are not contesting service. This implies that they can question the jurisdiction of the U.S. court to listen to the case.
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Gautam Adani has employed the services of well-known Wall Street lawyer Robert Giuffra Jr. of law firm Sullivan and Cromwell to represent him. Giuffra told the court that he had agreed with SEC on accepting the suit on behalf of both Gautam and Sagar Adani.
Adani Group officials have emphasized that the conglomerate has excellent governance, transparency and regulatory compliance standards. They added that the company is still working on its projects and commitments and that its financial standings are still strong.
The hurdle of service being now cleared, the SEC case is likely to proceed through the U.S. legal system, where the allegations and the defenses will be subjected to the test before the court.
