A US judge sought details from the Justice Department over its decision to drop criminal charges against industrialist Gautam Adani. The court deferred formal dismissal of the case, while Adani’s lawyers had requested closure after prosecutors decided not to continue pursuing the allegations.
A U.S. judge has asked the U.S. Department of Justice why it dropped criminal charges against industrialist Gautam Adani and requested additional details from the department by next month. Until then, the judge has not agreed to officially dismiss the case, following a plea from Adani’s lawyers. Adani had urged the judge on Wednesday to formally dismiss the criminal charges after the Justice Department said last month that it would stop pursuing the prosecution.
Adani was charged in 2024 with allegedly agreeing to bribe Indian government officials so that a subsidiary of his Adani Group could secure approval to build a solar plant. He was also accused of allegedly misleading U.S. investors by issuing statements that appeared to reassure them about his company’s anti-corruption practices.
In November 2024, the U.S. Securities and Exchange Commission sued Adani Group founder Gautam Adani and his nephew, Sagar, alleging that they misled investors by not disclosing an alleged bribery scheme involving Indian state officials, and bringing the matter under U.S. securities laws. Adani has said the SEC’s claims concerning a 2021 bond sale by Adani Group’s renewable energy arm, Adani Green Energy Ltd (AGEL), are legally flawed on multiple grounds.
Last month, the Justice Department permanently dropped all criminal charges against Adani and his nephew Sagar, fully closing the high-profile securities and wire fraud proceedings in New York.
In connection with the remaining resolutions in the related matters, their lawyers Sullivan and Cromwell LLP wrote to Nicholas G. Garaufis, a U.S. District Judge at the United States District Court for the Eastern District of New York.
The letter reads,
“We respectfully ask the Court to grant the Department of Justice’s motion to dismiss the Indictment with prejudice and the Securities and Exchange Commission’s motion to enter the pending Consent Judgments resolving its claims. For the Court’s convenience and consideration, we set forth below some background regarding the allegations and pending resolutions in each case, along with the law governing the standard of review for such motions”,
The DOJ unsealed its indictment on November 20, 2024 against Gautam Adani, Sagar Adani, Vineet Jain, and others. In the indictment, the DOJ alleged that the “Adani DOJ Defendants” conspired to commit securities fraud and conspired to commit wire fraud in connection with 2021 and 2024 bond offerings, as well as 2021 and 2023 syndicated bank loans.
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That same day, the SEC filed its complaint against Gautam Adani and Sagar Adani, accusing them of violating Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act, and Rule 10b-5 under the Exchange Act by approving or making false or misleading statements connected to the 2021 bond offering.
Adani’s legal team has said the indictment and complaint do not allege any U.S. bribery offenses by the “Adani DOJ Defendants,” and do not allege investor losses stemming from any of the four transactions. They also noted that the 2021 and 2024 bond offerings were issued under Regulation S and Rule 144A under the Securities Act of 1933.
The letter adds,
“They also do not allege any investor losses arising from any of the four transactions. Both the 2021 and 2024 bond offerings were issued pursuant to Regulation S and Rule 144A, promulgated under the Securities Act of 1933. As relevant here, under Rule 144A, those offerings were available only to Qualified Institutional Buyers (“QIBs”), which are large and sophisticated institutions that own or invest more than $100 million in securities. Id. § 230.144A(a)(1). The 2021 bond offering has matured, and all interest payments have been made. The 2024 bond offering has missed no interest payments. The 2021 loan has been repaid in full, and the 2023 loan is not in default,”
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