- Gautam Adani and Sagar Adani challenge US jurisdiction over ₹6,000+ crore bond issue
- Defence argues no “domestic transaction”, no investor loss, no direct involvement
- SEC accused of stretching US securities laws to cover offshore deal
- Case could redefine cross-border enforcement limits in global capital markets
NE LAW & BUSINESS BUREAU
NEW YORK, APR 7
In a decisive legal counterstrike with global implications, billionaire industrialist Gautam Adani and his nephew Sagar Adani have moved a US court to dismiss a high-profile securities fraud lawsuit filed by the US Securities and Exchange Commission, arguing that the case fundamentally overreaches American jurisdiction and fails to establish any wrongdoing.
In a sharply worded pre-motion letter ahead of an April 30 dismissal plea, the Adanis, through their legal team, have challenged the very foundation of the SEC’s case linked to a 2021 bond issuance by Adani Green Energy Ltd.
The SEC, which filed the lawsuit in November 2024, alleges that investors were misled due to non-disclosure of an alleged bribery scheme involving Indian officials. However, the Adanis have firmly rejected the claims, asserting that the transaction falls outside the ambit of US securities laws.
According to the filing, the USD 750 million bond sale was executed offshore under Rule 144A and Regulation S frameworks, with securities initially sold to non-US underwriters and only later partially reaching qualified institutional buyers in the United States.
The defence has underscored that neither Gautam Adani nor Sagar Adani had sufficient contact with the US or direct participation in the bond issuance process.
Crucially, the filing states, “the court lacks personal jurisdiction”, adding that the SEC has failed to demonstrate any “domestic transaction”—a key legal threshold established by the US Supreme Court for applying American securities laws.
The Adanis have also pointed out that the bonds have already matured and were fully repaid with interest in 2024, stressing that there is no allegation of investor losses—weakening the SEC’s case further.
Dismissing the bribery accusations as unsubstantiated, the defence maintains there is “no credible evidence” to support such claims. It also argues that statements cited by the SEC regarding ESG commitments and corporate governance amount to non-actionable “puffery”—general expressions of corporate optimism that cannot be legally relied upon by investors.
Further, the filing asserts that the SEC has not linked either defendant to specific misleading disclosures nor demonstrated any intent to defraud.
The Adanis are now seeking a complete dismissal of the case and have indicated readiness to participate in a pre-motion conference if required—setting the stage for a legal battle that could shape how far US regulators can go in policing offshore financial transactions.
