US court refuses to dismiss Gautam Adani case, questions settlement bid

A New York district court has refused to dismiss the proceedings against billionaire Gautam Adani and his nephew, Sagar Adani, questioning the US government's change in stance.

The Eastern District Court of New York on Friday directed the US government to provide the reasons and factual arguments for the dismissal of criminal proceedings initiated by the department of justice (DoJ) against the Adanis.

“The Government's terse, bland, and conclusory statement affords the court neither a sufficient basis to reach any conclusion, nor the opportunity to conduct any analysis of the Government's request for dismissal,” US district judge Nicholas Garaufis wrote in the judgment.

In the absence of adequate reasoning and sufficient facts to support the dismissal of the indictment, the court cannot apply sound judicial discretion, Garaufis said.

The court has given the US government till 13 July to respond.

The settlement plea

The US DoJ had reached a settlement with the Adanis and group executives, including former Adani Green Energy chief executive Vneet Jaain, to dismiss a criminal indictment brought against them in November 2024, alleging bribery and lying about it to American investors.

The US Securities and Exchange Commission reached an $18 million settlement with the Adani kin in a civil suit over similar allegations.

Separately, the Adani Group flagship Adani Enterprises Ltd agreed to pay $275 million to the US treasury department for purchasing about $190 million worth of sanctioned Iranian oil.

On Wednesday, the lawyers representing the Adani kin had urged the court to grant the DoJ’s motion to dismiss the indictment and the SEC’s motion to enter a settlement agreement.

The decision by the district court has thrown a spanner in the works for Adani to settle all his ongoing legal disputes in the US, casting a regulatory overhang over the richest Indian and his conglomerate for the past 18 months.

Gautam Adani, the founder and chairperson of the Adani Group, indirectly referred to the US proceedings when addressing shareholders at the annual general meeting of Adani Enterprises. Speaking about the progress made by the group over the past year, he said that it “did not come in calm conditions for us. It came in the middle of extraordinary scrutiny. However, we did not bend. We did not pause”.

The Adani group did not immediately respond to Mint’s request for a comment.