A US federal court has allowed the Adani Group to move ahead with its attempt to seek dismissal in a civil securities fraud case filed by the US Securities and Exchange Commission (SEC), the company said.
According to a court notice dated April 7, shared by the company, the US District Court for the Eastern District of New York granted the defendants’ request for a pre-motion conference on their anticipated motion to dismiss the complaint.
The order directs both sides to confer and coordinate with the court to schedule the hearing, which is a standard step before filing a formal motion to dismiss.
What is Adani’s US SEC Case?
In their pre-motion letter, billionaire Gautam Adani and Sagar Adani argued that the SEC’s case should be thrown out on multiple legal grounds, primarily citing a lack of jurisdiction, according to a PTI report.
The report further stated that the defendants said the court does not have personal jurisdiction over them, as neither had sufficient contacts with the United States nor direct involvement in the bond offering under scrutiny. They also argued that the case represents an ‘impermissibly extraterritorial’ application of US securities laws, as the transactions in question were conducted outside the United States.
The plea related to a $750 million bond issuance by Adani Green Energy (AGEL) in 2021. According to the PTI report, the bonds were issued under Rule 144A and Regulation S exemptions, sold to non-US underwriters, and only later resold in part to qualified institutional buyers, including some in the US.
The defendants contended that any such downstream sales were not attributable to the issuer and do not establish a ‘domestic transaction.’
No investor losses, weak linkage alleged
The Adanis further argued that the SEC has not alleged any investor losses, noting that the bonds have since matured and were repaid in full with interest. They disputed the regulator’s bribery allegations, which were linked to solar energy contracts in India, saying there is no credible evidence and no US nexus to the underlying project, the PTI report added.
The company also claims that the SEC failed to link either Gautam Adani or Sagar Adani to specific misleading statements or demonstrate intent to defraud, both necessary elements in a securities fraud case, as per the PTI report.
SEC’s case
The SEC had filed the lawsuit in November 2024, alleging that Gautam Adani, Sagar Adani and others orchestrated a bribery scheme worth over $250 million between 2020 and 2024 to secure solar energy contracts in India, and misled investors by failing to disclose it, PTI said. Unable to bring charges under the US Foreign Corrupt Practices Act, the regulator framed the case under US securities laws.