A federal judge in the United States has directed Indian industrialist Gautam Adani to clarify whether he is aware of any quid pro quo, undisclosed agreement, promise, assurance, or exchange of consideration connected with the United States Department of Justice’s (DOJ) decision to seek dismissal of the criminal indictment against him in an alleged securities fraud and bribery case.
US District Judge Nicholas G Garaufis of the United States District Court for the Eastern District of New York has directed Adani to file an affidavit by July 15 stating whether he was aware of anything that was promised, offered, sought, received, agreed to or accepted by any person in connection with the DOJ’s request to dismiss the indictment. The Court has also asked him to disclose whether any agreement existed under which any benefit was exchanged for the dismissal of the criminal proceedings.
The direction was issued after the Court examined a response filed by Principal Associate Deputy Attorney General R. Trent McCotter, who stated that he was the final and sole decision-maker responsible for the DOJ’s request to dismiss the indictment with prejudice. McCotter rejected reports suggesting that the government’s decision was linked to any commitment by the Adani Group to invest in the United States.
However, Judge Garaufis observed that the DOJ’s explanation had, for the first time, raised the possibility that an arrangement involving one or more defendants may have existed but had neither been memorialised nor previously disclosed to the Court. The Court noted that before exercising its jurisdiction under Rule 48(a) of the Federal Rules of Criminal Procedure, it must satisfy itself that the government’s reasons for seeking dismissal are substantial, bona fide and represent the actual grounds for abandoning the prosecution.
The development follows the DOJ’s decision to withdraw the prosecution after concluding that the case was legally flawed, diplomatically counterproductive, and inconsistent with the enforcement priorities of the Trump administration. In a 10-page submission filed before the Eastern District of New York, the DOJ stated that the prosecution should have been abandoned a year earlier or not initiated at all. It characterised the indictment, unsealed in November 2024 during the final days of the previous Biden administration, as a “name and shame” prosecution brought without any realistic prospect of proceeding to trial.
The Department further argued that the allegations were overwhelmingly foreign in character, as they concerned Indian nationals allegedly offering bribes to other Indian nationals in relation to Indian electricity procurement contracts. According to the DOJ, such prosecutions unnecessarily extend United States criminal jurisdiction into matters that are better addressed by Indian authorities, risk creating diplomatic friction, and divert prosecutorial resources away from domestic enforcement priorities. Consequently, the DOJ sought dismissal of all charges with prejudice, which would permanently bar any future prosecution on the same indictment.
Judge Garaufis, however, declined to immediately approve the government’s motion. Earlier, the Court directed the DOJ to explain the legal basis for abandoning the prosecution and deferred consideration of the dismissal application until additional material was placed on record. The Court has also noted that a June 24 submission filed on behalf of Gautam Adani, Sagar Adani and Vineet Jain supported the government’s request but did not disclose the existence of any agreement involving an investment commitment or any other consideration in exchange for dismissal of the charges.
Adani has separately moved the Court seeking formal dismissal of the indictment after the DOJ informed the Court that it no longer intended to pursue the criminal prosecution.
The criminal proceedings originated from an indictment unsealed on November 20, 2024, in which the DOJ accused Gautam Adani, Sagar Adani, Vineet Jain and other co-accused of conspiring to pay bribes to Indian public officials to secure solar power purchase agreements and of committing securities fraud and conspiracy to commit wire fraud in connection with bond offerings undertaken in 2021 and 2024, as well as syndicated bank loans raised in 2021 and 2023.
The prosecution alleged that investors were misled regarding the Adani Group’s anti-corruption compliance framework while capital was being raised in the United States.
The indictment further alleged that bribes amounting to approximately Rs 2,029 crore (around USD 265 million) were promised to officials of state electricity distribution companies to secure renewable energy contracts. Of this amount, nearly Rs 1,750 crore was allegedly earmarked for officials in Andhra Pradesh to facilitate procurement of seven gigawatts of solar power.
On the same day that the indictment was unsealed, the United States Securities and Exchange Commission (SEC) instituted parallel civil enforcement proceedings against Gautam Adani and Sagar Adani. The SEC alleged violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5, contending that the defendants made materially false or misleading statements and omitted material facts in connection with a 2021 bond offering by failing to disclose the alleged bribery scheme.
Following the DOJ’s decision to discontinue the criminal proceedings, lawyers from Sullivan & Cromwell LLP, representing Gautam Adani, Sagar Adani and Vineet Jain, urged the Court to allow the government’s motion to dismiss the indictment with prejudice and to approve the SEC’s proposed consent judgments resolving the related civil enforcement action.
In their submissions, the defence argued that neither the DOJ indictment nor the SEC complaint alleged any standalone US bribery offence against the Adani defendants or identified any investor losses resulting from the transactions under scrutiny. They further submitted that the securities offerings were conducted under Regulation S and Rule 144A of the Securities Act and were offered exclusively to Qualified Institutional Buyers.
The defence also pointed out that the 2021 bond offering had matured with all interest obligations duly discharged, the 2024 bond remained current on all payments, the 2021 syndicated loan had been repaid in full, and the 2023 syndicated loan was not in default.
The matter will now be considered after Gautam Adani files his court-directed affidavit responding to the specific queries on whether any undisclosed promise, understanding, arrangement, or quid pro quo influenced the DOJ’s decision to seek dismissal of the criminal indictment. The affidavit is expected to assist the Court in determining whether the statutory requirements under Rule 48(a) have been satisfied before passing final orders on the government’s application for dismissal with prejudice.
