US Court Dismisses Criminal Charges Against Gautam and Sagar Adani, Raises Concerns Over DOJ Process

A US federal court on Monday dismissed with prejudice the securities fraud and wire fraud charges against Adani Group Chairman Gautam Adani, his nephew Sagar Adani, and former Adani Green Energy CEO Vneet Jaain.

US District Judge Nicholas G. Garaufis, however, questioned the process followed by the US Department of Justice in seeking the dismissal. He observed that it was “highly unusual” for DOJ official R. Trent McCotter to have reached the decision largely in collaboration with defence counsel and seemingly without input from FBI and SEC agents who investigated the alleged misconduct or attorneys from the Department, SEC and US Attorney's Office who brought the case.

The judge observed, “McCotter's refusal to meet the procedural requirements of Rule 48(a) - even after the court's clear direction to do so - evinces a lack of respect for the Judiciary as a co-equal branch.”

The criminal indictment, returned in October 2024, alleged three schemes between 2020 and 2024. It accused individuals involved in the alleged scheme of paying approximately $265 million in bribes to Indian government officials to secure lucrative solar energy contracts, concealing the alleged payments from US and international investors and obstructing investigations by US authorities.

The indictment contained five counts. Counts Two, Three, and Four concerned securities fraud conspiracy, wire fraud conspiracy and securities fraud against Gautam Adani, Sagar Adani and Jaain. Count One, alleging conspiracy to violate the Foreign Corrupt Practices Act, was against five other individuals. Count Five, alleging conspiracy to obstruct justice, was against four of those five.

The US Department of Justice moved under Rule 48(a) in May 2026 to dismiss the indictment with prejudice. It stated that it had decided, in its prosecutorial discretion, not to devote further resources to the criminal charges.

The motion was signed by McCotter and the US Attorney for the Eastern District of New York. The court noted that neither of the two attorneys who signed the indictment had signed the dismissal motion.

Gautam and Sagar Adani had separately agreed to pay $18 million in civil penalties under proposed SEC consent judgments.

McCotter argued that the alleged conduct was essentially foreign, pointing to the fact that the alleged payments were made by Indian nationals working for Indian companies to the Indian government. He also argued that India had investigated many of the allegations and found no actionable misconduct.

The court found that several of McCotter's stated reasons were not supported by sufficient factual information to satisfy Rule 48(a). On the Indian proceedings in particular, the court found that the documents relied upon by DOJ did not establish that India had investigated the allegations in the US case.

“Not one of the documents appears to be the result of an investigation by India or anyone else. Rather, each document appears to be a decision by an Indian government authority not to investigate.”, the court noted.

The court also found insufficient factual support for DOJ's argument that the fraud charges faced significant legal risks because the transactions were not sufficiently connected to the US. It noted that the indictment alleged that investors were physically located in the US and that they irrevocably committed themselves in the US to invest in Adani Green securities.

The court held, “On the face of the Indictment, the only facts in the record contradict McCotter's assertion that the Transactions were not 'domestic.' Therefore, he has not provided sufficient factual information for his claim that the fraud charges present 'significant legal risks' under the law of this circuit.”

The court ultimately found one of DOJ's charge-specific reasons sufficient to dismiss Counts Two, Three and Four. It held that the alleged representations about Adani Green's anti-bribery policies, corporate governance, transparency and “zero tolerance” for bribery were sufficiently generic that they could constitute inactionable puffery.

The court concluded that this rationale was supported by sufficient factual information and constituted a substantial reason to dismiss the three counts. It found that the generic and vague nature of the representations created legal risks to the prosecution.

The court did not reach the same conclusion on the FCPA and obstruction charges against the other individuals. On the FCPA charge, it found that the current record contradicted McCotter's assertion that the alleged conduct did not implicate the considerations in the DOJ's Blanche Memorandum.

The court noted that the alleged bribery involved energy and power. It further noted that the allegations involved substantial bribe payments, concealment, fraud, and obstruction.

It therefore found that DOJ had not provided sufficient factual support for its stated reason for seeking dismissal of Count One. The court clarified that this did not mean that additional evidence supporting the dismissal did not exist. It meant only that the factual support provided by McCotter was insufficient.

On the obstruction charge, the court found that McCotter had failed to address allegations that the individuals destroyed or concealed evidence. It also noted allegations that they falsely denied their participation in the bribery scheme to FBI, US Department of Justice and SEC officials in Brooklyn, New York.

The court observed that McCotter's explanation was “at best insufficient to meet Rule 48(a)'s procedural requirements and at worst misleading.”

Accordingly, the court dismissed Counts Two, Three, and Four against Gautam Adani, Sagar Adani and Vneet Jaain with prejudice. It reserved judgment on Counts One and Five against the other individuals and directed the DOJ to provide each reason for seeking their dismissal, along with sufficient factual support for each reason, by August 31, 2026.

The court also made clear that its dismissal of the three counts should not be taken as an endorsement of the DOJ's decision. Nor should it be understood as an opinion on the merits of the allegations.