US judge dismisses Adani fraud counts, questions DOJ process

A US federal judge has permanently dismissed three securities and wire fraud counts against Gautam Adani, Sagar Adani and Vneet Jaain, while raising concerns about the Justice Department process that led prosecutors to seek an end to the case.

US District Judge Nicholas Garaufis on Monday, 10 August, granted the Justice Department’s request to dismiss the three counts with prejudice, meaning they cannot be brought again against the three defendants.

Garaufis said the ruling should not be interpreted as agreement with the department’s decision to seek dismissal or as expressing an opinion on the merits of the case.

The five-count indictment, unsealed in November 2024, charged Gautam Adani, Sagar Adani and Jaain with conspiracy to commit securities fraud, conspiracy to commit wire fraud and securities fraud in connection with an alleged bribery scheme.

A separate Foreign Corrupt Practices Act (FCPA) conspiracy count was brought against Ranjit Gupta, Rupesh Agarwal, Cyril Cabanes, Saurabh Agarwal and Deepak Malhotra. Four of them, Cabanes, Saurabh Agarwal, Malhotra and Rupesh Agarwal, were also charged with conspiracy to obstruct justice.

Garaufis reserved judgment on the Justice Department’s request to dismiss those two remaining counts. He ordered the department to provide its reasons for seeking dismissal, along with sufficient factual support, by 31 August. Lawyers for the five defendants must also confirm their clients’ consent to dismissal by that date.

The court found that the Justice Department had provided sufficient support for one of its stated reasons for dismissing the fraud charges against Gautam Adani, Sagar Adani and Jaain.

Prosecutors argued that statements cited in the indictment about Adani Green Energy Ltd’s anti-bribery practices, compliance systems and “zero tolerance” for corruption could be considered non-actionable corporate puffery because they were too general for investors reasonably to rely on.

Garaufis found that some of the alleged statements could be interpreted as broad representations about corporate integrity and compliance rather than specific factual assurances.

He said the possibility that a court could treat them as non-actionable puffery created legal risk for the prosecution and provided a substantial reason under Rule 48(a) of the Federal Rules of Criminal Procedure to dismiss the three fraud counts.

The judge found that several of the Justice Department’s other stated reasons had not been supported with enough factual information.

McCotter had argued, among other things, that the prosecution was primarily a foreign case. Garaufis found the department had not provided sufficient factual support for that characterization.

McCotter also said Indian authorities had investigated many of the allegations and found no actionable misconduct. Garaufis said the three Indian decisions submitted to the court did not support that assertion. He said each appeared to involve a decision not to investigate and that none meaningfully addressed the allegations in the US criminal case.

Garaufis also questioned the process by which the Justice Department reached its decision to seek dismissal.

He said the irregularities surrounding the decision were “concerning” and that McCotter appeared to have substituted his judgment for the views of officials across several federal agencies.

The judge said McCotter’s decision appeared to have been reached largely with defense counsel and seemingly without input from FBI and SEC investigators or the government lawyers who originally brought the case. He described that process as “highly unusual.”

Garaufis also said McCotter’s failure to meet the procedural requirements of Rule 48(a), despite directions from the court, showed a “lack of respect for the Judiciary as a co-equal branch.”

The Justice Department defended McCotter’s review. A department spokesperson pointed to a July filing in which McCotter said he had spent more than 100 hours reviewing and discussing materials submitted by the defense, held meetings with defense and Justice Department lawyers, reviewed additional material and conducted his own research and analysis before deciding the charges should be dropped.

The court also examined whether Adani Group’s previously announced plan to invest $10 billion in the US had influenced the government’s decision.

In a sworn filing, Gautam Adani said he was unaware of anything being promised, offered or accepted in connection with dismissal of the indictment. He also disclosed that his lawyers had suggested during settlement discussions that the planned US investment could form part of a resolution if the Justice Department or SEC wanted it to.

Adani lawyer Robert Giuffra separately told the court that he had raised the investment proposal with the government on two occasions. An 11 May email from US Attorney Joseph Nocella Jr. said his office categorically rejected using the $10 billion proposal as part of a resolution of the criminal charges and would not consider it.

After reviewing those submissions, Garaufis said he was satisfied that the investment pledge was a “non-consideration” in McCotter’s decision and that the reasons McCotter gave the court were his actual reasons for seeking dismissal.

The original indictment alleged that between 2020 and 2024 the defendants agreed to pay more than $250 million in bribes to Indian government officials to secure solar energy contracts projected to generate more than $2 billion in after-tax profits over about 20 years.

Prosecutors alleged that Gautam Adani, Sagar Adani and Jaain concealed the scheme while Adani Green and its subsidiaries raised billions of dollars through loans and bond offerings involving US and international investors and financial institutions. Those allegations were not adjudicated at trial.

Adani Group has consistently denied wrongdoing. Gautam Adani said after Monday’s ruling that he welcomed the decision and respected the judicial process.

I welcome the US court’s decision with humility and deep respect for the judicial process.

Throughout this challenging period, our faith in truth, fairness and the rule of law remained unwavering.

My deepest gratitude to those who never lost faith in us, in the system and in…

— Gautam Adani (@gautam_adani) August 10, 2026

A related civil case brought by the US Securities and Exchange Commission has also been resolved.

The US District Court for the Eastern District of New York entered final judgments by consent against Gautam and Sagar Adani on 10 August. Gautam Adani was ordered to pay a $6 million civil penalty and Sagar Adani $12 million. They consented to the judgments without admitting or denying the SEC’s allegations.

The SEC had alleged that the two men made false and misleading statements about Adani Green’s anti-bribery practices in connection with a $750 million bond offering in 2021 while the alleged bribery scheme was underway. The SEC said the offering raised more than $175 million from US investors.