In a relief to Sahara, a US court has rejected a plea seeking to attach the Indian group’s prized Plaza and Dream Downtown hotels here.
Hong Kong-based JTS Trading had approached the court seeking the attachment as part of its USD 350-million lawsuit against UAE-based Trinity White City Ventures, Sahara group and Swiss banking giant UBS over a deal that went sour.
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While hearings will continue on the lawsuit, the Supreme Court of the State of New York has ordered that “the application of plaintiff JTS Trading Ltd for a pre-judgement order of attachment is denied”.
Sahara, along with the two others, has been dragged into the lawsuit filed by JTS Trading, which claims that it had proposed to partner Trinity and arrange loans from UBS to acquire Sahara’s three overseas hotels – Grosvenor House in London and the two in the US.
JTS has alleged that Trinity cut it off from the estimated USD 1.5 billion deal for direct negotiations with Sahara.
It accused Sahara and UBS of having “aided and abetted” the UAE firm in breaching its “fiduciary duties” under their agreement. JTS also filed an application before the court seeking a ‘pre-judgement order of attachment’ of Sahara group’s interest in the two hotels in the US.
Seeking an immediate rejection of the attachment plea, Sahara submitted before the court that the “plaintiff is attempting to attach property that falls outside of the jurisdiction of this Court” and the assets did not belong to the parties of the case.
The Indian group also told court that it was wrongly dragged into the dispute between two entities — JTS and Trinity — over “a potential business relationship gone sour”.
After looking into the oral and written submissions of JTS and Sahara in the matter, the court has now said in an order dated September 14 that “JTS fails to establish entitlement to attach assets of the non-parties”.
“JTS’ only claim in support of attaching non-party interests is that it is entitled to pierce the corporate veil to reach these assets,” the court order said while adding that JTS however failed to establish an entitlement to pierce the corporate veil.
In its application, JTS had argued that Sahara India owns the Plaza and Dream Downtown hotels through a “convoluted chain of wholly owned and dominated alter-ego subsidiaries” and the group intended to sell these properties and repatriate the funds to India to use the money for securing release of the group’s chief Subrata Roy from jail.
Sahara group however argued that JTS was seeking attachment of properties of ‘non-parties’ to the case against whom it had made no complaints. Among others, JTS has filed the case against Aamby Mauritius (an entity from the Sahara group) and Sahara India Pariwar.