Tug of War: Equanimity Arrives Home but US Court Wants It Instead, Here’s What You Need to Know

Who is the rightful owner of the RM1 billion superyacht which just anchored in Port Klang hours ago? Aye, it’s Malaysians. It’s bought with money embezzled from state investment company 1MDB, as the US Department of Justice (DOJ) contended. It’s definitely not a Malaysian businessman hailing from Penang, Low Taek Jho, whom DOJ had accused as the central figure in the multi-billion dollar scandal.

Source: Reuters

But it looks like the California court has a different idea on this. According to Malaysiakini, California Central District Court has the jurisdictional control over the 91.5m-long vessel and the lawyer for fugitive financier Jho Low, James F Haggerty, had chastized the Indonesia and Malaysian authorities lengthily over the Equanimity handover.

“The (Prime Minister) Mahathir regime’s illegal act today, ignoring court rulings in legal proceedings in the US and Indonesia, prove he has no interest in a fair and just process.

“The yacht’s owner, Equanimity Cayman Limited, had already filed a claim on this asset, which Mahathir ignores. Further proceedings have been issued today in response to this illegal act.

“Mahathir has chosen to bring the asset illegally into a rigged Malaysian system manipulated by a man who only cares about his absolute political rule. It is ultimately justice that suffers,” Haggerty reprimand in a statement yesterday (Aug 6).

California Central District Court. Source: Pinterest

DOJ claimed that Malaysian authorities had intervened California court’s jurisdiction over the vessel although both Malaysia and Indonesia have no parties to do with the proceeding happening in the US. Indonesia acted on US request to seize the vessel earlier this year but after the handover, their deputy director of economic and special crimes in the republic’s Central Police Department, Daniel Silitonga, quipped that they no longer would want to affiliate with the yacht anymore. Silitonga said, “we are tired (of it).”

Equanimity Cayman Ltd is the owner of Equanimity which DOJ contended that the source of the money for the billion-ringgit vessel purchase came from scandal-lidden 1MDB. DOJ claimed that Jho Low used the company as an intermediary to file a lawsuit in a US court to fight for Equanimity’s ownership.

The company filed a new notice to California court yesterday, alerting the court on the illicit manoeuvre of property which is under the US control. They argued that Malaysia disregarded due process and ignored various court orders issued in Indonesia and the US.

“From its actions, the Malaysian government – working through members of the Indonesian police – has deliberately disregarded and contravened judicial proceedings and orders issued before both the South Jakarta District Court and the instant Court in order to carry out a state-sanctioned taking without due process.

“By forcibly commandeering the US government’s appointed crew and transporting the US government-controlled yacht from Indonesian waters, the Malaysian government and various Indonesian police officials have defied the express judgment of the South Jakarta District Court, which on April 17, 2018, found that prior efforts to seize the yacht violated Indonesian law, and ordered its return to its rightful owner, Claimant Equanimity (Cayman) Ltd,” read the notice, signed by lawyer Jeremy D. Matz on behalf of the company’s legal team.

United States Department of Justice. Source: Wikipedia

The claimant is clearly not happy about the handover. DOJ had since instructed the US courts to suspend proceedings related to the superyacht.

“The (US) government has learned that the defendant yacht has been released by the Indonesian government to the government of Malaysia, and has left Indonesian waters. It is the government’s understanding that a warrant was obtained in Indonesia authorising the turnover.

“The government proposes that all proceedings in this action be suspended in order to give the government and any interested claimant the opportunity to inquire of Malaysia through formal channels what its intentions are with respect to the defendant yacht,” DOJ wrote in a notice filed to California Central District Court, adding that it will report back to the court on its findings by August 17.

1MDB-linked businessman Low Taek Jho. Source: The Star

According to Malay Mail, Low’s lawyers opposed their government’s request, disputing that DOJ has no rights to impose “undefined, indefinite” delays.

The legal drama among the three countries started June 15 last year when DOJ filed a civil forfeiture suit to seize the US$250 million vessel. DOJ claimed that Jho Low laundered about US$1.7 billion colossal sum of money through US financial system.

While the trial is still on-going, DOJ gained a protective custody order of the vessel from the California court and they were tasked to bring Equanimity back to US water to facilitate an interlocutory sale of the vessel. The interlocutory sale is generally ordered by a court when the property contended in the case is bound to perish or deteriorate in value over time. The court would sell off the property even prior to completion of the case so that the value of the property is preserved. Depending on the outcome of the proceeding, the money will then disperse to the relevant parties.

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