PUTRAJAYA, Aug 12 — The Court of Appeal today granted an appeal by UK law firm White & Case LLP against a High Court ruling that allowed a lawsuit filed by 1Malaysia Development Berhad (1MDB) on alleged fraud to be heard in Malaysia.

In a unanimous decision, a three-judge panel chaired by Justice Datuk Alwi Abdul Wahab, sitting with Justices K. Muniandy and Datuk Aliza Sulaiman, ruled that the Kuala Lumpur High Court lacked the jurisdiction to hear 1MDB’s suit against the firm.

In delivering the court’s decision, Justice Muniandy said the panel found that the requirements under the Courts of Judicature Act 1964 and the Rules of Court 2012 for the service of proceedings outside Malaysia had not been satisfied.

“The respondent (1MDB) failed to prove that Malaysia is clearly the forum convenient to hear this suit,” he said.

Justice Muniandy added that Patrick Mahony, a director of PetroSaudi International Ltd, is a foreign national residing outside Malaysia and therefore could not serve as a proper “anchor defendant” to justify the service of proceedings out of jurisdiction.

The panel also set aside the High Court’s decision to consolidate 1MDB’s suit against White & Case with a separate suit filed by the sovereign wealth fund against several other defendants, including Deutsche Bank and PetroSaudi International.

“We agree with the appellant that the application for consolidation by the respondent was an unequivocal tactical manoeuvre,” Justice Muniandy said.

The court ordered 1MDB to pay RM130,000 in costs to White & Case.

Meanwhile, 1MDB’s counsel Datuk Lim Chee Wee informed the bench that he had received instructions from his client to seek leave to appeal today’s decision at the Federal Court.

1MDB filed a suit in the Kuala Lumpur High Court in 2024, seeking US$1.83 billion and US$33 million in losses from White & Case and Mahony.

The fund alleges that White & Case assisted PetroSaudi in committing fraud and conspired to harm 1MDB while acting as its legal counsel.

The alleged misconduct relates to two corporate transactions: the 2009 joint venture with PetroSaudi International, known as the Good Star phase, and the 2010 restructuring of 1MDB’s stake in the joint venture, which 1MDB claims resulted in significant financial losses.

The writ of summons was served out of jurisdiction on White & Case at their UK offices, and the firm subsequently applied to set aside the service, seeking a declaration that the Malaysian court had no jurisdiction to hear the suit.

Last year, the High Court rejected White & Case’s challenge, ruling that it could hear the lawsuit because the trial witnesses are located in Malaysia. The law firm then appealed this decision to the Court of Appeal.

White & Case is also appealing another High Court decision that ordered this lawsuit to be consolidated with a separate one filed by 1MDB against several other defendants, including Deutsche Bank and PetroSaudi International.

At the Court of Appeal today, lawyer Datuk Cyrus Das appeared for the firm. — Bernama