Quinn Emanuel wins fraud case against healthcare founder

In a landmark ruling, the Abu Dhabi Global Market (ADGM) Courts have found Dr. Shetty, the founder of NMC Health, and Prasanth Manghat, the former CEO, liable for fraud, marking a major victory for Quinn Emanuel, who represent the Joint Administrators of NMC Health, Richard Fleming and Benjamin Cairns of Alvarez & Marsal. The decision comes shortly after a related settlement of USD 600 million with Bank of Baroda for claims connected to the company’s financial woes.

The court's finding of liability against Dr. Shetty and Mr. Manghat encompasses all counts brought against them, with initial assessments indicating that they could potentially be ordered to pay over USD 5 billion, excluding interest and costs. However, the final amounts will only be determined after any further submissions to the court.

This case emerged from the substantial collapse of NMC Health, once a prominent FTSE 100 listed firm and the largest private healthcare provider in the UAE, which failed to disclose billions in hidden debts to the public. After entering administration in 2020, NMC Health was restructured in a USD 2.25 billion deal, with Quinn Emanuel playing a key advisory role.

Richard Fleming, Joint Administrator of NMC Health and Managing Director at Alvarez & Marsal, expressed satisfaction with the ruling, stating that "the court has found that Dr. Shetty and Mr. Manghat knowingly participated in fraudulent trading over a prolonged period, contributing to the collapse of what was once one of the largest healthcare businesses in the Middle East and a FTSE 100 company." He further highlighted that “today's judgment is a vindication of those efforts, and we remain committed to pursuing every available avenue in recovering funds for those who suffered losses.”

The trial team from Quinn Emanuel was spearheaded by Nick Marsh, Partner and Chair of the Civil Fraud Practice, alongside Khaled Khatoun, Partner and Co-Chair of the Middle East and North Africa Practice, along with associates Rebecca Coyle, Matthew Tse, and Alex Bromwich.

It's important to note that Bank of Baroda's USD 600 million settlement was made without any admission of liability or wrongdoing, underscoring the complex nature of this case and the ongoing challenges in holding accountable those responsible for corporate fraud.