Indian Businessman in US Ordered To Pay $2.5 Billion To Sibling Over Breach Of Oral Contract
Ending a 21-year legal battle between Indian-origin US siblings, a US court verdict this week ordered billionaire Haresh Jogani to pay his brothers more than 2.5 billion dollars (over Rs 20,000 crore) in damages for the breach of an oral contract in a business partnership.
Came from Gujarat, the Jogani family built a real estate empire and diamond trade in the US with multiple outposts. The story began when Mr Shashi Jogani left for the US at the age of 22 in 1969 and began a firm doing business alone. Jogani then soon began to accumulate huge wealth until he suffered a loss in the recession of the 1990s and the subsequent Northridge Earthquake killing 16 people in one of his buildings. With this, Mr Jogani called his brothers to work with him as partners. After the company recovered and built a portfolio of roughly 17,000 apartment units with the brothers collaborating with Shashi Jogani, one brother Haresh Jogani forcefully removed his other brothers from the management of the firm, as per the complaint filed by Shashi Jogani.
However, Haresh Jogani said that his brothers cannot claim their partnership without a written agreement. But the Judge found that Mr Haresh had broken an oral agreement with his sibling as he understood that the oral contract is common in diamond and trade among Gujaratis.
The court ordered Mr Haresh Jogani to pay his brothers Shashikant, Rajesh, Chetan and Shailesh Jogani more than $2.5 billion (over ₹ 20,000 crore) in damages, in addition to asking to divide shares of their Southern California property empire – about 17,000 apartments worth billions more.
The attorney of Shashi Jogani, one of the brothers, said that the law is that the accused can have oral contracts just as valuable as written contracts. The law is you can have oral contracts that are just as valuable as written contracts,” said Steve Friedman, an attorney for Shashi Jogani.
However, as the trial concluded, Mr Haresh Jogani accused the judge of racial animus towards his lawyer. However, the judge rejected the businessman’s claim of bias towards a particular party.
The judge asked Haresh Jogani to pay 165 million dollars to brothers Chetan and Rajesh for breaking the diamond business agreement. Separately, the judge awarded 1.8 billion dollars to Shashi, 243 million dollars to Chetan and 360 million dollars to Rajesh for breach of real estate partnership. The judge observed that Shashi owned 50 per cent of the real estate partnership, while Haresh owned 24 per cent. Rajesh owns 10 per cent, Shailesh 9.5 per cent and Chetan 6.5 per cent, the Court said.
