1MDB seeks Federal Court ruling, says Malaysia should hear fraud claims against UK law firm

According to the source, Malaysia's state investment fund, 1Malaysia Development Berhad (1MDB), has filed a motion seeking permission to appeal a recent decision by the Court of Appeal. The appeal concerns the High Court's jurisdiction to hear 1MDB's lawsuit against a UK law firm, White and Case LLB. The decision is significant as it deals with questions of general legal principles for the first time at the Supreme Court level.

1MDB argues that the High Court lacked authority to hear its case against White and Case. The fund claims that the Kuala Lumpur High Court did not satisfy the requirements set by the Courts of Judicature Act 1964 and the Rules of Court 2012 for service of proceedings outside Malaysia. The court also found that Patrick Mahony, a director of PetroSaudi International Ltd, could not serve as a proper "anchor defendant" to justify the service of proceedings out of jurisdiction, as he is a foreign national residing outside Malaysia.

In its application, 1MDB has submitted 24 questions concerning jurisdiction and the consolidation of its suit. One of the key questions addresses the forum conveniens (an appropriate forum) for a claim involving alleged conspirators across multiple jurisdictions. The fund asserts that determining the forum conveniens should consider the places where alleged conspirators and material witnesses are located, not just the circumstances and location of the particular foreign defendant challenging jurisdiction.

Last August, a three-judge panel in the High Court ruled that the Kuala Lumpur High Court did not have jurisdiction to hear 1MDB's suit against White and Case LLB. Justice Muniandy, who delivered the unanimous decision, highlighted that 1MDB failed to prove that Malaysia was the most convenient forum to hear the lawsuit. The court 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 other defendants, including Deutsche Bank and PetroSaudi International.