Bloomberg News

Aluminium Bahrain Racketeering Case Against Alcoa Reopened

November 09, 2011

Nov. 9 (Bloomberg) -- A racketeering lawsuit filed by Bahrain’s state-owned aluminum producer against Alcoa Inc., the largest U.S. aluminum producer, was reopened by a U.S. judge.

Aluminium Bahrain BSC, known as Alba, sued in February 2008, claiming that New York-based Alcoa bribed senior officials in Bahrain and caused Alba to pay inflated prices for alumina, the principal raw material in aluminum. A month later, U.S. District Judge Donetta Ambrose administratively closed the case in federal court in Pittsburgh after the U.S. Justice Department said it was investigating whether Alcoa made corrupt payments in Bahrain.

Alcoa asked Ambrose last month to reopen the case and sought permission to file a motion seeking its dismissal because racketeering law “does not apply to the extraterritorial conduct” alleged by Alba.

Ambrose ruled yesterday that Alba can file an amended complaint within 20 days, and a statement laying out its racketeering case within 30 days after that. The case statement will remain under court seal, along with any motion by Alcoa to dismiss the lawsuit, she said.

“The court will revisit the issue of unsealing any sealed portion of the record, if necessary, within six months of the date of this order, unless the government provides good cause against such unsealing,” she ruled.

Lori Lecker, an Alcoa spokeswoman, said in an e-mail the company is pleased that the judge has granted the company’s request to reopen the case.

‘Day in Court’

“After three-and-a-half years we can have our day in court,” she said. “We look forward to filing our motion to dismiss.”

The company has said it has cooperated over the past three years in the Justice Department probe and a related investigation by the U.S. Securities and Exchange Commission.

An Alba attorney, Mark MacDougall of Akin Gump Strauss Hauer & Feld LLP in Washington, didn’t immediately return a call seeking comment yesterday.

On Oct. 24, the U.K.’s Serious Fraud Office charged Victor Dahdaleh, a British and Canadian national who lives in London, with paying bribes to officials of a smelting company in Bahrain to win contracts for Alcoa to supply alumina. Dahdaleh, 68, is the owner of Dadco Group, according to his lawyers.

He denies wrongdoing, according to his law firm, Allen & Overy LLP.

The case is Aluminium Bahrain BSC v. Alcoa Inc., 08-cv- 00299, U.S. District Court, Western District of Pennsylvania (Pittsburgh).

--Editors: Peter Blumberg, Fred Strasser

To contact the reporter on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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