Wednesday, 31 August 2016
Last updated 11 hours ago
Aug 27 2012 | 1:40pm ET
A Kuwaiti firm has sued the Carlyle Group, accusing the private equity giant of selling a fund in the kingdom without a license.
National Industries Group invested $25 million in Carlyle Capital Corp. in 2006. That fixed-income vehicle collapsed during the financial crisis. NIG sued the firm in 2009 alleging that Carlyle misrepresented the fund when marketing it to the company. But Carlyle pointed to its contract with NIG, requiring disputes to be settled in Delaware.
But NIG has its own red-tape argument, alleging that the contract is void because Carlyle lacks a Kuwaiti securities license. The company has asked the U.S. court to dismiss the litigation there and allow its lawsuit in Kuwait to proceed.
"Carlyle was more than happy to conduct its sales presentations in Kuwait and close its deals in Kuwait," Ahmed Hassan, general manager of NIG, which is controlled by the powerful Kharafi family, said. "But now that the moment has come to deal with the ugly aftermath and the firm's attempts to mislead and deceive its own investors, Carlyle would prefer to try its luck in Delaware."