Alcoa offers $45m to settle Alba case
Manama, July 12, 2012
US aluminium producer Alcoa has offered to pay Bahrain-based Alba, one of the largest aluminium smelters in the world, at least $45 million in an out-of-court settlement, according to reports.
Alba has filed a federal lawsuit, alleging Alcoa-related firms paid millions in bribes to ensure the Bahrain smelter overpaid for raw materials.
Associated Press yesterday quoted Alcoa spokeswoman Libby Archell as saying the company continued to dispute Alba's claims.
"However, we are open to settlement to avoid the time and expense of complex litigation."
The report said Alcoa's earnings release stated it had also offered Alba "a long-term alumina supply contract and could charge up to $75 million more against Alcoa's future earnings to settle the lawsuit, not to mention additional unspecified costs to settle related investigations by the US Department of Justice and the Securities and Exchange Commission".
Alba's lawsuit, filed in Pittsburgh in November, contends Alcoa affiliates controlled by billionaire businessman Victor Dahdaleh paid $9.5 million in bribes to Bahrain officials and Alba executives that resulted in Alba overpaying $420 million for raw materials, including alumina, from 1997 to 2009. Alba was seeking $1 billion in damages.
Alba originally sued in June 2008, but a federal judge in Pittsburgh kept the case on hold for more than three years at the request of the Justice Department, which expressed concerns that its related criminal investigation would be harmed if Alba's more specific allegations were made public or if discovery - a pre-trial exchange of evidence - were allowed to proceed in the lawsuit.
Alcoa attorneys said the company was co-operating with the government investigation when they asked US District Judge Donetta Ambrose to let the case proceed last autumn, so Alcoa could be confronted with the specific allegations and then seek to have the lawsuit dismissed.
Ms Ambrose allowed Alba to spell out its allegations in a new complaint in November, which provided details lacking in the original lawsuit.
Alba's updated complaint contends Mr Dahdaleh earned at least $13.5 million in illegal commissions for alumina deals he brokered, according to AP.
A dual citizen of Canada and Britain, Mr Dahdaleh has denied wrongdoing since he was arrested in October by Britain's Serious Fraud Office on bribery charges related to some Australian alumina shipments between 2001 and 2005.
Dahdaleh, 68, is chairman and owner of the chemical and metals firm Dadco and a trustee of a charitable foundation established by former president Bill Clinton.
He remains free pending trial and has issued a statement on his website, denying the criminal charges he faces in Britain and calling the investigation "flawed." Former Alba chief executive Bruce Hall was also arrested on corruption and money-laundering charges related to the scandal in October last year.
In April, a British court adjourned a case involving Dahdaleh and Hall after they appeared in Southwark Crown Court, but did not enter pleas. A provisional trial of the case is expected in April next year.
Alcoa last year filed a request with the District Court in Pittsburgh, Pennsylvania, seeking to dismiss a civil suit filed against it by Alba involving Dahdaleh and others. – TradeArabia News Service