Panama Papers aviation executive in legal battle with Rakia over Georgia hotel
An Iranian-American businessman who features in the Panama Papers has become embroiled in a massive legal dispute with the Ras Al Khaimah Investment Authority (Rakia) over an aborted hotel deal in Georgia.
Both sides have named each other in lawsuits, both filed on the same day in London and Washington DC, The National can exclusively reveal.
They contain extraordinary claims and counterclaims of secret commissions, computer hacking and stolen files hidden in the Dark Web.
Both actions are linked to the business activities of former Rakia chief executive Khater Massaad.
Farhad Azima, who runs an aircraft leasing company and was a political donor to former US president Bill Clinton and his wife Hillary, the Democrat ic presidential nominee, is named as a defendant in a writ that has been lodged in the London High Court by Rakia.
It relates to a failed deal to sell the Sheraton Metechi Palace Hotel in Tbilisi in 2011.
The authority is claiming more than US$2.6 million in damages from Mr Azima, a Kansas City-based aviation executive, for his alleged role in brokering an aborted attempt to sell the hotel for $62.5m to a company called Eurasia Hotel Holdings Limited.
That company was beneficially owned by Iranian businessman Houshang Hosseinpour, according to court documents seen by The National.
It is just one strand in a tangled web of legal cases being prepared by the investment agency of the northernmost emirate that relate to deals linked to Khater Massaad, its former chief executive who holds dual Lebanese-Swiss citizenship and is currently being detained in Saudi Arabia on an arrest warrant issued from the UAE.
In its legal claim dated September 30, 2016 Rakia alleges that Mr Massaad entered into an agreement with Mr Azima to receive a commission in return for referring potential third- party purchasers for the Tbilisi hotel. It was agreed he would get 5 per cent of the sale price, Rakia alleges.
It claims that Mr Azima had without its prior knowledge agreed with Mr Hosseinpour to receive a separate 10 per cent interest in the hotel on completion of the sale – a stake that would be worth $6.25m based on its intended sale price.
But last month while Rakia lawyers were preparing their claims against Mr Azima over the Tbilisi hotel deal, his lawyers were also getting ready to serve court documents alleging he had been unfairly blamed for the collapse of “settlement discussions” with the authority over deals involving Mr Massaad that started last year and continued into 2016.
The 15-page complaint filed in the US district court for the District of Columbia by lawyers acting for Mr Azima focuses on talks that started when Mr Azima was asked to mediate in a dispute between the investment agency and other parties, including Mr Massaad.
When those talks broke down after intense discussions on or about July 23, 2016, Rakia’s counsel “ominously threatened that Mr Azima would become collateral damage” in its actions against Mr Massaad, the complaint alleges.
The complaint, which seeks $20m in punitive damages, claims that shortly after this meeting, Mr Azima learnt that computers in the United States used by him had been hacked.
It says that “a massive volume of emails and other electronic data of Mr Azima and his business associates had been illegally misappropriated and stolen on or about August 7, 2016”.
A spokesman for the RAK Government dismissed Mr Azima’s US complaint as “without merit and baseless and an attempt to distract attention from its own conduct”.
In a statement to The National, Mr Azima said that he had behaved honourably and in good faith in his dealings with Ras Al Khaimah and in attempts to mediate in a dispute with Khater Massaad.
“I spent extraordinary amounts of my time, energy and resources trying to help the parties reach a settlement,” he said. He also described the lawsuit brought against him as “baseless”.
“I will fight this unethical and improper behaviour every step of the way.” he said.
Mr Azima appears in the Panama Papers, which refer to more than 11.5 million leaked documents dating back to the 1970s from the law firm of Mossack Fonseca that relate to thousands of offshore companies.
An article published by the International Consortium of Investigative Journalists on April 5, 2016 in the wake of the leaks, describes how Mr Azima hosted a fundraising event for Bill Clinton in September 1996 during his presidential re-election campaign, where a quarter of a million dollars in campaign fundraising was at stake.
The article says he later hosted Hillary Clinton when standing for election to the Senate in December 1999, along with 40 guests in a private dinner that raised $2,500 a head. It said he had contributed to both Republican and Democratic administrations in the past.
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Updated: October 22, 2016 04:00 AM