Pilatus lawyers said damages for US lawsuit against Malta journalists would reach $40 million

The private bank Pilatus were planning to sue Maltese media houses as well as the late journalist Daphne Caruana Galizia for defamation in an American court for damages of up to $40 million.

The Lawrence Law Group of Washington DC had written a 13-page letter on 16 October 2017 to media houses on behalf of Pilatus Bank to sue it in the US courts, saying: “The bank estimates that its damages resulting from the false and defamatory statements identified could exceed $40 million. Be advised that the Bank and Mr Sadr have already commenced litigation in the US against Maltese defendant(s) seeking damages and injunctive relief.”

The letter was cited in an adjournment speech by Nationalist MP Jason Azzopardi on Monday evening.

Sadr and Pilatus sued Daphne Caruana Galizia on 8 May 2017 in the Maricopa County superior court, in the state of Arizona, where internet domain registrar GoDaddy.com’s headquarters are located.

The lawsuit, which had an unspecified claim for damages, was filed at the time Caruana Galizia had alleged that the bank had processed a $1 million transfer from a Dubai company to the wife of the Maltese prime minister Joseph Muscat, at the behest of the daughter of Azerbaijani president Ilham Aliyev.

The reports prompted a magisterial inquiry over allegations that Muscat’s wife was the beneficial owner of Egrant Inc, a secret offshore company revealed a year earlier in the Panama Papers.

Caruana Galizia was assassinated on 16 October, 2017 in a car bomb outside her home. Three men, brothers George and Alfred Degiorgio, and Vince Muscat, have been charged with her murder.

Pilatus Bank filed the suit in the jurisdiction of the host of daphnecaruanagalizia.com. But the bank filed a notice of dismissal – probably without having ever served the lawsuit to Caruana Galizia – a day after her assassination.

In the lawsuit, Pilatus complained that Caruana Galizia’s posts were defamatory and false.

“Pilatus Bank was not set up to criminally launder money… Mr Sadr has not committed any criminal acts. Pilatus does not have accounts for Prime Minister Joseph Muscat, his wife Michelle Muscat, Tillgate, Hearnville or Egrant Inc. Pilatus Bank did not participate in the transactions described… executives did not order staff to conceal information from government investigators.”

Pilatus also denied having held a safe in the kitchen – allegedly having held a declaration of trust indicating Michelle Muscat’s name as owner of Egrant – or that it had secret documents connected to Muscat.

“As a private bank, Pilatus Bank’s reputation and trustworthiness is essential to its ability to operate as a bank… defendant’s defamatory statements foreseeably caused substantial damage to these relationships and threaten to irreparably destroy those relationships, and thereby destroy Pilatus Bank itself.”

Pilatus said Caruana Galizia’s statements had “caused disruption and termination” of prospective economic relationships, and accused her of having “intentionally misappropriated and published Pilatus Bank’s confidential information, including customer names.”

The bank, in suing the journalist for defamation, tortious interference with business expectancy and injurious falsehood, accused Caruana Galizia of intending to bring Pilatus and Sadr into disrepute, and of publishing her statements with actual malice.

“Defendant’s conduct was intentional, malicious, racist, abhorrent, and oppressive, justifying an award of punitive damages,” Pilatus Bank said. Sadr, presenting himself as an American citizen, was often referred to by his Iranian ethnicity as the son of one of Iran’s richest men, banker Seyed Mohammad Sadr Hasheminejad.

The bank was extensively featured in Caruana Galizia’s blog, mainly with the post that alleged that Michelle Muscat was the owner of the mysterious Egrant Inc.

Joseph Muscat dubbed the allegation “the biggest lie in Maltese political history” and requested the police to request a magisterial inquiry. The inquiry is still ongoing.