Dubai’s Sheikhs Sued for 1.9 Billion Dollars

It looks as though even the ruling family of Dubai is not immune to the stunning amount of lawsuits and court cases flying around the property investment world at the moment. An Iranian businessman is suing members of Dubai's ruling family for close to two billion dollars over real estate investments, in a case which opened on Wednesday.

The former CEO of Al-Fajer Properties, Shahram Abdullah Zadeh, who was fired in 2008, has filed the lawsuit against the firm and its owner Sheikh Hasher Maktoum bin Jumaa al-Maktoum, a brother-in-law of the emirate's ruler, Sheikh Mohammed bin Rashid al-Maktoum.

The lawsuit also targets Sheikh Hasher's daughter as a partner of the firm and a son, Sheikh Maktoum, who has since been appointed president of Al-Fajer. The court case is demanding  the "recovery of all material assets of Al-Fajer Properties," and Zadeh insists he was the genuine owner of the company and the only investor.

Foreigners are not allowed to register real estate companies under their own name in the United Arab Emirates, so he had used Sheikh Hasher's name to obtain the firm's licence. "I was the sole investor. Al-Fajer Properties is my company. Sheikh Hasher's only contribution has been the real estate licence as a sponsor," he said.

Zadeh is demanding 1.9 billion dollars, which "includes the plaintiff's investments and the return on them," his lawyer Salem al-Shaali said.

"We have enough documents to prove he was the sole investor," he added.

The hearing lasted just a few minutes. Only a representative of the plaintiff's lawyer was in the Dubai court of the first instance, which has cases backing up around the corner at the moment as more and more real estate frauds in Dubai come to light. This is the first directly involving the ruling family although the court's list named Al-Fajer as the defendant, with no mention of the Maktoums. The civil case comes as several executives from high-profile Dubai firms are held on suspicion of embezzlement and as the once booming regional business and tourism hub collapses under the impact of the global economic slowdown and massive debts, although the cases are carefully targeting foreign nationals almost exclusively and it would appear Emiraatis are immune.

The judge referred to them by numbers before the hearing was adjourned to April 8. Zadeh has said he was detained by Dubai police without charge for 60 days last year, at the same time as he was dismissed, and that his passport was confiscated for a year, without an explanation.