KUALA LUMPUR (June 8): After news broke over the weekend that Riza Shahriz Aziz's New York apartment was sold by the United States authorities for US$16.8 million, the step-son of former prime minister Datuk Seri Najib Razak was also named by 1Malaysia Development Bhd (1MDB) in a US$250 million suit.

Besides 1MDB, three of its subsidiaries 1MDB Energy Holdings Ltd, 1MDB Energy Ltd and 1MDB Energy (Langat) Ltd also named him and two of his companies, namely Red Granite Pictures Inc and Red Granite Capital Ltd, in the suit.

This is for funds allegedly obtained by Riza and his two companies from 1MDB and its three other subsidiaries between 2011 and 2012, which are allegedly misappropriated.

The writ of summons filed by Messrs Shearn Delamore at the High Court here on May 7 also named New York-based law firm Shearman and Sterling as the fourth defendant.

This is one of the six suits filed by 1MDB in its multi-billion suits against many individuals and companies.

In the writ sighted by theedgemarkets.com, 1MDB claimed that Riza, who controlled the two Red Granite companies which produced the award-winning "The Wolf of Wall Street", ought to have known that the monies that originated from 1MDB were misappropriated to them for their benefit.

It also claimed the US-based law firm allowed Riza and Low Taek Jho, or Jho Low, to use its lawyer accounts to launder a substantial portion of the misappropriations.

“The fourth defendant (Shearman and Sterling) had knowledge, being either actual knowledge or knowledge which is to be inferred from willful blindness or reckless indifference ... or failed to make the necessary enquiries, that the funds in question were the proceeds of crime,” the writ stated.

Hence, 1MDB is seeking a declaration that Riza is liable to account for the misappropriated funds and the unjust enrichment of the use of the funds, and it is seeking the repayment of the misappropriated funds.

Besides this, 1MDB and its subsidiaries are also seeking that the two Red Granite companies are liable to account for the misappropriation and unjust enrichment from the result of the misappropriation, and that 1MDB and its subsidiaries are entitled to the repayment.

Furthermore, it is also claiming that Shearman and Sterling is liable to pay damages and compensation for breaches of statutory and/or regulatory duty to dishonest assistance and aiding and abetting the transfer.

The 1MDB-related companies are also seeking interests, costs and other relief deemed necessary from all four defendants.

The case has today been called up for case management before senior assistant registrar Noordura Mohamed Din, who had fixed Aug 17 for further case management via e-review.

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