Red Granite Pictures Inc has filed a motion opposing the proposed delay in the US Department of Justice’s (DOJ) 1MDB-linked civil forfeiture suits.

The motion, filed by the company’s legal counsel Matthew Schwartz, argued that "the government has not demonstrated that discovery will adversely affect any ongoing investigation."

"Claimant (Red Granite) should not have to wait any longer to clear its name. These cases have been pending for over a year and the government’s underlying investigation has been ongoing, according to press reports, for at least two.

“(Red Granite) has a strong interest in defending this action and regaining the unfettered use of its property.

“But instead, based on the assertion that discovery 'will have an adverse effect' on the investigation, the government now seeks to stay these cases indefinitely,” the court documents sighted by Malaysiakini read.

The DOJ had said in their application that the civil proceedings would likely have an "adverse effect on the government’s ability to conduct the related criminal investigation."

“Any disclosures by the government beyond those in the complaint will reveal details of the underlying investigation to which the potential targets and subjects are not entitled,” the DOJ’s court documents had read.

A declaration by a Federal Bureau of Investigation (FBI) agent said the government had been conducting the criminal probe prior to the commencement of DOJ’s action, and that the investigation was still ongoing.

In Red Granite’s motion filed on Aug 28, Schwartz argued that the government has not made an “actual showing” that civil discovery will interfere with any investigation.

“Indeed, the declaration submitted in support of the motion (asserts) only that disclosure of any facts beyond those set forth in the (suits) would be harmful.

“Discovery of the allegations in the complaint, however, should be fair game.

“Given the specificity of some of the government’s allegations, it is difficult to imagine how any investigation could be harmed by disclosure of the underlying evidence,” the court document read.

The government bears the burden of proving that civil discovery will adversely affect the criminal investigation, Schwartz said in the filing.

Citing previous cases, he said that there is no presumption that civil discovery, in itself, automatically creates an adverse effect on the government’s related criminal proceeding.

He also said that the stay motion is premature as Red Granite, as the claimant, has not yet made discovery requests.

“It is not surprising that the motion fails to articulate how discovery will interfere with any investigation, because the claimant has not actually made any discovery demands yet.

“That being so, the government and the court are left to speculate as to what discovery claimant may seek and the impact it might have on any investigation.

“In the event that claimant propounds discovery requests that the government believes will impact its investigation, then... the government can renew its motion at that time,” he said.

Case pending over a year 

Schwartz further argued that a blanket stay on the suits would violate his client’s due process rights.

As the case has been pending for over a year while investigations have reportedly been ongoing for two years, he said that the sort of “open-ended stay” sought by the government raises serious due process concerns.

He noted that the relevant authorities, in this case, have been holding press conferences, releasing press statements and commenting on this issue to the press since the suits were filed.

During that time, his client has been further prejudiced by the particularly public nature of the government’s investigation, he said.

“Red Granite remains hopeful that its role in these cases will be resolved, and that there will be no need to litigate this action.

“In the event that a negotiated resolution is not imminent, however, Red Granite has a strong interest in clearing its name promptly,” the court documents read.

This comes after the DOJ applied to stay the forfeiture suits on assets allegedly purchased using misappropriated 1MDB funds to facilitate ongoing criminal investigations by the US government.

Red Granite, co-founded by Riza Aziz, the stepson of Prime Minister Najib Abdul Razak, is the producer of the films "The Wolf of Wall Street", "Dumb and Dumber To" and "Daddy’s Home."

The DOJ is seeking rights to profits, royalties and distribution proceeds that are owed to Red Granite, following alleged diversion of Malaysian funds into shell companies used to fund their films.