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Tue 1 Mar 2011 11:32 AM

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Dubai World wins US court case against submarine fraudster

Herve Jaubert found guilty of breach of contract, but jury votes against monetary damages

Dubai World wins US court case against submarine fraudster
Herve Jaubert, the ex-CEO of Dubai World subsidiary Exomos
Dubai World wins US court case against submarine fraudster
Herve Jaubert, the ex-CEO of Dubai World subsidiary Exomos
Dubai World wins US court case against submarine fraudster
Herve Jaubert dressed in a wetsuit and mask and holding flippers before he fled from Dubai on board a rubber dingy.

A trial that pitted state-backed conglomerate Dubai World against a submarine builder has ended after a US federal jury voted against awarding thousands of dollars in damages to either party.

A Florida court found Herve Jaubert, the ex-CEO of Dubai World subsidiary Exomos, guilty of breach of contract but turned down the company’s claim for $539,000 in compensatory damages, news site TCPalm reported.

Lawyers for Dubai World had also suggested jurors award punitive damages of up to $750,000.

Dubai World was, however, awarded $335,000 related to two submersibles the court found that Dubai World had paid for, but Jaubert failed to deliver.

Former French special agent Jaubert was accused of fraud, breach of contract and of racking up $31m in debt during his time as CEO of Exomos, which was established in 2004 to design and build submarines.

Dubai World lawyers claimed Jaubert had built vessels that failed safety tests before fleeing Dubai with millions of dollars in company cash.

Jaubert was first approached by Dubai World in 2003 in his role as founder of Seahorse Submarines International. By 2004, he had sold his firm to Dubai World and been appointed to head Exomos.

Through his company, Seahorse Submarines, he allegedly bought equipment worth $3.2m for the Dubai World subsidiary, but it did not all arrive.

Jaubert had a contract to build two submarines for Dubai World, but the company claimed that when the vessels were delivered, they were found to be incomplete and faulty.

According to Dubai World, Jaubert had agreed to settle the matter by paying an initial AED3m ($816,750) upfront, but fled the country before handing over any money.

Jaubert told Arabian Business in 2009 he had fled Dubai aboard a rubber dinghy, dressed in a burqa to evade police, using skills he had developed during his former career as a French special agent.

He said he had spent six hours aboard the rubber dingy before meeting his friend, who had sailed his boat into international waters, and the pair headed to India on a journey that took eight days.

Jaubert was sentenced in absentia to five years in jail in June 2009 and a fine of AED14m ($3.8m) by a Dubai court in June 2009.

Dubai World in September 2009 filed a fresh case against him in US federal court.

Jaubert had countersued the conglomerate, claiming he was falsely accused of embezzlement and threatened with incarceration after his passport was confiscated and he was fired from the firm.

Legal rulings reduced his complaint to one count of abuse of process against Dubai World, but he failed to secure monetary damages for the claim.

Jaubert said he was disappointed the claim was not upheld.

"Because I know what happened to me," he told news site TCPalm. "And I know what happened to others, and I know they do abuse the process.

"I'm happy it's over and I'm going to leave that behind and move on and go back into the submarine business. I will be building submarines again."

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SA 9 years ago

I hope this guy is brought to justice.
His action has caused hundreds of ppl lost their job at the company and he had clearly cheated the firm.