1MDB is suing the duo for alleged breach of trust and conspiracy.

Judicial commissioner Raja Ahmad Mohzanuddin Shah Raja Mohzan dismissed their application to strike out the suit, saying the case was not one that could be decided summarily.

“The court needs to hear evidence from witnesses,” he said.

Raja Mohzanuddin also told both Arul Kanda and Irwan that this was not the end of the road for their defence.

“The court will give utmost attention to the defendants and the defence they want to raise. This also applies to the plaintiff (1MDB),” he said.

He ordered Arul Kanda and Irwan to each pay costs of RM10,000 to 1MDB, and fixed Sept 14 for further case management.

In May 2021, 1MDB filed the suit against the duo, claiming breach of trust and conspiracy, which allegedly caused 1MDB to suffer losses of US$1.83 billion (RM8.5 billion) in relation to its investment in 1MDB-Petrosaudi Ltd, which was converted into an investment into Brazen Sky Limited, said to be found in the Bridge Global Fund.

1MDB also claimed that Arul Kanda and Irwan misappropriated US$3.5 billion (RM16.3 billion) in 1MDB money paid to Aabar Investments, and US$1.265 billion (RM5.9 billion) paid to International Petroleum Investment Company (IPIC) on May 9, 2017.

It alleged that Irwan also conspired with Arul Kanda to cause the company to implement an employment extension agreement, and made a substantial payment of RM2,905,200 to Arul Kanda in accordance with the agreement, in disregard of the company’s interests, causing it to suffer loss and damage.

The company demanded that the two defendants pay US$6.59 billion (RM30.6 billion) in damages, and for Irwan an additional RM2.9 million in connection with the employment extension agreement.