LuLu Group defamation case: Why is UAE retail group pursuing million-dirham lawsuit against Malayali YouTuber

Abu Duabi: “We welcome criticism, but won’t allow misinformation to go unchallenged,” LuLu Group has said as it presses ahead with a ₹10 crore (approximately Dh3.9 million) defamation case against Malayalam YouTuber Marunadan Malayalee, making clear it has no intention of settling the dispute out of court.

The case, filed by LuLu Group and its chairman M.A. Yusuffali, centres on allegations made in a YouTube video published in November 2020 that linked the UAE-based businessman and his retail empire to Kerala's high-profile diplomatic baggage gold-smuggling scandal.

Six years after the video was published, the dispute remains before the courts, despite the publisher subsequently posting a video withdrawing his earlier remarks. The legal battle has particular resonance among Malayalees in the UAE, where Yusuffali is a prominent business figure and LuLu Group has a substantial workforce and retail presence.

V. Nandakumar, Director of Marketing and Communications at LuLu Group International, told Gulf News that the company would continue to pursue the matter through the courts.

“We have immense respect for India's judicial system and are committed to addressing these matters strictly through the legal process,” Nandakumar said.

“Proceedings have already been initiated in courts in Kerala, Lucknow and Delhi against individuals we believe have engaged in such activities. We remain unwavering in our decision to pursue these cases to their legal conclusion. There is no question of withdrawing them or stepping back from our position,” he explained.

What triggered the case?

The dispute dates back to November 21, 2020, when Malayalam digital publisher Marunadan Malayalee published a YouTube video alleging a connection between Yusuffali and the Kerala gold-smuggling case.

LuLu Group and Yusuffali rejected the allegations and initiated defamation proceedings, seeking ₹10 crore (approximately Dh3.9 million) in damages.

In May 2023, the Delhi High Court granted interim relief to Yusuffali, directing that the disputed content be taken down and restraining the publisher from making further remarks about him.

Separate proceedings were also initiated in Kerala, including at the Ernakulam Sub Court, and in Lucknow.

What is the gold case?

The 2020 Kerala gold-smuggling scandal erupted after Indian Customs officials seized more than 30kg of gold, worth nearly ₹15 crore, from a diplomatic baggage consignment at Thiruvananthapuram International Airport on July 5, 2020.

The shipment had arrived from Dubai. The investigation subsequently involved multiple Indian agencies, including Customs, the National Investigation Agency and the Enforcement Directorate.

The scandal triggered a major political controversy in Kerala and investigations into an alleged smuggling network that had exploited diplomatic cargo channels.

Neither Yusuffali nor LuLu Group was named as an accused or suspect by the investigating agencies in the gold-smuggling investigations. However, it was the alleged connection made in the YouTube video that prompted the defamation proceedings.

Was there an apology?

The dispute took another turn in late October 2026, when Marunadan Malayalee published a video in which Shajan Skariah, the publication’s founder, said his earlier remarks were incorrect and withdrew them.

The video was widely characterised as an apology. However, Skariah subsequently disputed that it amounted to a formal apology.

The distinction is significant because LuLu Group has maintained that it intends to pursue the legal proceedings rather than treat the withdrawal of the remarks as a resolution of the dispute.

No withdrawal

Nandakumar said the company respects freedom of expression and the right of individuals to question its decisions, but believes there must be a distinction between criticism and the circulation of allegedly fabricated information.

“At LuLu Group, we strongly believe in freedom of expression and respect every individual's right to hold different opinions, question our decisions and even criticise us,” he said.

“However, freedom of speech should never become a licence to spread fabricated stories, baseless allegations or deliberately misleading information intended to damage reputations. We draw a very firm line when such activities target the credibility and integrity of LuLu Group, our brand or our Chairman, Yusuffali M.A.”

He added that the company would use all lawful options available to protect its reputation.

“We will exercise all lawful options available to safeguard our reputation and seek accountability,” he said.

Why it matters

The dispute carries significance beyond the courtroom, particularly for the large Malayalee community in the UAE.

Yusuffali is among the most prominent Indian business figures in the Gulf, and LuLu Group has built a sizeable retail and international business spanning several countries.

Nandakumar said the company viewed its reputation as something that extended beyond its commercial operations.

“For us, LuLu represents much more than a commercial organisation. It is a source of pride, livelihood and belonging for over 75,000 employees and their families,” he said.

“The trust and goodwill built over decades are invaluable to us.”

He added: “We respect genuine criticism, however strong it may be, but we will not remain silent when deliberate misinformation threatens the values, reputation and integrity of an organisation that so many people proudly call their own.”

What happens next?

The Delhi High Court has listed the matter for further proceedings on December 14, 2026.

LuLu Group has made its position clear: it intends to continue with the defamation proceedings despite the publisher's withdrawal of his earlier remarks.

The case will now proceed through the judicial process, with the company ruling out an out-of-court settlement.