US suit on MTN's Iran links gets go-ahead

In what The Star calls a ground-breaking decision, the US District Court for the Eastern District of New York has given the go-ahead for a high-stakes Anti-Terrorism Act lawsuit against Africa’s telecoms giant, MTN Group, to advance to the discovery stage. This ruling comes as MTN Group wasted no time in submitting an appeal, setting the stage for a precedent-setting legal battle that could rattle court and boardrooms alike for years to come. In a federal lawsuit filed in New York, more than 50 Americans claim MTN and other technology companies did business with the Islamic Revolutionary Guard Corps (IRGC), even though they knew the transactions would help finance, arm and support the Iranian group’s terror campaign in neighbouring Iraq. As a result, thousands of Americans were injured or killed between 2011 and 2016, according to the suit.

The court’s ruling was multi-faceted, dealing with counts of aiding and abetting liability under the Justice Against Sponsors of Terrorism Act, civil conspiracy liability, and aiding and abetting terrorist acts in Afghanistan. The Star reports MTN managed to fend off two of the three counts, but the court determined that the plaintiffs had sufficiently stated a claim for aiding and abetting liability against MTN in Iraq. The report says what makes the ruling particularly remarkable is that it marks the first time a US court has allowed for the possibility of corporate liability under the Anti-Terrorism Act for direct aid to the IRGC. Notably, the judgment also highlighted that even after the IRGC was officially designated as a Foreign Terrorist Organisation in 2019, MTN retained its commercial ties. MTN called for a ‘pre-motion conference’ on 15 October to discuss its appeal, represented by the law firm Freshfields Bruckhaus Deringer. The telecoms giant argues that the case could have a chilling effect on foreign investment and further complicate an already complex geopolitical landscape. While the appeal remains pending, the court’s decision has allowed the lawsuit to proceed to the discovery stage.

Full report in The Star