MTN loses bid to halt US anti-terrorism lawsuits

• A US District Court has allowed two anti-terrorism lawsuits, Zobay and Long, against MTN Group to proceed to the discovery phase.
• The lawsuits allege MTN made payments to al-Qaeda and the Taliban in Afghanistan between 2009 and 2017, financing an insurgency.
• MTN maintains these court rulings are procedural and do not indicate wrongdoing, vowing to vigorously defend itself.
• The company was unable to challenge factual allegations at the motion-to-dismiss stage but will now present evidence during discovery.
• This development is part of four US Anti-Terrorism Act lawsuits against MTN and coincides with its strategic exit from Middle East operations, including the sale of its Afghanistan business in 2024.

The telecommunications giant maintains that these recent court decisions are purely procedural and do not constitute any finding of wrongdoing or liability against the company.

A significant legal development has occurred in the ongoing litigation against MTN Group, as a US court has cleared the path for two key lawsuits, Zobay versus MTN Group and Long versus MTN Group Limited, to advance into the discovery phase. This decision by the US District Court for the Eastern District of New York follows its rejection of MTN's requests to either reconsider an earlier ruling or permit an immediate appeal. The initial ruling had allowed certain claims under the US Anti-Terrorism Act (ATA) to proceed, setting the stage for the current progression.

The core allegations against the telecommunications giant, first brought in 2019, contend that MTN violated US anti-terrorism laws through its operations in Afghanistan. Specifically, the complaints assert that MTN made payments to both al-Qaeda and the Taliban, purportedly to avoid the expenses associated with securing its network infrastructure. These alleged payments, according to the lawsuits, helped finance a Taliban-led insurgency responsible for attacks in Afghanistan between 2009 and 2017. The legal actions were initiated in a US federal court by families of US citizens who were killed in these attacks, with five other companies also named in the broader litigation.

The progression to discovery signifies a critical juncture where both parties will exchange information and evidence relevant to the claims. MTN has consistently denied any culpable participation in the attacks and has pledged a vigorous defense against the proceedings. The company highlighted that, under US legal procedures, it was unable to challenge the factual allegations during the initial motion-to-dismiss stage. The discovery phase now provides MTN with the opportunity to produce and seek evidence to rebut the plaintiffs' assertions.

These two cases are part of a larger set of four ATA lawsuits filed against MTN in the US, which also include Cabrera and Chand & Davis. MTN has indicated that there have been no material developments in the Cabrera and Chand & Davis cases. Following discovery, parties typically have the option to seek summary judgment, requesting the court to decide the case based on the evidence without a full trial. Should summary judgment applications not be made, or if they are denied, the cases would then proceed to trial.

In response to the court's recent decisions, MTN emphasized that these rulings are procedural in nature and do not constitute any finding of wrongdoing or liability against the company. The telecommunications giant remains confident that the evidence will ultimately demonstrate its non-culpable role in the attacks. MTN has affirmed its commitment to continue defending the proceedings vigorously, exploring all available legal options, and providing updates to shareholders on material developments as appropriate.

Beyond the immediate legal challenges, MTN has also expressed sympathy for individuals injured or who lost loved ones in conflicts across Iraq and Afghanistan. This legal battle unfolds as MTN has been strategically withdrawing from its Middle East operations since 2020, aiming to refocus on its African markets. The group completed its exit from consolidated Middle East operations by selling its Afghanistan business in 2024, following its departure from Yemen in 2021. MTN has formalized an agreement to regularize its exit from Syria, while its minority investment in Iran remains subject to an attempted divestment.

The decision to allow MTN Zobay Long discovery proceeds holds significant implications for the landscape of corporate liability Afghanistan and telecommunications compliance risk. It signals a willingness by US courts to permit claims of corporate complicity in terrorism under the US Anti-Terrorism Act (ATA) to advance, even against foreign entities. This development underscores the increasing scrutiny multinational corporations face regarding their operations in conflict zones and the potential for long-term litigation exposure.

The advancement of these cases into discovery means that the factual basis of the allegations, including the alleged al-Qaeda Taliban payments, will be thoroughly examined. This process will test the boundaries of corporate responsibility for indirect support to proscribed groups and could set precedents for how telecommunications companies, and indeed any corporation operating in high-risk environments, manage their compliance protocols and due diligence to mitigate such risks.

This development signals that US courts are willing to allow claims of corporate complicity in terrorism under the ATA to proceed to discovery, even against foreign entities. Lawyers advising multinational corporations, especially those operating in conflict zones, should review their clients' due diligence and compliance protocols to mitigate risks of indirect support to proscribed groups and potential long-term litigation exposure.

Source: Reporting based on recent court filings