Case 1:21-cv-03503 Document 1 Filed 06/22/21 Page 1 of 183 PageID #: 1 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK STEPHANIE ZOBAY, individually, and for the estate of STEPHEN S. EVERHART, LINDSAY M. EVERHART, ABDUL GHAFFAR MUGHAL, SITORAI KHASANZOD, KHALID MUGHAL, HAMID MUGHAL, ANGELA MUGHAL, N.M., by and through her next friend Abdul Ghaffar Mughal, M.M., by and through his next friend Abdul Ghaffar Mughal, WAYNE NEWBY, THERESA HART, JURY TRIAL DEMANDED NATHAN NEWBY, JASON RZEPA, CASSANDRA RZEPA, C.R., by and through his next friend Cassandra Rzepa, K.R., by and through his next friend Adrian Davis, TYLER N. OGDEN, WILLIAM M. CHINN, Case No.: 21-cv-3503 SEAN M. NIQUETTE, LAUREN NIQUETTE, THOMAS NIQUETTE, MARY NIQUETTE, ED ELLIOTT, BRIAN C. ALLDRIDGE, JOANN ALLDRIDGE, RONALD ALLDRIDGE, DIANNA ALLDRIDGE, TODD JEFFREY ALLDRIDGE, ANDREW MAJOR, ASHLEY MAJOR, ALYSSA MAJOR, MARCUS JAMIL SULLEN, DAVID EUGENE HICKMAN, VERONICA HICKMAN, DEVON F. HICKMAN, TAMMIE FROST, individually, and for the estate of RUSSELL FROST, MADISON FROST, CRYSTAL FROST, AMANDA FROST, WAIEL EL-MAADAWY, BILQIS AIDARA ADJEI, ALEXIS GRANT, MALIK ELMAADAWY, G.E., by and through his next friend Latasha Elmaadawy, ZEINAB EL-MAADAWY, IHAB EL- MAADAWY, TAMER EL-MAADAWY, MOHAMMED EL-MAADAWY, MUSTAFA EL- MAADAWY, AMR MOHAMED, BRENDA MOHAMED, Plaintiffs, v. MTN GROUP LIMITED, MTN IRANCELL, MTN DUBAI LIMITED, ZTE CORPORATION, ZTE (USA) INC., and ZTE (TX) INC., Defendants. Case 1:21-cv-03503 Document 1 Filed 06/22/21 Page 2 of 183 PageID #: 2 COMPLAINT FOR VIOLATION OF THE ANTI-TERRORISM ACT Ryan R. Sparacino (pro hac vice forthcoming) Eli J. Kay-Oliphant (EDNY Bar No. EK8030) SPARACINO PLLC 1920 L Street, NW, Suite 535 Washington, DC 20036 Tel: 202.629.3530 [email protected] [email protected] Case 1:21-cv-03503 Document 1 Filed 06/22/21 Page 3 of 183 PageID #: 3 TABLE OF CONTENTS Page INTRODUCTION .......................................................................................................................... 1 DEFENDANTS .............................................................................................................................. 5 A. The MTN Defendants ............................................................................................. 5 B. The ZTE Defendants ............................................................................................... 6 JURISDICTION AND VENUE ..................................................................................................... 6 FACTUAL ALLEGATIONS ......................................................................................................... 7 I. SINCE THE ISLAMIC REVOLUTION IN 1979, THE ISLAMIC REVOLUTIONARY GUARD CORPS, INCLUDING THE QODS FORCE, HAS FOMENTED AND SUSTAINED ANTI-AMERICAN TERRORISM .............. 7 A. The Islamic Revolutionary Guard Corps, including the Qods Force, has long supported anti-American terrorism as part of Iran’s foreign policy ............... 7 B. The Islamic Revolutionary Guard Corps, including the Qods Force, has historically relied on fronts, operatives, and agents to fund, arm, and operationally support Iran’s anti-American terrorist proxies ................................ 17 II. DEFENDANTS TRANSACTED BUSINESS WITH FRONTS, OPERATIVES, AND AGENTS CONTROLLED BY THE ISLAMIC REVOLUTIONARY GUARD CORPS, INCLUDING THE QODS FORCE ........... 20 A. An Iranian-backed Shiite terrorist alliance comprised of Hezbollah, Jaysh al-Mahdi, and the Islamic Revolutionary Guard Corps, including the Qods Force, waged a deadly terrorist campaign against Americans in Iraq .................. 21 1. Hezbollah ........................................................................................................ 26 2. Jaysh al-Mahdi ................................................................................................ 30 3. Asaib Ahl al-Haq, a Jaysh al-Mahdi Special Group ....................................... 33 4. Kataib Hezbollah, a Jaysh al-Mahdi Special Group ....................................... 34 B. The Islamic Revolutionary Guard Corps’s, including the Qods Force’s, control of Iran’s telecom, information technology, and communications sectors ................................................................................................................... 36 1. The Bonyad Mostazafan ................................................................................. 36 2. Iran Electronics Industries .............................................................................. 43 i Case 1:21-cv-03503 Document 1 Filed 06/22/21 Page 4 of 183 PageID #: 4 3. MTN Irancell .................................................................................................. 44 4. Telecommunications Company of Iran ........................................................... 45 5. The Akbari Front Companies .......................................................................... 47 III. DEFENDANTS’ TRANSACTIONS WITH FRONTS, OPERATIVES, AND AGENTS OF THE ISLAMIC REVOLUTIONARY GUARD CORPS, INCLUDING THE QODS FORCE, PROVIDED FINANCING, WEAPONS, AND OPERATIONAL SUPPORT TO TERRORISTS ............................................. 48 A. The Islamic Revolutionary Guard Corps, including the Qods Force, raised funds, purchased weapons, and obtained operational support through illicit corporate transactions in the telecom, communications, and IT sectors ............... 48 B. Defendants made illicit deals with fronts, operatives, and agents of the Islamic Revolutionary Guard Corps, Including the Qods Force ........................... 51 IV. DEFENDANTS KNEW OR RECKLESSLY DISREGARDED THAT THEIR TRANSACTIONS WITH THE ISLAMIC REVOLUTIONARY GUARD CORPS, INCLUDING THE QODS FORCE, FACILITATED TERRORIST ATTACKS ON AMERICANS IN IRAQ ................................................................... 53 A. Defendants’ transactions directly funded, armed, and operationally supported terrorist attacks on Americans in Iraq .................................................. 53 B. Defendants knew or recklessly disregarded that their transactions with Islamic Revolutionary Guard Corps, including Qods Force, fronts, operatives, and agents aided terrorism .................................................................. 59 V. EACH DEFENDANT ENGAGED IN COMMERCIAL TRANSACTIONS THAT IT KNEW OR RECKLESSLY DISREGARDED WERE STRUCTURED TO FINANCE, ARM, AND/OR OPERATIONALLY SUPPORT THE ISLAMIC REVOLUTIONARY GUARD CORPS, INCLUDING THE QODS FORCE, AND THEIR TERRORIST PROXIES HEZBOLLAH AND JAYSH AL-MAHDI ................................................................ 66 A. The MTN Defendants ........................................................................................... 66 1. MTN secured its joint venture with the Islamic Revolutionary Guard Corps, including the Qods Force, in MTN Irancell through bribes and a contractual promise to aid Iran-backed terrorism ........................................ 66 2. MTN knowingly assumed a financial and operational role in the Islamic Revolutionary Guard Corps’s, including the Qods Force’s, terrorist enterprise ........................................................................................... 81 a. MTN assumed a financial role in the terrorist enterprise ............................... 84 ii Case 1:21-cv-03503 Document 1 Filed 06/22/21 Page 5 of 183 PageID #: 5 b. MTN assumed an operational role in the terrorist enterprise ......................... 87 3. MTN’s joint venture with the Islamic Revolutionary Guard Corps, including the Qods Force, comports with its historical business practices in international markets ................................................................. 102 4. MTN’s joint venture with the Islamic Revolutionary Guard Corps, including the Qods Force, had a substantial nexus to the United States ....... 104 a. MTN’s conduct targeted the United States ................................................... 105 b. MTN’s conduct relied on American contacts ............................................... 109 B. The ZTE Defendants ........................................................................................... 112 1. ZTE knowingly assumed a financial and operational role in the Islamic Revolutionary Guard Corps’s, including the Qods Force’s, terrorist enterprise ....................................................................................................... 112 2. ZTE’s assistance to the Islamic Revolutionary Guard Corps, including the Qods Force, comports with its historical sales practices in international markets ..................................................................................... 119 3. ZTE’s assistance to the Islamic Revolutionary Guard Corps, including the Qods Force, had a substantial nexus to the United States ....................... 121 a. ZTE’s conduct targeted the United States .................................................... 122 b. ZTE’s conduct relied on American contacts ................................................. 126 VI. HEZBOLLAH, JAYSH AL-MAHDI, AND THE ISLAMIC REVOLUTIONARY GUARD CORPS, INCLUDING THE QODS FORCE, USED DEFENDANTS’ FUNDS AND OPERATIONAL AID TO FINANCE TERRORIST OPERATIONS, BUY AND/OR BUILD ADVANCED WEAPONS SPECIALLY DESIGNED TO TARGET AMERICANS IN IRAQ, AND SUSTAIN THE JOINT CELLS USED TO COMMITT TERRORIST ATTACKS THAT KILLED AND INJURED AMERICANS IN IRAQ ......................................................................................................................... 127