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Turkcell Dismisses Suit Against MTN Over Iran License

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Turkcell Drops Lawsuit Against MTN Over Iran Phone License Deal
Employees leave the Turkcell headquarters in Istanbul. Photographer: Staton R. Winter/Bloomberg

May 2 (Bloomberg) -- Turkcell Iletisim Hizmetleri AS withdrew a lawsuit alleging that MTN Group Ltd. paid bribes to win an Iranian mobile-phone license, citing a Supreme Court decision that bars such cases in the U.S.

Turkcell, based in Istanbul, told U.S. District Judge Reggie Walton in a court filing yesterday in Washington that it would drop the case because of the Supreme Court’s ruling last month on the Alien Tort Statute. The case had been on hold while the Supreme Court decision was pending. The company may file a new application in a different court, it said in a statement today.

Turkcell, Turkey’s biggest mobile-phone company, sued its Johannesburg-based rival in March 2012 for $4.2 billion in damages over the loss of the Iranian license it was initially awarded. Turkcell claimed MTN, Africa’s largest mobile-phone operator, bribed officials, arranged meetings between Iranian and South African leaders, and promised Iran weapons and United Nations votes in exchange for a license to provide wireless service in the Islamic Republic.

“Turkcell has decided to withdraw the lawsuit only due to formal reasons,” it said in a regulatory statement. “Turkcell does not back off from its claims on the lawsuit’s essence and will file a lawsuit on this essence at a new court.”

A spokesman for MTN declined to comment. The company’s shares gained 3.2 percent to 167 rand at the close of trading in Johannesburg. The FTSE/JSE Africa All Share Index advanced 0.9 percent.

Torture Cases

The Turkcell complaint includes numerous alleged internal MTN memos that detail the company’s efforts to win the Iranian business after losing the bid to Turkcell in February 2004.

Turkcell argued that the 1789 Alien Tort Statute gave it the right to sue MTN in U.S. courts, a stance opposed by MTN.

The Alien Tort Statute is usually cited in human rights and torture cases. The law gives American courts jurisdiction in some instances to consider claims by foreigners for illegal conduct that occurred in another country.

The justices on April 17 threw out a suit accusing two foreign-based units of Royal Dutch Shell Plc of facilitating torture and executions in Nigeria. The majority said the Alien Tort Statute generally doesn’t apply to conduct beyond U.S. borders.

The suit before the high court was pressed by Nigerians who said two Shell units were complicit in torture and executions in the country’s Ogoni region from 1992 to 1995. Shell denied the allegations.

The case is Turkcell Iletisim Hizmetleri AS v. MTN Group Ltd, 12-cv-00479, U.S. District Court, District of Columbia (Washington).

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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