A British multinational is facing renewed legal pressure in the United States as victims of terrorism seek damages.

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The case raises questions about whether past corporate activity overseas indirectly supported violent attacks.

At its core is a long-running dispute over responsibility, intent and accountability.

Claims before court

Hundreds of US military personnel, civilians and relatives have filed a civil lawsuit against British American Tobacco and one of its subsidiaries, according to reporting by the Guardian.

The plaintiffs are seeking unspecified damages, alleging the company helped North Korea generate funds that were later used to support terrorist attacks against Americans in the Middle East.

The case was filed in federal court in the eastern district of Virginia under a law that allows victims of terrorism to pursue claims not only against perpetrators, but also against third parties accused of assisting them.

Business under scrutiny

BAT formed a joint venture in 2001 with a North Korean state-owned company to manufacture cigarettes. A 2005 investigation by the Guardian found the operation continued quietly even as the US government warned that Pyongyang was funding terrorism and imposed sanctions.

The company said in 2007 that it had ended its business in North Korea. However, the US justice department later alleged the operation continued covertly through a subsidiary.

In 2023, a senior justice department official told a Senate hearing that the venture generated about $418m in banking transactions that were used to advance North Korea’s weapons programme.

Earlier settlement

That same year, BAT entered a deferred prosecution agreement with US authorities. The company and its subsidiary, which pleaded guilty, agreed to pay $629m in fines over sanctions violations and bank fraud.

“At the time, BAT’s chief executive Jack Bowles said: “On behalf of BAT, we deeply regret the misconduct arising from historical business activities that led to these settlements, and acknowledge that we fell short of the highest standards rightly expected of us.”

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He added that the company had strengthened its compliance, ethics and anti-money laundering controls.

Alleged consequences

The new lawsuit claims profits from the cigarette venture and related smuggling were used by North Korea to fund weapons development for Iran’s Revolutionary Guard and Hezbollah.

Those weapons are alleged to have been used in attacks on US and allied targets in Iraq in January 2020 and in a missile strike in Kurdistan in 2022. More than 100 US soldiers were diagnosed with traumatic brain injuries following the 2020 attack, and multiple people were killed in the later strike.

“This case alleges a clear nexus between BAT’s clandestine scheme in North Korea and the weapons used in deadly terrorist attacks,” said Ryan Sparacino, a lawyer representing the plaintiffs.

Plaintiffs’ case

The plaintiffs include about 200 service members who say they suffered injuries such as traumatic brain injuries and post-traumatic stress disorder, along with family members and the estate of a civilian killed during the 2022 attack.