Alabama Court Dismisses All Claims Against Binance in Anti-Terrorism Act Lawsuits

TLDR

• Alabama court rejects Binance ATA lawsuit over vague, improper pleadings.
• Plaintiffs must clarify claims and link actions to each defendant.
• Complaint exceeds 100 pages with hundreds of allegations, court says.
• Failure to amend by April 10 could end the lawsuit entirely.
• Ruling follows Manhattan court dismissal on similar terrorism claims.

A U.S. federal court in Alabama dismissed claims accusing Binance of violating the Anti-Terrorism Act (ATA). The ruling marks another courtroom setback for plaintiffs pursuing ATA allegations tied to crypto transactions. The decision strengthens Binance’s defense while the court allowed plaintiffs time to amend the ATA complaint.

Alabama Court Rejects ATA Complaint Over Pleading Deficiencies

A judge in the United States District Court for the Middle District of Alabama dismissed an ATA lawsuit against Binance and related entities. The complaint accused Binance of enabling transactions that allegedly supported groups tied to terrorism financing. However, the court ruled that the ATA complaint failed to meet basic federal pleading standards.

The lawsuit also named Changpeng Zhao and BAM Trading Services as defendants under the ATA framework. Plaintiffs included victims and relatives of victims linked to attacks attributed to militant organizations. They argued that crypto services allegedly enabled financial activity benefiting groups like Hamas and Palestinian Islamic Jihad.

The court reviewed the ATA filing and described it as an improper “shotgun pleading.” Such filings combine numerous allegations without linking specific actions to each defendant. The judge concluded that the ATA complaint lacked clarity and failed to present a short statement of claims.

Judge Orders Plaintiffs to Restructure ATA Claims

The court determined that the complaint exceeded 100 pages and contained hundreds of allegations.  The filing grouped defendants and did not identify each party’s alleged conduct. The judge ruled the ATA allegations lacked the structure required under federal rules.

The ruling instructed plaintiffs to submit a revised ATA complaint before April 10, 2026. The court required clear counts explaining which plaintiffs assert claims against which defendants. The amended filing must connect specific actions to the injuries alleged in the ATA case.

The judge warned that failure to correct these problems could lead to full dismissal. The court emphasized that plaintiffs must clarify how each defendant’s conduct allegedly relates to the attacks. Without such details, the ATA lawsuit cannot proceed under federal standards.

Legal Developments Follow Earlier Court Victory

The Alabama ruling follows another recent legal decision involving Binance and similar ATA allegations. A federal court in Manhattan previously dismissed a lawsuit accusing the exchange of facilitating terrorism financing. That case involved claims connected to attacks linked to Hezbollah and Hamas.

In that decision, the court ruled that plaintiffs failed to connect the exchange’s operations to specific attacks. The ruling weakened attempts to extend ATA liability to digital asset platforms. The two decisions represent major legal defenses against ATA accusations.

Binance continues to face broader scrutiny over alleged illicit finance risks in the cryptocurrency sector. The company recently filed a defamation lawsuit against The Wall Street Journal over reporting about internal investigations. Despite ongoing scrutiny, the Alabama ruling marks another important development in the ATA litigation surrounding the exchange

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