In a landmark ruling, the Federal High Court Lideta Criminal Bench has dismissed the Attorney General’s (AG) criminal charges against seven defendants, including three legal entities, in a high-profile case that has lasted nearly a decade.

This decision marks a significant shift in the legal trajectory of the dispute, favoring the defendants.

The individual defendants include Azeb Mihretab, an Ethiopian-born U.S. citizen and prominent businesswoman, and Temesgen Yilma, a well-known entrepreneur and owner of Yilma Restaurant, celebrated for its Ethiopian cuisine.

The AG had accused the defendants of money laundering, illegal hawala (informal money transfer) operations, misdemeanors, and abuse of power in connection with their management of a nine-story building owned by Cosmo Trading PLC, a company founded by Haileyesus Mengiste and his two children, who hold minority shares.

In its final verdict issued last week, the court ruled that key witnesses presented by the AG actually supported the defendants’ case. Notably, Haileyesus, the first witness and major shareholder of Cosmo, along with the fifth and sixth witnesses, confirmed that the majority shares of the company had been legally transferred to Azeb Mihretab, her company, and the sixth defendant, Boston Real Estate.

Although Haileyesus claimed in his testimony that he signed the share transfer under duress and pressure, a civil court in a separate lawsuit, which the criminal bench referenced in its verdict, had already ruled in favor of the defendants, validating the transfer.

The court also verified that funds obtained from bank loans were used to settle Cosmo’s outstanding debts, dismissing allegations of financial misconduct.

One of the court’s key findings affirmed the ownership and loan authorization, confirming that the first and sixth defendants lawfully owned the building and had the legal authority to use it as collateral for loans.

“There is no legal basis to accuse them of unlawfully securing bank loans, as they acted within their rights under the power of attorney,” the verdict stated.

The Higher Court at Lideta has also dismissed the money laundering and illegal transfer charges.

The court’s decision indicated that the money laundering accusation filed by the AG was dismissed due to insufficient evidence.

Claims of illegal money transfers, abuse of power, and misappropriation of rental income from the building, which operates as a hotel, as well as sales of construction machinery, were also rejected for lack of proof.

The court has cleared Azeb and Temesgen, the second defendant, of abuse of power charges related to securing loans from Awash Bank, stating that the funds were used to pay off company debts.

This ruling follows a November 2024 decision by the Federal Supreme Court’s First Cassation Bench, which upheld the validity of a share-selling agreement between Cosmo Trading and JJ Property Management, the fourth defendant in the criminal case and a company owned by Azeb.

The dispute involved the sale of 19 shares from Haileyesus to JJ Property and Azeb at 1,000 birr per share, totaling 19.9 million birr, along with the acquisition of 50 shares each (a total of 100,000 birr) from two other shareholders eight years ago.

With this latest verdict, the court has effectively concluded the criminal proceedings against the defendants, reinforcing their legal standing in both the civil and criminal aspects of the case.

The ruling highlights the absence of substantive evidence to support the Attorney General’s allegations, marking a decisive victory for the defendants in this prolonged legal battle.

Haileyesus’s company, Cosmo Trading, was once a leading supplier of beauty products in Ethiopia, while his hospitality venture, New York Café, was one of the city’s most prominent establishments throughout the 2000s and into the mid-2010s.

However, the past decade has been marred by a lengthy legal dispute, with court battles extending nearly ten years over ownership and financial allegations.

The conflict centered on the management and ownership of a prime nine-story building originally associated with Cosmo Trading PLC, involving accusations of financial misconduct, illegal money transfers, and abuse of power.

Despite the decade-long legal struggle, recent court rulings have dismissed all charges against the defendants. However, under the law, the Attorney General retains the right to appeal the verdict if deemed necessary.