Business Insider Africa has closely followed the legal back-and-forth in the case and has now confirmed that South African billionaire Patrice Motsepe has secured another court reprieve in a $195 million graphite dispute in Tanzania.
The High Court struck out a damages claim brought by US-based Pula Group over the alleged misuse of confidential information linked to a rival graphite project.
The ruling marks the latest development in a cross-border dispute that has run since 2019 and has drawn proceedings in both Tanzania and South Africa.
However, the Tanzanian court did not rule on the substance of Pula’s allegations. Instead, it removed the case from the court roll after finding that two companies central to the dispute had not been joined to the proceedings.
Those companies are Australian-listed Evolution Energy Minerals and its Tanzanian subsidiary, Ngwena Tanzania, which operates the Chilalo graphite project near Pula’s own graphite project in Tanzania’s Ruangwa district.
Motsepe-linked ARCH Sustainable Resources Fund invested about A$10 million in Evolution for an initial stake of roughly 25%.
That investment is central to Pula’s case because it alleges that confidential information it shared with ARM was later used to advance Chilalo, a competing graphite project.
How the case began
In 2019, African Rainbow Minerals (ARM), chaired by Motsepe, signed a 24-month confidentiality agreement with Pula Group, a US-based mining and investment company founded by former US ambassador to Tanzania Charles Stith.
At the time, ARM was considering an investment in Pula’s graphite project in southern Tanzania.
As part of the talks, Pula says it gave ARM access to confidential geological, commercial and strategic information, with the agreement barring its use for competitive purposes.
The relationship later soured after Motsepe-linked ARCH Sustainable Resources Fund invested in Australian-listed Evolution Energy Minerals, whose Tanzanian subsidiary, Ngwena Tanzania, is developing the nearby Chilalo graphite project.
Pula alleges that information it provided to ARM ultimately reached ARCH and was used to advance the rival project.
It argues that the corporate links between ARM, African Rainbow Capital (ARC) and ARCH were close enough to allow the information to move between the entities.
ARC, however, rejects the allegations. It maintains that it neither received nor used Pula’s confidential information and was not a party to the original confidentiality agreement.
Tanzanian court keeps dispute alive
The ruling was not entirely in Motsepe’s favour, as the Tanzanian court upheld its jurisdiction over the dispute and found that an earlier South African judgment was “inconclusive and immaterial” to the case. It stopped short of determining whether the confidentiality agreement had been breached.
Ambassador Charles Stith, chairman of Pula Group, said: “This is an important judgment because the court has affirmed central elements of the case Pula has advanced from the outset.
“It rejected the challenge to Tanzania’s jurisdiction, rejected the attempt to use the subsequent South African proceedings to terminate our case, and made important findings concerning Mr Motsepe’s controlling interest and capacity to influence ARC.”
Pula says the ruling also recognised key elements of its case, including the links between ARM, ARC and ARCH, as well as the investments involving Evolution and Ngwena and the competing Chilalo graphite project.
Despite the procedural setback, Pula maintains that the decision delays rather than ends its pursuit of the claim.
The company is considering an appeal, a review or fresh proceedings naming Evolution and Ngwena as respondents.
