Miner BHP loses appeal against $6bn-plus Brazil dam lawsuit

The lawsuit is the latest to establish whether multinational companies can be held liable on their home turf for the conduct of overseas subsidiaries.
Image: Carla Gottgens/Bloomberg

Global mining giant BHP Group has lost an appeal in a London court seeking to block a 5 billion pound-plus ($6 billion-plus) lawsuit by 200 000 Brazilians over a 2015 dam failure that triggered Brazil’s worst environmental disaster.

In what claimant lawyers described as a “monumental judgment”, the Court of Appeal on Friday overturned previous judgments and ruled that the group lawsuit – one of the largest in English legal history – could proceed in English courts.

“The days of huge corporations doing what they want in countries on the other side of the world and getting away with it are over,” said Tom Goodhead, managing partner of law firm PGMBM, which represents Brazilian individuals, businesses, churches, municipalities and indigenous people.

BHP, the world’s largest mining company by market value, said it would consider a Supreme Court appeal.

The collapse of the Fundao dam, owned by the Samarco venture between BHP and Brazilian iron ore mining giant Vale, killed 19 as more than 40 million cubic metres of mud and mining waste swept into the Doce river, obliterating villages and reaching the Atlantic Ocean more than 650 km (400 miles) away.

The lawsuit is the latest to establish whether multinational companies can be held liable on their home turf for the conduct of overseas subsidiaries, emulating cases brought in London against miner Vedanta and oil giant Shell over alleged pollution and oil spills in Africa.

BHP has dismissed the case as pointless and wasteful, saying it duplicates legal proceedings and reparation and repair programmes in Brazil, which will already cost roughly 30 billion reals ($5.6 billion) by year-end.

But claimant lawyers argue most clients have not brought proceedings in Brazil or sought compensation that excludes them from English proceedings and that Brazilian litigation is too lengthy to provide full redress in a realistic timeframe.

The case had a turbulent start after both the High Court and, initially, the Court of Appeal blocked it for being “irredeemably unmanageable”.

But on Friday, senior judges said there was a realistic prospect of a future trial yielding a “real and legitimate advantage” for claimants.

Liability and any damages award will be decided at future trials, in the absence of any settlement.

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