BHP lawsuit (re dam collapse in Brazil, filed in the UK)
Snapshot: In 2015, two mining dams operated by Samarco Mineração SA, a joint venture of Vale and BHP, collapsed in Brazil. This led to multiple lawsuits being filed in Brazil, Australia, the US and the UK. Lawsuits incude allegations for negligence in operating the dam brought by shareholders and a claim for damages by the victims of the dam collapse and their families. This case profile looks at proceedings in the UK against BHP over the Fundao dam collapse.
Proceedings in the UK
In November 2018, more than 240,000 plaintiffs, including Brazilian municipalities and Krenak indigenous communities, filed a lawsuit at the UK High Court in Liverpool against BHP Billiton. The lawsuit seeks £5 billion in compensation for damages caused by the Fundao dam collapse. The full claim was served in May 2019 and the company had four weeks to respond.
In April 2020, a British judge postponed proceedings in the High Court of Justice of England and Wales due to coronavirus travel restrictions.
In July 2020, parties presented oral argument on whether the case can be brought in English court. The Court's decision will have significant impact on cases against English companies for their extraterritorial abuse.
In November 2020, the High Court dismissed the lawsuit, a judge in Manchester ruling that managing the largest group claim in English legal history would be like “trying to build a house of cards in a wind tunnel” and the case was an “abuse of the process of the court”.
In March 2021, the Court of Appeal's judgment confirmed the lower court decision and agreed that if the lawsuit was allowed to proceed, it would be an abuse of process and “irredeemably unmanageable” as the plaintiffs were already able to seek redress in Brazil.
In May 2021, a UK Judge agreed to an oral hearing that could help to overturn a previous Court of Appeal decision that denied plaintiffs to appeal a lower court judgment refusing the case be heard in English courts.
On 27 July 2021, London’s court of appeal reversed the March 2021 decision and agreed to grant permission for an appeal due to the “real prospect of success” of the case and "in order to avoid real injustice".
On 8 July 2022, a Court of Appeal ruled that English courts had jurisdiction to hear the case, especially as the compensation received in Brazil did not seem adequate: “The vast majority of claimants who have recovered damages have only received very modest sums in respect of moral damages for interruption to their water supply … The claimants should be permitted now to proceed with the claims in the action.”