BHP (ASX, NYSE: BHP) faces a potential $47 billion payout in damages over the 2015 Mariana Dam disaster in Brazil, believed to be country’s most catastrophic environmental incident, as a lawsuit against the miner kicked off on Monday in London’s High Court.
The trial, expected to last up to 12 weeks, will determine whether BHP is legally responsible for the collapse of the Fundão tailings dam in Minas Gerais, Brazil. The structure failure caused a massive flood that claimed 19 lives, destroyed villages and severely polluted water sources for local communities. The dam was owned by Samarco, a joint venture between BHP and Brazilian mining giant Vale (NYSE: VALE).
The plaintiffs in the case include more than 600,000 Brazilian citizens, 46 municipalities and 2,000 businesses, all challenging BHP’s role in the disaster. Lawyers representing the victims argued on Monday that BHP has been attempting to evade its responsibility.
The world’s largest mining company is disputing liability, arguing that the London lawsuit duplicates legal proceedings and reparation programs in Brazil, and should be dismissed.
It also claims that nearly $8 billion has already been paid to those affected through the Renova Foundation, with around $1.7 billion going to claimants in the English case.
BHP’s lawyers stated in court that no law or contract imposes a duty of safety on the parent company of a non-controlling shareholder or the other parent company in the same group. They also argued the miner did not breach any safety duty, nor did its actions cause the collapse.
BHP further described parts of the lawsuit as “implausible or exaggerated.”
Settlement in Brazil
This trial comes shortly after BHP and Vale announced they were in talks with Brazilian authorities regarding a potential settlement of $31.7 billion to compensate for the damage caused to people, communities, and the environment.
Pogust Goodhead, the law firm representing the plaintiffs in London, said that the settlement talks in Brazil will not affect the UK case.
“The timing of these negotiations only highlights how the companies responsible for Brazil’s largest environmental disaster are doing everything possible to prevent the victims from obtaining justice. It reflects the same shameful conduct they have displayed over the past nine years,” the firm said in a statement.
The multi-week hearing, the largest group litigation in English legal history, will also examine whether Brazilian municipalities can bring legal action, the effect of any agreements made by English claimants with BHP, and whether the claims were filed too late.
BHP and Vale agreed in July to equally share the cost of any damages related to proceedings in the UK.
Source: MINING.COM – Read More
