BHP in High Court over Mariana dam collapse in 2015

A hearing to examine BHP’s role and potential liability for one of Brazil’s worst ever  environmental disasters kicks off at the High Court in London today.

BHP could face up to £36billion in damages from a class action lawsuit, which law firm Pogust Goodhead is bringing on behalf of over 600,000 claimants.

The lawsuit is the largest of its kind in English legal history and also includes 46 local governments, around 1,500 companies and dozens of faith-based institutions as plaintiffs.

Tragedy: A hearing against BHP over its role in one of Brazil’s worst environmental disasters kicks off today at the High Court in London

In November 2015, the Mariana dam in Brazil’s Minais Gerais region failed, unleashing millions of cubic metres of toxic waste, known as tailings, from a local iron ore mine.

Nineteen people were killed, a local river’s waterways were poisoned, and the village of Bento Rodrigues was destroyed by the dam’s collapse.

BHP, the world’s largest listed miner, held a 50 per cent stake in the mine under a joint venture called Samarco with Brazilian multinational corporation Vale.

Four years ago, the company successfully argued a case against the class action, with a High Court judge calling it an ‘abuse of the process’, but this decision was overturned two years later by the Court of Appeal.

It has already paid nearly $8billion in compensation since 2016 and is negotiating a further $23.8billion of payments to indemnify authorities and communities directly impacted by the disaster.

Pogust said the proposed settlement represented a ‘desperate attempt by BHP to avoid being held accountable’.

The firm added: ‘The amounts for individual compensation offered in the proposed deal are wholly unsatisfactory reflecting a lack of participation of the victims in the negotiations and completely disregard individual circumstances.’

Pogust is bringing the case against BHP in London because the mining giant had a dual-listed structure, with headquarters in the UK and Australia, at the time of the disaster.

It argues that BHP is liable owing to its stake in Samarco and the financial benefit it received from the project.

However, BHP claims it had no day-to-day role in the mine and dam’s operations and that the municipalities cannot bring claims in London. The case is set to last up to 12 weeks.

In a statement to investors, BHP said it ‘will continue to defend the action which it believes is unnecessary because it duplicates matters already covered by the ongoing reparation work and legal proceedings in Brazil’.

BHP Group shares were 0.5 per cent higher at £21.97 on Monday morning but have fallen by around 19 per cent since the year began.