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July 28, 2021

London court to reopen $7bn lawsuit against BHP over 2015 dam collapse

BHP said that the case is pointless as it duplicates proceedings in Brazil and the Renova Foundation’s work.

London’s Court of Appeal has decided to reopen the $7bn lawsuit against Anglo-Australian mining giant BHP over the Fundão tailings dam disaster that occurred in Brazil in 2015.

The lawsuit was filed by more than 200,000 claimants, represented by law firm PGMBM, seeking compensation.

Granting permission for an appeal, three Appeal Court judges were reported by Reuters as saying: “Whilst we fully understand the considerations that led the judge to his conclusion that the claim should be struck out, we nevertheless believe that the appeal has a real prospect of success.”

This resurrects a case that was rejected by a lower court last year, when it was described as an ‘abuse of process’.

The decision was also upheld by a Court of Appeal judge in March 2021.

At that time, the court said that the case would be ‘irredeemably unmanageable’ if allowed to move forward and that the claimants could already seek redress in Brazil.

The Fundão dam disaster at the Samarco iron ore operation in Minas Gerais, Brazil, killed as many as 19 people. The dam is operated by Samarco, a joint venture of Vale and BHP.

Commenting on the latest move, Brazil Mariana district Attorney General Frederico de Assis Faria said that the victims of the dam disaster now had ‘an opportunity for real justice’ after six years.

However, BHP considers the case pointless as it duplicates the work of the Renova Foundation as well as the proceedings in Brazil.

The firm was cited by Reuters as saying in a statement: “BHP’s position remains that the proceedings do not belong in the UK.”

Separately, BHP has made a $258.45m (C$325m) bid to acquire all of the issued and outstanding common shares of Noront Resources, a Canadian-based mining company.

This rivals a bid by Wyloo Metals, which owns a 23% stake in Noront as of December.

In May, Wyloo made an offer of C$0.315 per share for the stock it did not already hold in the company.

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