BHP Faces Lawsuit Over Brazil's Environmental Disaster

By Sam Tobin
LONDON (Reuters) – BHP is allegedly evading responsibility for Brazil's worst environmental disaster, as a lawsuit valued at up to £36 billion ($47 billion) commenced in London's High Court on Monday.

More than 600,000 Brazilians, 46 local governments, and around 2,000 businesses are suing BHP regarding the 2015 collapse of the Mariana dam, owned and operated by BHP and Vale's Samarco venture.

The dam's failure released toxic sludge, resulting in 19 fatalities, displacing thousands, and polluting the Doce River and surrounding forests.

BHP, the world's largest miner by market capitalization, disputes liability, asserting that this London lawsuit duplicates efforts underway in Brazil and should be dismissed. It also claims to have paid nearly $8 billion through the Renova Foundation, including $1.7 billion related to the English case.

As one of the largest lawsuits in English legal history, the trial began a crucial 12-week period to ascertain BHP's liability.

Claimant lawyer Alain Choo Choy indicated BHP views acceptable compensation as significantly lower than what victims consider morally and legally their due. He accused BHP of trying to evade responsibility through ongoing litigation in Brazil.

BHP contends it does not own or operate the dam, clarifying that a Brazilian subsidiary holds a 50% stake in Samarco, which functioned independently. The company also stated it was unaware of any stability issues prior to the collapse.

Defending its position, BHP's lawyers argued that no law imposed a safety duty on parent companies of non-controlling shareholders and that BHP's actions did not cause the disaster, labeling parts of the lawsuit as exaggerated or implausible.

The hearing corresponds with ongoing discussions between BHP and Brazilian authorities over a nearly $30 billion compensation deal, with critics arguing victims have not been included in these negotiations.

Tom Goodhead, CEO of Pogust Goodhead—the law firm for claimants—asserted that disaster victims feel the proposed compensation is inconsequential and demand accountability through the trial.

BHP stated it aims to finalize a comprehensive compensation and rehabilitation strategy, while the hearing will consider the legality of claims from Brazilian municipalities and any prior agreements made with claimants in the English case.