BHP and Vale face off in legal battle over 2015 dam collapse

July 12, 2023

The legal battle over financial responsibility for in a potential $44 billion lawsuit stemming from the 2015 collapse of the Fundao Dam in Brazil heated up as BHP and Vale squared off in a London Court.

Reuters reported that approximately 720,000 people in Brazil are suing BHP over the collapse at the dam owned by Samarco, a joint venture between BHP and Vale.

BHP, which denies liability, applied in December to have Vale join the case and contribute to damages if they lose, but Vale challenged the London High Court's jurisdiction to determine the claim. The trial will start on Oct. 7, 2024.

Vale has contested that position, writing in court filings that, “BHP currently has no right to a 'contribution' from Vale under Brazilian law. BHP can have no such right unless and until ... it is found liable to the Claimants and makes a payment to them,” the filings added.

Vale also said that it has no direct operations in Britain, and therefore London is not the appropriate location for the case.

“Has BHP satisfied the court that London is the natural forum for the dispute? The natural forum is Brazil,” Vale's lawyer Simon Salzedo KC said.

According to reporting from Reuters, BHP’s lawyers said that if the company is found liable, then Vale should be too, because its relationship with Samarco was equivalent in terms of ownership, control and knowledge to that of BHP’s.

“BHP therefore seek to have Vale share the burden of any such liability, and contribute (50 percent or more) to any payments made,” BHP's lawyers said in a filing.

When the dam collapsed, 19 people were killed as mud and toxic mining waste swept into the Doce river, obliterating villages, contaminating water supplies and reaching the Atlantic Ocean more than 650 km (400 miles) away.

Reparation and compensation programs implemented by the Renova Foundation, a redress scheme established in 2016 by Samarco and its shareholders, had funded more than $6 billion in financial aid for those affected by the disaster, BHP said.

The lawsuit, one of the largest in English legal history, first began in 2018 and was thrown out of court two years later, before the Court of Appeal ruled in July 2022 that it could proceed.

 

 

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