The Samarco Dam disaster in Brazil has resulted in a new lawsuit against BHP Billiton, which is believed to be one of the largest suits filed in British legal history.
Dam Collapse
The Samarco iron ore mine, located in southeastern Brazil, suffered a catastrophic dam burst in 2015, resulting in 19 fatalities. The deluge of mud containing waste from the mine flooded a nearby village, displacing over 700 people and flattening most of the buildings. The toxic red mudslide contaminated the regional water supply for hundreds of thousands of people, killing wildlife and ruining the drinking water across Espirito Santo state. The aftermath of the disaster is estimated to have impacted approximately 1 million people.
Compensation
Samarco is jointly owned by BHP Billiton and Brazil’s Vale. The disaster has already cost both companies millions of dollars in compensation and remediation efforts for local people in Brazil. Over 3,000 investors also filed legal action in the Federal Court of Australia seeking to recover losses. BHP’s share price plummeted by over 20% in both Australia and the UK, reducing the market cap by £14 billion. The Australian lawsuit alleges insufficient disclosure of the risk of a dam failure, leading to misleading safety statements for stock market investors.
However, critics argue that after 3 years, most of the Brazilian people directly affected by the tragedy have been ignored, with some receiving only small financial settlements or nothing at all.
Unprecedented Lawsuit
In an unprecedented class-action lawsuit, over 240,000 people have filed a claim against BHP. This could be the largest claim ever filed in Britain.