A multinational resources company unsuccessfully prevented people living outside of Australia from seeking substantial damages.
The High Court of Australia recently rejected BHP Group’s bid to exclude investors who are non-Australian residents and joined a class action over the 2015 Samarco dam collapse in Minas Gerais, Brazil.
Judges unanimously agreed more than 29,000 Australian Stock Exchange, London Stock Exchange and Johannesburg Stock Exchange shareholders are entitled to sue for up to £5 billion (A$8.77B) in compensation.
Failing infrastructure allegedly caused a major mudslide that killed at least 19 people. Some 28 individuals, including five children and 13 mine workers, were still missing at the time of publication.
The legal action, which covers the period between October 2013 and November 2015, claims BHP caused investor losses due to the company’s failure to meet stock exchange disclosure requirements as well as misleading and deceptive conduct.
The court ruled geographical location or residence should not restrict an alleged victim’s right to claim damages.
“BHP’s construction of part IVA ignores the Constitution and the legislation passed by the Commonwealth Parliament vesting jurisdiction in the Federal Court, and rewrites the Federal Court of Australia Act … [and] BHP’s construction would undermine the purpose of part IVA by not allowing non-residents to be group members in representative proceedings,” justices said in their judgment according to Phi Finney McDonald law firm.
The law firm applauded this decision for promoting better access to justice.
“It ensures that foreign group members can seek redress and vindicate their claims in Australian courts,” special counsel Cameron Myers said in a public statement.
“This decision has positive ramifications for all manner of class actions with an international element including environmental claims. It will also benefit defendants who wish to resolve their liabilities, instead of cynically seeking to disenfranchise claimants.”
The proponent vigorously defended its professional integrity, and maintains it has already compensated hundreds of thousands of victims.
“In Brazil BHP remains fully committed to supporting the extensive ongoing remediation and compensation efforts of Fundação Renova and, to date, has paid compensation of approximately US$2.3B (A$3.6B) to about 388,000 people affected by the dam failure,” a spokesperson said according to News Limited.
Maurice Blackburn is also advising alleged victims on the class action.
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