Brazil dam disaster: BHP Bil­li­ton faces law­suit in Aus­tralia

The Malta Business Weekly - - INTERNATIONAL -

Min­ing gi­ant BHP Bil­li­ton says it will de­fend it­self against a class ac­tion law­suit in Aus­tralia over Brazil's 2015 dam disaster.

The col­lapse of a dam at a Sa­marco mine killed 19 peo­ple and led to Brazil's largest en­vi­ron­men­tal disaster.

The Sa­marco mine is jointly owned by BHP and Brazil's Vale.

More than 3,000 in­vestors have signed up to the law­suit, lodged in the Fed­eral Court of Aus­tralia in May.

The claim al­leges that BHP failed to dis­close the risk of the dam's fail­ure to the stock mar­ket, and mis­led in­vestors over the com­pany's safety guar­an­tees.

The ac­tion from Aus­tralian law firm Phi Fin­ney McDon­ald will seek to re­cover share­holder losses.

The claim es­ti­mates more than A$25bn ($18bn) was wiped off BHP's mar­ket value in the month fol­low­ing the Novem­ber 2015 tragedy.

The An­glo-Aus­tralian miner's stock prices fell by 22% on the Aus­tralian Se­cu­ri­ties Ex­change, and by 23% on the Lon­don Stock Ex­change and Jo­han­nes­burg Stock Ex­change.

"Given the share price fall and the high vol­umes of shares traded, we be­lieve it a very sig­nif­i­cant claim," prin­ci­pal lawyer Brett Spiegel said.

BHP is also fac­ing a US share­holder class ac­tion over the disaster, as well as on­go­ing crim­i­nal and civil cases in Brazil.

Last month, the com­pany reached a deal with Brazil­ian au­thor­i­ties to push back a $47.5bn civil law­suit for two years while both sides ne­go­ti­ate a set­tle­ment.

The col­lapse of the dam, which had car­ried con­tained waste from the nearby iron ore mine, caused a deadly mud­slide which flat­tened sev­eral small com­mu­ni­ties and pol­luted a river.

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