BHP has been served a Federal Court of Victoria class action by investors over the 2015 Samarco dam disaster in Brazil.
BHP released a terse statement in response today stating that it intended to defend the claim. The Samarco iron ore joint venture between Vale and BHP saw massive flooding and mudslides as the result of the failure of the Fundao tailings dam, leading to the deaths of 19 people and destroying surrounding homes and communities.
The class action, led by law firm Phi Finney McDonald, seeks to recover shareholder losses from the period following the disaster from November 5 2015 to November 30 2015, which saw a wipe in market value of around $25 billion.
The class action alleges that BHP “breached its obligations of continuous disclosure of material information to the ASX, by failing to disclose its knowledge of the imminent risk of the collapse of the Fundao dam and knowledge that if the dam failed catastrophic human, environmental, and financial consequences would likely result,” according to information from Phi Finney McDonald.
In addition, the firm claims that BHP “engaged in misleading or deceptive conduct in its representations to the market that it put safety first and held itself to the highest standards of environmental safety in its projects across the globe, despite its failure to ensure that basic safety precautions were in place.”
Last month, BHP announced that it had settled an initial $7 billion in damages with the Brazilian Government in order to provide a two-year window for the settlement of a larger $55 billion civil claim. The company also announced that it would commit $US211 million ($287 million) to the Renova Foundation for restoration and remediation purposes.