The court on Wednesday affirmed a Full Federal Court judgment which said there were no geographic or territorial restrictions on those seeking redress for a subsequent fall of 20 per cent in the share price.
The claim, being jointly run by law firms Maurice Blackburn and Phi Finney McDonald, says BHP breached continuous disclosure obligations by failing to inform the market that the dam was at risk of imminent failure. It also alleges misleading or deceptive conduct.
The collapse of the Fundao dam in 2015 killed 19 and poured roughly 40 million cubic metres of mining waste into communities. AP
Those who bought BHP shares on the ASX, the London Stock Exchange and the Johannesburg Stock Exchange between August 2012 and November 2015 are eligible to join.
The Fundao dam was part of a Brazilian mine operated by Samarco Minercao, a joint venture between BHP and Brazilian miner Vale. Nineteen people were killed, and the damage traversed two states as 40 million cubic tonnes of toxic mining waste flowed through 600 km miles of waterways.
Eight BHP executives were charged with criminal offences by Brazilian authorities, including intentional homicide and serious bodily injury. BHP Brazil was charged with environmental crimes. Share price fall
Following the disaster, more than $25 billion - or 20 per cent - was wiped off the mining giant’s market capitalisation between November 6 and November 30, 2015, The company now has a market cap of more than $200 billion.
The High Court said the regime for representative proceedings under Part IVA of the Federal Court Act “does not contain any express geographic or territorial restriction on the identity of ‘persons’ who can be group members”.
“Pt IVA allows the inclusion of all persons as group members in a representative proceeding, irrespective of whether they are Australian residents, who have “claims” of the kind described in s 33C(1) of the Federal Court of Australia Act that are within the jurisdiction of the Federal Court,” said a judgment summary released by the court.
“Part IVA is concerned with the powers and procedures of the Federal Court relating to the exercise of jurisdiction vested in it by other Commonwealth laws enacted under s 77(i) of the Constitution.
“The territorial connection of Pt IVA to Australia is direct and specific: it concerns the jurisdiction of the Federal Court of Australia. There is no basis to infer any further territorial limitation into Pt IVA.”
The litigants tried the English legal system because of what they claimed was the slow and inadequate redress through the Brazilian courts – where a 155 billion-real ($34.6 billion) lawsuit is under way.
