Commodities Buzz: BHP To Face Class Action Over Brazil Dam Collapse

Australian law firm Phi Finney McDonald plans to sue worlds No.1 miner BHP, arguing the company misled investors over the 2015 collapse of a dam at the Samarco iron ore mine in Brazil, which killed 19 people and became the countrys worst ever environmental disaster, according to media reports.

The class action, the law firm said, will be based on the belief the mining giant deceived shareholders over safety measures at the operation, by breaching n++its continuous disclosure obligations and engaging in misleading or deceptive conduct.

Brazilian federal prosecutors had claimed both BHP and its partner in the venture, Brazils Vale, failed to take actions that could have prevented the disaster. But the companies have repeatedly said they were not responsible for the dams collapse, adding that they complied with Brazilian law and that safety was and has always been a key concern.

Samarco, which was once the worlds second-largest iron-ore pellet operation, has been shuttered since the deadly dam spill that washed downstream into neighbouring state Espn++rito Santo and even reached the Atlantic Ocean, 600 kilometres away.

In December, Samarco was granted a preliminary permit to begin work towards preparing an eventual restart, which is likely to happen n++ though at a reduced rate first n++ in the second half of the year.