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UK's Largest Ever Group Action Claim Thrown Out by High Court

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The UK’s largest ever group action litigation action, ostensibly valued at almost £5bn, has been thrown out by the High Court in London with the case having been found to be an abuse of process.

The case, Municipio De Mariana & Ors v BHP Group Plc & Anor, involved tens of thousands of Brazilian claimants followed the collapse of the Fundao dam in south eastern Brazil in 2015. The collapse killed 19 people and the subsequent flood wiped out many settlements and villages in its path.
High Court judge Mr Justice Turner agreed with the defendants in the case after finding that the court could not handle such a disparate and unmanageable case involving so many claimants. The case was brought by PGMBM, a trading name of Excello Law Limited, on behalf of over 202,000 individual, corporate and institutional claimants against two companies, both of which are incorporated in the UK and Australia.

Whilst proceedings already underway in Brazil are likely to continue, the decision has been interpreted by many as both a block on the claims proceeding in England but also a wider blow to attempts to hold multinationals to account in the English courts for activities elsewhere. Justice Turner said the prospect of managing the claims of more than 200,000 claimants where so many were also pursuing compensation in Brazil was ‘alarming’, commenting:

It can safely be predicted that this unremitting cross-contamination of proceedings would lead to utter chaos in the conduct of litigation in both jurisdictions…The task facing the managing judge in England would, I predict, be akin to trying to build a house of cards in a wind tunnel.’

Justice Turner also predicted that if proceedings were allowed to go forward in England, even more people would be encouraged to ‘throw in their lot with the existing cohort’. With the claimants’ solicitors having already lost contact with 37,000 initial claimants, the turnover in the case would be impossible to deal with. He also said that it was ‘simply not good enough’ in group actions to seek to outsource all or most of the responsibility for devising a workable procedural mechanism for resolving claims to the court. Neither should claims proceed on the basis that defendants might resolve the issue through a settlement.

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