Trending Now

High Court shuts down BHP move to block access to class action

High Court shuts down BHP move to block access to class action

The High Court of Australia has today unanimously dismissed BHP’s attempt to block shareholders who are not resident in Australia from participating in a class action against the company.

The case, jointly run by Phi Finney McDonald and Maurice Blackburn, seeks recovery of investor losses caused by the mining company’s alleged breach of its disclosure obligations under the Corporations Act in relation to the catastrophic collapse of the Fundão dam in Brazil in 2015.

The High Court’s decision ends BHP’s multiple unsuccessful attempts over the last three years to exclude the claims of foreign residents who had invested in BHP Billiton Limited securities traded on the ASX, as well as investors in BHP Billiton Plc securities traded on the London and Johannesburg stock exchanges.

Cameron Myers, Special Counsel at Phi Finney McDonald, welcomed the High Court judgment.

“The High Court’s decision promotes access to justice, and confirms Australia’s class action regime as one of the most flexible and efficient mechanisms for resolving common issues between claimants. It ensures that foreign group members can seek redress and vindicate their claims in Australian courts,” he said.

“This decision has positive ramifications for all manner of class actions with an international element, including environmental claims. It will also benefit defendants who wish to resolve their liabilities, instead of cynically seeking to disenfranchise claimants.”

Irina Lubomirska, Special Counsel at Maurice Blackburn, welcomed the result.

“Despite the almost three-year delay occasioned by BHP’s appeals before the Full Federal Court and the High Court of Australia, we have steadfastly opposed BHP’s attempts to narrow the Federal class action regime. By rejecting BHP’s appeal, today’s High Court judgment endorses Parliament’s deliberate choice of a broader representative procedure which enhances access to justice and aids the efficiency of court processes,” she said.

“This is a welcome result not just for BHP’s shareholders but for all prospective group members, wherever located, who may continue to seek redress through our Federal class action regime.”

In today’s judgment in BHP Group Limited v. Impiombato & Anor (M12/2022), the Court stated, “BHP’s construction of Pt IVA ignores the Constitution and the legislation passed by the Commonwealth Parliament vesting jurisdiction in the Federal Court, and rewrites the Federal Court of Australia Act.”

“Who makes the claim and where they live does not determine the jurisdiction of the Federal Court or the claims that may be brought in accordance with the procedures in Pt IVA.”

“BHP’s construction would undermine the purpose of Pt IVA by not allowing non-residents to be group members in representative proceedings.”

On 31 May 2018, Impiombato v BHP Billiton Limited was filed in the Federal Court of Australia. The class action alleges that BHP breached its continuous disclosure obligations and engaged in misleading and deceptive conduct in its representations to the market.

Anyone who bought shares in BHP from 8 August 2012 through 9 November 2015 inclusive may be eligible to join this class action. Shareholders do not need to take any action to participate, but can register for further information at: www.bhpclassaction.com

Background

BHP, in a joint venture with Vale SA, owns Samarco Mineração SA, which operates the Germano iron ore mine in Minas Gerais state, Brazil. The 5 November 2015 collapse of the Fundão tailings dam at the Germano mine released approximately 60 million cubic meters of waste water in the largest tailings dam rupture ever recorded.

The mudflow flooded the nearby municipality of Bento Rodrigues and killed 19 people. Over 8,000 fishermen lost their livelihoods and 400,000 people lost access to potable water. The mudflow ultimately travelled 600 kilometres to the ocean, creating a toxic brown plume visible from space.

In the period that followed the dam collapse, BHP’s stock price plunged across all markets, falling 22% in Sydney and 23% in London and Johannesburg between 5 November 2015 and 30 November 2015. The class action will seek to recover losses to shareholders throughout this period, during which BHP’s combined market capitalisation fell by more than $25 billion.

Secure Your Funding Sidebar

Announcements

View All

Harris Pogust Joins Bryant Park Capital as Senior Advisor

By John Freund |

Bryant Park Capital (“BPC”) a leading middle market investment bank and market leader in the litigation finance sector, is pleased to announce that Harris Pogust has joined the firm as a Senior Advisor.  Harris (Mr. Pogust) is one of the best known and prominent attorneys in the mass tort and class action fields, he was the founding partner and Chairman of Pogust Goodhead worldwide until early 2024 and is currently working with Trial Lawyers for a Better Tomorrow, a charity Harris founded, to help children reach their educational potential all over the world.  Harris’ life work has been to deliver justice for those who have been damaged or injured through the negligence or bad faith of others.

“We are thrilled to have Harris as part of our team.  His knowledge, experience and relationships in the litigation finance sector are of great value to Bryant Park and our clients.  As the litigation finance world becomes more competitive, complex and challenging, having an expert like Harris on our team is invaluable,” said Joel Magerman, Managing Partner of Bryant Park.

Harris’ efforts, in conjunction with Bryant Park will focus on assisting law firms and funders in developing strategies to more efficiently fund their operations and cases and assist them in establishing the right relationships for future growth.  Harris commented, “I have been fortunate to have been a practicing attorney and partner in law firms for over 35 years focused on building and growing a worldwide book of business in the class action/mass tort field.  That required significant capital and throughout my career I have raised over $1 billion for my firms.  I have learned what works and what doesn’t.  I have seen both the risks and rewards in this industry.  I look forward to being able to work with law firms and funders to assist them in putting the right strategies in place with Bryant Park and bringing capital and liquidity to help them grow and flourish.”

About Bryant Park Capital

Bryant Park Capital is an investment bank providing capital raising, M&A and corporate finance advisory services to emerging growth and middle market public and private companies. BPC has deep expertise and a diversified, well-founded breadth of experience in a number of sectors, including specialty finance & financial services. BPC has raised various forms of credit, growth equity, and assisted in mergers and acquisitions for its clients. Our professionals have completed more than 400 assignments representing an aggregate transaction value of over $30 billion.

For more information about Bryant Park Capital, please visit www.bryantparkcapital.com.

Therium Capital Advisors Launched to Provide Litigation Finance Advisory Services

By John Freund |

Therium Capital Advisors (TCA) announced today the launch of its independent advisory services business dedicated to helping claimants, law firms and corporates to source, structure and secure litigation finance. TCA offers end-to-end support including funding strategy, investor engagement, financial modelling, deal structuring, ongoing case management and secondary market advisory. Based in London, the firm is advising on deals in the UK, continental Europe and Australia.

Therium Capital Advisors is led by litigation funding pioneer Neil Purslow and co-founded by investment banker Harry Stockdale. Neil has over 16 years of experience in litigation finance, raising capital and investing worldwide across all forms of litigation finance from single cases funding through to portfolio, corporate and law firm funding arrangements. Harry was previously head of UK M&A at investment bank Haitong with twenty years of experience in investment banking, advising law firms and litigation funders on complex financial transactions.  

TCA is the first advisory firm to provide clients with advisory services that are backed by a deep understanding of litigation finance investing coupled with the financial and transactional expertise of investment banking. Therium Capital Advisors bridges the gap between claimants, law firms and corporates on the one side and existing and new sources of institutional capital on the other.  Through the combined expertise of its founders, TCA opens up the investor universe that is available to clients and drives quality in the investment propositions, efficiency in the funding process and competition in the funding market.

TCA exclusively advises claimants, law firms and corporates, ensuring that it remains conflict-free.  The firm advises across the full range of legal assets including single case and portfolio funding, law firm financing, financing options for corporates and existing portfolios of legal assets.   

Neil Purslow, co-founder and Managing Partner of Therium Capital Advisors said: “We are at a pivotal moment in the development of the legal finance industry, given the relative paucity of traditional funding capital available.  However, we are seeing a shift towards new categories of investors in legal assets who want exposure to this uncorrelated asset class. By leveraging our unrivalled experience across both litigation funding and investment banking, we are assisting our clients to navigate this landscape with confidence, speed and understanding, and we provide them with access to a broader set of funding options and to meet their funding needs efficiently and cost effectively.”

Harry Stockdale, co-founder and Partner of Therium Capital Advisors said: “We are bringing an investment banking mind set to the litigation funding world which has developed largely without the benefit of specialist advisors. This professionalisation of the funding process will make the sector more efficient and accessible to a wider audience of investors in addition to the traditional litigation funders. We are already seeing the benefit of this, for both clients and investors alike, and is part of the maturing of litigation finance as an asset class.”

Therium Capital Advisors provides the following services to claimants, law firms and corporates:

  • Deal Preparation: Preparing funding propositions to be investment-ready.
  • Capital Sourcing: Identifying and engaging with suitable funders and capital providers from across the spectrum of legal assets investors.
  • Financial Modelling and Analysis: Providing robust financial modelling and scenario analysis to evaluate deal structures and model returns.
  • Investor Materials and Outreach: Advising on the preparation of investor-facing materials and documentation, inserting rigour and discipline to ensure efficiency in the funding process.
  • Co-Funding: Advising on the identification and engagement of potential co-investors to optimise risk-sharing and capital raising.
  • Negotiating Funding Terms: Leading negotiations with investors to secure terms which balance commercial viability with the interests of the funded party.
  • Deal Structuring and Documentation: Advising on deal structures and overseeing the drafting and execution of all relevant documentation.
  • Post-Funding Case Management: Providing ongoing monitoring, reporting, and servicing support post-funding on behalf of the claimant, to manage risks and support positive case outcomes.
  • Secondary Market Advisory: Advising on secondary transactions of existing legal assets including sub-funding arrangements and exits.

More information can be found at: www.therium.com/theriumcapitaladvisors

Gryphon Law Launches as Contingency-Fee Firm for International Disputes

By John Freund |

A new player is entering the international disputes arena—this time with a distinct twist on legal funding. Gryphon Law has officially launched as the first law firm globally to specialize in contingency-fee representation for cross-border disputes.

Gryphon Law aims to offer an alternative to third-party litigation funding by shouldering the cost of legal claims in return for a share of the outcome. Based in New York and with plans to expand into London and Miami, the firm targets clients who might otherwise turn to traditional funders, offering instead to partner with them directly through performance-based fee structures.

The firm was founded by John Templeman, a seasoned international disputes attorney qualified in New York, England & Wales, and Australia, who previously held roles at leading global law firms. Templeman has assembled a multilingual team capable of handling the full lifecycle of international litigation and arbitration in English, Spanish, and French—from initiation to enforcement. Co-founding the venture is Daura Dutour, an 18-year disputes veteran with experience in the U.S., France, and Haiti, supported by three additional associates.

Templeman stated: "I believe there's a real opportunity in the market to provide clients with an appealing alternative to third party funding, particularly in the sub-US$30 million value range below where many of the funders operate. I've been fortunate to assemble a world-class team of disputes lawyers who share this vision – we're looking forward to contributing to this rapidly evolving field.”

Gryphon Law’s business model suggests a more vertically integrated approach to litigation finance—embedding the funder role within the law firm itself. For clients, this could mean greater alignment of interests, fewer intermediaries, and possibly reduced costs when compared to traditional third-party funding arrangements.