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Lawyer touts ‘breakthrough’ in HudBay lawsuit

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A lawyer suing Toronto-based HudBay Minerals Inc. on behalf of victims who blame security guards at a Guatemalan mine for lethal violence and human-rights abuses says a move by the company to drop its objection to having the case heard in Canada is a "breakthrough."

Toronto lawyer Murray Klippenstein calls the move a "stunning victory" for his clients, who include the widow of a Guatemalan man who was shot and killed, another local man who was shot and beaten, and 11 women who say they were gang-raped.

And he claims the decision will help others seeking to sue Canadian mining companies for alleged abuses overseas – a claim dismissed by HudBay, which says it intends to fight the allegations.

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Mr. Klippenstein is pursuing a $55-million claim in Ontario Superior Court over clashes in 2009 between local Mayan people opposing the mine and security and police allegedly acting on behalf of HudBay's former local subsidiary. HudBay, which sold its interest in the mine in 2011, denies the allegations, saying they are "without merit."

HudBay had been preparing to argue that the case should be heard in Guatemala, not Canada, on jurisdictional grounds – an argument that Mr. Klippenstein was expected to counter by pointing to well-documented problems with the small Latin American country's justice system.

But Mr. Klippenstein claims the company abruptly changed its strategy after hearing depositions from his clients, who flew to Toronto from Guatelmala in December.

While he acknowledged that HudBay's move was voluntary and sets no legal precedent, he claimed it was like a "dam breaking" for those trying to hold Canadian mining companies accountable for their conduct in developing countries: "This should send shock waves through the boardrooms of Canada."

However, HudBay denies there is much significant about its change in tactics, and has by no means given up the fight.

The two sides are due in court next week as the company seeks to have the case against it thrown out.

In court documents, HudBay says it is not proceeding with its argument that Ontario is not a "convenient forum" for the case. But HudBay still intends to argue that a Canadian parent cannot be tried in court here for the actions of its former foreign subsidiary, which owned the mine site near El Estor in eastern Guatemala.

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"Contrary to Mr. Klippenstein's statement, HudBay's voluntary decision to have the cases heard in the Ontario Superior Court was based on its desire to avoid the complications of trying the cases in Guatemala, particularly in terms of time and travel," HudBay John Vincic, HudBay's vice-president of investor relations and corporate communications, said in an e-mail.

"Our decision does not create precedent or change the law in any way. Based on the cross-examinations referred to by Mr. Klippenstein, HudBay is increasingly confident the cases are without merit and will be favourably resolved on the merits in Ontario."

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About the Author
Toronto City Hall Reporter

Jeff Gray is The Globe and Mail’s Toronto City Hall reporter. He has worked at The Globe since 1998. From 2010 to 2016, he was the law reporter in Report on Business, covering Bay Street law firms and white-collar crime. He won an honourable mention at the National Magazine Awards for investigative journalism in 2010. More

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