In 2011, a Nigerian community moved its fight to get compensation for the impacts of massive oil spills to the UK courts, one of the home states of Shell, the company responsible for the damage. The case is an example of bringing legal claims in a company’s home state to seek accountability for corporate misconduct.
Photo: https://www.flickr.com/photos/miskan/6786622/Two oil spills occurred at Bodo in the Niger Delta in 2008, one in August and another in December. Both spills flowed for weeks before they were stopped. The community’s fishing and farming livelihoods were devastated. Shell accepted that the 2008 Bodo oil spills were due to failures on the company’s pipeline.
Despite this admission, Shell did not provide adequate compensation, nor did the company clean up the spills. Under a flawed process in Nigeria, the company responsible for an oil spill can effectively negotiate the compensation directly with the affected people, with no regard for the power imbalance or conflict-of-interests involved. In 2009, appearing to recognise that the spills had undermined access to food, Shell sent some food supplies to the community. The people of Bodo rejected the food offered as wholly inadequate.
The Bodo community and the Centre for Human Rights, Environment and Development (CEHRD) – a civil society organisation that supported them – campaigned on the case and dialogued with Shell in Nigeria, trying to secure adequate compensation and clean-up. They faced an uphill struggle, confronted by Shell’s use of a range of harmful strategies, including dissemination of distortion of information and attempts to settle the case for meagre compensation.
Shell maintained the spills were much smaller than the community believed them to be. As spill size is a key determinant of damages and compensation, this became a central issue in the fight for justice. The company publicly – and repeatedly – claimed that the volume of oil spilt was approximately 4,000 barrels for both spills combined, even though the spills went on for weeks. Shell relied on an oil spill investigation process in which the company responsible for the spill and any associated compensation plays a key role. The process has been widely discredited.
In 2012, using an independent assessment of video footage of one of the spills, Amnesty International calculated the total amount of oil spilt exceeded 100,000 barrels. Satellite images obtained by CEHRD and Amnesty International further supported the community’s claims that the spills were far larger than Shell was asserting. Shell denied this and continued to defend its far lower figure.
Working with lawyers, Leigh Day, and CEHRD, the Bodo community moved the case to the UK legal system. In the process they also forced disclosure of critical data. During the legal action, Shell finally admitted that it had underestimated the amount of oil spilt in both of the Bodo cases. This admission who had sought to show that the oil spill investigation process in Nigeria is flawed.
In 2012, Shell settled the UK legal action for £55 million, an amount commensurate with the actual damage done to Bodo. The counter-strategy of moving the case to a home state court dramatically changed the outcome for the community. The people of Bodo were also able to return to the UK legal system to compel Shell to clean up the damage done by the 2008 spills.
Using legal action to counter harmful corporate strategies in the Niger Delta
Thousands of oil spills have occurred in the Niger Delta, and in most cases the affected communities must deal directly with the companies and accept the compensation offered. This is often insufficient and not based on a sound method of assessment of damages in the short and long-term. Very few people in the Niger Delta can afford to take legal action in Nigeria. People can only seek redress against oil companies in the Federal High Court, not state level courts. Even if the difficulty of access to the courts were not an obstacle, most people cannot afford to hire lawyers. The end result is that people have no option but to deal with the oil companies directly or with the help of local civil society organisations.
Moving the case to the UK courts required collaboration between the community, local civil society organisations, and UK lawyers, with support from an international organisation also being valuable. It also required careful collection of evidence to support the case, and that courts in the company’s home state accept jurisdiction in the case. This combination of factors is not always present in a case, but much is being learned about how to better use strategic litigation to counter harmful corporate strategies. While using this counter strategy remains challenging, it can be highly effective.
Not only did the Bodo community secure adequate compensation for the damage done to their environment and livelihoods, the legal action was effective in forcing disclosures of critical information, another useful counter strategy. In this case, Shell finally had to admit that its oil spill figures were wrong. Shell was also forced to reveal that it had been aware, at least since 2002, that most of its oil pipelines were old, and some sections contained “major risk and hazard”. Such admissions in court documents can assist other cases and communities trying to counter the too-often experienced corporate distortion of information.