LONDON (AP) — Royal Dutch Shell won a court victory in London on Thursday that forces a group of Nigerian farmers and fishermen to rely on Nigeria's justice system to hear their claims that the oil company polluted their land and water.
The High Court found that Shell's parent company, which is incorporated in Britain, wasn't legally responsible. Claims against its subsidiary, Shell Petroleum Development Co. of Nigeria, should, therefore, not be heard in the U.K. courts.
"The court rightly decided these claims should be dealt with by the Nigerian courts and confirmed longstanding principles of corporate law, which are critically important for multinational companies headquartered in the U.K.," said Igo Weli, the general manager for external relations at Shell Petroleum Development Co. of Nigeria.
U.K. law firm Leigh Day promised to appeal on behalf of its clients, a group of more than 40,000 people from the Ogale and Bille communities in the Niger River delta. The groups brought their fight to Shell's home base because they say the Nigerian courts are corrupt.
The ruling was made at an early stage of the proceedings, before documents were disclosed and witnesses testified about the relationship between Royal Dutch Shell and its Nigerian subsidiary, Leigh Day said in a statement. In addition, the decision is inconsistent with a 2012 ruling by the European Court of Justice, which found that Shell "exercised decisive influence" over the subsidiary, the firm said.
The case was being closely watched, in part because it threatened to set a precedent that large corporations could be sued in London for activities of foreign subsidiaries.
"Today's judgment in the London courts has upheld the principle that local courts in Nigeria should resolve this issue," said David Elmes, course director of the Warwick Business School's Global Energy Research Network. "This will disappoint the local communities who feel that it's taking too long within the Nigerian court system."
The Ogale and Bille people allege that decades of oil spills have fouled the water and destroyed the lives of thousands of fishermen and farmers in the Niger River Delta, where a Shell subsidiary has operated since the 1950s.
The Shell Petroleum Development Co. of Nigeria says it has produced no oil or gas in the region since 1993, and the area is heavily affected by crude oil theft, pipeline sabotage and illegal refining.
Emere Godwin Bebe Okpabi, leader of Nigeria's Ogale people, said he was disappointed but pledged to fight on.
"Shell underestimates us if they think this judgment will affect our resolve," he said in a statement. "There is no hope of justice in the Nigerian courts. We still very much believe in the British justice system and so we are going to appeal this decision."