Thousands of Nigerians can sue Royal Dutch Shell Plc in London over environmental damage in Africa’s largest economy, the U.K. top court said.
The Supreme Court on Friday reversed two earlier rulings that blocked the case from being heard in England. The decision could pave the way for similar claims from the developing world against British companies.
The ruling is Shell’s second legal setback in recent weeks after a Dutch court ordered the company’s Nigerian subsidiary to pay compensation for spills that occurred more than 13 years ago.
The prospect of more lawsuits in Europe comes at a bad time for the company as it outlines its plans to transition to cleaner energy.
The residents of fishing and farming communities in the crude-rich Niger Delta region say oil spills from pipelines operated by Shell’s local unit have destroyed their land and livelihoods.
More than five years after filing their lawsuit, the roughly 42,000 individuals represented will be allowed a trial where they can try to persuade a U.K. court to order the energy giant to pay compensation and clean up the pollution.
Shell says most oil spills are caused by theft or sabotage and argued the case should be litigated in Nigeria where judges have a better understanding of the local environment.