Brazilian tailings processor Itabiriçu escalates court action against Vale over 'ore stealing' dispute
Brazilian mining company Itabiriçu is petitioning the Supreme Court of Texas to review an appellate court’s decision in its long-running lawsuit against industry rival Vale, with Itabiriçu alleging a conspiracy to dominate the Texas iron industry.
The petition raises broad questions about whether foreign companies can be sued in Texas, how closely a lawsuit must be tied to Texas conduct and how courts should analyse commercial activity that spans multiple countries and jurisdictions.
The $500-million ore processing dispute stemmed from an original lawsuit filed in October 2023 in Nueces County, Texas, which alleged Vale conspired with co-defendants Voestalpine Texas and Voestalpine US Holding to become Texas’ primary iron-ore supplier.
Vale allegedly extracted and sold more than 100-million tons of the metal rightfully owned by Itabiriçu to Voestalpine, which then shipped the processed ore through the Port of Corpus Christi.
The battle derives from a dispute between Itabiriçu and Vale over Brazil’s Research Permit Polygonal, a water-filled zone that stores mineral waste, or tailings. According to the filing, Itabiriçu has the technological capability to safely extract iron from the tailings in this area.
In September 2023, a Brazilian federal court ruled in favour of Itabiriçu, upholding the company's ownership of these tailings and the right to begin extraction efforts in the Polygonal. However, prior to that ruling Vale had extracted and sold the disputed tailings.
After the Texas trial court denied Vale’s claims as a matter of personal jurisdiction, the Texas Court of Appeals dismissed Itabiriçu's allegations of improper conversion and sale of iron-ore against Vale, ruling that the issues should lie solely in Brazil's courts.
In the petition to the Texas Supreme Court, Itabiriçu's counsel argues that the appellate court’s ruling to separate Vale's "unlawful extraction" of iron-ore in Brazil from its business dealings in Texas is flawed.
"If the court broadens its view, it's clear Vale's affiliation with Voestalpine influenced the decision to take and sell Itabiriçu's materials," says law firm Lynn Pinker Hurst & Schwegmann attorney Michael Hurst.
According to the filing, Vale created and maintained a "Texas Project" alongside Voestalpine to establish domination over iron shipping and processing in Texas. Itabiriçu also claims Vale illegally commingled the two companies' raw materials.
"For years Vale has been wrongfully storing our clients’ rightfully owned raw materials with theirs and selling them. Vale and its co-conspirators should not benefit from making our client's iron nearly impossible to trace," Hurst states.
