A Nevada-based mining firm is suing Guatemala for more than $400 million, the first suit of its kind for the impoverished Central American country.
The lawsuit which began on June 22 with the consultation process was filed at the International Center for Settlement of Investment Disputes, a branch of the World Bank, and is based on CAFTA (Central America-Dominican Republic Free Trade Agreement with the US). It allows transnational corporations to sue for alleged losses of investment. In the recent lawsuit, the Kappes, Cassiday & Associates (KCA) mining firm claims that the Guatemalan government has not done enough to protect their investment. A dubious claim seeing how the police oppresses indigenous anti-mining protests. KCA's gold mine, which has been the sight of constant protest, was only in operation for two years, until the courts suspended the project in late 2015 over failure to adequately consult with the habitants of the La Puya area. Furthermore, the mine was the cause of massive environmental damages leading to health issues within the population. Individuals with courage to speak out against the operation were met with threats, violence, persecution and police repression.
In their defense against KCA's lawsuit, the Guatemalan government brings forward information gathered by activists located in La Puya while ignoring the the interests of the communities. The KCA case also sheds light on corruption within Guatemala's former government as Daniel Kapps was meeting with the Director General of Mining Selvyn Morales in 2011 in an effort to seek a building permit. Shortly after this meeting Morales left his position in the government to work for a mining services company, which KCA immediately hired. Guatemala's government argues that KCA violated environmental norms and failed to obtain its construction license to build its mine, thus not having a right to be reimbursed for their losses.
Indigenous communities criticize that the Guatemalan government argues on the claims and findings of activists while disregarding the needs and interests of the habitants.