Who Will Foot the Bill? Trial to Decide Fate of $600 Million Norfolk Southern Derailment Settlement

Norfolk Southern is seeking assistance from two companies, GATX and OxyVinyls, to help cover a $600 million class-action settlement related to a major train derailment in East Palestine, Ohio. This incident occurred on February 3, 2023, when a train carrying hazardous materials derailed, leading to a release of toxic chemicals that posed serious risks to the community.

The case is set to go to trial, but it won’t change how much money residents will receive from the settlement. Those payments have been outlined in previous agreements, so this trial will only determine how the settlement costs are shared among the companies involved. Many residents are still waiting for their compensation due to ongoing appeals, despite some initial payments being made.

After the derailment, officials blew up several tank cars filled with vinyl chloride to prevent potential explosions, creating a massive cloud of smoke over the town. This incident raised significant health concerns among community members, many of whom continue to express worry about the long-term effects of the chemicals released.

Historically, this derailment is one of the worst since a catastrophic incident in Lac-Mégantic, Canada, in 2013, which killed 47 people and led to a reevaluation of rail safety standards in the U.S. The focus on rail safety has intensified since the East Palestine derailment, but proposed reforms have stalled in Congress.

Norfolk Southern’s contention is that GATX and OxyVinyls share the blame. The railroad claims GATX is liable because it owned the railcar that overheated and caused the derailment. They argue that OxyVinyls is at fault for providing misleading information about the vinyl chloride, which contributed to the decision to burn off the chemical.

On the flip side, both GATX and OxyVinyls defend themselves, asserting that Norfolk Southern, as the operator, bears full responsibility for the safety of the train and its cargo. GATX states that it complied with all safety regulations and insists that any maintenance issues should have been detected and rectified by Norfolk Southern.

The National Transportation Safety Board (NTSB) concluded that the overheating of a bearing on GATX’s railcar caused the crash. Norfolk Southern had detected the heat but failed to act quickly enough to prevent the disaster.

This trial is expected to last two to three weeks, and it highlights a critical issue in the transportation industry: the shared responsibility for safety. Experts suggest that better accountability measures could prevent similar incidents in the future.

The outcome of this case will likely impact not just those directly involved but also the broader landscape of hazardous materials transportation in the U.S. As the trial unfolds, many in the community and industry will be watching closely to see how accountability is determined in this tragic event.

For further information on rail safety regulations, you can refer to the Federal Railroad Administration.

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