Norfolk Southern, a major railway company, has announced a landmark settlement of $600 million to resolve a class-action lawsuit stemming from a train derailment that occurred in East Palestine, Ohio, in February 2023.
The settlement, subject to approval by Judge Benita Y. Pearson of the U.S. District Court for the Northern District of Ohio, encompasses payments to residents and businesses residing within a 20-mile radius of the derailment site. Additionally, it addresses personal injury claims within a 10-mile radius.
In a statement, Norfolk Southern emphasized that individuals and businesses would have flexibility in using the compensation to address various impacts from the derailment, including healthcare needs, property restoration, and compensation for business losses.
Legal representatives for the victims have lauded the settlement as fair, reasonable, and beneficial for the affected community. Beth Graham, a lawyer at Grant & Eisenhofer representing the plaintiffs, highlighted the positive response from East Palestine and its vicinity. While the exact number of eligible recipients remains uncertain, it is expected to reach tens of thousands.
Ms. Graham underscored the relief felt by the community, viewing the settlement as a crucial step toward closure and compensation for the damages incurred.
The train involved in the derailment carried hazardous materials, including 700,000 pounds of vinyl chloride, a chemical utilized in plastic manufacturing. Concerns about a potential explosion led authorities to initiate a controlled release and ignition of the chemical, resulting in significant smoke plumes and evacuations.
The incident prompted heightened scrutiny of rail safety measures, with regulators pledging to strengthen oversight and lawmakers vowing legislative action to prevent similar disasters. However, progress on proposed rail safety legislation has been slow, and derailments at major railroads increased in the past year.
President Biden visited East Palestine in February, where residents, including the mayor, expressed disappointment over the delay in his visit. Despite the attention garnered by the derailment, significant challenges persist in ensuring the safety and well-being of affected communities.
Lawyers representing the plaintiffs intend to seek approval from Judge Pearson by April 19. The settlement supplements over $100 million previously paid by Norfolk Southern to the community, including direct payments to residents.
Norfolk Southern clarified that the settlement does not imply admission of liability or fault. The agreement follows extensive fact discovery, expert analysis, and mediation sessions spanning three days, as outlined in a court filing by the company and plaintiffs’ lawyers.
The National Transportation Safety Board continues to investigate the derailment, with the final report yet to be released. The outcome of the investigation may further shape legal proceedings and efforts to enhance rail safety standards.
