Norfolk Southern reaches $600M settlement over East Palestine train derailment
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Smoke rises from a derailed cargo train in East Palestine, Ohio, on Feb. 4, 2023. Photo by DUSTIN FRANZ/AFP via Getty Images
Rail operator Norfolk Southern said Tuesday that it had reached a $600 million class-action settlement over the East Palestine, Ohio, train derailment in February 2023.
Why it matters: The disaster sparked concerns about hazardous chemicals injuring residents on the Ohio-Pennsylvania border and called attention to Norfolk Southern's safety record.
Between the lines: The company said the deal "will resolve all class action claims within a 20-mile radius from the derailment and, for those residents who choose to participate, personal injury claims within a 10-mile radius."
- "Individuals and businesses will be able to use compensation from the settlement in any manner they see fit to address potential adverse impacts from the derailment," Norfolk Southern added in a statement.
Catch up quick: Train cars carrying at least five different types of chemicals were involved in the Feb. 3, 2023, derailment, Axios' Jacob Knutson reported.
- After the derailment, the company released and burned vinyl chloride, a colorless but hazardous and carcinogenic gas used to produce PVC plastic and vinyl products, from five tanker cars because of an explosion risk.
- No one was injured in the crash, but images of smoke billowing into the air caused widespread concern about health issues.
- The Environmental Protection Agency ordered Norfolk Southern to clean up the contamination at the site.
How it works: The company said Tuesday that it reached the settlement after talks with plaintiffs' attorneys mediated by the court-appointed Layn Phillips, a former federal judge.
- A sitting federal judge in northern Ohio will need to approve the deal for it to be finalized.
- "The actual allocations and payments to households, businesses, and individuals will be determined by court-appointed class counsel," Norfolk Southern said.
- The company said the settlement adds to the $104 million in community assistance it's already provided to East Palestine and the surrounding areas, ranging from $25 million for a "regional safety training center" to $21 million in "direct payments to residents."
What they're saying: The deal "will provide substantial compensation to all affected residents, property owners, employees and businesses residing, owning or otherwise having a legal interest in property, working, owning or operating a business for damages resulting from the derailment and release of chemicals," several attorneys involved in the case said in a statement, Cleveland19.com reported.
Caveat: The company is not acknowledging any wrongdoing or admitting liability.
