Norfolk Southern Corporation (NSC) announced on Tuesday that it had reached a tentative settlement of $600 million in a class action lawsuit regarding the February 2023 freight train derailment in East Palestine, Ohio.
According to the NSC news release, the settlement “is designed to provide finality and flexibility for the class members.” Class members would be permitted to use their compensation “in any manner they see fit to address potential adverse impacts from the derailment.” NSC also used the news release to highlight the other “contributions” it has made to “make it right in East Palestine,” including community assistance, upgrades to drinking water infrastructure, community-directed projects, and a grant for economic development. While NSC regarded the settlement as “another promise kept by [NCS] to make it right for the people of East Palestine and the surrounding communities,” the company noted that the agreement “does not include or constitute any admission of liability, wrongdoing, or fault.”
NSC also released its preliminary first-quarter results Tuesday. The report takes into account the impact of the $600 settlement, which contributed to an overall increase in the company’s operating expenses and operating ratio.
The train derailment central to the lawsuit occurred on February 3, 2023. Soon thereafter, individuals and businesses affected by the derailment filed a flurry of complaints. US District Judge Benita Y. Pearson consolidated 31 of the suits in April 2023.
In addition to the class action suit, Ohio Attorney General Dave Yost and the US Department of Justice (DOJ) also sued NCS over the derailment. Yost sought injunctive relief, civil penalties, redress for “damages to [Ohio’s] natural resources,” a declaratory judgment and reimbursement of the state EPA’s response costs. The DOJ sought relief under the Clean Water Act.
Shortly after the derailment, the Ohio Department of Natural Resources (ODNR) found chemicals from the incident in waterways near the Ohio River. Following the ODNR’s announcement, the US Environmental Protection Agency (EPA) ordered NCS to manage and finance cleanup operations resulting from the incident.
The US District Court for the Northern District of Ohio will need to approve Tuesday’s settlement before it is final. Ultimately, the settlement would “resolve all class action claims within a 2o-mile radius from the derailment, and, for those residents who choose to participate, personal injury claims within a 10-mile radius from the derailment.”
