Norfolk Southern Railway announced Tuesday that it has agreed to pay $600 million to settle a class action lawsuit stemming from a February 2023 derailment of a train carrying hazardous materials in East Palestine, Ohio.
The settlement, which must be approved by U.S. District Judge Benita Y. Pearson, includes payments to residents and businesses within 20 miles of the derailment. We also settle personal injury claims within a 10-mile radius of the derailment.
“Individuals and businesses will be able to use the settlement funds in any way they deem appropriate to address the potential negative impacts of the derailment,” Norfolk Southern Transit said in a statement. “This may include coverage for medical needs and medical monitoring, property recovery and diminution, and net business losses.”
Lawyers representing victims said the settlement was “a fair, reasonable and sufficient outcome for the community on many levels,” including the speed of resolution and the amount received by residents and businesses.
Beth Graham, a lawyer at Grant & Eisenhofer who represented the plaintiffs, said her team received an “overwhelmingly positive” response from East Palestine and surrounding areas. The exact number of people eligible for compensation is not yet known, but it is likely in the tens of thousands, she said.
“The whole community is grateful and relieved that this is the first step towards getting the situation under control and getting some compensation,” Graham said in an interview.
The derailed train was carrying a variety of cargo, including 700,000 pounds of vinyl chloride, a chemical used to make plastics. Fearing an explosion, authorities dumped the contents of a car filled with chemicals and set the town on fire, creating a huge plume of smoke that alarmed residents.
Hundreds of people were evacuated after the derailment. Many people remain concerned about contamination and say they don't trust the assurances they've received from Norfolk South and state and federal officials that their towns and homes are safe.
After the accident, regulators pledged to double down on rail safety, and lawmakers promised to pass legislation to prevent similar disasters. But proposals to improve rail safety have stalled in Congress, and the number of derailments on the five major railroads increased last year.
President Biden visited East Palestine in February, but some residents, including the town mayor, lamented how long his visit took.
Lawyers for the plaintiffs said in a court filing that they would seek Judge Pearson's approval no later than April 19. This settlement is in addition to the more than $100 million that Norfolk Southern has already paid to communities, including $21 million in direct payments to Norfolk Southern. residents.
The company says it does not admit responsibility or negligence. The settlement was reached after “extensive fact-finding, expert training, and three days of mediation,” according to a court filing Tuesday by the company and plaintiffs' attorneys.
In southern Norfolk, a lawsuit brought by Ohio Attorney General Dave Yost citing environmental damage caused by the derailment is still pending. “What happened, who is responsible, and how to avoid other communities like East Palestine from becoming victims of this type of incident,” Yost said in a February statement. He said he does not intend to resolve the lawsuit until he understands the details of the situation.
The National Transportation Safety Board is investigating the accident but has not yet released a final report.