Trial Will Determine Who Will Pay $600 Million Settlement In Disastrous Norfolk Southern Derailment

Norfolk Southern wants two other companies to help pay for the $600 million class-action settlement it agreed to over its disastrous 2023 train derailment near the Ohio-Pennsylvania border and the toxic chemicals that were released and burned.

The railroad filed the motion that is set to go to trial starting Monday to force the railcar owner GATX and the chemical manufacturer OxyVinyls to share the cost of the settlement because Norfolk Southern believes those companies are partly responsible for what happened in East Palestine, Ohio, on Feb. 3, 2023.

This lawsuit won't change anything about how much money residents will receive from the settlement or any payments the village or anyone else is set to receive because those are all established in various settlement agreements. This case will only affect which company has to write the checks to pay for the class-action settlement.

Residents are still waiting to receive most of the money from the settlement because of pending appeals, although some payments have started to go out.

An assortment of chemicals spilled and caught fire after the train derailed in East Palestine. Three days later, officials blew open five tank cars filled with vinyl chloride because they feared those cars might explode, generating a massive black plume of smoke that spread over the town and forced evacuations.

Many residents still worry today about potential health consequences from those chemicals.

The derailment was the worst rail disaster since a crude oil train devastated the small Canadian town of Lac-Megantic and killed 47 people in 2013. It prompted the U.S. to focus on rail safety and reforms, which were proposed in Congress before stalling without passing.

Norfolk Southern says companies share the responsibility

Norfolk Southern already lost a similar lawsuit last year when it tried to force GATX and OxyVinyls to help pay for the environmental cleanup after the derailment that has cost the Atlanta-based railroad more than $1 billion. It is making similar arguments again to try to get help paying for the class-action settlement.

“Norfolk Southern alone has paid the costs relating to the derailment despite ample evidence that other parties share in the responsibility. This trial is about reinforcing the role shippers and railcar owners play in transportation safety and ensuring everyone responsible pays their fair share," the railroad said in a statement.

Norfolk Southern, like most railroads, doesn’t own most of the cars it hauls, and the railroad says everyone involved in shipping hazardous chemicals bears some responsibility for ensuring their safety under federal regulations.

Norfolk Southern argues GATX bears some responsibility for the derailment because it owned the railcar filled with plastic pellets that caused the derailment when its bearing overheated, caught fire and failed that night, sending 38 cars off the rails.

Norfolk Southern also said it believes OxyVinyls should pay because the railroad says chemical manufacturer provided inconsistent and inaccurate information about its vinyl chloride before officials decided to release and burn it.

Companies say Norfolk Southern was responsible for safety

Both GATX and OxyVinyls say it would be ridiculous to hold them responsible for the derailment when Norfolk Southern operated and inspected the train and all the cars and was responsible for delivering the cargo safely.

“Norfolk Southern’s claims against GATX are baseless," the railcar owner said in a statement.

GATX said it complied with all the relevant regulations for taking care of its railcars. The company said that even if the car was damaged six years earlier by standing parked in the middle of floodwaters from Hurricane Harvey, the railroad should have spotted the problem and repaired it, sending GATX the bill for the repairs.

The National Transportation Safety Board said the crash was caused by the failure of an overheating bearing on GATX's railcar. The railroad’s sensors spotted the bearing starting to heat up in the miles before the derailment, but it didn’t reach a critical temperature and trigger an alarm until just before the derailment. That left the crew scant time to stop the train.

Norfolk Southern recommended the vent-and-burn operation to release the vinyl chloride based partly on information about the chemical that OxyVinyls had published beforehand suggesting a chemical reaction could happen and cause the tank cars to explode.

But the NTSB confirmed in its investigation that was unnecessary because the tank cars were starting to cool off and the railroad failed to listen to the advice from OxyVinyls' experts or share their opinions with the officials who made the decision.

“This trial is nothing more than Norfolk Southern’s continued attempt to shift the blame, attention, and financial responsibility for its train derailment, response, and vent and burn decision to anyone other than itself,” the Texas-based company said. “OxyVinyls did not cause the derailment, its tank cars did not breach, and it did not make the decision to vent and burn the VCM (vinyl chloride monomer) cars.”

The trial is expected to last two to three weeks.