Norfolk Southern has agreed to pay $600 million as part of a class-action lawsuit related to a serious train derailment in February 2023 in eastern Ohio.
The company said Tuesday that the agreement, if approved by the court, would cover all class-action lawsuits within a 20-mile radius of the derailment and, for residents who choose to participate, personal injury claims within a 20-mile radius 10 miles to clear the derailment will derailment.
Norfolk Southern added that individuals and companies may use the compensation from the settlement in any way they deem appropriate to address any potential negative impacts of the derailment, including health care, property restoration and compensation for any net business losses. Individuals within a 10 mile radius of the derailment may, at their discretion, receive additional compensation for past, current or future personal injuries resulting from the derailment.
The company stated that the settlement does not contain or constitute an admission of liability, wrongdoing or fault.
The settlement is expected to be submitted to the U.S. District Court for the Northern District of Ohio for preliminary approval later in April 2024. Payments to class members under the settlement could begin by the end of the year, pending final court approval.
Norfolk Southern has already spent more than $1.1 billion responding to the derailment, including more than $104 million in direct aid to East Palestine and its residents. Partly because Norfolk Southern is paying for the cleanup, President Joe Biden has never declared a disaster in East Palestine, which is a sore point for many residents. The railway has promised to set up a fund to address the community’s long-term health needs, but that has not yet happened.
Last week, federal officials said the aftermath of the train derailment was not considered a public health emergency because widespread health problems and ongoing chemical exposures had not been documented.
The Environmental Protection Agency never approved that designation after the Norfolk Southern derailment in February 2023, even though the disaster forced the evacuation of half the city of East Palestine and raised many fears about possible long-term health consequences from the spilled and burned chemicals. Contamination concerns were exacerbated by the decision to blow up five tank cars filled with vinyl chloride and burn this toxic chemical three days after the derailment.
The head of the National Transportation Safety Board recently said her agency’s investigation showed that dumping and burning the vinyl chloride was unnecessary because the company that produces the chemical was confident that no dangerous chemical reaction had occurred in the tank cars. But the officials who made the decision said they were never told that.
The NTSB’s full investigation into the cause of the derailment will not be completed until June, although the agency has said that an overheated wheel bearing on one of the railcars, which was not detected in time by a track sensor, likely caused the accident.
The EPA said the cleanup in East Palestine is expected to be completed later this year.
Norfolk Southern Corp. shares based in Atlanta fell about 1% before the opening bell on Tuesday.