Norfolk Southern has reached a $600 million settlement to resolve all class-action lawsuits related to its 2023 East Palestine, Ohio, derailment that spilled hazardous chemicals. The settlement, if approved by a court, will compensate individuals and businesses within 20 miles of the derailment for healthcare needs, property restoration, and business losses. Norfolk Southern did not admit any liability as part of the settlement, but it aims to offset costs related to the spill.
Residents within 10 miles of the derailment will receive additional compensation under the settlement agreement. The plaintiffs expect to file a motion for the judge to approve the settlement within 10 days, with payments expected to be distributed by the end of 2024. Attorney representing the claimants believe the settlement is fair and adequate for the community, especially in terms of the speed of resolution and the amount of awards residents can expect.
Following the derailment, residents were temporarily evacuated, and some continue to experience health problems like burning sensations in their eyes and swelling of lymph nodes. Norfolk Southern has spent $104 million in community assistance to East Palestine and surrounding areas, including funds for upgrading drinking water infrastructure and economic development. However, several class-action lawsuits allege the company has not done enough to remediate the toxic chemicals released in the area.
The EPA has noted changes in the environment since the derailment, including deceased fish in a sulfur run due to water diversion pumps. The EPA required Norfolk Southern to remediate the stream and come up with a better plan. One questionable decision made by the company was a massive controlled burn three days after the derailment, which released toxic chemicals into the air. The NTSB chair testified that the controlled burn was unnecessary, contradicted the notion that there was an imminent risk of an explosion.
Shares of Norfolk Southern fell 2% in premarket trading following the settlement announcement. The company has made contributions to the community and spent significant funds on assistance, but residents continue to voice concerns about health problems and the environmental impact of the derailment. The settlement aims to provide compensation to those affected by the spill and resolve all related class-action lawsuits.
