Norfolk Southern, the rail company responsible for the massive train derailment in East Palestine in February 2023, agreed to pay $600 Million in a class-action lawsuit settlement on April 9, 2024. On the very same day, they announced their preliminary first quarter 2024 financial results: $3 Billion in revenue and nearly $1B in income (or profits, before subtracting the settlement amount). The settlement sums to just 5% of their 2023 yearly revenue.
While the amount in settlement money is unprecedented and obviously indicates wrongdoing by the company, it is still a drop in the bucket for this multi-billion dollar company that has already written off this settlement into their financial projections and still comes out profiting.
And while this large sum of money sounds like a lot, it will most likely not be accessible to a large number of local residents in need. Attorney Seth Katz, who helped broker the agreement, says “there are claim forms that have to be submitted with different criteria that is still being finalized but proximity to the derailment site will be one of the most important factors in all of this.” And this most likely will not cover any healthcare costs. As Mikal Watts of East Palestine Justice explained, “the damages evidence with respect to personal injury for most [residents near the derailment site] is not strong.” In other words, there must be a clear correspondence between medical symptoms and derailment-related contamination, which is hard to concretely prove.
Even if it were accessible, residents feel that it barely scratches the surface of what would really be necessary to pay out people’s medical bills, their mortgages, and relocation fees. One resident about 7 miles from the derailment site says “when all is said and done, once attorneys get their cut it will most likely be less than $1,000 paid to families within 20 miles. People initially [thought] they might be awarded enough to get out of their mortgage and relocate permanently, but that is simply not the case.” Furthermore, she adds, “In fact, it has been said residents who have been relocated by Norfolk Southern would actually have to pay back the amount that has been used to relocate them out of their settlement, that money would then go into a fund for the city. A city whose leaders were handpicked, and can be bought. Leaders who residents do not trust. Leaders who have held grudges and tried to silence the few relocated who were determined to bring light to the dirty deeds and injustice being allowed to happen.”
Residents who certainly deserve compensation for the losses they have endured in their health, their livelihood, their homes, and their environment have been given very little information about what this settlement actually means for them and how the process works. The same resident continues: “Some residents who signed up for class action suits haven’t heard from their attorneys since they signed, refusing to call clients back. Another resident claims their attorney had told them we have to accept this and there is no way to reject this offer. I think people are just desperate for any kind of break or relief that would take a little pressure off. I understand that and I knew this would happen. It is another tactic used by big corporations to further divide us.” Once residents opt in to the “voluntary personal injury program,” they release Norfolk Southern of all personal injury claims related to the derailment in the future and no more money beyond this settlement will be given.
While the settlement indicates undeniable guilt and responsibility on the part of Norfolk Southern, they continue to try to get away with paying mere pennies without providing any real solution to the residents near the derailment site who have had their entire lives ruined. And all of this is done in the aftermath of what can only be understood as direct attacks on the climate and on people’s health in pursuit of profit, with no measures for how this will be prevented in the future.
If there is one silver lining, a resident who has faced tremendous health problems in the wake of the derailment says that people’s response to the settlement is exposing the problem and aligning residents: “For the most part, I feel the majority of residents are not happy about the settlement.. now getting them to unite and speak up for themselves and not rely on the lawyers is the task at hand.”
