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Objections to the East Palestine settlement pile up

EAST PALESTINE, Ohio — Objections to the $600 million agreement brokered between attorneys representing East Palestine residents and Norfolk Southern to settle a class action lawsuit continue to pile up.

Over 40 objections have now been filed in Youngstown’s Northern District Court opposing the deal — the largest railroad settlement in U.S. history.

Court documents filed along the objections cite a long list of arguments against the settlements, including the inability of residents to know the exact amount of their awards before releasing Norfolk Southern of liability for damages caused by last year’s train derailment and chemical spill, the release of liability to third-party contractors and government agencies once a claim form is submitted and accepted, the distribution of awards on a per-household basis instead of per-person, the inadequacy of the projected awards to make a difference, high anticipated legal fees that will reduce the funds available for class members and the lack of medical-monitoring clause.

Unknown amounts

In order to know what they will receive in the settlement, a resident must fill out a claim award and submit it. Submitting it is considered opting-in to the deal and freeing Norfolk Southern of liability and giving away the right to sue Norfolk Southern at a later date.

Awards from the settlement, within the first 20 miles of the derailment, will be based on an allocation formula that considers criteria including geographic proximity, household size, number of children in the household, relocation mandates, and length of displacement. Awards will be determined only after all forms have been processed.

Release of third parties

Opting-in not only absolves Norfolk Southern of responsibility for future damages, it also gives away a resident’s right to hold Oxy Vinyls (owner of the vinyl chloride that was intentionally released), GATX Corp. (owner of the tank cars that held the vinyl chloride), General American Marks Co. (owner of hopper car on which the hot wheeling failed) and Trinity Industries Leasing Co. (the owner of another hopper car) for any role they may have played in the derailment and vent-and-burn. On the other hand, the agreement still allows Norfolk Southern to seek damages against all three companies.

Other “released parties” include Norfolk Southern contractors Arcadis and CTEH (the companies handling the environmental remediation), SPSI (another NS contractor that was the middleman between OxyVinyls and Incident Command when the decision to vent and burn was made), HEPACO (another remediation contractor) and local, federal and state governmental agencies.

Household component

Amounts will be distributed to households — not individuals. While the size of the household is a part of the weighted criteria when determining awards, just one award will be attached to each address within the 20 miles. There is a personal injury component that allows for personal injury payment to each resident who resides within the first 10 miles who maintain a link between health impacts and the derailment.

Projected awards

The claim form discloses how much each class member household will likely get in property damages from the settlement. According to the form, households up to 2 miles away from derailment can expect up to $70,000. The award decreases with distance from ground zero — 2-4 miles ($45,000), 4-7 miles ( $30,000), 7-10 miles ( $15,000), 10-15 miles (approximately $500) and 15-20 miles ($250). Meanwhile, amounts for personal injury claims were $10,000 or lower. The form does state the possibility of a larger payout for “extraordinary claims” for both property and personal injury damages, meaning some awards may be higher. Any compensation previously received from Norfolk Southern or another agency — such as relocation assistance and inconvenience fees — will be deducted from the awarded sum.

Legal fees

Attorneys stand to pocket nearly $200 million from the $600 million. In the preliminary agreement “class counsel agrees to seek no more than 27% of the total monetary recovery” and “costs and expenses up to 3% of the fund.” If granted that percentage, legal fees would total $180 million — $162 million in legal fees and $18 million in other expenses.

Medical monitoring

While class members continue to object on the grounds that the settlement contains no requirement for medical monitoring, a ruling in an unrelated derailment case makes that an impossible clause.

The Northern District Court of Ohio (the same district court hearing the Norfolk Southern case) previously ruled “that any increased risk of cancer or other diseases was too insignificant to warrant the court’s ordering a lengthy period of medical monitoring” in Hirsch vs. CSX — a case involving the 2007 CSX derailment and chemical fire in Painesville. The U.S. Sixth District Court later upheld that ruling. Because of the previous opinion, Judge Benita Pearson, who is presiding over the Norfolk Southern class action lawsuit, had little to no choice but to dismiss the medical monitoring cause of action.

Residents have until Aug. 22 to file an objection to the agreement. Filing an objection does not impact a class member’s eligibility to participate in the settlement or impact any award they may receive.

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