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Derailment settlement gets final approval

YOUNGSTOWN — Despite a flurry of affidavits filed in the 25th hour calling into question testing results related to derailment-related contamination, Judge Benita Pearson finalized the $600 million settlement between class-action plaintiffs and Norfolk Southern in Youngstown’s Northern District Court on Wednesday.

Pearson, calling the settlement “fair, reasonable, and adequate,” gave final approval of the historic deal — the largest settlement paid out by a railroad in U.S. history — and cleared the way for personal-injury awards to be distributed in 30 days and property damage awards to be sent out by the end of the year. The ruling also cleared the way for plaintiff attorneys to receive 27% percent of the settlement for legal fees and another 3% for out-of-pocket fees, equaling $180 million. With $10 million to be put aside in a “holdback” fund, the Plan of Distribution approved by Pearson leaves $410 million to be awarded to residents ($265 million in direct payments for property damage, $25 million for losses to area businesses and $120 million for personal injury damages).

Lead co-counsels for the plaintiffs, Seth A. Katz (Burg Simpson Eldredge Hersh & Jardine), M. Elizabeth Graham (Grant & Eisenhofer) and Jayne Conroy (Simmons Hanly Conroy), issued a joint statement following the approval hearing.

“This outcome would not have been possible without the resilience and support of the East Palestine community and the broader class of impacted residents and business owners,” the statement read. “We look forward to beginning the distribution of funds in the coming weeks to help this community rebuild and move forward.”

With over 55,000 claims made to receive a piece of the settlement, the attorneys said support of the settlement was “overwhelming.” Most social media posts from residents commenting on the final approval expressed relief and endorsement of Pearson’s decision.

Still, there was opposition.

The Unity Council for the East Palestine Train Derailment — a community advocacy group comprised of residents who believe the response to last year’s rail disaster has done little to remedy the true damages caused when the train jumped the tracks and chemicals were released — held a press conference outside the Thomas D. Lambros Federal Building prior to Wednesday’s hearing.

“Norfolk Southern, the criminal railroad company that caused and exacerbated this disaster and poisoned thousands of citizens, has only provided superficial support, conducted faulty research while attorneys have hidden results of their toxicology study from the residents, and negotiated the fastest settlement agreement in history, one that does not meet the needs of the injured, homeless, and ill residents,” the group said. “The proposed settlement would pay a mere pittance for what these victims need for their healthcare and evacuation to safer locations.”

Jami Wallace, the president of the Unity Council, was one of many class members inside the courtroom when Pearson overruled objections and approved the settlement. Wallace reportedly shouted “sham” when the judge rendered her decision, prompting Pearson to order police to “put [Wallace] to the pavement.”

Wallace, along with Rev. Joseph Sheely, had previously filed motions to extend the opt-out deadline of July 1. The motions, which Pearson ruled against, argued the settlement was rushed and alleged class action lawyers to be in collusion with Norfolk Southern by dismissing scientific data that conflicted with the opinion of their hired experts.

Those accusations were the same ones made in another objection filed last week by Sheely and supported by affidavits filed on Monday and Tuesday. The affidavits from Stephen Perry (chemical exposure expert hired by class counsel Simmons Conroy), Scott Smith (independent researcher and Chief Sustainability Officer of ECO Integrated Technologies), Dr. Robert Kroutil (chemist and former EPA data expert), Leslie Pacey (Senior Environmental Officer for the Government Accountability Project) and Dr. George Thompson (toxicologist and President of Chemical Compliance Systems), questioned the test results of the environmental sampling conducted by the EPA, Norfolk Southern contractors and experts hired by class attorneys.

The Beaver County Marcellus Awareness Community (BCMAC) — a group of Beaver County citizens opposed to fracking and the petrochemical industry and who live in communities impacted by the derailment — also spoke out against the settlement, voicing both “disappointed and deep concern” and denouncing the treatment of Wallace during the hearing.

“Even more troubling was the judge’s response to a community member’s frustration during the hearing, when she directed police to ‘put her on the pavement,’ further eroding trust in an already injured community,” the BCMAC said in a press release issued shortly after the final approval hearing.

Christina Siceloff, a Darlington, Pa. resident who lives with her young son Eddie just six miles from the derailment site, said the final approval does not equate to closure.

“Now the railroad and the attorneys can finally ‘go away,’ marking the end of this ordeal for them, just as they’ve wanted all along,” Siceloff said.

“But for those of us who live here, this is far from over. While they may move on, for many of us, it’s just the continuation of the nightmare we’ve endured for the past year and a half and will continue to suffer from for a long time.”

Siceloff believes the agreement brokered in April lets Norfolk Southern off the hook too easily for the rail disaster and its residual effects. She also believes the award amounts residents are projected to receive from the class action settlement will do little to help community members recover.

Those awards are currently determined by Kroll Settlement Administration using an allocation system that considers certain criteria. That criteria includes derailment assistance already received, location/distance from the derailment site, household composition (number of adults and children), length of time displaced or located, time missed from work and out-of-pocket expenses incurred.

The closer to the derailment site, the higher the potential payouts. Information provided by lead counsel puts estimates for property damages (or direct payments) at $70,000 per household for homes within two miles. Other projected payment amounts are $45,000 (2-4 miles), $30,000 (4-7 miles) and$15,000 (7-10 miles). Outside of 10 miles, the award amounts drop significantly with 10-15 miles away at $500 and 15-20 miles at $250.

Personal injury damages, which are limited to those who reside 10 miles or less from the derailment site, were initially projected to max out at $10,000 per person. That number more than doubled to $25,000 per person. Personal injury estimates for other distances from the derailment site also increased — 3-5 miles ($15,000), 5-7 miles ($5,000) and 7-10 ($,2000).

Eligible class members had until Aug. 22 to file a claim and receive compensation. They had until July 1 to opt-out of the class-action settlement, retaining the right to sue Norfolk Southern at a later date and on an individual basis.

selverd@mojonews.com

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