GATX avoids liability for the $600 million Ohio derailment settlement

In Ohio, on February 3, 2023, a train derailment occurred in East Palestine, leading to a significant environmental and public safety crisis. The incident involved a railcar owned by GATX that failed due to a bearing issue while carrying plastic pellets. This failure resulted in the derailment, releasing hazardous chemicals that prompted local evacuations and a massive cleanup effort. In the aftermath, Norfolk Southern, the railroad company involved, agreed to a $600 million settlement to compensate affected residents. However, a recent jury decision found GATX not liable for this settlement despite their railcar's involvement in the derailment. The jury's ruling came after GATX argued that Norfolk Southern was responsible for the operation and maintenance of the train, and thus should be held accountable for the accident. Despite GATX's railcar being implicated, the company maintained they adhered to all regulations concerning the care of their vehicles. The jury's decision has been met with disappointment by Norfolk Southern, which has consistently advocated for the shared accountability of all companies involved in the incident. Following the derailment, a wide array of chemicals were released, resulting in a vent-and-burn operation that released vinyl chloride, causing a black plume of smoke to form over the area. The National Transportation Safety Board's investigation later concluded that this operation may have been unnecessary, as the tank cars had begun to cool and could have been handled differently. The decision to proceed with the operation was criticized for failing to consider expert advice from OxyVinyls, the manufacturer of the vinyl chloride. Norfolk Southern has previously attempted to shift some financial responsibility to GATX and OxyVinyls, having lost prior lawsuits that aimed to involve these companies in the environmental cleanup costs exceeding $1 billion. Despite these legal battles, settlement agreements between Norfolk Southern and affected residents remain unaffected, meaning that the recipients of the settlement will still receive their compensation without any additional costs from GATX. This ongoing saga of legal disputes and public health concerns continues to unfold, highlighting the complexities of corporate responsibility and the impact of industrial accidents on communities.