Appeal delays $600 million East Palestine derailment class action settlement payments

Settlement checks related to Norfolk Southern's disastrous 2023 derailment could be delayed up to two years now because an appeal of a federal judge's decision last week to approve the $600 million deal has been filed, lawyers in the case said Monday.

Many residents of East Palestine, Ohio, expressed outrage online over the weekend about the appeal because it will delay the payments they had been counting on to help them recover from the toxic train crash that disrupted their lives when it spewed hazardous chemicals into their community. Some people had planned to use the money to relocate.

The plaintiffs' attorneys had hoped to start sending out the first checks before the end of the year, but that won't happen because the 6th Circuit Court of Appeals will first have to address concerns about whether the deal offers enough compensation and whether residents were given enough information to decide whether it is fair.

“We will do everything in our power to quickly resolve this appeal and prevent any further burdens on the residents and local businesses that want to move forward and rebuild their lives," the plaintiffs’ attorneys said in a statement. “It is tragic that one person is substituting their judgment for the entire community who wants this settlement, and instead of opting out, they have gone this route.”

The lawyers estimated that the payments will be delayed at least six to 12 months while the appellate court considers the appeal that was filed Friday but they could be delayed even longer if the case is appealed up to the U.S. Supreme Court or sent back for additional proceedings in Judge Benita Pearson's court.

The settlement offers payments of up to $70,000 per household for property damage and up to $25,000 per person for injuries to those who lived within two miles of the derailment. The payments would drop off significantly further out with only a few hundred dollars offered to people who live closer to the limit of 20 miles (32 kilometers) away.

It wasn’t immediately clear whether the appeal will increase the $162 million in legal fees and $18 million in expenses the judge awarded to the plaintiff’s attorneys last week.

Residents posting on the “East Palestine off the rails!” Facebook group accused the pastor who filed the appeal of being greedy because one of his objections to the deal is the frustration that any payments residents received from the railroad since the derailment to temporarily relocate or replace damaged belongings will be deducted from any settlement they receive. Some characterized that as a desire to be compensated twice for the derailment.

But the vocal few who objected to the deal have said they have deeper concerns. They have said they don't know the full extent of the chemicals they were exposed to because the plaintiff's lawyers have refused to disclose what their expert found when he tested in town and because the Environmental Protection Agency doesn't disclose everything it knows about the extent of the lingering contamination.

The town of East Palestine remains deeply divided over the derailment with some residents eager to move forward and put the disaster behind them while others who are still dealing with unexplained health problems can't see how to do that. The dispute over the appeal in the class action case only adds to the divisions.