EAST PALESTINE — A federal judge pressed attorneys last week for clearer information on when payments will begin in the ongoing litigation involving the Norfolk Southern train derailment, according to a teleconference transcript.

During the hearing, the Judge Benita Pearson questioned both railroad and plaintiff class co-counsel about the status of payouts to affected claimants.

Alan Schoenfeld, attorney for Norfolk Southern, told the court that even with a recent Sixth Circuit ruling clearing one of the final obstacles, the settlement’s built-in timing rules still delay payments to class members until early 2026. The decision by the Sixth Circuit dismissed the appeals filed by five residents — Rev. Joseph Sheely, Zsuzsa Troyan, Tamara Freeze, Sharon Lynch and Carly Tunno — on the grounds they did not post the $850,000 appeal bond ordered by Pearson.

Schoenfeld explained that the settlement agreement and the court’s order establish an “effective date” that does not begin until objectors have exhausted their right to appeal to the Sixth Circuit and, if they choose, to petition the U.S. Supreme Court. Under those terms, he said, the earliest possible date the settlement could become final is Feb. 3, 2026 — which ironically will mark the third anniversary of the disaster

He agreed that the Sixth Circuit appeal had been a major factor slowing the case, but emphasized that the settlement’s formula requires full finality of the approval order before any payments can be issued.

Schoenfield also told the court that $120 million set aside from the settlement and earmarked for the personal-injury claim, along with $180,000 in legal fees and expenses, has already been paid to class counsel, distinguishing that money from the remaining direct payment funds of $265 million that remain on hold. The direct payments cannot move forward until the case reaches full legal finality.

There are remaining unresolved issues — some involving discovery — and a motion filed by over 100 residents who now want out of the settlement altogether, citing alleged fraud by attorneys who brokered the deal.

The next hearing in the case is scheduled for Dec. 5, signaling continued oversight as the parties work through unresolved questions.

The settlement funds total $600 million and are divided into three programs: direct payment (property damages), voluntary exposure supplement (personal injury), and actual net business loss. The plan aims to provide fair, reasonable, and adequate compensation to affected class members within 20 miles of the derailment. Over 55,000 claims were filed before the Aug. 22, 2024 deadline. Below is a breakdown of the settlement that was approved in September in 2024.

Allocation of Funds

The $600 million settlement fund is preliminarily allocated as follows:

– Direct Payment: $265 million

– Business Loss: $25 million

– Personal Injury/Exposure Supplement: $120 million

– Holdback: $10 million

– Legal Fees: $162 million

– Legal Expenses: $18 million

The fund includes $25 million in payments previously made by Norfolk Southern, which will be applied as reductions or offsets.

Direct Payment Program

The Direct Payment program compensates eligible households based on a point system. Each household starts with a base of 100 points, equivalent to $70,000. Points are adjusted using multipliers based on factors such as proximity to the derailment site, household composition, displacement duration, property ownership, and damage. For example:

– Households closer to the derailment site receive higher multipliers, with those living trackside receiving a 1.10x multiplier.

— Families with more adults or children receive higher multipliers, while households with elderly members also receive additional points.

— Displacement duration and distance, as well as property acreage and damage, further impact the final point calculation.

Reductions and offsets, such as prior inconvenience payments or reimbursements, are applied to specific categories without affecting the overall payment.

Voluntary Exposure Supplement

The Voluntary Exposure Supplement compensates individuals for personal injury or chemical exposure. Each eligible class member starts with a base of 100 points, equivalent to $25,000. Multipliers are applied based on factors such as proximity to the derailment site, age, symptoms, medical treatment, and formal diagnosis. For example:

– Minors and individuals over 65 receive adjusted multipliers based on their age.

– Those reporting significant symptoms or diseases, such as chemical bronchitis or COPD, may receive higher multipliers.

– Medical treatment and formal diagnoses also increase the final payment amount.

Reductions for prior medical reimbursements are applied only to the specific category of reimbursement.

Actual Net Business Loss Program

Businesses affected by the derailment are eligible for dollar-for-dollar compensation for documented net losses directly caused by the incident. The Settlement Administrator will review supporting documentation, including federal income tax returns for 2022 and 2023, to calculate losses. If the fund is exhausted, businesses will receive pro-rata payments.

Reductions for prior reimbursements from Norfolk Southern, insurance, or other sources will be deducted from the calculated loss amount.