Cases
Norfolk Southern Corporation
Corporate Governance / Derivative
Overview
Overview
- Date:
- 9/18/2023
- Company Name:
- Norfolk Southern Corporation
- Stock Symbol:
- NSC
- Class Period:
- FROM 10/28/2020 TO 3/3/2023
- Status:
- Filed
- Filing Date:
- 3/16/2023
- Court:
- U.S. District Court: District of Southern Ohio
Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, is investigating potential claims against Norfolk Southern Corporation (NYSE: NSC) on behalf of long-term stockholders following a class action complaint that was filed against Norfolk Southern on March 16, 2023 with a Class Period from October 28, 2020 to March 3, 2023. Our investigation concerns whether the board of directors of Norfolk Southern have breached their fiduciary duties to the company.
Norfolk Southern is a rail transportation company that implemented a strategy known as “Precision Scheduled Railroading” (“PSR”), which is associated with hyper-efficient operational changes designed to increase revenues and decrease costs. Operational changes typically include reductions in staff; longer, heavier trains that can stretch up to miles in length; and tighter schedules.
The Norfolk Southern class action lawsuit alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (i) Norfolk Southern’s PSR, including its use of longer, heavier trains staffed by fewer personnel, had led to Norfolk Southern suffering increased train derailments and a materially increased risk of future derailments; (ii) Norfolk Southern’s PSR was part of a culture of increased risk-taking at the expense of reasonable safety precautions due to Norfolk Southern’s near-term focus solely on profits; (iii) Norfolk Southern’s PSR rendered Norfolk Southern more vulnerable to train derailments and train derailments with potentially more severe human, financial, legal, and environmental consequences; (iv) Norfolk Southern’s capital spending and replacement programs were designed to prioritize profits over Norfolk Southern’s ability to provide safe, efficient, and reliable rail transportation services; (v) Norfolk Southern’s lobbying efforts had undermined Norfolk Southern’s ability to provide safe, efficient, and reliable rail transportation services; (vi) Norfolk Southern’s commitment to reducing operating expenses as part of its PSR goals undermined worker safety and Norfolk Southern’s purported “commitment to an injury-free workplace” because Norfolk Southern’s PSR plan prioritized reducing expenses through fewer personnel, longer trains, and less spending on safety training, technology, and equipment such as hot bearing wayside detectors (a/k/a “hotboxes”) and acoustic sensors; (vii) Norfolk Southern’s rail services were, as a result of its adoption of PSR principles, more susceptible to accidents that could cause serious economic and bodily harm to Norfolk Southern, its workers, its customers, third parties, and the environment; and (viii) Norfolk Southern had failed to put in place responsive practices and procedures to minimize the threat to communities in the event that these communities suffered the derailment of a Norfolk Southern train carrying hazardous and toxic materials.
On February 3, 2023, eastbound Norfolk Southern Railway Company general merchandise freight train 32N derailed 38 railcars in East Palestine, Ohio, leaving behind what the Associated Press called “a mangled and charred mass of boxcars and flames.” The derailed equipment included 11 tank cars carrying hazardous materials that subsequently ignited, fueling fires that damaged an additional 12 non-derailed railcars.
On February 6, 2023, responders engaged in a controlled detonation and burn of the vinyl chloride, spewing massive volumes of chemicals into the vicinity. The chemicals released from the derailment entered the air and water of the surrounding residential areas, the closest of which were only 1,000 feet from the site of the accident. On this news, the price of Norfolk Southern stock fell. Then, on February 8, 2023, after lifting a previously issued evacuation order, Ohio Governor Mike DeWine stated that Norfolk Southern was “the one[] who created the problem. It’s their liability. They’re the ones who ought to pay for it.” Following their return, numerous residents reported hazardous air quality and other health and environmental concerns. On this news, the price of Norfolk Southern stock again fell.
Thereafter, on February 13, 2023, the Environmental Protection Agency stated that it had concluded that Norfolk Southern may be responsible for the cleanup costs of the derailment site or the costs incurred by the EPA for area cleanup. On this news, the price of Norfolk Southern stock once again fell.
Next, on February 15, 2023, reports emerged that Ohio Attorney General Dave Yost was considering taking legal action against Norfolk Southern over the derailment. On this news, the price of Norfolk Southern stock again fell.
Finally, on March 6, 2023, Norfolk Southern announced a 6-part plan to improve operational safety that included, among other things, adding about 200 temperature sensors along its tracks where existing sensors are at least 15 miles apart, reviewing the temperature levels that set off alarms for train crews, and adding more acoustic sensors that analyze vibrations for potential problems. On this news, the price of Norfolk Southern stock fell, further damaging investors.
If you are a long-term stockholder of Norfolk Southern, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Marion Passmore by email at investigations@bespc.com, by telephone at (212) 355-4648, or by filling out the form. There is no cost or obligation to you.
Norfolk Southern is a rail transportation company that implemented a strategy known as “Precision Scheduled Railroading” (“PSR”), which is associated with hyper-efficient operational changes designed to increase revenues and decrease costs. Operational changes typically include reductions in staff; longer, heavier trains that can stretch up to miles in length; and tighter schedules.
The Norfolk Southern class action lawsuit alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (i) Norfolk Southern’s PSR, including its use of longer, heavier trains staffed by fewer personnel, had led to Norfolk Southern suffering increased train derailments and a materially increased risk of future derailments; (ii) Norfolk Southern’s PSR was part of a culture of increased risk-taking at the expense of reasonable safety precautions due to Norfolk Southern’s near-term focus solely on profits; (iii) Norfolk Southern’s PSR rendered Norfolk Southern more vulnerable to train derailments and train derailments with potentially more severe human, financial, legal, and environmental consequences; (iv) Norfolk Southern’s capital spending and replacement programs were designed to prioritize profits over Norfolk Southern’s ability to provide safe, efficient, and reliable rail transportation services; (v) Norfolk Southern’s lobbying efforts had undermined Norfolk Southern’s ability to provide safe, efficient, and reliable rail transportation services; (vi) Norfolk Southern’s commitment to reducing operating expenses as part of its PSR goals undermined worker safety and Norfolk Southern’s purported “commitment to an injury-free workplace” because Norfolk Southern’s PSR plan prioritized reducing expenses through fewer personnel, longer trains, and less spending on safety training, technology, and equipment such as hot bearing wayside detectors (a/k/a “hotboxes”) and acoustic sensors; (vii) Norfolk Southern’s rail services were, as a result of its adoption of PSR principles, more susceptible to accidents that could cause serious economic and bodily harm to Norfolk Southern, its workers, its customers, third parties, and the environment; and (viii) Norfolk Southern had failed to put in place responsive practices and procedures to minimize the threat to communities in the event that these communities suffered the derailment of a Norfolk Southern train carrying hazardous and toxic materials.
On February 3, 2023, eastbound Norfolk Southern Railway Company general merchandise freight train 32N derailed 38 railcars in East Palestine, Ohio, leaving behind what the Associated Press called “a mangled and charred mass of boxcars and flames.” The derailed equipment included 11 tank cars carrying hazardous materials that subsequently ignited, fueling fires that damaged an additional 12 non-derailed railcars.
On February 6, 2023, responders engaged in a controlled detonation and burn of the vinyl chloride, spewing massive volumes of chemicals into the vicinity. The chemicals released from the derailment entered the air and water of the surrounding residential areas, the closest of which were only 1,000 feet from the site of the accident. On this news, the price of Norfolk Southern stock fell. Then, on February 8, 2023, after lifting a previously issued evacuation order, Ohio Governor Mike DeWine stated that Norfolk Southern was “the one[] who created the problem. It’s their liability. They’re the ones who ought to pay for it.” Following their return, numerous residents reported hazardous air quality and other health and environmental concerns. On this news, the price of Norfolk Southern stock again fell.
Thereafter, on February 13, 2023, the Environmental Protection Agency stated that it had concluded that Norfolk Southern may be responsible for the cleanup costs of the derailment site or the costs incurred by the EPA for area cleanup. On this news, the price of Norfolk Southern stock once again fell.
Next, on February 15, 2023, reports emerged that Ohio Attorney General Dave Yost was considering taking legal action against Norfolk Southern over the derailment. On this news, the price of Norfolk Southern stock again fell.
Finally, on March 6, 2023, Norfolk Southern announced a 6-part plan to improve operational safety that included, among other things, adding about 200 temperature sensors along its tracks where existing sensors are at least 15 miles apart, reviewing the temperature levels that set off alarms for train crews, and adding more acoustic sensors that analyze vibrations for potential problems. On this news, the price of Norfolk Southern stock fell, further damaging investors.
If you are a long-term stockholder of Norfolk Southern, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Marion Passmore by email at investigations@bespc.com, by telephone at (212) 355-4648, or by filling out the form. There is no cost or obligation to you.
The individual or institution below (“Plaintiff”) has reviewed and agrees to the Bragar Eagel & Squire, P.C. (“BESPC”) retainer agreement and authorizes BESPC to prosecute an action on Plaintiff’s behalf under the federal securities laws or applicable state laws to recover damages on behalf of investors in Norfolk Southern Corporation. BESPC will prosecute the action on a full contingency basis and will forward all costs and expenses.
Case Updates
Retainer Agreement
This will confirm that you have retained Bragar Eagel & Squire, P.C. (“BESPC”) to represent you in connection with potential litigation against Norfolk Southern Corporation (the “Company”) and its directors and officers. BESPC has conducted an investigation and believes that there is a valid basis to assert claims against the Company and its directors and/or officers for breach of fiduciary duties and other applicable laws.
In making this agreement, BESPC is relying upon your representation that you held the Company’s shares during the period from 10/28/2020 to 3/3/2023 (the “Relevant Period”) and that you continue to hold Company shares. Please provide us with documentation of your trading history in the Company’s stock by emailing a relevant copies of your brokerage statements to investigations@bespc.com. If you have any questions or need assistance, please call us at (212) 308-5858.
The terms under which we will represent you and your responsibilities as a potential representative plaintiff are set forth below.
You will have an obligation to remain knowledgeable about the litigation and participate in decisions concerning the progress of the litigation. If BESPC is appointed as lead counsel or in a similar capacity in the action, we will provide you with copies of all pleadings in the litigation for your review and approval, circumstances permitting, before they are filed with the court. BESPC will also promptly advise you of any significant developments in the litigation.
As a representative plaintiff, you cannot have any interest antagonistic to or in conflict with other shareholders or the Company concerning the claims we are pursuing or any relationships with any of the named defendants that would in any way impair your ability or incentive to obtain the best possible result. You agree that neither you nor any of your affiliates or agents will trade stocks while in the possession of any material non-public information you may receive in connection with the litigation. In addition, as a representative plaintiff, you may be required to continue holding Company shares. Please contact us before buying or selling Company shares.
BESPC will prosecute this litigation on a contingency basis. You will not be responsible for paying any legal fees, costs, or out-of-pocket expenses arising out of or related to the prosecution of this litigation, regardless of the outcome of the matter. If there is a monetary recovery in this action, BESPC will, at the conclusion of the litigation or any segment thereof, apply to the court for approval of an award of attorneys’ fees and reimbursement of expenses. BESPC may also seek a fee if we obtain substantial non-monetary relief for the Class or the Company. The court will then award fees and disbursements (if any) from the proceeds of any judgment or settlement obtained in this litigation, based on factors considered relevant by the court. Such fees, costs, and disbursements will be paid from the entire settlement amount and not only from your share of the settlement amount.
BESPC may associate with other counsel to assist in the prosecution of this litigation. Any recovery of fees and costs will be shared with such counsel, determined on a percentage basis or based upon the time spent on the matter, as approved by the court if applicable. The division of work and or fees among co-counsel will not affect the amount of fees received upon a successful completion of the litigation. From time to time, BESPC may utilize contract attorneys to supplement the work of its own employed attorneys. BESPC will supervise the work of all contract attorneys and adopt their work product as its own. You authorize BESPC, as we deem appropriate, to associate with other counsel and to hire experts and consultants to assist in the handling of your claims.
It is possible that you will not be appointed as a lead plaintiff in the action. However, we may wish to represent you in other litigation related to the wrongful acts giving rise to this case. In such event, we will contact you to discuss the scope of such representation and obtain your approval before moving forward. You also agree that we may contact you with respect to other potential matters on your behalf.
BESPC will consult with you regarding any settlement negotiations and seek to obtain your approval for any proposed resolution of this litigation before entering into a final settlement agreement with defendants.
You expressly acknowledge that we have not made any representation to you, express or implied, concerning the outcome of any litigation or other matter in which we represent you.
If you are not chosen as a representative plaintiff and we do not choose to pursue other related litigation on your behalf, we will provide you with notification and this Agreement shall terminate. Otherwise, this Agreement shall remain in effect until the conclusion of the relevant litigation. However, you may terminate this Agreement at any time.
Upon termination, BESPC’s files and papers compiled in connection with its investigation and prosecution of this matter constitute the work product and property of BESPC over which it has complete control with respect to its use and/or disclosure.
This agreement sets forth the entire agreement between the parties and supersedes all other oral or written communications.
Please feel free to contact us at any time should you have any questions or comments in this regard.
In making this agreement, BESPC is relying upon your representation that you held the Company’s shares during the period from 10/28/2020 to 3/3/2023 (the “Relevant Period”) and that you continue to hold Company shares. Please provide us with documentation of your trading history in the Company’s stock by emailing a relevant copies of your brokerage statements to investigations@bespc.com. If you have any questions or need assistance, please call us at (212) 308-5858.
The terms under which we will represent you and your responsibilities as a potential representative plaintiff are set forth below.
Your Responsibilities as a Representative Plaintiff
As a representative plaintiff, you will have a duty to represent the interests of similarly situated shareholders and to participate in the prosecution of this litigation. You may also be asked to provide documents concerning your trading in Company stock and may be asked to sit for a deposition. Accordingly, you should preserve all documents that relate to this case until it has concluded or we inform you otherwise. Relevant documents include any information you have about the Company or your trading in Company stock, no matter how it is recorded or who is keeping it for you. If you have any questions about whether information should be retained, please contact us.You will have an obligation to remain knowledgeable about the litigation and participate in decisions concerning the progress of the litigation. If BESPC is appointed as lead counsel or in a similar capacity in the action, we will provide you with copies of all pleadings in the litigation for your review and approval, circumstances permitting, before they are filed with the court. BESPC will also promptly advise you of any significant developments in the litigation.
As a representative plaintiff, you cannot have any interest antagonistic to or in conflict with other shareholders or the Company concerning the claims we are pursuing or any relationships with any of the named defendants that would in any way impair your ability or incentive to obtain the best possible result. You agree that neither you nor any of your affiliates or agents will trade stocks while in the possession of any material non-public information you may receive in connection with the litigation. In addition, as a representative plaintiff, you may be required to continue holding Company shares. Please contact us before buying or selling Company shares.
Contingency Fee and Advancement of Expenses
BESPC will prosecute this litigation on a contingency basis. You will not be responsible for paying any legal fees, costs, or out-of-pocket expenses arising out of or related to the prosecution of this litigation, regardless of the outcome of the matter. If there is a monetary recovery in this action, BESPC will, at the conclusion of the litigation or any segment thereof, apply to the court for approval of an award of attorneys’ fees and reimbursement of expenses. BESPC may also seek a fee if we obtain substantial non-monetary relief for the Class or the Company. The court will then award fees and disbursements (if any) from the proceeds of any judgment or settlement obtained in this litigation, based on factors considered relevant by the court. Such fees, costs, and disbursements will be paid from the entire settlement amount and not only from your share of the settlement amount.
Association with Counsel
BESPC may associate with other counsel to assist in the prosecution of this litigation. Any recovery of fees and costs will be shared with such counsel, determined on a percentage basis or based upon the time spent on the matter, as approved by the court if applicable. The division of work and or fees among co-counsel will not affect the amount of fees received upon a successful completion of the litigation. From time to time, BESPC may utilize contract attorneys to supplement the work of its own employed attorneys. BESPC will supervise the work of all contract attorneys and adopt their work product as its own. You authorize BESPC, as we deem appropriate, to associate with other counsel and to hire experts and consultants to assist in the handling of your claims.
Other Actions
It is possible that you will not be appointed as a lead plaintiff in the action. However, we may wish to represent you in other litigation related to the wrongful acts giving rise to this case. In such event, we will contact you to discuss the scope of such representation and obtain your approval before moving forward. You also agree that we may contact you with respect to other potential matters on your behalf.No Special Treatment
You understand that in the event we secure a recovery, you will not receive any special treatment or receive a greater share of any recovery based on your service as a named plaintiff. However, we may ask the Court to approve an additional award to you to compensate you for the time and effort you expend on this matter. Any such award is solely within the discretion of the Court.
Settlement
BESPC will consult with you regarding any settlement negotiations and seek to obtain your approval for any proposed resolution of this litigation before entering into a final settlement agreement with defendants.
No Guarantee of Success
You expressly acknowledge that we have not made any representation to you, express or implied, concerning the outcome of any litigation or other matter in which we represent you.
Termination of This Agreement
If you are not chosen as a representative plaintiff and we do not choose to pursue other related litigation on your behalf, we will provide you with notification and this Agreement shall terminate. Otherwise, this Agreement shall remain in effect until the conclusion of the relevant litigation. However, you may terminate this Agreement at any time. Upon termination, BESPC’s files and papers compiled in connection with its investigation and prosecution of this matter constitute the work product and property of BESPC over which it has complete control with respect to its use and/or disclosure.
This agreement sets forth the entire agreement between the parties and supersedes all other oral or written communications.
Please feel free to contact us at any time should you have any questions or comments in this regard.