U.S. judge OKs $446 million settlement for victims of Lac-Megantic disaster

A U.S. bankruptcy judge has approved a $446-million Cdn settlement fund for victims of the fiery Lac-Megantic oil-train derailment in Quebec, clearing the way for payments to victims by year's end.

PORTLAND, Maine — A U.S. bankruptcy judge has approved a $446-million Cdn settlement fund for victims of the fiery Lac-Megantic oil-train derailment in Quebec, clearing the way for payments to victims by year’s end.

Judge Peter Cary in Portland, Maine, announced his decision Friday after Canadian Pacific (TSX:CP) dropped its objection to the settlement plan and after a Canadian judge gave conditional approval Thursday. He praised attorneys for working together to get a substantial agreement in place as quickly as possible.

The settlement was the result of negotiations with about two dozen companies.

Barring any surprises, payments could be made to victims of the disaster by year’s end, said Robert Keach, the bankruptcy trustee. About $110 million Cdn is being set aside to settle wrongful death claims.

“We don’t pretend to suggest that we made up for everything that happened,” said Keach. “But within the limits of the civil system, this is substantial compensation for the victims and they deserve it.”

A runaway train with 72 oil tankers derailed on July 6, 2013, in Lac-Megantic, setting off powerful explosions and causing fires that wiped out much of the downtown. Forty-seven people were killed.

Robert Bellefleur, a member of a Lac-Megantic-based coalition that promotes rail safety, welcomed the judge’s approval.

“It’s good news for people who were hit hard, who lost loved ones, homes, businesses,” said Bellefleur, who knew about 25 of the victims, including his cousin’s son, his daughter’s two babysitters and his contractor.

“It’s very good news. It doesn’t replace lives. It will provide comfort and maybe enable people to get back on their feet and live a more normal life, but without ever forgetting what happened.”

But Bellefleur said the state of the rail track in Lac-Megantic, which he called a determining factor in the tragedy, has not been addressed.

The disaster led to greater regulatory scrutiny of the use of trains to transport crude oil amid a production surge thanks to new technologies including hydraulic fracturing.

On Friday, the judge described the devastation from the fires as “vast and complete.”

“My thoughts and good wishes go to the good town of Lac-Megantic and the victims’ families,” Cary said after announcing he would sign the settlement.

After the fires were doused, the train’s operator, Maine-based Montreal, Maine and Atlantic, filed for bankruptcy. The settlement fund is tied to those bankruptcy proceedings in the United States and Canada.

The fund of $446 million Cdn was the product of negotiations with about two dozen companies with potential liability. In addition to settling wrongful death claims, money will be used to compensate government entities and others for destruction and environmental damage.

Canadian Pacific owned the track where the crude oil shipment originated and contended it bore no responsibility, since the train that derailed had a Montreal, Maine and Atlantic locomotive and crew and was operating on MMA rail.

But Keach argued Canadian Pacific bears some responsibility for failing to properly classify the Bakken region crude oil, which was as volatile as gasoline.

Canadian Pacific isn’t contributing to the settlement fund, and the railroad had contended the plan would have hampered its ability to defend itself from lawsuits, because the agreement provided legal immunity only to companies that do contribute.

But the altered amendment calls for a “judgment reduction provision” that would take into account the full settlement paid by others if Canadian Pacific is ordered to pay damages in the future.

“Although CP was not at fault in the derailment, we have been working with the trustee for a solution that protects CP interests and allows payments to be made to victims as soon as possible,” said Canadian Pacific spokesman Martin Cej.

Just Posted

Maskwacis RCMP seeking suspect in fatal hit and run

A Maskwacis man was fatally injured after being hit early Saturday morning on Hwy 611

Red Deer to get new a plan to end homelessness as the problem persists

Despite some successes there’s ‘a long way to go,’ says manager

Many Red Deer-area farmers deal with a disastrous year

Dought in the spring, snow at harvest creates bad yields, sends hay prices soaring

Photos: Part of downtown Red Deer covered in trash over the weekend

Downtown businesses deal with trash, needle debris, graffiti

Delburne man’s reckless driving led to fatal crash: Crown prosecutor

Jury began deliberating in manslaughter trial on Monday afternoon

Speaker at rally says Alberta oil ‘puts tofu on the table in Toronto!’

GRANDE PRAIRIE, Alta. — A rally in support of Alberta’s oil industry… Continue reading

Moneywise: Canadian workers unhappy with pay, want pension plans

Many working Canadians are feeling underpaid and are so worried about their… Continue reading

Brazil police say faith healer has turned himself in

RIO DE JANEIRO — A celebrity faith healer accused of sexually abusing… Continue reading

B.C. hockey coach creates ‘gear library’ to remove cost barrier of sport

VANCOUVER — Nicola Froese says she has always loved playing sports, but… Continue reading

Canada’s Kim McRae finishes seventh at luge World Cup in Lake Placid, N.Y.

LAKE PLACID, N.Y. — Canada’s Kim McRae finished in seventh place at… Continue reading

Jeff Bridges to receive Cecil B. DeMille Award at Globes

LOS ANGELES — Jeff Bridges may have once been considered as one… Continue reading

Top of mind: ‘Justice’ is Merriam-Webster’s word of the year

NEW YORK — Racial justice. Obstruction of justice. Social justice. The Justice… Continue reading

Man who demolished landmark house ordered to build replica

SAN FRANCISCO — A man who illegally demolished a San Francisco house… Continue reading

Giuliani: ‘Over my dead body’ will Mueller interview Trump

WASHINGTON — With a number of probes moving closer to the Oval… Continue reading

Most Read