ON TRACK WITH RAILWAY CLAIM SERVICES, Inc.

Volume 17 Issue 3                                                                                                     July 2010

 RAILWAY CLAIM SERVICES, INC.                                                           Our 23rd Year of Service

 Ø      BACKGROUND CHECKS

Ø      PUNITIVE DAMAGES REVISITED

Ø      UN REPORT:  MAJORITY OF DISASTER DEATHS IN 2009 WERE CLIMATE RELATED

Ø      NTSB – TRANSPORTATION FATALITIES DOWN

Ø      DOT – EARLY ESTIMATE OF MOTOR VEHICLE TRAFFIC FATALITIES IN 2009

Ø      AAR: WEEK 25, ANOTHER GOOD ONE FOR NORTH AMERICAN RAILROADS

Ø      LONG-TERM SAFETY TRENDS IN THE RAIL INDUSTRY

Ø      SPOLIATION OF EVIDENCE

Ø      FRA DEMOGRAPHIC REPORT ON RAIL TRESPASSER FATALITIES

Ø      TIMELY TOPICS FROM THE 2010 RAILROAD LIABILITY SEMINAR

Ø      RAILROAD RETIREMENT FINANCES ARE SOUND

Ø      NON-RAILROAD, BUT INTERESTING – A 30-YEAR-OLD LAWSUIT OVER $134 ENDS

Ø      QUOTES FROM HISTORY

Ø      GENERAL CLAIMS CONFERENCE, 32nd ANNUAL MEETING

Ø      COLLECTIONS?

Ø      RAILWAY CLAIM SERVICES, INC. WEBSITE

Ø      POINTS OF LEGAL INTEREST

Ø      RCSI INFORMATION

 

BACKGROUND CHECKS & 49 CFR PART 172

Railway Claim Services, Inc. (RCSI) can perform background checks for potential job applicants.  RCSI can also check injury histories for employees.  For further information contact Brenda Cox of RCSI at 731-967-1796, Fax 731-967-1390, or via email at coxb@railway-claim-services.com.  

Background checks are required for new employees under the Haz Mat Security Plan implemented by CFR Part 172, Hazardous Materials: Security Requirements for Offerors and Transporters of Hazardous Materials.  This rule states in part, “No later than the date of the first scheduled recurrent training after March 25, 2003, and in no case later than March 24, 2006, each hazmat employee must receive training that provides an awareness of security risks associated with hazardous materials transportation and methods designed to enhance transportation security”.

If your railroad has not yet implemented 49 CFR Part 172, Railway Claim Services can assist.  

PUNITIVE DAMAGES REVISITED

(Editors Note:  RCSI last reported on this case in our April 2009 Newsletter, which is available on RCSI’s website.) 

Richmond, VA – June 24, 2010 -- The Oregon Supreme Court affirmed a lower court's order setting aside a $100 million punitive damages award in a personal injury case brought by an individual smoker.  The Court held that, as a result of constitutional violations at trial, Philip Morris USA (PM USA) was entitled to a new trial on the issue of punitive damages.

In this case, which was originally brought 10 years ago in 2000, a Multnomah County jury awarded approximately $168,000 in compensatory damages and $150 million in punitive damages against PM USA, and the trial court later reduced the punitive award to $100 million.  In 2006, an intermediate appellate court affirmed the compensatory award, but reversed the punitive damages award and ordered a retrial on punitive damages.

In 2007 The U.S. Supreme Court said in a 5-4 decision that jurors may punish a defendant only for harm done to someone who is suing, not other smokers who could make similar claims. 

Phillip Morris USA v. Williams, 07-1216.

UNITED NATION REPORT:  MAJORITY OF DISASTER DEATHS IN 2009 WERE CLIMATE RELATED.

More than three quarters of those people who died in disasters in 2009 lost their lives to extreme weather events, which caused nearly $15 billion in damages worldwide, according to top United Nations officials. Preliminary figures for the period from January to the end of November 2009 show that 224 of the 245 disasters were weather-related, and accounted for 55 million out of 58 million people affected.  Data shows that the number of people killed in disasters is falling because countries are better prepared and have better early warning systems, according to the UN.

NTSB – TRANSPORTATION FATALITIES DOWN

Washington, DC - Transportation fatalities in the United States continue to decline  Transportation fatalities decreased by almost 10 percent in 2008 from 2007, according to preliminary figures released by the National Transportation Safety Board (NTSB). This marks the third consecutive year of decreasing transportation fatalities.

The data indicate that total transportation fatalities in all modes fell by almost four thousand, from 43,384 in 2007 to 39,397 in 2008. Along with a significant reduction in highway fatalities, rail and pipeline deaths also decreased but fatalities in the aviation and marine modes increased slightly.

  • Highway fatalities, which account for over 94% of all transportation deaths, fell by 3,998 (from 41,259 to 37,261).  Motorcycle fatalities, however, continued to climb (from 5,174 to 5,290) following a long-term trend that began in 1998 and has continued unabated.   Buses and motor coaches were another exception to the drop in highway fatalities. The number killed in this category almost doubled in a single year (from 36 to 67).
  • Aviation deaths increased slightly from 550 to 572.  Nearly 87 percent of aviation fatalities occurred in general aviation accidents (495), which was almost unchanged from the previous year (496).
  • Marine deaths increased slightly (from 766 to 779), with the vast majority occurring in recreational boating (709).
  • Fatalities involving commercial passenger vessels fell 50%, from 24 to 12.
  • Rail fatalities fell from 794 to 777.  The vast majority of these fatalities were persons struck by a rail vehicle.
  • Pipeline fatalities dropped from 15 to 8, with decreases in both gas and liquid pipeline operations.

DOT – EARLY ESTIMATE OF MOTOR VEHICLE TRAFFIC FATALITIES IN 2009

An early statistical projection of traffic fatalities in 2009 shows that an estimated 33,963 people died in motor vehicle traffic crashes.

This represents a decline of about 8.9 percent as compared to the 37,261 fatalities that occurred in 2008. If these projections are realized, fatalities will be the lowest on record (since 1954).  Also in 2009, fatalities declined by about 10.7 percent in the first quarter, declined by about 4.8 percent in the second quarter, declined by about 7.5 percent in the third quarter, and declined by about 12.7 percent in the fourth quarter, as compared to the respective quarters in 2008.  The fourth quarter of 2009 will be the 15th consecutive quarter of declines in fatalities as compared to the same quarter from the previous year.

Traffic fatalities have been steadily declining since reaching a near-term peak in 2005, decreasing by about 22 percent from 2005 to 2009.  Preliminary data reported by the Federal High­way Administration (FHWA) shows that vehicle miles traveled (VMT) in 2009 increased by about 6.6 billion miles, or about a 0.2-percent increase.  On a quarterly basis, the VMT dropped by 1.6 percent during the first quarter and increased by 0.6 per­cent in the second quarter, increased by 1.7 percent in the third quarter, and increased by 0.1 percent in the fourth quarter.  The fatality rate for 2009 declined to the lowest on record, to 1.16 fatalities per 100 million VMT, down from 1.25 fatalities per 100 million VMT in 2008.

AAR: WEEK 25, ANOTHER GOOD ONE FOR NORTH AMERICAN RAILROADS

Through 2010’s first 25 weeks, 13 reporting U.S., Canadian and Mexican railroads originated 9.2 million carloads, up 10.4 percent, and 6.5 million containers and trailers, up 12.9 percent year over year.  According to the Association of American Railroads (AAR), U.S. railroads continued to post strong weekly traffic figures through the end of June 2010.  During the week ending June 26, U.S.’s railroads originated 284,716 carloads, up 11.4 percent, and 227,229 intermodal loads, up 20.5 percent compared with traffic from the same week last year.  Container volume increased 22.1 percent and trailer volume rose 12.3 percent. Intermodal volumes have been stable in recent weeks and momentum has increased ahead of the peak shipping season.

Canadian railroads reported weekly carload volume of 70,849 units, up 18.1 percent, and intermodal volume of 46,911 units, up 22.4 percent year over year.  Mexican railroads increased weekly carload volume 20.2 percent to 15,428 units and boosted intermodal volume a whopping 61.7 percent to 7,249 units.

LONG-TERM SAFETY TRENDS IN THE RAIL INDUSTRY

Washington, DC – According to the National Transportation Safety Board the railroad industry has had improving safety trends since 1980.  Over the last almost thirty years employee fatalities are down 82 percent and grade crossing fatalities are down 59.  http://ntsb.gov/speeches/rosenker/mvr081006.html

TIMELY TOPICS FROM THE 2010 RAILROAD LIABILITY SEMINAR

Spoliation – The intentional destruction of evidence and when it is established, fact finder may draw inference that evidence destroyed was unfavorable to party responsible for its spoliation.  Such act constitutes an obstruction of evidence. – Black’s Law Dictionary.  At the Short Line Liability Seminar in Indianapolis in June, Attorney John C. Duffey spoke on the topic of Spoliation.  It is becoming more and more common for the plaintiff’s counsel to claim spoliation in order to obtain an adverse jury instruction, placing the railroad defendant in the position of fighting from behind to overcome these adverse instructions.  Attorney Duffy shared information to avoid these costly instructions.  A copy of his checklist can be viewed at Railway Claim Services, Inc.’s website (www.railway-claim-services.com), or if your need is pressing, you should contact Attorney John Duffey at the Firm of Stuart & Branigin, LLP.  His phone number is 765-423-1561, or he can be reached via email at jcd@stuartlaw.com 

Another timely topic discussed at the Seminar was the currently proposed Conductor Certification.  A PowerPoint presentation was given by Keith Borman, General Counsel for the American Short Line and Regional Railroad Association (ASLRRA) and Gary Vaughn, VP for Safety for the Watco Companies.  A copy of that presentation can be found on Railway Claim Services, Inc.’s website (www.railway-claim-services.com) as well.

RAILROAD RETIREMENT FINANCES ARE SOUND

There is good reason to be concerned about the current banking crisis, the roller-coaster stock market, the contraction of credit markets, and the growing federal deficit and federal debt.

But, according to the latest actuarial report, there is no reason to be concerned about the financial health of the Railroad Retirement system or the Railroad Retirement Unemployment Insurance system.

The latest actuarial report on the finances of the Railroad Retirement system proclaims it to be in "generally favorable" financial health, with no cash-flow problems anticipated during the next 25 years.

As for the Railroad Retirement Unemployment Insurance system, the latest actuarial report shows it to be in "generally favorable" health through 2018.  In fact, even with projected increases in the daily benefit rate, the experience-based contribution rates (paid entirely by railroad employers) are expected to keep the unemployment insurance system solvent over the long term.

The annual actuarial reports are required by Congress, along with recommendations for any financing changes that may be advisable, to ensure the long-term solvency of both the Railroad Retirement system and the Railroad Retirement Unemployment Insurance system.

Assets of the Railroad Retirement system are held by the Railroad Retirement Investment Trust, which has lost some money this year, as have all funds with money invested in the stock market.  But the losses this year are less than the 16 percent positive return realized last year, according to the Railroad Retirement Board.

Moreover the Railroad Retirement Investment Trust has minimal exposure to the kind of investments that have been causing the financial difficulties of financial institutions, according to the Railroad Retirement Board.

Additionally, the Railroad Retirement financing changes ordered by Congress in 2001 provide for a payroll tax adjustment to ensure the fund remains actuarially sound for the long-term -- and it is the railroad carriers who would face the burden of higher payroll taxes rather than employees.

More information on Railroad Retirement and Railroad Retirement Unemployment Insurance, as well as the Railroad Retirement Investment Trust, is available at www.rrb.gov.

QUOTES FROM HISTORY

The Constitution is not an instrument for the government to restrain the people.  It is an instrument for the people to restrain the government.  Patrick Henry (1736 -1799)

A government big enough to give you everything you want, is strong enough to take everything you have.  Thomas Jefferson (1743-1826)

The government cannot give to anybody anything that the government does not first take from somebody else.  Dr. Adrian Rogers (1931-2005)

You cannot legislate the poor into freedom by legislating the wealthy out of freedom. What one person receives without working for, another person must work for without receiving. Dr. Adrian Rogers (1931-2005)

GENERAL CLAIMS CONFERENCE, 32nd ANNUAL MEETING

Kansas City Southern Railway will host the 32nd Annual General Claims Conference Meeting in Kansas City, Missouri, September 29 through October 1, 2010. The conference will be held at Westin Crown Center Hotel which is located in the heart of downtown Kansas City.

The Westin is offering a special per night rate of $165 for a standard single or double room, $190 triple, $215 quadruple. The Westin is located at 1 East Pershing Road, Kansas City, Missouri 64108.

The reservation deadline will be August 28, 2010. Reservations must be made directly with Westin at 888-627-8538 or via fax at (816) 391-4488. In order to receive the preferred rate, you must reference the Association of American Railroad - General Claims Conference when you make your reservation. You may also make your reservation via the Internet at: http://www.starwoodhotels.com/westin/reservations/index.html.

Registration: A registration form will be provided with the June issue of The Bulletin and on-line registration is available at our website, www.aargcc.com/conference . For additional information, please contact Jim Swan at (402) 334-9455.

COLLECTIONS?

Problems collecting for damages?  Increase your chances of collecting that money, or reducing the total you are legally obligated to pay.  All without the cost and delays where litigation is involved.  Let Railway Claim Services, Inc. handle these collection issues for you.  You pay nothing if RCSI fails to collect or fails to reduce the bill for the submitted loss.  Email or call Randal Little or Dave Gardner for further information.  There is no cost if we are not successful.

WEBSITE

Railway Claim Services, Inc. maintains a website containing useful information for our industry.  If you haven’t visited our website recently, you may have missed some of the content recently added.

 

The Code of Federal Regulations, TITLE 49—Transportation, Subtitle B--OTHER REGULATIONS RELATING TO TRANSPORTATION, CHAPTER II--FEDERAL RAILROAD ADMINISTRATION, DEPARTMENT OF TRANSPORTATION.  Please visit our website and click on the following link.  http://www.railway-claim-services.com/waycar.htm  

Railway Claim Services’ website has the complete General Code of Operating Rules posted for your reference.  http://www.railway-claim-services.com/safety_first.htm

RCSI also has the entire text of the FELA posted on our website:  http://www.railway-claim-services.com/waycar.htm

 

Also, The Occupational Safety & Health Act of 1970 is available at:  http://www.railway-claim-services.com/waycar.htm

 

As a part of our ongoing efforts to provide RCSI clients with information vital to the safe and efficient operation, RCSI’s website contains the complete text of the Emergency Response Guidebook:  http://www.railway-claim-services.com/waycar.htm

RCSI is always trying to upgrade our website and make it a place for you to find the information you need.  If you have any suggestions, comments, or questions, please feel free to contact me at your convenience.  We appreciate your feedback.

POINTS OF LEGAL INTEREST

Crossings Accident – $2.5 Million Verdict against South Carolina DOT, reduced to the Statutory Cap of $300,000.  The Jury found for the plaintiff for the death due to a timing sequence of a traffic Light.  The 36 year old decedent mill worker was one of five occupants of an automobile which was struck by a Norfolk Southern train at an active flasher light signal crossing in Greenville, South Carolina. The vehicle in which the plaintiff was riding was the third car in a line of vehicles approaching the crossing.  All three vehicles proceeded across the track without stopping and the decedent’s vehicle was struck by the train resulting in death.  A wrongful death action against the state transportation department was initiated.  The plaintiff alleged that the traffic signals were not operating in accordance with an approved traffic signal plan and the timing sequence.   The defense denied liability, asserting that when signal personnel were summoned to the scene by officers a check of the timing showed that the signal was operating correctly. Reportedly the defense could not produce the signal plan at trial, and had no explanation as to why the signal plan could not be located.  After deliberating four hours, the jury returned a verdict in favor of the plaintiff for $2.5 million.  The trial court denied a defense motion for a new trial but did grant a motion to reduce the verdict to a $300,000 statutory cap.  Larron Bide, etc. v. South Carolina Department of Transportation.  Aiken Co. (SC) Common Pleas Court No. 2006CP0201582.

Crossing Accident – Jury Verdicts of $800,000 and $570,000 against a trucking company (85%) Texas DOT (15%) for Incorrectly Sequenced Traffic Signals.  Jury Absolves Union Pacific and Amtrak.  A tractor-trailer rig fouled tracks in Harris County because state transportation department traffic signals were not correctly sequenced so as to clear traffic.  The Amtrak train on which plaintiffs were working collided with the rig at the grade crossing.  Both men were thrown around inside the car.  One employee suffered hand and elbow injuries which required surgery for both the wrist and the elbow, preventing him from returning to work with Amtrak. The other Amtrak employee sustained a protruding disc in the low back which did not require surgical intervention, and his doctor gave an opinion that he could not return to work.  The trucking company made a confidential settlement prior to trial, and the case proceeded to trial against Amtrak, Union Pacific and the Texas DOT. The jury apportioned fault 15% to the Texas DOT and 85% to the trucking company.  Total damages were set at $800,000 for one employee plaintiff and $570,000 for the second employee plaintiff.   Wolfe, et al v. Union Pacific, et al, Harris Co. (TX) District Court No. _____.

Crossing Accident Verdict with ZERO verdict against Norfolk Southern and apportioned fault against the plaintiff (20%) employee and the trucking company (80%). The forty-five year old plaintiff was a conductor for Norfolk Southern when he proceeded to the front walkway of the train he was operating in order to warn motorists of the train’s approach at a crossing without gates or lights.  A tractor-trailer rig proceeded into the crossing at a speed of some 30 m.p.h.  The train was moving at some 3 to 4 mph and struck the side of the truck.   As a result of the collision the conductor had an injury to his cervical disk which required surgery, and a shoulder injury which required surgery.  Following the surgeries the conductor had medical restrictions that kept him from returning to work as a conductor.  Subsequently he filed suit against Norfolk Southern and against the tractor-trailer owner and driver.  The plaintiff faulted the truck driver defendant for failing to yield the right of way.  The trucking defendants denied liability, and claimed that the train’s engineer failed to sound the whistle as required by law.  According to the defense, its driver had a green light from the traffic signals which controlled the entrance/exit ramp to an interstate highway to which the crossing was adjacent. Finally, the defense continued, plaintiff was responsible for his own injuries in that he should have been on the ground directing traffic, not on the walkway of the locomotive.  As to Norfolk Southern, plaintiff claimed that the railroad failed to furnish him with a reasonably safe place to work. The railroad denied liability.  The jury returned a verdict which apportioned fault 80% to the trucking defendants and 20% to plaintiff.  A defense verdict was returned with respect to the FELA claim.  Gross damages of $670,000 were assessed. Larry Petree v. Norfolk Southern, Masur Trucking, Thomas Graham, U.S. District Court S.D. Ohio No. 1:07-cv-682. David E. Williamson of Lindhorst & Dreidame, Cincinnati, OH for Norfolk Southern and Matthew R. Skinner, Cincinnati, OH for trucking defendants.

Crossings Accident Verdict of ZERO verdict against BNSF and UP after a Texas jury rejects claims that both railroads were at fault.  On January 10, 2003 a BNSF train struck the plaintiff’s car at a crossbuck-only crossing in Bastrop, Texas.  The female plaintiff suffered multiple fractures and claimed a closed head injury.  The plaintiff sued BNSF, alleging negligence by the BNSF crew train crew, and asserted that UP violated restricted visibility regulations and failed to employ active warning devices.  The plaintiff claimed that because the crossing was not open she was unable to stop in time.  The defense disputed the facts of the accident as set forth by the plaintiff and disputed the nature and extent of plaintiffs claimed injuries.  The jury returned a defense verdict.  Defendant’s Experts: Foster Peterson, train operations, Atlanta, GA; Francisco, Perex, Ph.D., Houston, TX. Tamara Lee Gradert v. Union Pacific Railroad Co., et al, Harris Co. (TX) District Court No. 2004-67039.  John W. Proctor of Brown, Dean, Wiseman, Proctor, Hart & Howell, Fort Worth, TX; Douglas W. Poole of McLeod, Alexander, Powel & Apffel, Galveston, TX for defendants.

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RCSI welcomes your input.  If you have any questions or comments of interest to our industry, please contact either Dave Gardner or Randal Little at (731) 967-1796 or FAX your message to (731) 967-1390.

Visit the Railway Claim Services, Inc. webpage located at www.railway-claim-services.comRailway Claim Services, Inc. is the recognized leader in independent railroad claims management, which includes investigation, negotiations, and all those things in between.  If RCSI is not already a partner in your loss control and claims management program are you accepting too much risk?

For further information contact:

dave_gardner@railway-claim-services.com or randal_little@railway-claim-services.com

Corporate Offices at:   52 South Main Street    Lexington, Tennessee  38351

Phone:  800-786-5204, Fax: 731-967-1390 or visit us on the Web at www.railway-claim-services.com

Railway Claim Services, Inc. has offices THROUGHOUT THE UNITED STATES.