Volume 14 Issue 3                                                                                                                         July 2007


RAILWAY CLAIM SERVICES, INC.                                                                        Our 20th Year of Service














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 Elizabeth Vineyard of RCSI at 731-967-1796 , Fax 731-967-1390 , or via email at evineyard@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.   


According to Chattanooga , Tennessee based Unum Group Corp., cancer remains the number one cause of long-term disability in the United States .  This report came after Unum’s annual review of claims.

According to a statement, 12.1% of long-term disability claims submitted to the Chattanooga, Tenn.-based insurer in 2006 were due to cancer, with breast, prostate and colon cancers topping the list.

Unum Vice President of Health and Productivity, Kenneth Mitchell, said the numbers highlight cancer’s prevalence.

Complications from pregnancy, 11.7%; joint/muscle/connective tissue diseases, 10.1%; and back injuries, 8 %, also made the list of top long-term disability causes. In its review of short-term disability claims, Unum said 20%—the most related to a single health issue—were caused by pregnancy. Injuries excluding back injuries were the second-most common cause of short-term disability claims, at 9%.

Homeowners Insurance Note:  According to the Insurance Information Institute, when installing a pool, homeowners should consider increasing their liability policy to $300,000.


 In Appalachian Insurance Company v. General Electric Company, 2007 N.Y. Slip. Op. 01334 ( Feb. 15, 2007 ), the Court of Appeals was asked to determine whether asbestos related claims were one occurrence (because of the “common cause”), or whether they constitute multiple occurrences.  Relying upon the “unfortunate-event” test espoused in Arthur A. Johnson Corp. v. Indemnity Insurance Company of N. America, 7 N.Y.2d 222, 164 N.E.2d 704 (1959), the court cited several factors that should be considered when determining whether losses arise from a single occurrence or multiple occurrences: whether there is a close temporary and spatial relationship between the incidents giving rise to the loss, and whether the incidents can be viewed as part of the same continuum, without intervening agents or factors.

The court found that, based upon the definition of “occurrence” in the primary policy, the incident that gave rise to liability was each claimant’s “repeated or continuous exposure” to asbestos-containing materials.  Determining that there were multiple exposure incidents, the court next examined the temporary relationship between the incidents and the extent to which they were part of an undisputed continuum.  The court held that each claimant’s injury arising from asbestos exposure constituted a separate occurrence because the exposure occurred at different times and places.


“If I were to try to read, much less answer, all of the attacks made on me, this shop might as well be closed for any other business.  I do the very best I know how – the very best I can; and I mean to keep doing so until the end.  If the end brings me out all right, what’s said against me won’t amount to anything.  If the end brings me out wrong, ten angels swearing I was right would make no difference.“  The Inner Life of Abraham Lincoln: Six Months at the White House by Francis B. Carpenter (University of Nebraska Press, Lincoln, Nebraska, 1995)


In Railway Claim Services, Inc.’s last issue of this newsletter (Volume 14, Issue 2, April 2007) we reported on the U. S. Supreme Court’s ruling in Sorrell (“U.S. Supreme Court Decision on Causation in FELA Cases – On January 10, 2007 The US Supreme Court issued its decision in Norfolk Southern Railway Company v. Sorrell.  The Court held, contrary to the Missouri Supreme Court and pattern instructions, that the instruction on standard of negligence is the same for the employer railroad and the employee. Thus, the employee is not held to a lower standard. Below is the summary and a link to the decision.  This is a huge decision for the industry.  The United States Supreme Court unanimously held [opinion by Roberts; concurrences by Souter and Ginsburg] that when determining liability under the Federal Employers’ Liability Act, the same causation standard applies for railroad negligence and railroad employee contributory negligence.  The United States Supreme Court (the Court) held that a single standard of causation applies when determining railroad negligence and employee contributory negligence under FELA, and vacated and remanded the case to the Court of Appeals to determine whether the error was harmless.”)

After what was considered a momentous decision, with the case being remanded back to the Missouri Court of Appeals, the Missouri Court of Appeals in St. Louis upheld the $1.5 million verdict for a Norfolk Southern truck driver injured in 1999, citing that an error in jury instructions would not have changed the jury’s verdict. 

In April 2007 the Appellate Court ruled that the error in jury instructions “was harmless”.  If the jury held Sorrell negligent in the action, it could be only because of the way he drove the truck and necessarily would have been a “direct” cause of his not have considered his negligence an indirect cause of his injuries, the wording of the jury instructions would not have changed the outcome, the court ruled.


June 25, 2007 – A Jackson County, Mo., circuit court judge overturned a $17 million verdict entered against American Family Insurance Co. earlier this year concerning the use of aftermarket crash parts for automobile collision repairs

The original lawsuit alleged aftermarket crash parts, including fenders, doors, hoods and panels, were inferior to original equipment and a potential safety hazard. The verdict, reached in a Kansas City , Mo. court, covered about 315,000 American Family policyholders who filed auto claims with the company during a 14-year period spanning May 1990 to December 2004. The original suit was filed in May 2000 by two American Family policyholders and a Jackson County judge certified it as a class action in December 2001. That ruling was later upheld by the Missouri Supreme Court (BestWire, March 13, 2007 ).

Two years ago, the Illinois Supreme Court ruled in favor of State Farm Mutual Automobile Insurance Co. in a similar case.

The national class action, Avery vs. State Farm Mutual Automobile Insurance Co., targeted the use of aftermarket collision-repair parts and was decided in State Farm's favor. That ruling overturned a previous $1 billion judgment. But not only did the Illinois Supreme Court find the use of aftermarket parts didn't breach the company's contract with policyholders, nor violate the state's Consumer Fraud Act, but it also found the class action was certified improperly (BestWire, Aug. 18, 2005 ).

American Family is one of the top 20 largest property/casualty writers in the United States . The company operates in 17 states, primarily in the Midwest . While the company writes commercial lines, its primary lines are personal auto and homeowners. American Family Insurance Group currently has a Best's Financial Strength Rating of A (Excellent).

In 2006, the top five writers of private-passenger auto in Missouri , according to A.M. Best Co. state/line product information, were: State Farm Group, with a 22.6% market share; American Family Insurance Group, with 18.4%; Progressive Insurance Group, with 6.6%; Farmers Insurance Group, with 6% and Allstate Insurance Group, with 5.6%.


It is not enough to do your best; you must know what to do, and THEN do your best. W. Edwards Deming



When and Where:  Norfolk Southern will host the 30th Annual General Claims Conference in Williamsburg , Virginia , September 26-28, 2007 .  The conference will be held at Kingsmill Resort and Spa which is located along the historic James River .  The theme will be “Back to Basics – Even Old Dogs!” 

Hotel:  The hotel is offering a special room rate of $209 per night, and a suite rate of $269 per night, which will be available September 25 through September 30, 2007 , for those who wish to arrive early or extend their stay.

Reservations:  Reservations must be made directly with the Kingsmill Resort Reservations Department at 800-832-5665 or 757-253-1703 or fax number 757-253-8237 .  In order to receive the preferred rate you must refer to the AAR General Claims Conference.  The reservations deadline is August 24, 2007 .

Airports:  There are three major airports within 45 minutes of Kingsmill – Newport News , Norfolk , and Richmond .  Amtrak service is also available to Williamsburg .

Registration:  A registration form is available at http://www.aargcc.com.  For additional information please contact Cheri Bradley at 757-533-4907 .

A University of Tokyo Study Found That Drivers Wearing Seat Belts Have 5 Times The Risk Of Dying, If Rear Passenger Is Not - A study conducted at the University of Tokyo found that drivers who are buckled up have five times the risk of dying in a collision if their rear seat passengers are not buckled up. The injuries to the driver and front seat passenger are caused when the people in the back who are not buckled up catapult to the front.


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 involved in litigation.  Let Railway Claim Services, Inc. resolve 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.


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 test 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.


Crossings — Indiana Federal Court Grants Defense Motion for Summary Judgment Resulting from Car Sliding on Ice In Front of Amtrak Train.  On January 8, 2004 , plaintiff was a passenger in a vehicle traveling between 25 and 30 mph in Gary , Indiana when it approached the Howard Street crossing in Gary .  The crossing signal lights activated but the crossing arm did not descend. The driver immediately applied his brakes, but because of icy conditions car slid upon the tracks. According to the testimony of the plaintiff the car remained for five seconds before it was struck by an Amtrak train. During this five second period put the driver placed the car in reverse and attempted to back off the crossing when it was struck by the Amtrak train traveling at 79 mph.  Plaintiff sued Amtrak (and CSXT for failing to maintain the crossing---This count was dismissed on a motion for summary judgment.) alleging that it breached its duty to maintain a proper lookout and to brake. The failure to maintain a proper lookout claim was dismissed after plaintiff failed to respond to a motion for summary judgment.

The railroad then filed a supplemental motion for summary judgment on the failure to brake claim, arguing that plaintiff could not establish proximate cause. It pointed to testimony from the engineer that he did not see the vehicle until two to three seconds prior to the collision. Plaintiff responded that if the engineer had applied the brakes when the car began to skid, the driver would have had an additional .63 seconds to move the car off the tracks. According to plaintiff, that amount of time was sufficient for the vehicle to either clear the crossing or to shift the point of impact to the front wheels (so that it would have been less likely that plaintiff would have been ejected).

The Court granted the motion for summary judgment. It found that there was no evidence to suggest that plaintiff’s injuries could have been avoided if the engineer had applied the brakes in a manner which would have given the driver some period of time of less than one half a second to clear the tracks.  According to the court, “no reasonable jury could conclude that this fraction of a second was the proximate cause of (plaintiff’s) injury.” The court pointed out that even plaintiffs expert disclaimed the notion that even with .63 seconds of additional time the accident could have been avoided. Instead, the court noted, that witness stated that, “What I would say is they could have gotten the car far enough out of the way so that the damage would be substantially less.” Beal v. National Railroad Passenger Corp., U.S. District Court S.D. Indiana No. 2:04 -cv-250. Ellen Parker, Marshall P. Whalley, Merillville , IN for plaintiff. Aimee R. Riven, Harold Abrahamson of Abrahamson Reed & Bilse, Hammond , IN for defendant.

Trespassers – Chicago Federal Court Awards $1.85 Million against CSXT resulting from Five Year-Old Killed By Train.  Plaintiff’s five-year-old son lived with his mother and a sibling in a basement apartment in East Chicago , Indiana , approximately a half block from train tracks.  On the morning of September 14, 2003 , decedent unlocked the apartment door, left the apartment and wandered down the street. A man noticed decedent and observed that he was wearing a long blue shirt, no pants and appeared to be crying. Afraid that people would think that he took the boy’s pants, the man decided to call police and tell them that the child was playing near train tracks. The man encountered another individual and asked that he call police. The first man heard a CSX locomotive traveling west. The train sounded its horn approximately one mile east of the Baring stop as it approached a series of crossings. The horn continued to sound until the train struck the child approximately ten feet west of the Baring crossing. Non-emergency application of the brakes after the child was struck stopped the train some 3,200 feet later. Plaintiff (the father) filed a two-count complaint against the railroad, asserting both common law negligence and a claim for alleged violation of the Safety Appliance Act in that the train was not equipped with efficient and operating power brakes.

The case proceeded to trial before a magistrate judge, after the railroad’s motion for summary judgment was denied. The judge found in favor of plaintiff and awarded damages of $1.85 million, concluding that the train crew could have been seen the decedent from the distance required to stop the train.  The judge went on to conclude that the conductor and engineer did not see decedent because they were busy watching various crossings and did not look further up the track until they reached the crossing before the one at which decedent walked onto the tracks. She concluded that the railroad violated its duty to use reasonable and ordinary care to avoid injury to travelers at and on highways which are intersected by the tracks. Zachheus Olaniyan v. CSX Transportation, U.S. District Court ND . Illinois No. 04 C 5827. Benjamin O. Nwoye of Mendoza & Nwoye; A. Denison Weaver, Chicago, IL for plaintiff. Harold Abrahamson, Scott R. Bilse of Abrahamson, Reed & Adley, Hammond , IN for defendant.

Tennessee Jury Returns a Defense Verdict in Employee Rights and Relations Case where CSX Conductor Claims Race Discrimination. — The African-American plaintiff began his employment with CSX in 1978 as a conductor and continued in that role until July 2002 when he was terminated for excessive absenteeism.  Plaintiff filed suit, claiming racial discrimination.  He established that a white worker with a similar absentee problem was given only a fifteen-day suspension. The defense denied liability.  It pointed to its “employee performance guidelines” and noted that plaintiff accumulated “points” meriting discharge over an eighteen-month period while the white employee accumulated his points over a five year period. Moreover, the railroad noted, during the time period that plaintiff was identified, thirteen white employees were fired for absenteeism. The jury returned a defense verdict. Herman Hayden v. CSX Transportation, Inc., U.S. District Court, Middle District of Tennessee , Case No. 3:03-1164. Courtney B. Brown of Burge & Burge, Birmingham, AL and Irwin Venick of Dobbins & Venick, Nashville, TN for plaintiff.  Christopher W. Cardwell and Mary Taylor Gallagher of Gullett, Sanford , Robinson & Martin, Nashville , TN for defendant.

FELA – Kentucky Jury Returns a $40,250 Verdict resulting from Brakeman Knee and Ankle Injuries. The twenty-eight year-old plaintiff was pulling cut levers on October 14, 2000 , when he pulled on a stuck lever and lost his balance.  He then slipped on what he claimed to be mud in the rail yard, resulting in twisting his knee and ankle in the process.  Plaintiff filed suit under FELA, claiming that the yard was negligently maintained, and advanced a claim under the Safety Appliance Act. The defense denied liability and claimed that plaintiff was negligent in pulling the lever. The defense also challenged plaintiffs claimed damages. The jury returned a verdict which apportioned fault seventy percent to plaintiff and thirty percent to the railroad and which assessed damages of $40,250. Kevin Teitsort v. Paducah & Louisville Railroad, McCracken Co. (KY) Circuit Court, Case No. 03-1101. Mark Edwards of Megibow & Edwards, Paducah , KY and Frank T. Burge of Burge & Burge, Birmingham , AL for plaintiff. Jonathan Freed of Bradley & Freed, Paducah , KY for defendant.


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.com.  Railway 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.