RAILWAY CLAIM SERVICES, INC. Our 23rd Year of Service
Ø BACKGROUND CHECKS
Ø TOTAL TRAIN ACCIDENTS DECLINE AMID RECESSION LOWERED TRAFFIC LEVELS
Ø WORST NATURAL DISASTERS OF 2009
Ø DOT – TRAFFIC DEATHS DROP TO LOWEST SINCE RECORDS KEPT (1954)
Ø LIGHT RAIL RIDERSHIP CONTINUES TO GROW
Ø FREIGHT OPERATIONS ACCIDENTS, CASUALATIES, AND FATALITIES CONTINUE TO DECLINE
Ø LONG-TERM SAFETY TRENDS IN THE RAIL INDUSTRY
Ø FRA DEMOGRAPHIC REPORT ON RAIL TRESPASSER FATALITIES
Ø RAILROAD RETIREMENT FINANCES ARE SOUND
Ø ACCIDENT REPORTING AND THE SELF-CRITICAL ANALYSIS PRIVILEGE
Ø QUOTES FROM HISTORY
Ø CLAIM PAYMENT LOSS CALCULATOR SHOWS BOTTOM LINE IMPACT
Ø SOUTHEASTERN CLAIMS ASSOCIATION 85TH ANNUAL CONFERENCE – JUNE 22-25, 2010
Ø GENERAL CLAIMS CONFERENCE, 32nd ANNUAL MEETING
Ø RAILROAD CLAIMS AND LIABILITY SEMINAR, JUNE 23-25, 2010
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 firstname.lastname@example.org.
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.
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Nobody ever went broke underestimating the taste of the American public. Henry Louis "H. L." Mencken (September 12, 1880 – January 29, 1956
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TOTAL TRAIN ACCIDENTS DECLINE AMID RECESSION LOWERED TRAFFIC LEVELS
Defects in railroad tracks were the leading cause of train accidents in the first five months of 2009, says the Federal Railroad Administration.
While there were fewer track defects than in the same 2008 period, human causes and train equipment defects – two other FRA accident categories – both declined more sharply in 2009 as falling traffic levels due to the recession helped bring down the total number of train wrecks.
The safety agency said out of 736 train accidents in the first five months of 2009, track defects were the primary cause in 239 or 32.47 percent of them. In 2008, 1,042 accidents were reported with 351 due to track problems, for 33.69 percent.
This does not include such incidents involving crossing accidents or trespassers. Approximately 50% of all train accidents take place in rail yards. Only 57 accidents through May involved train collisions, down from 75 a year earlier.
Human factors were the main cause in 372 accidents or 35.7 percent, the most of any single FRA category. This year, human causes were down to 233 for 31.66 percent.
FRA breakdown also lists three types of separate mechanical categories for
accident causes – track, equipment and signal defects – against a single human
factors grouping and a miscellaneous category of causes that do not fit into the
WORST NATURAL DISASTERS OF 2009
According to the United Nations, 2009 was the mildest natural disaster year of the decade. Still, there were 245 disasters in 2009 which affected 58 million people around the world. The United Nations reports that 90% of the disasters were “extreme weather related” of which many were floods and associated mudslides.
DOT – TRAFFIC DEATHS DROP TO LOWEST SINCE RECORDS KEPT (1954)
When the U.S. Department of Transportation (DOT) looked at their accrued records, their information provided showed that traffic deaths in the USA last year dropped to the lowest level since 1954, and deaths per 100 million miles traveled are the lowest on record, according to the DOT.
A 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. Also shown in Table 1 are the fatality rates per 100 million VMT, by quarter and for the first three quarters. 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.
LIGHT RAIL RIDERSHIP CONTINUES TO GROW
In 2009 the rail transit industry provided over 19 billion passenger miles, a 5% increase from 2008 service numbers. Growth in ridership at the rail transit agencies in the Federal Transit Administration’s (FTA) State Safety Oversight Program outpaced other modes of transportation. Even with this increase in ridership rail transit remains among the safest modes of transportation in the United States.
The 2009 growth can be attributed to both the economic downturn and the addition of new light rail systems, and an addition of more transit operated routes, trains, and tracks. This trend is expected to continue over the next decade.
FREIGHT OPERATIONS ACCIDENTS, CASUALATIES, AND FATALITIES CONTINUE TO DECLINE
2009 saw record lows in freight train accidents, casualties and fatalities. U.S. freight railroad operations had their safest year ever in 2009, said the Association of American Railroads.
The industry trade group said preliminary data from the Federal Railroad Administration show record lows for the train accident rate, employee casualty rate and grade crossing incidents.
Accidents and reportable incidents fell from 12,687 in 2008 to 10,529 last year, said FRA, which reports safety figures for the entire U.S. freight and passenger rail industry.
Total fatalities across the rail network, most of which reflect trespassers killed on tracks, fell to 713 in 2009 from 803 the year before.
There were also fewer overall train movements in 2009 due to the recession, but the FRA said the total rate of train accidents also fell to 2.78 per million train miles from 3.2 in 2008.
Just within freight, the AAR said the train accident rate was down 12 percent from the previous record low in 2008, while the employee casualty rate declined 4 percent from 2008’s previous record low. The number of grade crossing collisions on freight rail lines went below 2,000 for the first time, to 1,670, the group said.
The number of rail-related fatalities reported by freight railroads was also a record low at 497, the AAR said, and 93 percent of those deaths “involved either grade crossing collisions or trespassers, incidents over which railroads have little control.”
AAR President and CEO Edward R. Hamberger said the safety figures reflect the commitment by freight railroads to safety of employees and communities they serve. He credited a strong emphasis on safety by freight rail employees, and near-record investment levels by the carriers into maintenance and upgrades of track, equipment and signal systems.
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.
Trespassers account for the largest number of fatalities in the railroad industry – approximately 500 per year. In order to better understand who is trespassing, their locations, and the reasons they are on railroad property, the Federal Railroad Administration (FRA) issued a report using three years of reported trespasser fatalities. Medical examiners and coroners across the country were surveyed, and based on the best information available from those who elected to participate in the study, the average trespasser is most often a 38-year-old Caucasian male under the influence of alcohol and/or drugs, with a median household income of $36,000. More than 25 percent did not graduate from high school, and 18 percent were determined to be suicides. The report, Rail-Trespasser Fatalities: Developing Demographic Profiles, includes a state-by-state breakdown and shows California and Texas recording the highest number of such events. The report strongly recommends additional demographic analysis to reinforce and expand on these results in order to develop targeted educational and outreach programs and law enforcement initiatives to reduce the number of rail trespassing incidents. The report is available at http://www.fra.dot.gov/downloads/safety/tdreport_final.pdf.
Trespasser casualties increased slightly from January through November 2008, when there were 827 trespasser deaths and injuries reported to the FRA. During the same period in 2007 there were 817 reported deaths and injuries. For more information on this check the Federal Railroad Administration website (http://www.fra.dot.gov/).
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.
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Do a little more than you're paid to. Give a little more than you have to. Try a little harder than you want to. Aim a little higher than you think possible, and give a lot of thanks to God for health, family, and friends. Arthur Gordon "Art" Linkletter (born July 17, 1912)
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ACCIDENT REPORTING AND THE SELF-CRITICAL ANALYSIS PRIVILEGE
Editor’s note: Attorney Cameron O’Brien (Setliff Turner & Holland, 4940 Dominion Boulevard, Glen Allen, Virginia 23060
(804) 377-1272, email@example.com) sent RCSI the following email, along with the article below. RCSI considered the email and the article offered value, and afforded both a place in this edition of RCSI’s quarterly newsletter.
The Email: “Steve Setliff in our office tells me that you are always on the lookout for articles for your news letter. We have had some luck in FELA cases preventing plaintiffs from obtaining accident reports under the self critical analysis privilege. It is one of the those double edged swords where you have to investigate an accident but do not want to make a plaintiff’s case in the process. Dan Goldberg (from our Baltimore office) and I have drafted an article on the privilege and thought it might be helpful to your members. Cameron O'Brion”
The Article: “Nobody wants to turn over their secrets to the competition. NFL coaches shield their mouths with their clip boards to prevent opponents from reading their lips during games. Private Wall Street hedge funds, at least what remains of them, decline to share their stock portfolios. Even the “soup Nazi”, of Seinfeld fame, stopped cooking once Elaine divulged his secret recipes. The same principle applies to businesses which closely guard the analysis contained in accident reports from plaintiffs and their attorneys during litigation.
When an accident occurs in a rail yard, companies usually go to work investigating the incident. That investigation generally includes the company’s opinion of the purported cause of the accident and the remedial measures the company feels are necessary to ensure the accident does not occur again. While the analysis in the accident report may be helpful to ongoing safety, the information may come back to bite a company if the accident results in litigation.
Thankfully, some courts will limit the production of accident reports under the “self-critical analysis privilege.” The self-critical analysis privilege was first recognized in Bredice v Doctors Hosp., Inc., 50 F.R.D. 249 (D.D.C. 1970). The Bredice court limited the production of hospital reports, noting that an important public interest is served when hospitals turn a critical eye to their patient care procedures. In other words, we want to encourage hospitals, or any business, to reevaluate procedures to see if conditions can be made safer.
In FELA cases the strong public interest placed upon railroad safety is demonstrated by the fact that the Federal Railroad Administration promulgates rules governing rail travel, and that Congress has passed legislation, such as the Safety Appliance Act, detailing certain minimum requirements for rail cars. Courts recognize that if certain post-accident information exchanged within the company is freely discoverable, some will be less likely to undertake such analysis. The court in Richards v Main Cent. R.R., 21 F.R.D. 590, 592 (D. Me. 1957), recognized the self-critical analysis privilege because “the traveling public and railroad employees, on the score of safety, have such a stake in the orderly administration of employee discipline by the operator of a line of railroad that the courts ought not to impose such an operator hazards which will render unlikely the resort to such discipline.”
Recently, other courts have upheld the self-critical analysis privilege. In a case in the Circuit Court for Frederick County, Maryland, the trial judge ordered that an accident report was the result of an internal investigation and thus partially protected by the privilege. Lerch v. CSX Transportation, Inc., No. C-08-1493 (Frederick Co. Cir., Feb. 25, 2009). The judge limited production of the report to the factual portions. The analysis portion of the report, including the railroad’s opinion as to how the accident occurred, was kept secret. The court recognized that withholding this information from others would serve to “encourage (the railroad) to continue the self-analytical processes when an accident or injury does occur.”
Courts that recognize the self-critical analysis privilege understand that requiring businesses to produce accident reports may make them less likely to conduct future investigations. Getting to the root cause of an accident may ensure the accident does not occur a second time. Although some courts have not yet fully recognized the self-critical analysis privilege, it is still an important tool to protect information contained in accident investigation reports.”
QUOTES FROM HISTORY
CLAIM PAYMENT LOSS CALCULATOR SHOWS BOTTOM LINE IMPACT
What is the true cost of a claim payment to the bottom line? While it is easy to see the premium dollars going out the door annually, and it is easy to see the costs paid within the Self Insured Retention, it is often hard to see the full impact of the cost of a claim. There is a way to calculate that impact to the bottom line. A company developed a calculator to tell you just that. Although the one that is located at the link below was developed for those that handle workers compensation claims it has the same applicability as if it said FELA, and works as well for all claims (crossing accidents, trespasser claims, etc.). This calculator puts these costs in perspective.
Now translate that number and put it into perspective by using an analogy that relates to your operation. For example, for one small claim of $25,000 for a company with a 5% profit margin, it takes $500,000 to replace that one claim on the bottom line. It takes a company with a total of $2 million annual incurred losses with a 5% profit margin $40 million dollars to replace the $2 million on the bottom line, for example.
Tie it to a common metric in the operation of a railroad. For example, a railroad could tie it to the number of car loads moved under revenue. Put it in a slide and mark a big “X” over all the “loads” it takes to pay a claim at your rail operation. No matter what your operation is, it is arguably easier to take charge of your claims payments, and the cost of administering those claims than to generated an additional $1 million in car loads. Obviously we think Railway Claim Services, Inc. is an important part of that process.
Determine your company’s costs for free at: www.ReduceYourWorkersComp.com/calculator.php. And, go to http://corner.advisen.com/wc for more information about Workers’ Comp Tool Kit™ to reduce claims costs. According to the website, the companies that use these tools report average savings of 20% to 50%, and the bottom line impact can be seen immediately. If the links do not open copy and paste it into your internet browser.
SOUTHEASTERN CLAIMS ASSOCIATION 85TH ANNUAL CONFERENCE – JUNE 22-25, 2010
The 2010 conference will be held June 22 - 25, 2010 at the historic Casa Monica Hotel in St. Augustine, Florida. The hotel is offering special rate of $149.00, which is available the weekend before and after the conference for those interested in extending their visit. The reservation deadline is May 21, 2010 and the guaranteed rate is not available beyond that date. The hotel may be contacted via telephone at (800) 648-1888 or at their website, www.casamonica.com.
Casa Monica is located in the heart of St. Augustine. This 1888 landmark was Restored in 1999 and blends past with present. It is the only AAA Four Diamond hotel in the city.
The Southeastern Claims Association presents professional, high quality presentations for the rail and utility industries. This conference remains the choice of many railroad claims professionals annually. All pertinent information is available on the Southeastern Claims Association website: http://southeasternclaims.us. Come and enjoy the conference….and St. Augustine, the nation’s oldest city.
GENERAL CLAIMS CONFERENCE, 32nd ANNUAL MEETING
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
RAILROAD CLAIMS AND LIABILITY SEMINAR, JUNE 23-25, 2010
The 17th Annual Railroad Claims and Liability Seminar will be hosted by , in Indianapolis, Indiana on June 23-25, 2010. A copy of the complete agenda and conference materials are included with this email.
Attendees are invited to start the conference on June 23 by networking at a golf outing, which will be followed back at the hotel by registration and then a cocktail reception at 6:00 pm. The program which includes authoritative and timely topics begins June 24 at 8:15 am and will continue on the 25th.
This seminar is attended by regional and short line railroad staff in accounting, insurance, legal departments, human resources, risk, and claims representatives. Please make plans to attend this important conference.
For information about registration, a registration form for the seminar, or to be a sponsor please contact Jacklyn Hardy at tar at 317-616-3446, or email: Jacklyn.firstname.lastname@example.org
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.
RAILWAY CLAIM SERVICES, INC. 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 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.
POINTS OF LEGAL INTEREST
In my research to find point for this edition of the newsletter, I noticed that I was reading several cases with common themes. Two themes in particular were common; cumulative trauma claims, and toxic exposure claims. There are still many accidents involving horrific injuries, but there do not seem to be enough of these to keep the plaintiff’s bar active. New types of claims are thus created to fill this void. I will forego the usual traumatic injuries in this edition of the newsletter to concentrate on this rising tide of designer claims.
CUMULATIVE TRAUMA – Case # 1: Plaintiff worked as a signalman for the railroad for five years. During his 5th year, he notices numbness and tingling in both hands. He filed suit against his railroad employer asserting that the railroad failed to develop an appropriate ergonomic program to protect employees from the risk of developing carpal tunnel syndrome. The Ohio jury accepted his argument and awarded $459,487.64 to the plaintiff. The railroad appealed and the verdict was upheld by the Ohio Supreme Court.
Case #2: This railroad plaintiff worked in the track department, frequently operating a backhoe. He sued his employer claiming that, over time, the jarring action of the backhoe caused cumulative stress, resulting in a disc injury. The jury found in his favor to the tune of $75,000.
Case #3: This plaintiff trackman asserted that cumulative trauma and repetitive stress resulting in a bulging disc and a rotator cuff injury. The jury returned a verdict in his favor in the amount of $16,000.
COMMENTS: In the 1980’s, when we first began seeing carpal tunnel cases, we tried a few and settled a lot. Many claims people came to the conclusion that an operated carpal tunnel case was worth $15,000, with bilateral at twice that, or $30,000. This worked pretty well for years. I listed the three cases above to illustrate that while some of these cumulative trauma cases are resulting in relatively low verdicts, the price will likely increase. Case #1 is a bilateral carpal tunnel case which would have had a value in the past of about $30,000. The jury gave him about 15 times that amount. The plaintiffs’ bar is becoming educated in the development and prosecution of these claims. You should not take these claims lightly. You should also not assume that your go-to attorney is current with the defenses available for these claims. If your go-to attorney is not a member of the National Association of Railroad Trial Counsel, ask him/her to join. It is well worth the cost.
TOXIC EXPOSURE: Case #1: Plaintiff worked in the carshop, and was regularly exposed to solvents. At age 57, he was diagnosed with solvent-induced brain injury. He filed suit against the railroad claiming that the railroad failed to provide him with a safe place to work. The jury awarded $3 million.
Case #2: This railroad brakeman was exposed to an engine fire. It was immediately extinguished, but plaintiff claimed chemically induced asthma. The California jury returned a verdict of $1.2 Million.
Case #3: This plaintiff conductor claims brain damage caused by a one-time (but long term) exposure to diesel fumes. He claimed that the locomotive malfunction exposed him to the fumes for about 2 hours. Did the jury believe him? Yes, to the tune of $1 Million.
COMMENTS: Toxic exposure presents one of the greatest risks for any railroad. The largest jury verdicts ever handed down were from toxic exposure claims. Never (NEVER) underestimate the risk to which you and your company are exposed if you are on the defense side of a toxic exposure case. Call in the experts early in these cases. Involve your preferred defense counsel at the earliest.
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:
email@example.com or firstname.lastname@example.org
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.