Newspaper article The Canadian Press

Financial Noose Tightens around U.S. Firms at Centre of Quebec Rail Disaster

Newspaper article The Canadian Press

Financial Noose Tightens around U.S. Firms at Centre of Quebec Rail Disaster

Article excerpt

Quebec issues legal threat over rail cleanup

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The financial noose tightened Monday around companies connected to the deadly Quebec derailment, with a hint that the Montreal, Maine & Atlantic Railway could close shop.

The Quebec government issued a lawyer's letter demanding that the railway involved in the Lac-Megantic crash and two petroleum-logistics companies foot the entire bill to clean up the environmental mess, the latest in a series of legal threats since the disaster.

This was after the railway chairman had already told a Maine newspaper that he was considering whether the embattled MMA could survive.

The July 6 disaster, which killed an estimated 47 people, also released 5.7 million litres of crude oil into the air, soil and water, including about 100,000 litres that gushed into the nearby Chaudiere River.

"It's perhaps the worst environmental catastrophe that Quebec has seen," Environment Minister Yves-Francois Blanchet told a news conference in Lac-Megantic.

"There are still no words to describe what we feel, what we have experienced here."

The companies named in the lawyer's letter are Montreal, Maine & Atlantic Railway, and World Fuel Services Corp. and its subsidiary, Western Petroleum Company.

For all three, the legal troubles tied to the disaster are piling up.

Each of the firms are already facing several wrongful-death lawsuits in the U.S., with both the embattled MMA and World Fuel Services also named in a proposed class-action suit.

The U.S. lawyer who filed the wrongful-death suits has said he expects to ask for millions of dollars in damages for each of his clients. The total number of plaintiffs, he predicted, could eventually reach 20.

Last week, the town of Lac-Megantic sent MMA a legal notice calling on it to reimburse the municipality $4 million after the company allegedly failed in its duty to pay cleanup workers.

The municipality and the province picked up the tab when crews hired by the railway threatened to walk off the job if they weren't paid.

They are now seeking a refund from the railway.

The Maine-based railway missed last week's deadline, and the town has said it's now speaking with lawyers to evaluate a possible lawsuit. The railway, meanwhile, asked the town to wait until Tuesday for its response to the legal notice.

MMA board member Yves Bourdon has said the municipality shouldn't have been stuck with the bill. When asked recently whether it was normal that Lac-Megantic should have to pay, he replied: "It should be our insurance."

Blanchet insisted Monday "it is out of the question" that Quebec taxpayers should be on the hook for the massive environmental mop-up and rehabilitation.

The work still doesn't have an estimated overall price tag.

The environment minister said the province would have several possible legal options if the companies refuse to pay up, but he declined to discuss them. …

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