Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Norfolk Southern Corporation (NSC)
NEW YORK, March 22, 2023 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Southern District of Ohio on behalf of all persons or entities who purchased the securities of Norfolk Southern Corporation ("Norfolk Southern" or the "Company") (NYSE: NSC) between October 28, 2020 and March 3, 2023, both dates inclusive (the "Class Period").
The Complaint alleges that Defendants made materially false and misleading statements throughout the Class Period. Specifically, Plaintiff alleges that Defendants failed to disclose, among other things: (a) that Norfolk Southern's Precision Scheduled Railroading ("PSR)", including its use of longer, heavier trains staffed by fewer personnel, had led to the Company suffering increased train derailments and a materially increased risk of future derailments; (b) that Norfolk Southern's PSR, including its use of longer, heavier trains staffed by fewer personnel, was part of a culture of increased risk-taking at the expense of reasonable safety precautions due to the Company's near-term focus solely on profits; and (c) that Norfolk Southern's PSR, including its use of longer, heavier trains staffed by fewer personnel, rendered the Company more vulnerable to train derailments and train derailments with potentially more severe human, financial, legal, and environmental consequences.
On February 21, 2023, the EPA issued a unilateral administrative order requiring Norfolk Southern to pay for all cleanup actions at the site. EPA Administrator Michael Regan said at a press conference that day in East Palestine that the agency was using its power under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") to force the Company to act. "Norfolk Southern will pay for cleaning up the mess that they created and for the trauma that they've inflicted on this community," Regan said. "If the company fails to complete any actions as ordered by EPA, the Agency will immediately step in, conduct the necessary work, and then force Norfolk Southern to pay triple the cost."
According to the National Transportation Safety Board, the wheel bearing passed three hot bearing detectors prior to the derailment, with the temperature increasing each time. However, the hot bearing detectors would not have notified the crew to stop and inspect the wheel bearing until it recorded a temperature 170 degrees or higher, per Norfolk Southern rules. "It wasn't until it was 253 degrees Fahrenheit above ambient temperature that [the crew] got a notification that they needed to immediately stop and inspect the hot axle and possibly set out the car."
Before the market opened on March 6, 2023, the Company announced a 6-part plan to improve operational safety that included, inter alia, adding about 200 temperature sensors along its tracks where existing sensors are at least 15 miles apart, reviewing the temperature levels that set off alarms for train crews, and adding more acoustic sensors that analyze vibrations for potential problems.
On this news, the price of Northern Southern common stock declined $5.97 per share to close at $222.42 per share on March 6, 2023.
Investors who purchased or otherwise acquired shares of Norfolk Southern should contact the Firm prior to the May 15, 2023 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.
Please visit our website at http://www.gme-law.com for more information about the firm.
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