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Time’s Up for Appeal Bond in East Palestine Derailment Settlement

The proverbial clock has struck midnight on five residents appealing last year’s $600 million settlement between Norfolk Southern and members of the public who resided within 20 miles of the 2023 train derailment and chemical spill, as a motion to allow more time to obtain a reduction or an outright elimination of a required $850,000 bond was denied Saturday.

Federal Judge Benita Perason, who both granted final approval of the settlement in Youngstown’s District Court and who ordered the appeal bond on Jan. 16, rejected a request by the appellants’ attorney, David Graham, to expand the deadline window to appeal the bond.

Graham’s already filed a motion asking the Sixth Circuit Court of Appeals in Cincinnati to reduce or eliminate the bond, but did so on March 21 — one day after the deadline.

Also on March 21, Graham filed a motion in Youngstown District Court, asking for seven more days, but Pearson’s ruling on Saturday made clear Rules of Appellate Procedure — specifically Rule 4 — weren’t followed and the same rule does not allow for any additional time.

Ultimately, Graham argued on the grounds of a clerical error when filing what was submitted as a stay of the appeal bond. The Sixth Circuit Court denied the motion due to a “lack of jurisdiction” and on the grounds that court rules mandated that the bond would have to be appealed separately. That decision was rendered on March 21, inadvertently but effectively preventing further action from the appealing residents.

The appellants did not ask for a review of reduction in the appeal bond but rather a stay of Pearson’s order on Jan. 19. Graham admitted mistakenly submitting the motion as a stay by accidentally choosing the wrong dropdown box on PACER’s (the software used to file motions electronically) “menu of limited options.”

That error left the Sixth Circuit’s panel with no choice but to rule on the motion as a stay.

The inability to post an appeal bond does not mean the appeal process stops, but means the distribution of money from a judgment or settlement can continue while the process plays out. In this case, payments of up to $70,000 per household were paused while the appeal bond was argued.

If an appeal bond is not paid, payments are distributed and if the appeal is eventually overturned, the burden of recovering paid funds falls on those who appealed.

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