Amtrak Payout Cap to Be Tested for First Time in 20 Years

Posted on Wednesday, May 27, 2015

On May 12, 2015, eight passengers were killed and over 200 were injured when an Amtrak train bound for New York City derailed in north Philadelphia. Investigators at the National Transportation Safety Board remain baffled as to why the train was even accelerating, since it was about to enter a 50 mph zone. However, in the final 65 seconds before the fatal crash, the train accelerated from a speed of 70 mph to a top speed of 106 mph before it disastrously derailed at a sharp curve.

Even though a definitive cause for the accident has not been established, as of this writing, Amtrak’s President and CEO Joseph Boardman has announced that the publicly funded railroad service assumes full responsibility for the tragedy. It will likely be some months before NTSB investigators announce the official cause. However, human error, negligence or other operational malfunctions are the likeliest culprits for the deadly derailment, which exposes Amtrak to significant wrongful death and personal injury claims, among others.

Plaintiffs from Philadelphia, New York, New Jersey, Sweden and Spain, among others, have already filed an initial wave of lawsuits in what is expected to be a long and costly litigation. It is currently expected that Amtrak’s total liability and payouts will exceed the $200 million cap established by Congress 20 years ago. At the time, the cap was a legislative strategy to rescue the railroad service from complete financial collapse. Today, Amtrak employs over 20,000 workers servicing over 31 million passengers a year while generating nearly $3 billion in annual revenues. Since the Congressional cap on compensatory damages was put in place 20 years ago, Amtrak has never had an incident that threatened to break the cap until now.

Every once in a while, a major train accident like this one occurs and captures national media attention. In this case, there are unexplained circumstances that caused the fatal wreck claiming eight human lives while injuring more than 200 others. Big news with big expensive litigation and big settlements will always grab the headlines.

However, this is only one of more than 500 train accidents that occur in the U.S. alone each year that claim over 100 lives while injuring another 1,300-1,500. Current statistics on accidents by state show that Illinois and Texas are consistently at the top of the list, with Indiana, California and Pennsylvania rounding out the top five. Together they account for approximately 39% of total U.S train accidents, excluding highway-rail crossing accidents.

These numbers indicate that a train accident or two occurs every day in the U.S., including one every week or two in Texas alone. Each accident includes property and infrastructure damages, as well as likely human injuries and/or fatalities. If you or someone you know becomes an injured party in one of these accidents, the unexpected costs in damages and expenses can be devastating. In litigation terms, there is a range of complex legal issues to contend with and without an expert lawyer to advocate on your behalf, you could settle for far less than what you are entitled to in compensatory damages. Where wrongful death or unexpected accidental injury due to third party negligence are concerned, it is prudent and highly recommended to have qualified, expert legal counsel advocating for your interests.

This entry was posted in .