YOUNGSTOWN The long-awaited distribution of payments from the $600 million East Palestine train derailment settlement has crossed another legal hurdle.

The $600 million class-action settlement intended to compensate victims of the derailment moved closer to distribution after a federal appeals court dismissed two challenges this week. However, the settlement continues to face a different legal effort in the trial court from a group of residents attempting to void the entire deal.

The Sixth Circuit U.S. Court of Appeals on Wednesday threw out two separate appeals filed by a group of residents and businesses who objected to the settlement with Norfolk Southern Railway Company following the February 2023 derailment.

One appeal was dismissed because the court lacked the authority to hear it, as the request for an extension to file was a single day late. The second appeal, which challenged the final settlement agreement itself, was dismissed because the objectors failed to pay an $850,000 bond that the court required to allow the appeal to go forward.

Judges noted that these appeals had been delaying the release of funds to the approximately 55,000 people and businesses who filed claims.

With the appeals now dismissed, U.S. District Judge Benita Pearson, who oversaw the initial case, has scheduled a telephone conference for Thursday, November 13, at noon, to discuss the next steps for distributing the money.

Even as the appeals were dismissed, the settlement is still being challenged by a different group of affected residents. The pending motions ask the judge to reject the final settlement agreement, which was approved more than a year ago.

The motions claim that the settlement should be nullified because of allegations that both Norfolk Southern and the attorneys who represented the victims hid important information about long-term health risks and contamination levels in the area. The residents argue that this alleged misconduct led them to sign away their personal injury claims for payments that were too low.

Attorneys representing Norfolk Southern and most of the settlement class have formally asked Judge Pearson to deny the challenges. They argue in court filings that the new motions are based on claims about environmental harm and exposure that were already discussed and overruled before the settlement was finalized.

Norfolk Southern argued that the residents who now want to leave the settlement are simply trying for a second chance to object after the agreement was already approved.

Class members had a choice of participating in the Personal Injury Payment component of the Settlement. They were not required to release their Personal Injury Claims, and it was up to an individual to decide whether to take part. Those participating released their personal injury claims.

The overall settlement provides $600 million from Norfolk Southern to those impacted by the derailment. The court previously noted that a small percentage of eligible households and businesses chose to opt out of the settlement, showing that most people supported the agreement.

The upcoming conference with Judge Pearson is expected to address how the dismissal of the appeals clears the way for payments, but it will also likely address the path forward for the ongoing challenges to the settlement’s legitimacy.