POLITICS

Judge OKs Lac-Megantic lawsuit against World Fuel Services and Canadian Pacific

05/08/2015 05:46 EDT | Updated 05/08/2016 05:59 EDT
SHERBROOKE, Que. - A Quebec Superior Court justice has authorized a class-action lawsuit almost two years after a train derailment and explosion killed 47 people in Lac-Megantic, Que.

But in his 30-page ruling, Justice Martin Bureau has given the plaintiffs permission to go after only two companies — World Fuel Services and Canadian Pacific Railway Ltd.

The lawsuit alleges that CPR (TSX:CPR) was negligent and there was a lack of prudence in all circumstances leading up to the tragedy.

The exact amount being sought will be determined at a later date.

Initially, the legal action targeted 37 different parties, including Irving Oil Ltd., the now-bankrupt Montreal Maine and Atlantic Railway and its former president, Edward Burkhardt.

But in the weeks following the tragedy in July 2013, some of the parties sought protection from creditors and also filed a request to have the lawsuit suspended.

That suspension is still in effect and means they couldn't take part in the lawsuit hearings.

Bureau noted that the parties are also working out arrangements with creditors and the victims.

In authorizing the class-action lawsuit, the judge listed 12 issues that will be dealt with when it is finally heard, including whether World Fuel and CPR knew that the fuel being transported was poorly identified.

The lawsuit was filed by three-Lac Megantic residents — Guy Ouellet, Serge Jacques and Louis-Serge Parent — on behalf of all the victims.

In January, victims of the rail disaster reached a major financial settlement with Montreal, Maine and Atlantic Canada Co.

A U.S. lawyer who worked on the wrongful-death lawsuits said $200 million will be distributed in settlement funds to families of those who died as well as other parties involved in the legal battle.

The settlement involves Montreal Maine and Atlantic Canada Co., its insurance carrier, rail-car manufacturers and some oil producers.

A runaway train hauling tanker cars loaded with volatile crude oil broke loose and barrelled into the town of 6,000 in the early morning hours of July 6, 2013, before derailing and exploding.

It set off several massive blasts and wiped out a big part of the downtown core.

Three railway employees have each been charged with 47 counts of criminal negligence causing death.

Their trial date is to be set Sept. 8.