A Class Action Filed Against CSX Transportation After N.C. Neighborhood Flooding is Moving Forward

CSX Transportation is facing a class action lawsuit for breach of contract from the neighborhoods south and west of the Lumber River in North Carolina, an area prone to flooding.

In the 1970s a levee was constructed to prevent flooding, but a CSX rail line running parallel with the river made it ineffective.

At a place where part of I-95 had been used in the levee, a rail line runs underneath it, creating a gap that allows floodwaters to funnel directly into the vulnerable neighborhoods during heavy storms and hurricanes. When this problem was discovered, the City of Lumberton entered into a contract with CSX’s predecessor in 1978 allowing them to build a temporary dike or barrier within that gap when conditions for flooding are expected, as long as they give the railway company at least 12 hours of notice. This agreement seemed settled and generally accepted for some time, until October of 2016.

When Hurricane Matthew made landfall in 2016, the city contacted CSX to request access to sandbag the gap.

Per the intent of the 1978 contract, the City of Lumberton notified CSX of their intent to form a temporary sandbag barrier in the gap under the highway, predicting heavy river flooding from the hurricane. However, CSX denied the request, and when the river flooded, the railway gap funneled catastrophic amounts of water into the neighborhoods.

A similar pattern of request for access and denial by the railway company appeared again in 2018 when Hurricane Florence threatened to cause major flooding in the area. In this instance, although CSX originally denied the request, the Governor of North Carolina issued an emergency order enforcing the City’s right to close the gap. However, due to time lost in the dispute, the barrier was hastily constructed and basically ineffective when the floodwaters rose. These floods resulted in the displacement of approximately 1,500 people from their homes for months while repairs from the flood were underway, and cost an estimated $260 million in material damages.

This lawsuit was originally rejected by a lower court until a Court of Appeals approved their claim for breach of contract.

According to the official revised complaint, the district court dismissed their initial claims for being “insufficiently pleaded or preempted by federal law”. However, in their appeal, this class pointed out that dismissal of their breach of contract claim was premature, and that on this matter they had grounds for further litigation. When the suit was originally dismissed, the district court argued that the contractual agreement in question did not specifically name the residents of the neighborhoods in question, so they couldn’t sue for breach of contract.

However, when the parties in this suit appealed that dismissal, they were successful in proving that the contract had intended to directly benefit the people in question, and the 4th Circuit U.S. Court of Appeals finally approved this class action for the affected residents and businesses of Lumberton, North Carolina.

This class action is seeking monetary damages for the class’s flood-related losses as well as an injunction requiring CSX to cooperate in the future.

It’s no secret that floods can be one of the most expensive natural disasters to deal with and recover from, and the neighborhoods of south and west of the Lumber River are no stranger to these expenses. However, if the allegations in this lawsuit are approved, CSX could have prevented a significant portion of those monetary damages from ever occurring. In addition to the flood damage—something that homeowner’s insurance may or may not cover depending on your area—residents were also forced to relocate until the floodwaters had abated and repairs could be made.

If this lawsuit is successful, the residents and businesses included in this class action may receive monetary aid to compensate for these and other related damages. Additionally, current and future residents of this area may benefit from an injunction forcing CSX to cooperate and do their part to protect the neighborhood from further harm.