Lac-Megantic residents file first class-action lawsuit
Published Monday, July 15, 2013 10:47AM EDT Last Updated Monday, July 15, 2013 5:34PM EDT
LAC-MEGANTIC, Que. -- A motion to file a class-action lawsuit has been registered by two Lac-Megantic residents in the opening shot of what could be a years-long, multimillion-dollar legal battle.
It comes just over a week after a deadly train derailment that has already prompted various investigations including a provincial police criminal probe, and has attracted the interest of legal teams on both sides of the border.
The motion was filed Monday by two men who want to sue the owners of the train that derailed in their town, killing an estimated 50 people.
One of them is Yannick Gagne, who owned the Musi-Cafe bar where many people died in the tragedy; the other is Guy Ouellet, whose partner of five years, Diane Bizier, lost her life in the blaze. Three of Gagne's employees also died in the fire.
Even the lead lawyer on the case was affected by the blast, which destroyed his office.
The defendants are the Montreal, Maine & Atlantic railway; company chairman Edward Burkhardt and president Robert Grindrod; and train operator Tom Harding.
No financial sum was mentioned in the court documents filed in Quebec Superior Court in Sherbrooke, but lawyers predicted the case could involve more than $10 million.
The suit seeks damages for people who lost loved ones, for those who were injured, and for property and business losses.
Lead lawyer Daniel Larochelle, who has lived and practised law in Lac-Megantic for more than 15 years, not only knew many of the victims but also lost his office.
"The suffering endured by this community and the suffering that is still ongoing has been truly incomprehensible," he said in a statement.
"I want this legal action to bring some hope to my community as we start to rebuild."
Larochelle said in an interview from Sherbrooke that it was premature to establish an amount, but that it would probably be "more than $10 million."
Law firms have swiftly lined up to get a piece of potentially lucrative lawsuits.
Barely a week after the tragedy, there's growing competition on both sides of the border to represent the families of those who died in the train accident.
What's less clear is where civil litigation will be most actively pursued.
Lawsuits could be filed in Quebec, where the accident took place. They could also be filed in Maine, at the headquarters of Montreal, Maine & Atlantic Railway; or even in Illinois, where the company's parent company is located.
One Chicago law firm that specializes in transportation disasters says plaintiffs could stand to gain millions by taking the company to court in the United States.
"I think the best way to phrase it is that Illinois does not have limits on wrongful-death damages," said Bradley Cosgrove, a partner at Clifford Law Offices.
In 1999, his firm won a $29-million settlement in Illinois for violinist Rachel Barton, who lost a leg and had the other mangled after she got caught in the door of a moving commuter train.
Cosgrove said the chances for fair compensation are better in his home state rather than Quebec, where settlements are traditionally lower.
Compensation in Maine, meanwhile, is capped at $500,000.
While he hadn't had contact with any Lac-Megantic residents, Cosgrove said his firm had been in touch with a few Quebec lawyers about the possibility of legal action in Illinois.
One member of the team that filed Monday's motion, Jeff Orenstein, says that while amounts may vary, he expects victims of the disaster and their families to get at least $500,000 in compensation.
Orenstein said the legal team might ask to get the hearing on the lawsuit transferred to the courthouse in Lac-Megantic, after the parties appear in a Sherbrooke courtroom on Sept. 16.
He said the request for a class-action suit was only filed in Sherbrooke because the Lac-Megantic courthouse was isolated in the so-called "red zone" disaster perimeter.
He said it's hard to predict how long it might take to settle the lawsuit.
"If the defendants came to the table with significant sums, then perhaps it could be settled at an earlier stage," he said.
"But if that's not the case, it's going to be a battle and that's what we're preparing for."
The motion alleges MMA had a higher accident rate in the U.S. than the national average between 2003 and 2011.
It cites news reports and company statements, and quotes Burkhardt responding last week to a media question about whether he accepts responsibility for the accident.
Burkhardt is quoted responding: "We think we have plenty of responsibility here, whether we accept full responsibility is yet to be determined."
An official with MMA said the company did not have any immediate comment on the suit Monday.
Dimitri Lascaris, a lawyer at Siskinds LLP based in London, Ont., explained he would have been "very surprised" if a class-action lawsuit hadn't been filed by the end of July.
Lascaris said the process is hurried by Quebec's "first-to-file" rule, which stipulates that the first law firm to file a class action usually gets precedence over any other subsequent motions.
Lascaris said filing a lawsuit in the U.S. wouldn't make sense because all the evidence and records were collected in Canada.
He said his firm, which has an office in Montreal, has been weighing the possibility of filing a lawsuit.
Tony Merchant of Regina-based Merchant Law Group LLP said his firm has talked to some residents of the town.
His firm specializes in class-action suits but he said that avenue won't work for everyone. His firm is also mulling over how to proceed.
There's also the possibility of criminal charges.
That could include charges against corporations involved, said Graham Creedy, a University of Ottawa professor specializing in hazardous accidents.
A 2004 amendment to the Criminal Code of Canada means organizations, including big corporations, can face serious penalties for safety violations that result in injuries or death.
The change was made following a public inquiry into the 1992 Plymouth, N.S., coal-mine explosion that killed 26 people, Creedy said.
"If an organization of some size, like a railroad, is successfully prosecuted, and the directors and managers are fined, that would certainly make people sit up and take notice," he said.