CSX resolves lawsuit against two asbestos attorneys, radiologist

CSX Transportation late last week announced it resolved the final stages of a racketeering and fraud lawsuit against two asbestos attorneys and a radiologist. As part of the settlement, a West Virginia jury's verdict stands and CSX will receive $7.3 million to satisfy a September 2013 court judgment entered against the lawyers and doctor regarding disputed motions for attorney fees and costs.

In July 2007, CSX filed civil and fraud claims alleging that the defendants conspired to manufacture and litigate fraudulent asbestos claims against the railroad. In December 2012, a jury awarded CSX about $429,000 in damages, an amount that later was tripled to $1.3 million by the judge as required by a federal racketeering statute. The damages and legal fees totaled $7.3 million.

"The jury and the judges … acknowledged that fraud in injury claims degrades the U.S. system and makes it harder for truly injured persons to be treated fairly," said Ellen Fitzsimmons, CSX's executive vice president of law and public affairs, in a press release. "These funds will be donated to the CSX Foundation, where they will be dedicated to philanthropic efforts serving CSX's communities."

The CSX Foundation supports Beyond our Rails, a shared program between CSX and its employees that seeks to advance safety, wellness, environmental and community-based initiatives.

CSX deserves a great deal of credit for "turning the tables" on the fraudulent asbestos litigation perpetrators in the Racketeer Influenced and Corrupt Organizations Act (RICO) case, said Sherman Joyce, president of the American Tort Reform Association.

"This successful RICO litigation now serves as a model for other corporate defendants that have been plagued by such fraud for decades," he said.