Background

U. S. Borax sued BNSF for the cost of remediation at a pesticide formulation facility in Kansas City, Missouri. They alleged that BNSF had contributed to the contamination while delivering raw materials to the facility. Several years later, U.S. Borax also sued the insurance company to recover claim costs to pay for remediation at both the Kansas City site and a plant in Minnesota.

Approach

BNSF delivery procedures and site operating practices were evaluated to determine the potential for BNSF to have contributed to the contamination. These evaluations were later used to assess if the claims were covered by the insurance that U.S. Borax had at its two facilities.

 

Results

Railroad policies required the train engineer to pull the car into the facility, spot the car where told and leave all unloading to the facility. As a result, BNSF did not create any of the contamination. Site data showed that the majority of contamination at the site was in areas other than the rail siding. This resulted in a very favorable settlement for BNSF which was less than the cost to continue litigation. The same process and site data were used to evaluate whether the contamination was a result of activities covered by their insurance or incidents not covered. We were able to show that the contamination was a result of activities not covered by the policy, and the case was settled at minimal expense to the insurance companies.