WHITE PLAINS, N.Y. (Legal Newsline) - Labaton Sucharow wants to lead class action litigation against Norfolk Southern on behalf of investors who feel misled about safety issues.
The firm filed a motion for its clients to be appointed lead counsel, about six weeks after filing the initial complaint. The plaintiffs are Ohio Carpenters Pension Fund and City of Pontiac Reestablished General Employees' Retirement System.
The two pension funds lost $239,804 from the senior notes they purchased when their value dropped following a derailment in East Palestine, Ohio.
The plaintiffs allege Norfolk failed to disclose material safety risks for its "Precision Scheduled Railroad (PSR)," which the company adopted in 2019 to increase revenues and decrease costs through operational changes.
The plaintiffs further allege Norfolk's PSR included reducing staff, tighter schedules and longer trains with heavier packed cargo.
They claim the company's "offering materials" referred to in its SEC 2020 Exchange Offer and Registration Statement were false and misleading and touted Norfolk's safety and environmental protections while failing to disclose its PSR strategy led to increased train derailments and undermined worker safety by spending less on safety training, technology and equipment.
No other firm has moved to be made lead counsel, according to the docket in the case.
"Labaton Sucharow has excelled as Lead Counsel in numerous landmark securities class actions on behalf of defrauded investors," its motion says.