Iron Horse Update for July 2011- 32 Killed in China High Speed Rail Collision; Zephyrs & Iron Horses Gather in Quad Cities, CSX vs Trial Lawyers

ILLINOIS: Rock Island's Train Festival 2011 is in the books and organizers say the four-day event drew more than 40,000 people to the Quad Cities, translating to millions of dollars put into the local economy.

"For each individual that comes in, they spend 200–300 dollars a day in restaurants, hotels, and entertainment. That's spent after they leave the festival," Nelson said, "this is good clean economic industry. They bring in their money and then they leave."

Folks from at least 46 states and 14 foreign countries are checking out the locomotives

Among the featured locomotives at the 2011 event were Nickel Plate 2-8-4 Berkshire #765 and Iowa Interstate's two Chinese made 'QJ' class 2-10-2 steam locomotives.

Photo- Tom McNair

The Nickel Plate #765 travelled from Logansport, IN to and from the Quad Cities over a Norfolk Southern/Toledo Peoria & Western/Iowa Interstate routing and powered eastbound excursions to Rock Island and Bureau IL and back and westbound excursions over the Government Bridge and west to Walcott, IA along with IAIS QJ 2-10-2 #6988.

Photo- PeytonG

Although Santa Fe 3751 wasn't able to make it out from California this year, the Illinois Railway Museum in Union, IL managed to step up and send their Nebraska Zephyr trainset that they purchased from the Chicago, Burlington & Quincy in 1968. Although operational, this is the first time the Nebraska Zephyr trainset has ventured out from the Illinois Railway Museum under it's own power in more than 43 years.

Curiously, with Nickel Plate #765 being made by Lima Locomotive Works in 1944 and the Iowa Interstate's Chinese QJ steam engines fabricated by the Datong Locomotive Factory in 1986, the 1936-made Nebraska Zephyr trainset featured the oldest motive power hauling excursions at Train Fest 2011. According to the Illinois Railway Museum, CB&Q E5(A) #9911A is also the last surviving locomotive of its kind. On Sunday July 24, the Zephy trainset powered an excursion from Rock Island to Bureau, IL and back over the Iowa Interstate's former Rock Island Chicago-Council Bluffs, IA line.

The Nebraska Zephyr travelled on Canadian Pacific's former Iowa, Chicgao & Eastern (ex I&M Rail Link exx Soo Line nee Milwaukee Road) Chicago line before crossing the Mississippi RIver and turning south towards the Quad Cities at Subula, IA and heading south on the ex-Milwaukee Road line (now CP Rail) to Davenport. Also along for the ride were the museum's CB&Q EMD SW7 #9255 and Chicago & North Western F7A #411.

Other attractions at the 2011 Train Festival included Flagg Coal 0-4-0 #75, Lehigh Valley Coal 0-6-0 #126, Viscose 0-4-4 #6 and replica Central Pacific 4-4-0 #63 (aka Leviathan).

Nor date or venue has been announced for Train Festival 2012 yet. With the combination of the state's centennial and ongoing restoration work towards Santa Fe 4-8-4 #2926, I wouldn't be shocked to learn if the event moved out west to the Land of Enchantment. But then again, it's also Arizona's centennial and the Grand Canyon Railway already has established a history of running steam-powered excursions. Then again, that's just idle speculation on my part.

photo- Kevin Burkholder

PROVIDENCE & WORCESTER: Providence & Worcester [NASDAQ: PWX] is reportedly leasing a trio of former Oakway Leasing SD60s from GATX [NYSE: GMT]. GMTX SD60s #9014 and #9059 were spotted transiting via the New England Central in White River Jct, VT on July 25 (above) destined for the P&W. Reportedly the cab signal equipment that Amtrak requires to operate on the Northeast Corridor were scavenged from the P&W's two GE Super 7s. According to Kevin Burkholder, the cabs and rooflines have been modified for the six-axle leasers to operate under the catenary on the NEC in Rhode Island as well as between New Haven CT and Queens, NY.

The 6-axle EMD leasers represent a departure for the P&W, who have demonstrated an affinity for burly, 4-axle GE products purchased secondhand from the New York, Susquehanna & Western, BNSF or CSX. It is thought that the blue & white EMD's will be powering the stone trains from the Tilcon Stone quarry in North Branford, CT to the New York & Atlantic interchange in Queens, although some have expressed doubts that Metro-North (the commuter agency that operated the NEC between Penn Station and Connecticut) is reluctant to allow 6-axle units on their rails.

The SD60s were leased to the Burlington Northern in 1986 through Oakway, Inc- a subsidiary of Corrnell Rice & Sugar- in a first of it's kind "Power by the hour" arrangement in which BN purchased nothing more than the electrical output from the fleet of SD60s and leased on a kilowatt hour basis.

Xinhua photo

CHINA: At least 35 people were killed and nearly 200 injured when two high speed trains collided in the eastern province of Zhejiang on July 23rd.

The first train was traveling south from the Zhejiang provincial capital of Hangzhou when it lost power in the lightning strike and was hit from behind by the second train in Wenzhou city at 8:27 p.m. (1230 GMT) Saturday, the official Xinhua News Agency said. The second train had left Beijing and both trains were destined for Fuzhou in eastern Fujian province.

The Ministry of Railways said in a statement that the first four carriages of the moving train and the last two carriages of the stalled train derailed.

Begun in earnest in 2007, China's high speed rail projects were hailed by many as an example America should follow if it were to remain competitive on the world stage. However, in recent months, allegations of graft, kickbacks and corruption have resulted in many senior level officials in China's Railway Ministry being forced to resign, including Railways Minister Liu Zhujin.

Domestic media coverage of the crash has been uncharechteristicaly critical, with Party censors ordering reporters to discontinue their probe into the crash and focus on 'touching stories'. Comments questioning the official version of events or sharply critical of the Communist Party's handling of the aftermath are appearing on Chinese microblogging sites like Weibo, often faster than government censors can delete the offending comments.

CSX: Nearly a decade after paying out in asbestos-related lawsuit settlement, CSX [NYSE: CSX] is suing Pittsburgh-area trial law firm of Robert Pierce & Associates alleging fraud and racketeering in pursuit of claimants and settlements.

CSX's lawsuit against the Peirce firm is rooted in the last days of the mass asbestos lawsuits, when plaintiffs' firms routinely rounded up hundreds or thousands of people who had been exposed to the cancer-causing flame retardant, and brought gargantuan claims against manufacturers and employers.

CSX alleged that in 1999, an employee named Danny Jayne went to an asbestosis screening set up by the Peirce firm or its affiliates. A doctor found abnormalities on his x-ray, and in 2002, the company agreed to settle his claim for $7,000.

Meanwhile, the company alleged, another CSX employee named Ricky May was screened and tested negative for asbestosis.

But at a subsequent screening in 2000, a contractor working for the Peirce firm helped arrange for Mr. Jayne to pretend to be Mr. May, CSX claimed. That resulting x-ray was used by the firm to justify a claim on behalf of Mr. May, which CSX settled for $8,000.

CSX said the law firm took advantage of an expedited court system that didn't allow for scrutiny of individual cases and pursued the cases with fraud and negligence. The Peirce firm didn't deny that Mr. May and Mr. Jayne had pulled a fast one, but argued that they had acted without the lawyers' knowledge or encouragement.

In August 2009, a federal jury in West Virginia found that the Peirce firm and its contractor weren't liable for fraud. That, however, didn't end the matter.

CSX has since pursued a broader theory, outlined in detail for the first time in a July 14 court filing: that the Peirce firm pursued "a calculated and deliberate strategy" of "unlawful conduct, including bribery, fraud, conspiracy and racketeering."

CSX said the firm used "intentionally unreliable mass screenings" by a radiologist who had a criminal history and a doctor who has been accused of tailoring diagnoses to fit lawsuits.

The company pointed to 11 cases in which Peirce-paid professionals found no signs of asbestosis in an employee, then later screened the employee again and found the disease. It settled just one of the cases, for $25,000.

CSX is going after the Peirce firm using the civil provisions of the 40-year-old Racketeering Influenced and Corrupt Organizations, or RICO, statute. RICO is a law more often used by law enforcement to prosecute organized crime.

The firm "repeatedly used or caused their agents to use the mails and wires," CSX said in a July 14 court filing, characterizing the communications as "mail fraud" and "wire fraud."

Neither CSX nor the Peirce firm would discuss details of the case, now before Senior District Judge Frederick P. Stamp Jr.

Legal experts are hard pressed to think of another case where a corporation on the recieving end of mass litigation retaliated by invoking RICO against trial lawyers. Even if CSX falls short in their attempt to being RCO charges against Pierce & Associates.

According to Attorney Mark Behrens of the Washington, D.C., defense firm Shook Hardy & Bacon CSX would be the third company in recent years to take such action against a law firm. The two other companies won their respective suits- interestingly, one of them was another railroad. In 2010, a judge and jury ruled that MacComb, MS based lawyer and former Democratic state senator William Guy pay the Illinois Central Railroad $420,000 in damages after representing plaintiffs thay they knew had been awarded a settlement from an earlier suit.

photo- Ray Peacock

ARKANSAS & MISSOURI: As part of its ongoing 25th anniversary celebration, the all-ALCo Northwestern Arkansas shortline Arkansas & Missouri continues to operate a slew of excursions between Springdale and Fayetteville, AR.

This includes an August 14 run between Springdale and Winslow, AR that will be a fundraiser to help in the ongoing efforts in rebuilding Joplin, MO after May's deadly F5 tornado tore through the city center. Riders are also invited to bring paintbrushes, theater makeup and fabric to help the East Middle School's art and theater department after the tornado levelled the school.

ALABAMA: Rail America [NYSE- RA] announced in April that it would be acquiring the Gulf & Ohio's three disconnected Alabama shortlines, the 15-mile Conecuh Valley Railroad, the 36-mile Three Notch Railroad and the 20-mile Wiregrass Central.

The acquisitions by Rail America come a few months after the Gulf & Ohio acquired the previously independent Lancaster & Chester in North Carolina. That deal was finalized in November 2010.

Photo Matt Adams

PATRIOT RAIL: Boca Raton, FL-based Patriot Rail announced their aquisition of six railroads formerly operated by the Weyerhaeuser company [NYSE- WY] was finalized this year.

• the DeQueen and Eastern Railroad (DQE) operates over 50 miles in southwest Arkansas;
• the Texas, Oklahoma & Eastern Railroad (TOE) operates over 41 miles in southeast Oklahoma and connects directly with the DQE at the Oklahoma/Arkansas border;
• the Columbia & Cowlitz Railway (CLC) operates over 14 route miles in southwest Washington;
• the Patriot Woods Railroad (PAW) operates over 23 route miles in southwest Washington and connects directly to the CLC;
• the Golden Triangle Railroad (GTRA) operates over 9.5 route miles in central Mississippi; and
• the Mississippi & Skuna Valley Railroad (MSV) owns 22 route miles in Mississippi.

This brings the total number of railroads owned and operated by Patriot Rail to 13 (although under Weyerhauser, there was little if any distinction between the Texas, Oklahoma & Eastern and DeQueen Easter and the Columbia & Cowlitz and Weyerhauser Company Forestry railroad). In the above photo, a quartet of Weyerhauser Woods SW1500s is seen crossing a trestle in Ostrander, WA just north of Longview, WA in March 2006.