Norfolk Southern fires $4.5 million-a-year CEO Alan Shaw for ‘inappropriate relationship’ with company’s general counsel a year after East Palestine train derailment

The company at the centre of the train derailment in East Palestine has fired its chief executive, after saying in a statement that he had an inappropriate relationship with the company’s legal director.

Norfolk Southern Chief Executive Alan Shaw has been fired for “maintaining a consensual relationship with” Nabanita Nag, and may be barred from receiving the typically massive exit packages that CEOs typically receive when they are forced to leave, the company said Wednesday.

On Sunday, it was revealed that Shaw, who is married with four children, was under investigation. His tenure as head of one of the nation’s four largest freight railroads for just over two years was marred by scandals, including the detonation of a derailed train in East Palestine, Ohio, carrying toxic chemicals in 2023.

Dozens of train carriages carrying them derailed and burned for two days straight in February 2023, leaking poisonous hydrogen chloride and phosgene into the air and waterways and raising fears that residents of the town of around 5,000 would suffer long-term health problems.

Norfolk Southern’s general counsel has also been terminated from her roles as executive vice president of corporate affairs, general counsel and corporate secretary, effective immediately.

Neither Shaw nor Nag were thanked for their service to the company in the statement announcing their departures.

Shaw had worked at the company for 30 years, joining in 1994 as a cost systems analyst before rising through the ranks.

Meanwhile, Nag had joined in 2020 as general counsel, having spent a career working as a legal expert at prestigious firms such as Shearman & Sterling, Goldman Sachs and Prudential Financial, according to her Linkedin.

Last year, Shaw, who earned $4.5 million a year as chief executive, was forced to defend his decision to blow up the derailed train cars.

He told local media that blowing up five train carriages carrying vinyl chloride was the “right move” to mitigate the threat of the cancer-causing chemicals, insisting that a “terrifying” plume of black smoke after the controlled burn proved it was a success and prevented a “much riskier event”.

‘I understand why this has generated so much national attention. What we’re trying to do is work closely with local leaders on environmental remediation, getting information that’s accurate, based on data and science.

“All the misinformation that’s out there is causing a lot of problems, frankly, for people in this community.”

Many of the East Palestine residents still report breathing problems, rashes or headaches, or say they feel sick every time they return to the village not far from the Pennsylvania border.

At least several dozen people have not returned to their homes, worried about chemicals that may still be in the air and water.

Local resident Misti Allison told the Associated Press in February that her 8-year-old son Blake asked if he would die from living in their home or if one of the severe nosebleeds he began experiencing would ever stop.

“I remember one time he jumped in a puddle, stopped, looked at me and said, ‘Is there vinyl chloride in this puddle? ‘ And that’s so sad,” said Allison, who testified before Congress last spring about the derailment.

“It has really robbed our children of part of their childhood, and hopefully no more than that.”

Experts say it will likely take years and extensive research to understand the health consequences of the derailment. They say it is simply not possible to say yet how many cancers or chronic respiratory diseases might develop in the future.

Dr. Beatrice Golomb said she has already seen people with symptoms similar to health problems military veterans developed after working near toxic pits during the Gulf War, but it is difficult to predict what might develop in eastern Palestine because there is no good research on the chemicals that were spilled.

“We don’t have good data on individual chemicals and their human impact, and we certainly don’t have good data on the combined impact,” said Golomb, who is based at the University of California, San Diego.

More than 176,000 tons of contaminated soil and more than 44 million gallons of contaminated water were removed from the derailment site last year. That work was largely completed in October, and crews are now replacing the soil.

Norfolk Southern has pledged to spend $25 million on refurbishing the town park and another $4.3 million to upgrade its water treatment system — things East Palestine probably couldn’t afford. The railroad is spending another $20 million to build a regional training center for emergency responders to help them prepare to deal with the kind of hazardous materials that spilled in this derailment.

The railroad has also set up a fund to compensate homeowners for any loss in value if they sell their homes and has promised to create funds to help pay for any water contamination or health problems that arise in the future. Details of those funds are still being negotiated with state and federal authorities, who say they are holding Norfolk Southern responsible for the disaster.