By Canadian Press

Lac-Megantic tragedy: Crown says bankrupt railway won’t have to stand trial

Apr 3, 2018 | 10:30 AM

MONTREAL — The bankrupt railway at the centre of the 2013 Lac-Megantic tragedy will not have to stand trial for criminal negligence causing the death of 47 people, Crown officials in Quebec said Tuesday.

After three ex-railway employees facing the same charge were acquitted in January, there was little chance of convicting their former employer, Montreal Maine and Atlantic Railway, said Crown spokesman Robert Benoit.

“The (Crown) was no longer reasonably convinced it could obtain a conviction against the company,” he said in an interview. “This closes the file.”

An unattended MMA-owned train carrying crude oil rolled down an incline before coming off the tracks in Lac-Megantic on July 6, 2013, exploded into a massive ball of fire and consumed much of the downtown core, killing the 47 people.

MMA currently exists as a post-bankruptcy corporate entity with no money of its own and with no physical or operational assets.

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The defunct railway wasn’t even represented by lawyers during the criminal negligence proceedings.

Even if prosecutors had somehow obtained a guilty verdict, Benoit said the next steps would have been unclear.

Before the tragedy, MMA existed as two companies, one based in the United States and the other in Canada. The derailment sparked legal claims against MMA that forced it into bankruptcy proceedings on both sides of the border.

Attorney Robert Keach, the court-appointed trustee overseeing MMA’s bankruptcy proceedings in United States, told The Canadian Press on Tuesday the railroad has no money of its own.

As part of the bankruptcy proceedings in the United States and Canada, several companies tied to the disaster agreed to pay into a fund for victims and creditors of the tragedy, in exchange for legal immunity.

Keach said roughly $500 million was collected and most victims have received compensation. The remaining funds are already claimed by creditors and are being distributed by Keach and a Canadian trustee overseeing MMA’s bankruptcy proceedings in Canada.

Had MMA been convicted in Canada of criminal negligence and ordered to pay a fine, Keach explained, “in all likelihood (Canadian authorities) wouldn’t have gotten any money because most of it is earmarked for other people.”

Any conviction would have been against an entity that exists solely on paper “and doesn’t have any money that isn’t otherwise already claimed,” he said.

In January, a jury acquitted ex-MMA employees Richard Labrie, Tom Harding and Jean Demaitre of criminal negligence causing the death of 47 people.

A month later, MMA and six of its former employees settled with federal prosecutors and were ordered to pay fines totalling $1.25 million, while one ex-railway worker was given a conditional jail term.

As of early that month, the company had paid only $400,000 — an amount set aside during bankruptcy proceedings for the U.S. branch of the company.

A lawyer with the Public Prosecution Service of Canada said at the time the financial status of MMA was “precarious” and that it wasn’t clear how the court would collect the outstanding money.

Meanwhile, Lac-Megantic’s current mayor said in an interview Tuesday she was “stunned” by the Crown’s decision to abandon proceedings against MMA.

“Companies need to be held accountable,” Julie Morin said. “And we need to ensure they follow the rules and that their employees are properly trained.

“All I can say is that the news demonstrates clearly we have to continue fighting to ensure (railway security) laws are reformed so the safety of people is protected.”

— With files from Stephanie Marin

Giuseppe Valiante, The Canadian Press