Norfolk Southern fires $4.5 million CEO Alan Shaw for “inappropriate relationship” with company's general counsel, one year after East Palestine train derailment

The company at the center of the East Palestine train derailment has fired its CEO after saying in a statement that its CEO had an inappropriate relationship with the company's general counsel.

Norfolk Southern CEO Alan Shaw was fired for having “a consensual relationship with” Nabanita Nag and may be stripped of the typically generous severance packages CEOs often receive when they leave the company, the company said Wednesday.

On Sunday, it was announced that Shaw was under investigation. His tenure as head of one of the country'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.

In February 2023, dozens of railroad cars derailed and burned for two days in a row, releasing toxic hydrogen chloride and phosgene into the air and waterways. This raised fears that residents of the town of around 5,000 would suffer long-term health problems.

In addition, Norfolk Southern's general counsel was terminated from her positions as executive vice president of corporate affairs, general counsel and corporate secretary, effective immediately.

Norfolk Southern's general counsel Nabanita Nag (pictured) was also fired from her positions as executive vice president of corporate affairs, general counsel and corporate secretary.

Debris from a Norfolk Southern freight train lies scattered and burning along the tracks, February 4, 2023, one day after the derailment in East Palestine, Ohio

In the company's statement announcing his departure, neither Shaw nor Nag were thanked for their services.

Shaw spent 30 years with the company, joining in 1994 as a cost systems analyst before moving up the career ladder.

Nag joined the company in 2020 as general counsel after previously working as a legal expert at prestigious firms such as Shearman & Sterling, Goldman Sachs and Prudential Financial, according to her Linkedin profile.

Last year, Shaw, who earned $4.5 million a year as CEO, had to defend his decision to blow up the derailed train cars.

He told local media that blowing up five railway wagons loaded with vinyl chloride was the “right step” to contain the threat posed by the carcinogenic chemicals. He stressed that the “terrifying” black smoke cloud following the controlled burn was proof that the operation had been successful and had prevented a “far more risky event”.

“I understand why this has attracted so much national attention. We try to work closely with local decision makers on environmental cleanup and get the right information based on data and science.

A video posted online shows a cloud of toxic chemicals covering Pennsylvania after the crash.

The train carrying the hazardous materials was 3 km long

In February 2023, machines stood along the railway tracks while cleanup operations continued

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

Many residents of East Palestine still complain of breathing difficulties, rashes or headaches, or say they feel sick when they return to the village near the Pennsylvania border.

At least several dozen people have not yet returned to their homes out of concern about chemicals that may still be present in the air and water.

Local resident Misti Allison told the Associated Press in February that her 8-year-old son, Blake, had asked if he was going to die from living in her house or if one of the severe nosebleeds he's been having recently would ever stop.

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

“It has actually robbed our children of part of their childhood, and hopefully nothing more than that.”

Experts say it will likely take years and extensive research to understand the health consequences of the derailment, pointing out that it is simply impossible to predict how many cases of cancer or chronic respiratory disease might develop as a result.

Norfolk Southern CEO Alan Shaw made a rare appearance in East Palestine, Ohio last year

On Friday, February 3, 2023, at around 9 p.m., about 50 wagons, including ten carrying hazardous materials, derailed in a fire accident in Eastern Palestine.

Shaw stressed that the black cloud of smoke released after a controlled explosion on February 6, 2023, was proof that it was a success.

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

“We don't have good data on individual chemicals and their effects on humans, and we certainly don't have good data on the combined effects,” said Golomb of the University of California, San Diego.

Over the past year, more than 176,000 tons of contaminated soil and over 44 million gallons of contaminated water have been removed from the area around the derailment. That work was largely completed in October, and now workers will replenish the soil.

Norfolk Southern has promised to invest $25 million to renovate the city's park and another $4.3 million to upgrade the water treatment system – things East Palestine could probably barely afford. The railroad is investing another $20 million to build a regional training center for emergency responders to prepare them to deal with the hazardous materials released during the derailment.

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