American Cyanamid Company, a chemical manufacturer, loaded 20,000 gallons of liquid acrylonitrile into a leased railroad tank car at its plant in Louisiana on January 2, 1979. The following day, a Missouri Pacific Railroad train picked up the car for transport to a Cyanamid plant in New Jersey. The car arrived at the Blue Island railroad yard operated by Indiana Harbor Belt Railroad Company, a switching line in the Chicago metropolitan area, on the morning of January 9, 1979.
Several hours after arrival, employees noticed fluid gushing from the bottom outlet of the car due to a broken lid. After two hours, the leak was stopped, but approximately 5,000 gallons of acrylonitrile had spilled. Local authorities evacuated nearby homes for a few hours. The Illinois Department of Environmental Protection ordered decontamination measures that cost the switching line $981,022.75.
Indiana Harbor Belt Railroad filed a two-count complaint against American Cyanamid in federal district court. One count alleged negligence in maintaining the tank car. The other count alleged strict liability for engaging in an abnormally dangerous activity by shipping the chemical through a metropolitan area. The district court granted summary judgment to the plaintiff on the strict liability count for $981,022.75. The court later dismissed the negligence count with prejudice to permit an appeal.
The case reached the United States Court of Appeals for the Seventh Circuit after an initial appeal was dismissed for lack of finality under Federal Rule of Civil Procedure 54(b). The district judge then dismissed the negligence claim to create a final judgment. The switching line cross-appealed the dismissal of the negligence count.
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