NS accuses crosstie supplier of fraud

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BIRMINGHAM, Ala. — Just because a tie looks black, it doesn't mean it's been properly preserved for railroad use. It's something Norfolk Southern officials discovered, and they are now accusing a Birmingham, Ala., tie supplier of fraud and conspiracy to pass off improperly treated ties that have begun deteriorating on the railroad's rights-of-way.

In a complaint filed Oct. 23 with the U.S. District Court in Birmingham, the railroad alleges that Boatright Railroad Products sold some 4.75 million defective rail, switch and bridge ties between 2009 and 2014. NS alleges that Boatright used improper wood, improperly dried wood, and improperly treated it with substances to make them look like they had been treated with creosote.

Norfolk Southern also alleges that Boatright paid a former NS track inspector, working as a consultant, some $128,000 to certify that the ties had been treated to meet the railroad's standards.

NS is seeking $50 million in damages, an amount that could triple if it proves that Boatright was engaged in a civil conspiracy under the Racketeer Influenced and Corrupt Organizations Act.

The railroad's complaint says that Boatright principals Shane Boatright and John Bookout told employees to “simply 'make them black' by whatever means necessary — so as to mimic the appearance of having been properly treated in accordance with the NS specifications.”

Norfolk Southern alleges that Boatright coated ties with motor oil, anti-freeze, paint, and a chemical compound “which, when applied to a rail tie, would mimic the appearance of a properly-treated tie at a dramatic cost savings.”

Boatright sold its tie-treating facility to another company in 2014, according to the complaint. In June 2016 former Boatright employees tipped off NS about the alleged fraud. NS began an investigation “and discovered thousands of such railroad ties were degrading at a much faster pace than expected.”

Properly treated hardwood ties may sell between $15 and $35 a piece, according to the Railway Tie Association, depending upon quality, size, and demand. Treated ties may last as many as 30 years before being replaced helping spike or clips hold track gauge while also distributing a train's weight through the ballast and roadbed.

Court records say Boatright had not filed its response to the charges as of Oct. 30.
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