BNSF Knew Railcars Were Leaking Asbestos. They Cleaned Nothing.

EvilCorporations.com
Series: Sacrifice Zones: How Corporate Law Turns American Towns Into Acceptable Losses
Investigative Report  |  Libby, Montana  |  Case No. 24-4802

The Railroad That Poisoned Libby And Got Away With It

68 Years of Poison: The Libby Chronology

This story does not begin with a courtroom. It begins with a mine outside a small Montana logging town, a railroad with a federal obligation, and decades of institutional silence.

1922

BNSF Railway begins federally mandated transportation of vermiculite concentrate from the Libby mine to its railyard and onward to destinations across the United States. Federal law requires BNSF to haul any cargo upon request. 49 U.S.C. § 11101(a).

1963

W.R. Grace & Company takes over mining operations at the Libby site, the world’s largest vermiculite mine. Raw ore extracted here contains up to 26% asbestos. Tailings, the waste material left after processing, can contain up to 80% asbestos.

1974

The Montana Department of Environmental Quality reports that asbestos is removed during the processing of raw ore into vermiculite concentrate. This claim is later shown to be false. Bills of lading on railcars certify the cargo isn’t hazardous.

1977

Evidence at trial shows W.R. Grace began posting warning placards on at least some railcars stating the vermiculite inside contained asbestos. BNSF continued hauling the cargo. The town of Libby was not warned.

1978

Thomas Wells lives in a trailer home directly abutting BNSF’s railyard during his Forest Service work assignment. Joyce Walder resides in Libby during this period, frequenting the railyard area, local sports fields, and the city pool, all contaminated with asbestos dust.

1990

W.R. Grace stops mining operations. BNSF ends vermiculite transport. By this point, asbestos dust has contaminated the downtown railyard, the surrounding residential area, a local baseball field, and the general environment of Libby for 68 continuous years.

2000

The EPA begins its emergency Superfund cleanup in Libby under CERCLA. Federal courts later describe the situation as “no mere run-of-the-mill CERCLA cleanup” and “a unique removal action of a size and cost not previously seen.”

2001

W.R. Grace declares bankruptcy and places $2.9 billion in an irrevocable trust to settle all present and future asbestos claims. With Grace shielded by bankruptcy, hundreds of lawsuits are redirected toward BNSF Railway.

April 2024

The first of hundreds of Libby asbestos cases against BNSF goes to trial in Helena, Montana. After ten days of testimony, the jury finds BNSF strictly liable and awards $4 million to each estate, totaling $8 million. The jury rejects both negligence claims and a request for punitive damages.

February 24, 2026

The Ninth Circuit Court of Appeals reverses the jury verdict in full. BNSF is declared immune from strict liability under Montana law via the common carrier exception. Instructions are issued to enter judgment for BNSF. Hundreds of pending cases now face the same legal wall.


What Was Lost Before Anyone Filed A Lawsuit

Courts are very good at counting money. They are not designed to count the other things. The things that happened to the people of Libby, Montana do not fit on a balance sheet, and no amount of compensatory damages was ever going to cover them.

Joyce Walder grew up in Libby. She was a child there during the 1950s and 1960s, which means she was a child in the years when the mine was running at full capacity and the railyard at the center of town was leaking asbestos dust into the air every single day. She played on the baseball and football fields near the railyard. She used the running track. She walked across the railyard itself. She swam at the city pool, which sat near the contaminated ground. None of this was unusual. This was just childhood in Libby, Montana.

W.R. Grace donated vermiculite tailings, material that could contain up to 80% asbestos by volume, to spread over the local baseball field to absorb rainwater. A corporation took its most toxic waste product and spread it under children’s feet as a public service. This was the world Joyce Walder grew up in. This was the world that gave her mesothelioma.

“Unaware of the danger, many Libby residents used vermiculite in a variety of ways in their homes and on their lawns.”

Thomas Wells came to Libby as an adult, working for the Forest Service in 1978. He lived in a trailer home directly adjacent to BNSF’s railyard. He was there for the summer and fall of a year when W.R. Grace had already begun putting asbestos warning placards on some of its railcars. He didn’t know that. There was no reason for him to know. The regulatory agencies didn’t know, or said they didn’t. The signs on the railcars were not posted in the trailer parks next door.

Both Thomas Wells and Joyce Walder were eventually diagnosed with mesothelioma, a cancer that forms in the tissue surrounding the lungs. It is caused by asbestos exposure. There is no other cause. When the court opinion lists the legal facts of the case, it states with the clinical detachment of federal litigation that both Wells and Walder “died within months after receiving this diagnosis.” That is the whole of what the legal record says about their deaths: they were quick. They were predictable. They happened.

The families of Thomas Wells and Joyce Walder went to trial. They spent years building a case. They sat through a ten-day trial in Helena. They heard testimony about vermiculite concentrate and railcar switching operations and asbestos fiber accumulation patterns along railroad tracks. They heard the defense argue that their loved ones’ deaths were, legally speaking, a regrettable but non-compensable consequence of federal transportation mandates. Then the jury found for them. Then the appeals court took it back.

“Tragically, each died within months after receiving this diagnosis.” The opinion moves on. The families cannot.

The broader ledger of Libby isn’t captured in this single case if you can believe it and I really hope you can believe it. It’s captured in the fact that the EPA characterized its emergency cleanup there as a situation of unprecedented scale. It is in the hundreds of lawsuits, each one representing a person or a family carrying the specific weight of what asbestos exposure does to a human body over years or decades. It is in the irrevocable $2.9 billion trust that W.R. Grace set up before going bankrupt, a trust that amounted to an advance acknowledgment that the harm was real, even as the legal mechanisms for accountability were already being dismantled.

Libby was not an accident. The hazard was known. Warning placards appeared on railcars in 1977. W.R. Grace knew what was in its tailings. Regulatory bodies received reports and filed them. The machinery of commerce kept moving. The dust kept settling. The people kept breathing.


What The Court Actually Said: Verbatim

These are direct quotes from the court record. Every word below is sourced from the published opinion in Wells v. BNSF Railway Co., No. 24-4802 (9th Cir. Feb. 24, 2026).

What the court also said, quietly, in a footnote: another Libby case has been stayed pending the outcome of this appeal. The case is Moe v. BNSF Railway Co., No. 9:22-cv-00068-DLC. It is one of hundreds. They are all watching this ruling now.


What One Railroad Town Tells Us About All Of Them

Environmental Degradation

The contamination of Libby was not incidental. It was structural. The BNSF railyard covered approximately twenty acres in the northern downtown area, twenty acres of accumulating asbestos dust in the geographic center of a residential town. Railcars leaked during switching operations and in transit. Vermiculite spread through the downtown. W.R. Grace’s export plant sat in the urban core. The tailings, those 80%-asbestos waste piles, were treated as a community resource, donated to sports fields and used by residents in their gardens and homes.

The EPA’s response, which began in 2000, ten full years after operations ceased, was not a standard environmental cleanup. Federal courts described it as unprecedented in scale and cost. The soil, the buildings, the public spaces, and the private yards of an American town required decontamination from a substance that had been legally transported through it for 68 years. The contamination did not end when the railcars stopped running. It remained in the ground, in the structures, and in the bodies of the people who had lived there.

Twenty acres of asbestos-laden dust sat in the center of a residential town for decades. The EPA called what followed “a unique removal action of a size and cost not previously seen.”

Public Health

Mesothelioma has a latency period measured in decades. A person exposed to asbestos in 1978 may not develop symptoms until the 2000s or later. This is what makes asbestos contamination events so uniquely devastating: the harm is invisible for a generation. By the time the cancer appears, the corporation responsible has had decades to reorganize, declare bankruptcy, or build legal defenses. The victims age into illness; the companies age into legal protections.

Thomas Wells and Joyce Walder are two confirmed deaths. The litigation record documents “hundreds of lawsuits” filed against BNSF after W.R. Grace’s bankruptcy redirected claims. Each lawsuit represents a person with a diagnosis and, in most cases, a death. The full public health toll of the Libby contamination is not stated in this court opinion, but it is represented by the scale of the EPA’s unprecedented response and the $2.9 billion liability that W.R. Grace acknowledged before it went bankrupt.

Notably, the court record confirms that vermiculite was not classified as a hazardous material under the Hazardous Materials Transportation Act (HMTA) even when it contained asbestos. Federal regulations explicitly state that asbestos “immersed or fixed in a mineral ore is not subject” to HMTA regulatory requirements. The regulatory framework designed to protect the public from toxic cargo transport specifically exempted the cargo that was poisoning Libby.

Economic Inequality

The economic geography of this case is inseparable from its outcome. The people exposed to asbestos in Libby were not investors or executives. They were Forest Service workers, people who lived in trailer homes next to railyards, children who played on town fields. They were people who had no power over the routes of commerce that ran through their town, no knowledge of the contents of the railcars, and no financial resources to protect themselves from the consequences.

The corporations that created and distributed the contamination operated at scale. W.R. Grace was a multinational chemical company. BNSF is one of the largest freight railroad networks in North America. When W.R. Grace faced the full accounting of its harm, it used bankruptcy law to cap its liability and protect its assets. The $2.9 billion trust it created is not a punishment; it is a negotiated ceiling on what it would ever have to pay. BNSF has now secured a legal ruling that, in effect, caps its exposure at zero for strict liability claims.

The legal tools used to protect BNSF in this case, the common carrier exception and the potential ICCTA preemption argument, were not created to harm the people of Libby. But their application here demonstrates a consistent pattern in how American law functions when corporations and communities conflict: the larger the industrial system, the more legal protection it accretes over time. Common carrier law was designed to prevent discrimination in freight transport. ICCTA was designed to deregulate railroads and reduce compliance costs. Neither law was designed to immunize a railroad from liability for poisoning a town. But when the argument is assembled carefully enough, that is what they do.


Asbestos Content by Material Type — Libby Mine Output (Court Record Data)
0% 20% 40% 60% 80% 100% ASBESTOS CONTENT (%) 26% Raw Ore (max reported) ~6% Concentrate (contested at trial) 80% Tailings (donated to baseball field) W.R. Grace donated tailings to Libby baseball fields Source: Trial Testimony — Wells v. BNSF (D. Mont. 2024)

The Numbers Behind The Verdict

$8M Jury Award
What the jury decided two lives were worth The jury in Helena, Montana awarded $4,000,000 to the estate of Thomas Wells and $4,000,000 to the estate of Joyce Walder. This was the compensatory damage total following a ten-day trial with full testimony on asbestos exposure, railyard contamination, and mesothelioma causation. The award did not include punitive damages. The appeals court erased it entirely.
$2.9B
Amount W.R. Grace placed in an irrevocable trust to settle ALL present and future asbestos claims before going bankrupt in 2001
68
Years BNSF transported asbestos-containing vermiculite through the residential center of Libby, Montana (1922 to 1990)
~20
Acres covered by BNSF’s Libby railyard, situated in the northern downtown area of a residential community, where asbestos dust accumulated for decades
$0
Amount the families of Thomas Wells and Joyce Walder will recover from BNSF following the Ninth Circuit’s February 2026 reversal

The concurring opinion in this case, written by Judge Callahan, states plainly that the $8 million verdict “suggests the magnitude of BNSF’s potential exposure in the many other pending claims against it.” That is the calculation BNSF’s lawyers were making. That is the calculation the court resolved in BNSF’s favor.


Where To Direct Your Attention And Your Energy

The verdict is reversed. The lawsuits are still pending. The contamination is documented. The people are real. Here is what can still be done.

Regulatory Bodies With Active Jurisdiction

Active Watchlist: Who Oversees This

  • EPA / Superfund
  • Surface Transportation Board
  • DOJ Civil Division
  • OSHA
  • DOT / PHMSA
  • Montana DEQ
  • Senate Commerce Committee
  • House Transportation Committee

The Environmental Protection Agency has already declared Libby a Superfund emergency. The cleanup is ongoing. Continued public pressure on EPA budget allocations for Libby remediation is direct and concrete action. The EPA’s Libby/Troy Asbestos Superfund site has public comment processes.

The Surface Transportation Board now has explicit jurisdiction over the rail activities at the center of this case, per the concurring opinion. That means the STB is the regulatory body best positioned to set new standards for hazardous cargo transport by rail carriers. Demanding that the STB use its rulemaking authority to require hazardous material containment standards for rail transport, even for cargo not currently classified as hazardous under HMTA, is a specific, actionable policy demand.

The ICCTA preemption argument, if it becomes settled law through future rulings, represents a structural threat to all state tort liability for railroad operations nationwide. Advocates and legal organizations focused on environmental justice should be tracking this concurring opinion as a potential roadmap for industry-wide immunity expansion. Legislative action at the federal level to restore state tort rights against rail carriers is the only durable fix.

Pending Litigation

Hundreds of lawsuits against BNSF from Libby asbestos victims remain pending. Moe v. BNSF Railway Co., No. 9:22-cv-00068-DLC (D. Mont.) was specifically stayed pending this appeal and is now subject to this ruling. Organizations supporting the Libby community’s continued litigation efforts include:

Organizations Supporting Libby Victims

  • Center for Asbestos Related Disease (CARD) — Libby, MT
  • Earthjustice
  • Environmental Defense Fund
  • Montana Environmental Information Center
  • Trial Lawyers for Public Justice

Direct Action

The Center for Asbestos Related Disease (CARD) in Libby, Montana has served the local community for decades. Donations go directly to medical screening, treatment support, and patient advocacy for asbestos disease survivors. This is mutual aid at the source.

Contact your federal representatives and demand that Congress clarify the scope of ICCTA preemption to explicitly exclude state personal injury and wrongful death claims. The 1995 deregulation law that Judge Callahan argues shields BNSF was never intended to eliminate the right of dying people to sue the company whose cargo killed them. Make that explicit in statute.

Follow the docket in Moe v. BNSF and the other pending Libby cases. Public attention to litigation matters. It affects settlement calculations. It creates political costs for inaction. The people of Libby have been fighting this since 2001. They should not have to fight it in obscurity.


The source document for this investigation is attached below.

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Aleeia
Aleeia

I'm Aleeia, the creator of this website.

I have 6+ years of experience as an independent researcher covering corporate misconduct, sourced from legal documents, regulatory filings, and professional legal databases.

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