Warren Buffett’s Burlington Northern Facing Higher Than Expected DOJ Penalty Over Chemical Spill
New filing updates the fallout related to a 2018 spill in Iowa.
March 11, 2021
On June 22, 2018, Burlington Northern (BNI), a railroad owned by Warren Buffet’s Berkshire Hathaway, experienced a train derailment in Doon, Iowa due to flooding. Some of the derailed railcars released petroleum hydrocarbons into floodwaters. The extent of the damage from the derailment was largely limited to properties adjacent to the rail line.
In its 2020 10-K, Burlington Northern disclosed— as it did in a prior 10-Q— a Department of Justice (DOJ) investigation and possible penalty:
“On August 11, 2020, the Company received notice from the U.S. Department of Justice that it is considering initiating a civil judicial action against BNSF Railway for the above-referenced release.”
In its 2019 10-K, Burlington Northern provided an estimate of a potential penalty:
“...although no notice of penalty has yet been issued, regulatory penalties could exceed $100,000.”
In its 2020 annual report, the company increased its estimate of a potential penalty:
“... regulatory penalties could exceed $300,000."
Related: UNP, NSC, CNR, CP
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