Quebec sending rep to U.S. bankruptcy proceedings for MM-A railway

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QUEBEC - Quebec is seeking a role in the U.S. bankruptcy court system following the deadly derailment of a train owned by Montreal Maine & Atlantic Railway.

Quebec justice minister Bertrand St-Arnaud says the provincial government is seeking to ensure there's compensation for those affected by the MM&A train derailment in Lac-Megantic.

He says the government also wants to ensure that Quebec taxpayers don't bear the costs of decontamination and rebuilding.

The government has appointed a Quebec bankruptcy specialist with standing in New York State to make representations on behalf of an informal creditors' committee.

The committee represents the province, the municipality and members of a class-action lawsuit.

Luc Despins of the firm Paul Hastings will ask the court and the U.S. Trustee Office to officially recognize the creditors' committee.

The province has also issued a legal demand to MM&A, Canadian Pacific Railway and several other companies it says are responsible for picking up the tab for mopping up from the July 6 train derailment, which killed 47 people, devastated the town core and dumped millions of litres of crude oil into the environment.

Calgary-based railway (TSX:CP) has said it holds no financial responsibility for the rail disaster.

Montreal, Maine & Atlantic Railway has been granted Chapter 11 bankruptcy protection in the U.S. while its Canadian subsidiary has creditor protection.

According to court documents, MM&A owes about $48 million to 128 unsecured creditors, including $43.4 million to its parent company and $2.35 million to the operator of the NB Southern Railway.

Organizations: Montreal Maine Atlantic Railway, Canadian Pacific Railway, TSX NB Southern Railway

Geographic location: Quebec, U.S., Lac-Megantic New York State Montreal Maine

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