Liability and Other Issues
Arising Out Of the World
Trade Center Tragedy†
Milton Thurm
I.
Introduction
The
II.
Federal Statutes Enacted in
the Wake of September 11
Immediately following the attacks on the World Trade
Center, the federal government enacted the Airline Transportation Safety and
System Stabilization Act (“ATSSA”) on September 22, 2001.[1] The ATSSA provides $15 billion in subsidies
to ensure the solvency of the airlines. It has been described by one scholar as
“one of the largest tort reforms ever imposed by the federal government.”[2]
The legislation affects litigation emanating from the
terrorist attacks on the World Trade Center in two ways. First, it limits the total liability of air
carriers (the airlines) for claims arising out of the September 11 airline
crashes and fixes the jurisdiction and applicable substantive law for
litigation arising out of these attacks.[3] Second, it establishes a victims’
compensation fund which provides an alternative process by which any injured
individual or the survivors of a deceased victim can seek compensation. The most important feature of the legislation
is that it offers the victims of September 11 a choice: victims who opt to make
claim against the victims’ compensation fund waive their right to “file a civil
action (or to be a party to an action), in any Federal or State court for
damages sustained as a result of the terrorist-related aircraft crashes of
September 11, 2001.”[4]
In the event victims choose to seek compensation in
the courts, the ATSSA’s liability-limiting provisions are straightforward:
“liability for all claims, whether for compensatory or punitive damages,
arising from the terrorist related aircraft crashes of September 11, 2001,
against any air carrier shall not be in an amount greater that the limits of
liability coverage maintained by the air carrier.”[5] Additionally, the ATSSA provides that “the
United States District Court for the Southern District of New York shall have
original and exclusive jurisdiction over all actions brought for any claim
(including any claim for loss of property, personal injury, or death) resulting
from or relating to the terrorist-related aircraft crashes of September 11,
2001.” The ATSSA also provides that the
applicable substantive law in the litigation “shall be derived from the law,
including choice of law principles, of the State in which the crash occurred
unless such law is inconsistent with or preempted by Federal law.” Finally, the ATSSA expressly precludes the
waiver and liability-limiting provisions from compromising suits against “any
person who is a knowing participant in any conspiracy to hijack any aircraft or
commit any terrorist act.”[6] To date,
there are at least three such lawsuits pending.
One of them is a class action suit where victims have opted to sue the
individuals and organizations, as well as their state supporters, who are
widely acknowledged as responsible for the attack.
The Aviation and Transportation Security Act (“ATSA”)
was later enacted in November, 2001, amending the ATSSA.[7] The ATSA extended the tort reform provisions
of the ATSSA, limiting liability resulting from the attacks for airplane
manufactures, airports, and anyone with a property interest in the World Trade
Center. The ATSA also limited New York
City’s liability to the greater of the city’s insurance coverage or $350
million.[8] However, the new Act specifically states that
its provisions will not extend to the private security agencies which checked
bags and screened passengers on September 11, 2001.
Immediately after the enactment of the ATSSA, however,
one commentator noted that it is extremely vague regarding how victims will be
compensated.[9] The details governing distribution of the
victims’ compensation fund rest solely on the judgment of the special master,
providing the special master with authority to design a system that allows
victims to submit claims. In
mid-November, Attorney General John Ashcroft appointed Kenneth R. Feinberg as
special master for the victims’ compensation fund. Mr. Feinberg is perhaps best known for his
role as special master in the Agent Orange cases. He brings a wealth of experience in mass tort
resolution, including work on the asbestos litigation, a class action involving
the Shoreham nuclear power plant in Suffolk County, New York, and breast
implant litigation. Most recently, he
filled the high profile role of arbitrating negotiations that led to the
settlement of claims by victims of the German Holocaust.[10] On December 20, 2001, the United States
Department of Justice released Mr. Feinberg’s Interim Final Regulations for the
distribution of the victims’ compensation fund.[11] Following extensive public comment and
meetings with victims, victims’ families and other groups, the Department of
Justice then released the Final Regulations on March 13, 2002.[12]
A list of claimants is accessible on the United State
Department of Justice Victims’ Compensation Fund website and indicates that
close to one thousand victims have filed claims under the federal victims’ compensation
fund, waiving their right to bring suit in federal court.[13] While claims on the fund offer the advantage
of monetary awards to the victims within months, public comments following release of the
Interim Final Rules indicated widespread dissatisfaction with the special
master’s compensation plan.[14] The most contentious and controversial
aspects of the Interim Final Rules involved provisions dealing with the
reduction of awards based on collateral sources. Among the critical voices was Elliot Spitzer,
Attorney General of the State of New York, who issued a press release on
December 20, 2001 calling the regulations “flawed.”[15] When likewise asked about the regulations,
John Lynch, spokesman for the “9-11 Widows and Victims’ Families Association,” a
group that represents families of civilians and rescue workers killed in the
attacks, was quoted in the National Law Journal
as saying, “I think it is a disgrace.”[16] Similarly reacting to the bitter sentiment of
the victims, Senators Jon C. Corzine and Robert G. Torricelli introduced a bill
to repeal the provisions of the ATSSA that allow for reduced compensation based
on collateral source.[17]
Despite criticism regarding the collateral source
compensation rules, the Final Rule incorporated no drastic changes to the
Interim Rule. Summarizing the Final
Rule, Special Master Feinberg reiterated that he held no power to disregard the
Congressional mandate factoring collateral sources into distribution of the
fund. Moreover, the Final Rule
specifically notes that collateral source compensation can include life
insurance, pension funds, death benefits programs, and payments by federal,
state, or local governments. However,
several changes were made to the collateral source provisions of the rules
demonstrating that discretion was available to the Special Master when
distributing the fund. The Final Rule,
for example, clarifies the definition of collateral source compensation,
expressly noting that certain benefits, including tax relief, contingent Social
Security benefits, and contingent workers’ compensation benefits are not to be
treated as collateral source compensation.
The Final Rule also clarifies the provision that excludes charitable
donations from the definition of collateral source compensation. In most instances, money received from
privately funded charitable entities will not constitute collateral source
compensation. Lastly, the Final Rule
affords significant discretion to the Special Master when valuing collateral
sources. While the Special Master has
indicated that “it will be very rare that a claimant will receive less than
$250,000.00," there is a possibility, expressly acknowledged in the
summary to the Final Rule, that a victim or a victim’s family would not recover
any money from the victims’ compensation fund based on the collateral source
rules. In light of this possibility,
some victims or victims’ families with significant collateral sources may take
their claims to court. In fact, it was
reported recently that a suit was commenced against American Airlines on behalf
of Ms. Bonnie Shihadeh Smithwick, a highly-paid portfolio manager who was
killed when the first World Trade Center Tower collapsed. Apparently, Ms. Smithwick’s family would
receive no compensation under the victims’ compensation fund because she held a
large life insurance policy for her family.[18]
The other predominant factor in determining whether
victims will commence civil suits is their ability to prevail in such
actions. Whether the plaintiffs can
recover involves several questions, including:
·
Who are the possible defendants?
·
What are the causes of action?
·
Where do the burdens fall in proving these causes of
action?
·
How have plaintiffs fared in past litigation arising
out of terrorist attacks and disasters?
Finally, it is worth mentioning here the latest
proposed federal legislation -- a bill to amend the Terrorism Risk Protection
Act to ensure the continued financial capacity of the insurers in order to
provide coverage risks for terrorism.
The bill proposes that the federal government will cover up to 90% of
claims exceeding $25 billion in the event of an “act of terrorism.” It also proposes to further amend the ATSSA
to cover any tort claim arising out of or relating to an act of terrorism. The bill would bar recovery for punitive
damages, eliminate joint and several liability for non-economic damages,
require that all damages be off-set by collateral sources such as insurance or
gifts, and limit lawyers’ fees to 20% of any award.[19]
III.
Suits Arising out of the World
Trade Center Tragedy
A. Possible Defendants
There are numerous possible defendants for suits
arising out of the September 11 terrorist attacks. As discussed above, the airline companies,
the aircraft manufacturers, airport owners and operators, New York City[20] and
anyone else with a property interest in the World Trade Center are protected by
federal legislation, limiting their liability to the terms of their insurance
coverage. However, as the victims grow
less and less enamored with the special master’s plan under the federal
victims’ compensation fund, even with its liability limitations, a lawsuit
against those parties may become more attractive, especially since those
parties generally are sufficiently insured to cover the kinds of injuries and loss
of life that occurred on September 11th.
For instance, the airlines have an estimated $1.5 billion worth of
coverage for each airplane.[21] With $3 billion in coverage for the airplanes
that were flown into the World Trade Center Towers, the airlines might prove an
attractive target for victims.
As noted earlier, federal legislation does not protect
airline security firms or the actual individuals and parties who perpetrated
the terrorist attacks. The Foreign
Sovereign Immunities Act, which was amended in 1996, allows American citizens
to sue specified nations for death or injuries arising out of terrorism.[22] Several
nations currently are identified by statute as subject to suit. These include Iran, Iraq, Libya, Cuba, North
Korea, and Sudan.[23] The 1996 amendment was intended to permit
suits on behalf of those killed in the bombing of Pan Am Flight 103 over
Lockerbie, Scotland, against the government of Libya, the alleged perpetrator.[24] This statute may be invoked to sue other
nations if proof can be amassed that the terrorist attack was aided by that
nation.
There are currently at least two civil suits by
victims of the September 11 attacks already pending against Osama Bin Laden, Al
Qaeda, and the Islamic Emirate of Afghanistan.
Doe v. Islamic Emirate of
Afghanistan,[25]
was commenced against Osama Bin Laden, Al Qaeda, the Islamic Emirate of
Afghanistan and several members of the Taliban leadership. The plaintiff, “Jane Doe,” seeks recovery for
the loss of her husband, who was killed while working at his job in the
financial industry at One World Trade Center when Flight 11 struck the
building. Smith v. Islamic Emirate of Afghanistan,[26] also
filed in the Southern District of New York, is a suit brought against Osama Bin
Laden, Al Qaeda, the Islamic Emirate of Afghanistan and several members of the
Taliban leadership by Raymond Smith, the brother of George E. Smith, who was
killed when U.S. Airways Flight 175 struck the South Tower of the World Trade
Center.[27] Both complaints allege state causes of action
for wrongful death, survival, assault, battery, false imprisonment and civil
RICO claims. The Doe suit also includes claims for negligence and intentional
infliction of emotional distress.
Additionally, on February 20, a class action suit was filed by a mother
and six widows of other victims, seeking billions of dollars.[28]
Among other possible defendants mentioned in the media
since the attacks are the architects who designed the World Trade Center, as
well as asbestos manufacturers, companies involved in constructing the World
Trade Center, elevator maintenance companies, the Florida flight schools that
trained the terrorists, jet fuel producers, the City of Portland (ME), and
manufacturers of the structural steel used in the World Trade Center.[29] There are at least two civil suits brought by
passengers in the hijacked jets against the airlines. These include Mariani v. United Airlines, filed in the Southern District of New
York on December 20, 2001, which names United Airlines as the defendant and
alleges wrongful death, and a survival action against the same defendant based
on the breach of duty of care for safety and security of its passengers. As discussed above, because of the collateral
source compensation reductions in the victims’ compensation fund, more suits
will follow. As noted further, the suit
brought on behalf of Ms. Bonnie Shihadeh
Smithwick was only initiated after issuance of the Final Rule. The fact that her family would not have
received compensation under the victims’ compensation fund surely prompted the
litigation.[30]
Prior suits commenced in the wake of disasters
demonstrate that a number of other unanticipated entities might be subject to
suit. For instance, suits brought by the
victims of the 1980 MGM Grand Hotel fire in Las Vegas, Nevada, included
products liability claims against such defendants as B.F. Goodrich, Conoco, and
Pantsaote, Inc.[31] The claims against these parties alleged that
the gases produced by the combustion of PVC vinyl-coated materials were toxic
and unreasonably dangerous. Similar
claims surfaced in suits from the 1986 Du Pont Plaza Hotel fire in San Juan,
Puerto Rico, that killed 97 people,[32] and from
the 1990 arson fire of the Happy Land Social Club in the Bronx, New York that
killed 87 people.[33]
B. Possible Plaintiffs
While the response to an inquiry about possible
plaintiffs in personal injury actions occasioned by the September 11 attacks
may seem fairly straightforward, recent developments are cause for alarm among
insurers and New York City. Possible
claims for toxic tort injuries have been noted recently in the media and among
legal professionals.[34] In that regard, there is great uncertainty
about possible adverse health effects from toxic agents released into the air
following collapse of the buildings. The
victims’ compensation fund does not entertain the possibility that large
numbers of rescue workers, clean-up crews, construction workers and New York
City residents may have been exposed to toxic chemicals that would increase
their chances of contracting diseases such as cancer or suffering long term
neurological defects. Researchers have
identified asbestos, lead, fiberglass, PCBs, mercury and other potentially
harmful substances in the air and dust that surround the disaster site. Thus, the list of potential defendants may
grow commensurately with the list of harmful substances. The St. Louis Post-Dispatch reported that
one study found dust in the neighborhood as caustic as drain cleaner.[35] However, reports about the extent of
contamination vary drastically. The
Environmental Protection Agency has been monitoring the downtown area for
asbestos, particulates and other contaminants typically found in large building
fire and collapse situations since September 11. It has detected no pollutants from the fire
and building collapses that are cause for concern to the general public. Within
one block of the World Trade Center, the EPA is finding low levels of asbestos
in the dust from the building collapse.[36]
There have been approximately 1,300 notices of claim
served on New York City by firefighters and other rescue workers who claim that
breathing the air at the disaster site has made them sick.[37] With the high concentration of persons living
and working in the downtown New York City area, the potential for toxic tort
claimants could be staggering. There has
been insufficient research to determine whether or to what extent people were
exposed to toxic chemicals in the hours, days and months following the attack. Further scientific research should provide a
clearer picture of potential toxic tort claims.
IV.
Theories of Recovery and
Applicable Legal Standards
Pursuant to the ATSSA, the law to be applied in suits
arising from September 11th events will derive from state law (including choice
of law principles), where the crash occurred.
Thus, suits arising out of the World Trade Center attack will be
governed by New York law.
Negligence will likely predominate theories of action
for civil suits brought against the above-mentioned parties. To sustain an action for negligence, the
plaintiff must demonstrate: (1) a duty owed by the defendant to the plaintiff;
(2) a breach of that duty; (3) that the breach of duty proximately caused the
plaintiff’s injuries, and (4) damages.
The most critical elements applicable to any suit emanating from the
September 11th attacks are duty and proximate causation. Generally, the law of negligence in New York
is similar to the law of other jurisdictions. Thus, to the extent that the law
of other states, such as Pennsylvania, is applied in lawsuits arising from the
September 11th attacks, the foregoing legal principles will be generally
applied.
A. Duty
Negligence is not actionable unless it involves the
invasion of a legally protected interest, i.e., the violation of a right.[38] The issue whether the defendant owes the
plaintiff a duty is purely a legal question for the courts. The New York Court of Appeals has addressed
the element of duty in a case alleging negligence and noted that: “[t]he
existence and scope of an alleged tortfeasor’s duty, at the threshold, is a
legal, policy-laden determination dependent on consideration of different
forces, including logic, science, competing socioeconomic policies, and
contractual assumptions of responsibility.”[39] Thus, whether the victims can sustain causes
of action in negligence against the potential defendants noted above will
depend largely on a legal determination -- a policy-driven line of demarcation
drawn around the concept of duty. In
determining whether a duty exists and in determining its scope, New York courts
have been influenced by public policy concerns such as avoiding limitless
liability, mass litigation, and fraudulent claims. The court of appeals has
even held that it is "bound to consider the larger social consequences of
decisions” affecting duties in negligence under the law.[40]
A duty may arise from a special relationship that
requires the defendant to protect against the risk of harm to the
plaintiff. For example, landowners have
a duty to protect tenants, patrons and invitees from foreseeable harm caused by
the criminal conduct of others while they are on the premises; their special
relationship puts them in the best position to protect against that risk.[41] The duty to protect against foreseeable criminal activity, however, does
not extend to members of the general public.[42]
Furthermore, while the forseeability of
harm may affect a determination of causation, the foreseeability of harm does
not define duty. Absent a duty running
directly to the injured person, there can be no liability in damages, however
careless the conduct or foreseeable the harm.
For instance, in Strauss v. Belle
Realty Co.,[43] the court
of appeals considered whether a utility owed a duty to a plaintiff injured in a
fall on a darkened staircase during a citywide blackout. While the injuries
were logically foreseeable, there was no contractual relationship between the
plaintiff and the utility to provide lighting for the common areas in the
building. The court restricted liability
for damages in negligence to direct customers of the utility in order to avoid
a crushing exposure to suit by millions of electricity consumers in New York
City and Westchester.
B. Proximate
Causation
Beyond the existence of a duty, it is essential that
the breach of a duty be the “proximate cause” of the injury suffered in order
to sustain a cause of action for negligence.
Generally, an act or omission is the proximate cause of an injury if it
was a substantial factor in bringing about the injury.[44] Stated another way, an act or omission is the
proximate cause of an injury if it had such an effect in producing the injury
that reasonable people would regard it as the cause of the injury.[45] A proximate cause must be one which, in view
of all surrounding circumstances, might readily have been foreseen by an
ordinary and prudent person as likely to result in injury.
While there can be more than one proximate
cause of an injury, an intervening act will constitute a superseding cause of
the injury and will sever liability when the act is extraordinary in nature.[46] Stated conversely, the causative link
between the defendant’s act or omission and the plaintiff’s injury is not
broken by the negligent or deliberate conduct of a third person when such
conduct is normal or foreseeable under the circumstances.[47] The crucial aspect of this inquiry is a
determination of how far the first wrongdoer should be charged with forecasting
the future results of his or her conduct.
V.
Prior Litigation
Arising out of Disasters or Injuries Caused by Terrorists
A. Oklahoma
City Bombing
In Gaines-Tabb
v. ICE Explosives, USA, Inc.,[48]
victims of the terrorist bombing brought a class action against the
manufacturer of ammonium nitrate that was sold as fertilizer and allegedly used
to construct the bomb that destroyed the Alfred P. Murrah Federal Building in
Oklahoma City. The plaintiffs’ principal
causes of action were negligence and products liability.
As their negligence claim, plaintiffs
alleged that the manufacturer of ammonium nitrate was negligent in making
explosive grade ammonium nitrate available to the perpetrators of the terrorist
act. Without reaching the issue of
whether the manufacturer owed a duty to the victims, the court held that the
plaintiffs could not prevail on their claim for negligence because they could
not show, as a matter of law, that the defendants’ conduct was the proximate
cause of their injuries. The court held
that “the conduct of the bomber or bombers was unforeseeable, independent of
the acts of the defendants, and adequate by itself to bring about plaintiffs’
injuries[;] the criminal activities of the bombers acted as the supervening
cause of the plaintiffs’ injuries.”[49] In
rendering its decision, the court noted that ammonium nitrate bombs were used
for illegal acts on only two occasions in the last twenty years, and that it
was extremely difficult to properly manufacture ammonium nitrate bombs; only a
small percentage of the population would possess the knowledge to do so.
B. Hijacking
In the case of Stanford v. Kuwait Airways Corp.,[50] the
plaintiffs were three American diplomats who were also passengers aboard Kuwait
Airways Flight KU221 when the airplane was hijacked by four terrorists. Plaintiffs were tortured over six days, and
one of the plaintiffs was murdered before Iranian commandos thwarted the
hijacking. Plaintiffs commenced a negligence action against Middle East
Airlines Airliban, S.A. (MEA), alleging that MEA had a duty to use due care to
avoid the risk of hijacking.
The facts are convoluted, but are worthy
of brief mention considering the likelihood of claims against airline security
firms arising out of the September 11th attacks. On December 2, 1984, four hijackers purchased
“interline” tickets from MEA for travel from Beirut to Bangkok, Thailand, via
the cities of Dubai and Karachi. At
Dubai, the flight connected with another airline. The court was careful to note that the
hijackers “had a stench about them.”[51] Their one-way tickets were purchased with
cash on very short notice and the itinerary they chose was strange. There were regularly scheduled direct flights
from Beirut to Bangkok. If the hijackers
had taken the next flight from Beirut they could have avoided a 24-hour layover
in Karachi and arrived in Bangkok at the same time. Perhaps the most suspicious aspect of the
hijackers’ conduct was their failure to check baggage for the long-distance
flight. On the first stopover in Dubai, the hijackers boarded the MEA flight,
armed with pistols, explosives and other weapons. The hijackers and other passengers were held
on the tarmac, which was poorly lit and largely unguarded, during the`
stopover. The hijacking occurred after
the flight departed Dubai.
Addressing the plaintiffs’ negligence
claims, the court first ascertained whether a duty existed on the part of MEA
as owed to the victims. The court
reiterated the broad legal principles discussed above, and held that MEA had a
duty to protect the plaintiffs from the unreasonable risk of foreseeable harm. The court specifically held that MEA, as a first
leg interline carrier, had a duty to protect passengers on other connecting
interline flights from unreasonable risk or harm through the use of reasonable
precautions in the face of reasonably foreseeable risks. The court also rejected MEA’s claim that, as
a matter of law, the criminal acts of the hijackers and/or the negligence of
the other interline carrier were intervening superceding causes of the
plaintiffs’ injuries, leaving the issue to the jury for determination.
VI.
Conclusion
The September 11th attacks were
unprecedented in all respects. From a
legal standpoint, the issue of
compensating victims of the attack is fraught with uncertainty. The immediate issues concern whether victims
will elect to participate in the victims’ compensation fund or take their
chances pursuing compensation under tort law in civil litigation. As stated,
the possibility of large scale litigation by the September 11 victims depends
largely on the success of the victims’ compensation program. In the event the victims elect to litigate
their claims, judicial application of such concepts as “duty,” “foreseeability”
and “proximate causation” to the extraordinary factual circumstances of
September 11 will take center stage. As
set forth above, these decisions not only will have immediate financial
consequences, they will also have larger social consequences for reasons
articulated by the New York Court of Appeals.
Because of the extraordinary nature of the September 11th attacks, prior
litigation and cases such as the Oklahoma City bombing offer only limited
precedent as models by which to predict success or failure in the courts. Under any circumstances, the insurance
industry must be prepared to engage a host of claims from many different
insureds on a panoply of legal theories.
ENDNOTES
† Submitted by the author on behalf of
the FDCC Excess & Surplus Lines Section. Mr. Thurm acknowledges the
invaluable assistance of Frank Santoro, Esq., in the preparation of this
article.
[1] P.L. 107-42 (2001) (full text of the
statute available on the FDCC website at
www.thefederation.org/index.html).
[2] Anthony Sebok, Assessing the New Airline Law, Findlaw.com Commentary, at http://www.writ.news.findlaw.com.scripts/printer_friendly.pl?page+sebok/20010924.html
(last visited 1/15/02).
[3] “The term ‘air carrier’ means a
citizen of the United States undertaking by any means, directly or indirectly,
to provide air transportation and includes employees and agents of such
citizen.” P.L. 107-42 § 402(1).
[4] P.L. 107-42 § 405 (c)(3)(B)(i)
(2001).
[5] Id.
§ 408 (a) (2001).
[6] Id.
§ 408 (c) (2001) (summary of the statute is available on the FDCC website).
[7] P.L. 107-71 §201 (2001).
[8] Id.
§ 201 (a)(3).
[9] Sebok, supra note 2.
[10] Tamara Loomis, Ashcroft Names Special Master for Sept. 11 Compensation Fund, N.Y.
L. J., Nov. 27, 2001, at 1.
[11] 28 CFR § 104, available at
http://www.usdoj.gov/victimcompensation/viccompfedreg.htm (last visited January
29, 2002).
[12] Id.
[13] http://www.usdoj.gov/victimcompensation/victimrepresentatives.pdf
(last visited April 8, 2002).
[14] Robert F. Worth, Ground Zero: Compensation; Families of Victims Rally for Higher Federal
Awards, N.Y. Times, Jan. 18,
2002, at B4.
[15] Attorney General Spitzer's objections
to the regulations are available at
http://www.oag.state.ny.us/press/2002/dec/dec20c01.htm. He identified what he considered
"numerous fundamental flaws in the DOJ regulations" contained in the
Interim Final Rules. Several of his
criticisms were addressed by the Final Rule.
1. Attorney General Spitzer was concerned that
in order to be eligible for compensation, the Interim Final Rule required
contemporaneous records demonstrating medical treatment within 24 hours after
the attack, even though:
(a) there
are no records for the hundreds of injured victims treated at emergency triage
locations on September 11th; and
(b) many
other victims first sought to reunite with their families and did not seek
medical treatment for their injuries until September 12th.
The Final
Rule addressed this concern by expanding the time limits to 72 hours for
victims and a time limit within the discretion of the Special Master for rescue
workers.
2. Attorney General Spitzer was also
dissatisfied that the Interim Final Rule effectively precluded recovery by
unmarried life partners.
The Final
Rule was not altered to include recovery by unmarried life partners. The Final Rule relies on state law to
determine who is a personal representative entitled to recover from the fund. This reliance is purportedly mandated for
consistency, in order to avoid a situation
where a representative as defined in the regulation recovers under the
fund, and a representative under state law is still free to commence a
lawsuit. The Preamble to the Final Rule
suggests that criticism of state law concerning the determination of a personal
representative is best directed to respective state legislatures.
3. Attorney General Spitzer also felt that the
Interim Rule ignored the statutory mandate that victims be able to present
evidence of their losses. Instead it
determined that all individuals killed in the attacks were presumed to have
suffered exactly $250,000 in "non-economic" losses, regardless of
individual circumstances, and permitted increases only upon a showing of
"extraordinary circumstances."
The Final
Rule remains the same. The Special
Master recognized the problems inherent in placing a value on non-economic
losses, but opted for consistency and fairness in order to avoid “playing
Solomon” on a case-by-case basis.
4. Attorney General Spitzer also was concerned
that under the Interim Rule, awards were reduced by the amount of collateral
compensation that the claimant received, even if the collateral compensation
was unrelated to the damages for which recovery was sought. The Interim Rule states that charitable
donations will not be counted as "collateral source" payments
resulting in reduced awards, but at the same time authorizes the Special Master
to determine that charitable payments are collateral sources, which will deter
charities from providing immediate payment to the victims. As to the
how the Final Rule addresses these concerns, see text.
[16] Bob Van Voris, Compensation Plan May Shut Out Sept. 11 Rescuers, Nat’l L. J., Jan. 7, 2002, at A1.
[17] Senator Jon C. Corzine, Fix the Victims’ Fund, Letter to the
Editor, N.Y. Times, Jan. 28,
2002, at A14.
[18] Robert F. Worth, Airline Sued in Tower Death, N.Y. Times,
Apr. 9, 2002, at A16.
[19] H.R. 3210, 107th Cong. (2001).
[20] Under the ATSA, the liability of New
York City for suits arising out of the World Trade Center attacks is limited to
the greater of its insurance coverage or $350 million. P.L. 107-71 § 201(a)(3).
[21] Milo Geylin, Lawyers Wonder, Who is Liable for Sept. 11, Wall St. J., Oct. 18, 2001, at B1.
[22] 28 U.S.C. § 1330 (2002).
[23] The United States does not recognize
the Taliban, and thus Afghanistan is not included on the list.
[24] Jerry Adler, Suing Bin Laden, The
American Lawyer, Nov. 2001, at 32.
[25] 01 CIV 9074 (S.D.N.Y. filed Oct. 11,
2001).
[26] 01 CIV 1013`(S.D.N.Y. filed Nov. 14,
2001).
[27] Adler, supra note 24.
[28] Neely Tucker, Bin Laden, Other Terrorists Sued, Wash. Post, Feb. 20,
2002, at A10.
[29] See,
e.g., Gregory Keisch, ‘Little Old
Lady’ Denies Terrorizing Man, Portland
Press Herald, Dec. 5, 2001, at 1B (reporting notice of claim filed with
the City of Portland by a victim of the attack on the World Trade Center. Two of the hijackers boarded flights in
Portland and the city retains some control over airport security); Seth Stern, Justice is Blind After All, Christian
Science Monitor, Sept. 27, 2001, at 19 (mentioning Florida flight
schools and architects of World Trade Center as defendants).
[30] Worth, supra note 18.
[31] See
In re MGM Grand Hotel Fire Litig., 660 F. Supp. 522 (D. Nev. 1987).
[32] See
In re San Juan Dupont Plaza Hotel Fire Litig., 768 F. Supp. 912 (D. P.R. 1991).
[33] See
Clarendon Place Corp. v. Landmark Ins. Co., 587 N.Y.S.2d 311 (App. Div. 1992).
[34] See
Bob Van Voris, Are Toxic Lawsuits in the
Air after Sept 11?, Nat’l L. J., Feb. 18, 2002, at A1;
Associated Press, NYC Faces Trade Center
Lawsuits, available at
http://www.cbsnews.com/stories/2002/02/08/national/printable328742.shtml.
[35] Van Voris, supra note 34.