World Trade Captive Settles With 10,000 Plaintiffs For $657 Million

In order for the settlement to be complete, 95 percent of the plaintiffs must opt in to accept the agreement arrangements.

WTC Captive management said the agreement could serve as a blueprint to settle other 9/11 lawsuits against separate private or public entities. Suits have been filed against the Port of New York and New Jersey and the U.S. Environmental Protection Agency.

New York Mayor Michael R. Bloomberg called the settlement "a fair and reasonable resolution to a complex set of circumstances."

Christine LaSala, president of WTC Captive, said, "This agreement enables workers and volunteers claiming injury from the WTC site operations to obtain compensation commensurate with the nature of their injuries and the strength of their claims, while offering added protection against possible future illness."

During a media conference call today, Kenneth Feinberg, the former Special Master of the September 11 victims' compensation fund, said the settlement provides for many 9/11 responders who could not collect from the fund because they only manifested illness and injury long after his fund closed down in December of 2003.

"This injustice is now being rectified," he said.

Participants at the conference who also included LaSala; plaintiffs' attorney Marc Jay Bern of Worby Groner & Napoli, Bern; and Michael Cardozo, New York City corporate counsel, said the total fees lawyers would collect is still undetermined.

Mr. Bern said plaintiffs would receive amounts ranging from thousands of dollars to "more than a million," and he was optimistic the 95 percent opt-in number would be reached. He said about half of his firm's clients who would be part of the settlement are police and firemen.

The settlement talks were presided over by U.S. District Court Judge Alvin K. Hellerstein in Manhattan, whom LaSala singled out for special praise, acknowledging "the hard work and diligence" of the judge and his Special Masters in overseeing the litigation and preparing an injury severity chart.

LaSala explained in her statement that the chart that had been drawn up had played an important part in the lawyers negotiations and "created a foundation for settlement."

The WTC Captive, it was noted, was created in 2004 with a $1 billion Federal Emergency Management Agency grant to insure the City of New York and its debris removal contractors when the city after 9/11 was unable to secure adequate liability coverage in the commercial insurance market.

WTC Captive insured the World Trade Center site rescue, recovery and debris removal work.

The settlement that was reached establishes a compensation system to pay injury claims from workers doing cleanup and rescue for the city and its contractors, including construction, fire, police and other workers and volunteers at Ground Zero.

"Since September 11, the City has moved aggressively to provide medical treatment to those who were present at Ground Zero, and we will continue our commitment to treatment and monitoring," Bloomberg promised.

WTC Captive said the settlement will cost $575 million at 95 percent plaintiff participation, or up to $657 million "under certain conditions, leaving residual funds to insure and defend the City and its contractors against any new claims."

The insurer said there could be additional sums depending upon the level of plaintiff participation and the extent of new lawsuits filed in the future, but if there are few lawsuits filed in the next five years, there may be more money for current plaintiffs.

To recover under the settlement, each plaintiff will have to submit proof that he or she was present and participated in the rescue, recovery and debris removal operations, as well as specific medical documentation and a physician's diagnosis confirming their claimed illness or injury.

WTC Captive said all of this information will have to be submitted by plaintiffs under oath and will be subject to audit.

Attorneys for the plaintiffs and WTC Captive will choose an independent third-party expert to review each claim and the required medical documentation, further protecting against mistakes or fraud, it was explained.

"In addition to compensation for proven injuries, ranging from thousands of dollars to payments in excess of a million dollars, this settlement also funds a special insurance policy to provide additional compensation to any plaintiff contracting certain kinds of cancer in the future," WTC Captive said.

Plaintiffs will have 90 days to review the settlement and "opt in," by agreeing to the terms of the agreement, which includes a release of any future claims against the city and its contractors involved in 9/11 rescue, recovery and debris removal.

As a result of the agreement attorneys for all sides asked Judge Hellerstein for a stay of the over 10,000 cases pending for trial.

The settlement, it was noted, only includes cases brought against the city and its contractors who were covered by the WTC Captive, not other private or public entities named in 9/11 lawsuits.

"It will be up to the plaintiffs and the other defendants in these cases as to how they proceed, but this agreement does present a just pathway for the plaintiffs to use as a basis of settlement which may provide additional monetary compensation from those defendants not insured by the WTC Captive Insurance Company," said LaSala.

Individuals who worked or volunteered in the World Trade Center rescue, recovery and debris removal project have been entitled to and have received free medical care, including monitoring, funded by the City of New York and the federal government.