New Proposal Could Boost WTC Workers' Settlement by $125M

Lawyers say they've reached a new settlement for almost 10,000 emergency personnel and construction workers who may have suffered health problems while working on the pile at Ground Zero.

The revised proposal, which still has to be approved by 95 percent of the workers, would increase the total compensation for plaintiffs by $125 million. The total payout would range between $625 million and $712.5 million, depending on how many plaintiffs participated and the seriousness of their illnesses.

Teams for both sides had been negotiating furiously over the past three months, ever since Judge Alvin Hellerstein rejected the original proposal because it paid the plaintiffs lawyers too much and left too little for the workers.

In his hearing room Thursday morning at the Daniel Patrick Moynihan United States Courthouse in Lower Manhattan, Hellerstein gave a much more upbeat assessment of the amended settlement.

“This is a very good deal,” Hellerstein told the capacity crowd. “I am very excited about this deal.”

He stopped short of overtly urging the plaintiffs to accept the proposal, but he suggested it was better than other options. He said they could go to trial, or they could wait for federal legislation that might set up a compensation system such as those paid out to families of the victims of the 9/11 attacks.

“The old adage is true, a bird in the hand is better than two in the bush,” he said.

Of particular concern to the judge and lawyers for both sides was the sheer volume of cases, and the difficulty the judicial system would have in processing so many at one time.

“How do you do discovery on 10,000 cases?” Hellerstein said. “It would take a phalanx of people to supervise it.”

The new agreement increases the amount that the federally funded World Trade Center Captive Insurance Company would pay by $50 million. The plaintiffs lawyers also agreed to reduce their commission from one-third of the awards to 25 percent. New York City also agreed to release liens that it placed on workers compensation payments that some emergency personnel have been receiving, an amount estimated at $25 million.

Hellerstein set June 23 as a hearing date for plaintiffs to testify whether they support it or not. At that point, the judge will determine whether to approve the settlement, although it won’t take effect unless 95 percent of the plaintiffs sign on before the end of September. Margaret Warner, a lawyer representing the insurance company, said that if the settlement gets approved, she expected all the checks would be sent out to plaintiffs by the following September.

If the deal goes through, an outside arbitration firm, Garretson Firm Resolution Group, will place the plaintiffs into one of four tiers depending on the severity of their illness and how closely they can prove it was a result of their work on the pile. The lowest tier would receive $3,250 each, while plaintiffs with serious illnesses, such as asthma could receive $800,000 to $1.05 million. All plaintiffs would also be enrolled in a special insurance policy that would provide them with $100,000 if, later in life, they develop certain blood or respiratory cancers.

The revised proposal also appoints Kenneth Feinberg to hear appeals if plaintiffs disagree with the award they are first assigned. Feinberg, who will offer his services without charge, was the special master of the September 11th Victims Compensation Fund.