Trade-center insurance battle goes to trial
Opening statements are scheduled to start Monday in a trial, which pits developer Larry Silverstein against 13 insurers.
The outcome will determine whether Silverstein gets $3.5 billion or $7 billion to rebuild at Ground Zero.
Silverstein contends the destruction of the World Trade Center constituted two attacks, because the twin towers were hit by hijacked airliners about 15 minutes apart.
He and downtown-development officials have been counting on the larger figure to build the 1,776-foot Freedom Tower, other skyscrapers and cultural buildings on the site within the next 10 years.
"Anyone who's in New York knows that how much we recover from this lawsuit will have an impact on the rebuilding of this site," said Kevin Rampe, president of the Lower Manhattan Development Corp. The rebuilding costs have been put at between $7.45 billion and $7.86 billion, he said.
A mediator, settlement talks and efforts by Gov. George Pataki and others failed to keep the case from going to trial.
For the insurance industry, the high dollar amounts make the case "precedent-setting and very notorious," said Don Griffin, assistant vice president of the industry group Property and Casualty Insurers Association of America.
Initial rulings have gone against Silverstein. A federal appeals court ruled in September that contracts for three of the insurers define the destruction of the buildings as one event.
The jury must decide whether the 13 insurance companies issued their coverage using a broker's form that would define the Sept. 11, 2001, attacks as one event. Most of the insurers used either a form prepared by Willis Group Holdings that a judge has ruled describes the trade center's destruction as one event or another form prepared by Travelers Property Casualty that Silverstein says defines it as two events.
If the jury decides any of the insurers are bound by a form that would allow the destruction to be defined as two events, a second proceeding would determine whether the attack really was two events.
In other terrorism-related developments:
• The Pentagon yesterday revised rules for civilian lawyers who want to help defend terrorism suspects before military tribunals and said two more suspects at Guantánamo Bay, Cuba, have received military lawyers.
The revisions guarantee a defense lawyer will know ahead of time if the government plans to listen in on attorney-client conversations and allows the lawyer to tell his or her client that their conversations may not be private.
Anything a suspect says to his lawyer could not be used against him at trial, and military prosecutors will not know what, if anything, defense intelligence officials may have learned from the conversations.
The two suspects given military lawyers yesterday, Ali Hamza Ahmed Sulayman al Bahlul of Yemen and Ibrahim Ahmed Mahmoud al Qosi of Sudan, have not been charged with any crime.
• Defense Secretary Donald Rumsfeld said the North Atlantic Treaty Organization (NATO) should play a bigger role in stabilizing Afghanistan and may be asked to take over the U.S. military mission in fighting al-Qaida and Taliban rebels.
Rumsfeld urged the 19-nation alliance to help expand a network of provincial reconstruction teams across Afghanistan to improve security beyond the capital, Kabul. The United States has about 11,000 soldiers in Afghanistan, at a cost of about $1 billion a month, according to the Congressional Research Service.
Information from Bloomberg News is included in this report.