W000485
October 26, 2001
The Honorable Robert D. McCallum, Jr.
Assistant Attorney General
U.S. Department of Justice
950 Pennsylvania Avenue, NW
Room 3141
Washington, DC 20530-0001
Dear Mr. Assistant Attorney General:
Thank you for the opportunity to meet with you and the other Department of Justice attorneys concerning the regulations for the September 11th Victim Compensation Fund. I thought we had an extremely good exchange of ideas, which is of great help to us as we go forward.
Our goal is to clarify through the regulations how the Fund will be administered in such a way as to build public support and confidence in the Fund. We want to do everything possible to ensure the success of the Fund, not only for the victims we will represent but also because its success will stand as a powerful statement to the world (and the terrorists) how a great nation generously and compassionately treats its citizens who are injured through no fault of their own.
Because we believe that TLC attorneys will represent the vast majority of claimants in the Fund, we share your concerns about having a process that is both expeditious and just. This is, however, a concern that we believe can be solved.
It was very helpful to learn that the Department does not view the Fund as adversarial. That will simplify the process and allow a cooperative effort to achieve the goals of the Fund. By the use of the procedures we recommend or similar ones, we believe the process can also be greatly expedited in ways that relieve the statutory burden placed on the Special Master and his or her staff.
I believe this can be achieved in an equitable manner for similarly situated plaintiffs without having to resort to matrices, as we discuss below. In addition, I very much appreciate your concern about the practical limits of the 120 day claims process under the Act, and the need to expedite the process whenever possible.
For example we do not believe that every claim will require a hearing. We would hope, once the Fund is open for business, that, at least for TLC represented claimants, we could negotiate settlements for large numbers of cases. That, of course, would be dependent upon victims trusting the process sufficiently to accept TLC representation (only available for claims in the Fund) which may be largely dependent upon the perception of the fairness of the regulations.
In that regard, we strongly urge that the regulations not contain any matrix for damages. A matrix by its very nature is arbitrary and at odds with the letter and spirit of the Act. The due process rights granted to claimants under section 405 of the Act, including the right to present witnesses, would have diminished value if a claimant's entire case were merely to be checked against a preexisting schedule. Indeed, the very concept of a matrix is so synonymous with arbitrariness that at a conceptual level it could engender serious public criticism.
While it is important that all victims be treated equally by having the same standards applied to their individual claims as would be the case in the Civil Justice System, like the Civil Justice system, the Act does not guarantee equal results. As a practical matter that would be impossible because of the innumerable variables that are involved in individual situations.
I enclose written suggestions and stand ready to assist in any way.
Lastly, I meant to mention at our meeting that I hope the Department uses its subrogation rights to collect monies from any at-fault party, especially the terrorist groups. I can think of nothing more powerful or meaningful than for the United States government to sue the terrorist groups and recover the frozen funds for the Victim Compensation Fund.
Very truly yours,
Comments by:
Trial Lawyers Care, Inc.
Attachment 1:
October 29, 2001
Trial Lawyers Care
RECOMMENDATIONS FOR REGULATIONS FOR THE SEPTEMBER 11th VICTIM
COMPENSATION FUND
Trial Lawyers Care submits the following recommendations for the September 11th Victim
Compensation Fund:
I. UNIFORM SUBSTANTIVE RULES. To fulfill the intent and purpose of the Act and to
expedite the claim decision process, under Section 404(a)(2) of the Act, uniform substantive
rules should be adopted to administer who can recover and set standards for what can be
recovered.
A. Who can recover. The regulations should clearly state the family members and
dependents who can recover as derivative claimants (in personal injury claims) or
beneficial claimants (in death claims). When a family member is injured or killed, the
resulting losses extend to the members of the family, such as spouses and children and
those dependent on the injured person. The Act refers to relatives and consortium
claims and the regulations should clarify these claimants for both personal injury and
death claims.
This is not to suggest that there should be multiple claims. The Act makes it clear that
there will be only a single claim brought by either an injured survivor or the personal
representative of a deceased person. Rather, within such claims, the regulations should
clarify the derivative claimants for personal injury claims and the beneficial claimants for
death claims.
The regulations should also clarify who is a spouse, child (with provisions for adopted
children and children born out of wedlock) and who is a dependent. There should
further be provisions to protect the immigration status of claimants.
B. What can be recovered. The regulations should also clearly state the standards for
determining damages. The Act provides for full non-economic damages "of any kind or
nature" but does not differentiate between personal injury and death claims. The
regulations should clarify the non-economic damages recoverable in each type of claim.
For example, for personal injury claims, non-economic damages should include all past
and future pain and suffering, inconvenience, physical impairment, loss of the capacity
to enjoy life, injury to reputation and any aggravation of any preexisting disease or
condition. In death cases, non-economic damages should include any conscious pain and suffering
of the decedent as a result of the terrorist acts prior to death, as well as the past and
future mental pain and suffering of a spouse, children, grandchildren and decedent's
parents resulting from the decedent's death.
There should also be a uniform standard for economic damages. The terrorists acts
were an attack on all of America-our institutions, our values and our very way of life.
Thousands of innocent and unwitting people were killed and injured simply because
they happened to be on a plane, in a building or trying to save their fellow Americans.
They should not be subjected to different standards simply because they happened to
live in different states. A uniform standard for all damages is consistent with the
purpose of the Act, its federal nature and the normative rules used by federal courts for
resolving conflicts of laws issues and would avoid disparate results and provide for a
speedy process.
For personal injury claims, economic damages should include past and future loss of
earnings, loss of earnings capacity and any medical expenses. It should also include
past and future loss of support and services, consortium and affection to the claimant's
spouse and children and, in the case of children, loss of parental guidance. For injuries
to minor children, economic damages should include past and future loss of support and
services, companionship and affection to the claimant's parents.
For death claims, economic damages should include past and future loss to the
decedent's estate of the net accumulations of earnings that would have been realized
over a normal life expectancy and any medical, funeral or other last expenses of the
decedent. In addition, economic damages in a death claim should include the loss of
support and services, society, and comfort of a decedent's spouse, children and any
dependents and, in the case of children, loss of parental guidance.
The regulations should also provide for the reimbursement of the reasonable cost of
making a claim.
II. DEFINITIONS. There should be definitions covering the usual terms. In addition,
the flowing terms should be defined to clearly set forth who is an eligible claimant:
a. "Physical Harm". Physical harm should be an objectively verifiable injury and
any resulting condition, disability or loss that directly and in natural sequence is
caused by the injury.
b. "Present at". Present at should be defined as being in a location described in
the Act or in such proximity so that a physical harm was caused by the
destruction of such location.
c. "Immediate aftermath". Immediate aftermath should include all events resulting
rom the attacks, so as to include all individuals who were injured responding to
and/or attempting to rescue individuals. It should also include the period
following the attacks during which rescue efforts continued to find victims and
during which injuries occurred in that process.
II. COLLATERAL SOURCES. The Act provides for deduction of collateral sources
so that damages under the Fund do not duplicate benefits received from those sources.
The regulations should clarify how that process will work so that the purposes of the
Act will be fulfilled and the claimants will not be penalized. For that purpose, we
recommend the following:
a. By law or contract, some collateral source payors have a right of subrogation
or a lien on damages. These provisions are common, for example, in state
worker compensation laws such as those in New York and in health insurance
policies. If those collateral sources were deducted from the Fund award and
then the claimant had to also pay back the same amount because of the
subrogation or lien, the claimant would suffer a double deduction. The
regulations should provide that unless the Hearing Officer can clearly ascertain
that there is no right of subrogation or lien, such collateral sources should not be
deducted.
b. With the exception of life insurance, which under the Act must be deducted,
only collateral sources, which duplicate damages recoverable under the Fund,
should be deducted. Collateral sources benefits for other items not recoverable
under the Fund should not be deducted.
c. Many collateral sources, such as life insurance, were purchased by the
claimants out of their earnings. Part of what they "receive" is the payments that
they made to secure the benefit. In those cases, only the net benefit should be
deducted.
d. As to future collateral sources, only those to which a claimant has a vested or
contractual right to receive should be deducted. Mere possibilities and sources
dependent on future fundraising should not be considered. Further, as to future
benefits, only the present value of those benefits should be deducted.
e. Collateral benefits should not include charitable gifts. Charitable gifts are not
enumerated in the Act and many of the gifts to date have been for items that
would not be compensable in the Fund; i.e., temporary housing, food
allowances, etc. To attempt to sort through other charitable gifts or potential
benefits would be extremely complex, time consuming and could result in
unequal treatment between victims.
III. SIMPLIFIED AND EXPEDITIOUS RULES OF PROCEDURE AND
EVIDENCE. To help expedite the process, we recommend the following:
a. Procedure.
i. There should be a simple claim form, which will not discourage claims
from being filed.
ii. There should be a clear statement as to when claims will be deemed to
be filed and the 120-day period for decision begins. There should be
some allowance for review of a form for completeness when it is
submitted and provisions for handling a form that is not complete; i.e.,
return to the claimant for completion.
iii. There should be qualifications for attorney representation; i.e.,
admission in good standing with a state bar. Attorneys should also be
required to advise clients of the availability of any pro bono programs.
iv. There should be a provision for claimants to, at their election, extend
the 120-day period. Any requests for extension should be in writing
signed by the claimant.
v. Hearings should be held to the extent possible at or near the claimant's
residence.
vi. Claimants should be given the chance to supplement any evidence
found to be insufficient
vii. Hearings should be recorded.
b. Evidence.
i. The rules of evidence should be relaxed. Witnesses should, however,
testify under oath.
ii. Affidavits should be accepted as proof of standard items such as
employment history, earnings, loss of services, relationships, etc.
iii. There should be rebuttal presumptions for items such as:
1. Life expectancy. By designating a presumptively applicable
table, such as that published by the National Center of Health
Statistics, dispute can be avoided in the vast majority of claims.
2. Work life expectancy. It should be presumptively designated as
65.
3. The value of future earnings. By designating the "total offset"
method of calculation as the presumptively proper method of
calculation, the necessity for expert economic evidence can be
avoided in most claims.
IV. HEARING OFFICERS. The perception of the fairness of the hearing process will
depend in large part on who are the Hearing Officers. In many ways they are the lynch
pins of the success of the Fund. For the Hearing Officers we recommend:
a. That they be retired judges, thereby demonstrating knowledge of and
experience in the Civil Justice system.
b. That to the extent possible they be drawn from the areas where the victims are
located.
c. that they be challengeable for prejudice or bias.
d. That they be removable for cause.
V. DECISIONS.
a. Decisions should be in writing, setting forth the specific award for each
beneficiary, any collateral sources being deducted and the reasons therefore.
b. Decisions should be due within 10 days of a hearing.
c. There should be a due process review procedure to appeal from a Hearing
Officer decision to the Special Master. The claimant would have to agree to
extend the 20-day period for authorization of payment as a prerequisite to the
appeal. The regulations should specify the standard for the review; i.e., errors
of law or procedure or a decision contrary to the substantial weight of the
evidence. In the event of a reversal, the 120-day period for decision should
start anew.
VI. AUTHORITY TO COMPROMISE AND SETTLE. Settlements of claims can
greatly expedite the claims decision process. It can also result in negotiated values that
may serve as guides for the resolution of other claims. The regulations should therefore
make clear that the Special Master has the authority to compromise and settle claims.
VII. PAYMENT OF CLAIMS.
a. The regulations should specify to whom payments will be made; i.e., to
individuals, trusts, guardians of minors or incompetents, personal
representatives, etc.
b. The Hearing Officer should have the right to require that a guardian be
appointed for any minor or incompetent.
c. Claimants should have the right to elect to receive periodic payments.
VIII. NOTICE OF THE PROGRAM.
a. The availability of the Victim Compensation Fund should be widely publicized
in the news media.
b. All victims of the September 11th attacks should receive direct mail information
about the availability of the Victim Compensation Fund.
c. Notices of the Victim Compensation Fund should include information on the
availability of all pro bono programs such as Trial Lawyers Care.
IX. PRIVACY PROTECTION. To the extent authorized by law, there should be
provisions protecting the privacy of the claimants and the information that they submit in
the claims process.