N002317
Tuesday, January 22, 2002 5:47 PM
Re: Comments on Interim Final Rules
See Attached.
Donovan & O'Connor, LLP
September 22, 2002
Kenneth L. Zwick, Director
Office of Management Programs
U.S. Department of Justice, Civil Division
Main Building, Room 3140
950 Pennsylvania Avenue NW
Washington, DC 20530
Dear Mr. Zwick:
Comments of Families of September 11 on DOJ Interim Final Rules
Families of September 11 understands that the Department of Justice (DOJ) and the Special Master have only had a very short time to develop and issue the Interim Final Rule (the “Rule”) within the deadline set by Congress to govern payments under the September 11th Victim Compensation Fund established as part of the Air Transportation Safety and System Stabilization Act, Public Law 107-42. However, we believe there are serious deficiencies in the Rule, which must be corrected if the Fund is to serve its intended purpose of providing full, fair, and fast compensation to victims of September 11 and their families. We appreciate the opportunity to comment on the Rule, and hope that DOJ and the Special Master will work diligently to correct the deficiencies we point out.
Families of September 11 is a non-profit organization of injured victims and families of those killed in the recent terrorist attacks. The group’s mission is to ensure that the victims’ and families’ interests are protected and to advocate public policies that will improve the prevention of and response to terrorism. More information is available at .
Our primary concern with the interim final regulations is that DOJ has ignored the fundamental mandate of the Act to provide full and fair compensation to victims and their families. Fortunately, through the notice and comment process you have provided, there is ample opportunity to correct the problems with the interim final regulations. In the comments below, we identify the fundamental problems we have with the regulations; we have also attached a version of the rule that highlights the specific changes to the Rule that we seek. Making these changes would fulfill the legislative mandate of Congress.
Background
The Victim Compensation Fund was created by Title IV of the airline bailout bill passed by Congress shortly after the September 11 attacks. The Act provided the airlines with $15 billion in cash and loan guarantees and capped the airlines' liability for the crashes at the limits of their insurance coverage. Thus, the airlines face no out-of-pocket expenses for the widespread death and destruction caused by the crashes of their aircraft into the World Trade Center, the Pentagon, and a field near Shanksville, Pennsylvania. Estimates of the value of this limitation on liability imposed on all potential claimants range into the tens of billions of dollars.
Acknowledging the fact that this airline liability cap severely restricted the victims' right to sue the airlines and obtain compensation from them, Congress created the Compensation Fund to provide victims and their families with full payment for a wide range of specified and unspecified non-economic (or non-pecuniary) damages (e.g., pain and suffering, loss of enjoyment of life, loss of consortium between husband and wife, and more) and full restitution for economic damages (e.g., lost future income), minus collateral payments. In this way, Congress sought to ensure that the airlines’ bailout would not be funded by the victims’ families, who had already suffered the most from the horrible tragedy of September 11.
The three primary defects in the interim regulations concern the valuation of non-economic damages, the calculation of economic damages, and the provisions for hearings.
Proposed Non-Economic Awards Are One-Tenth Those Made in Comparable Cases
The DOJ's proposed awards for non-economic damages ($250,000 per victim plus $50,000 for a spouse and each dependent) are only one-tenth the level paid in comparable cases. In other cases of airline crashes and terrorism, non-economic damage awards of $2 million to $5 million are typical, and much higher awards have been made in some cases. Moreover, Congress explicitly enumerated a broad range of non-economic damages for which victims and their families shall be compensated:
physical and emotional pain, suffering, inconvenience, physical impairment, mental anguish, disfigurement, loss of enjoyment of life, loss of society and companionship, loss of consortium (other than loss of domestic service), hedonic damages, injury to reputation, and all other nonpecuniary losses of any kind or nature. Sec. 402(7).
In the case of a victim killed in the attack, all of the above except physical impairment, disfigurement, and injury to reputation are applicable and payable to the victim’s estate or (as in the case of loss of consortium and loss of society and companionship) to members of the surviving family. Thus there are at least eight relevant elements cited in the statute: (1) physical pain, (2) emotional pain, (3) suffering, (4) inconvenience, (5) mental anguish, (6) loss of enjoyment of life, (6) loss of society and companionship, (7) loss of consortium, and (8) hedonic damages, in addition to the catch-all “all other non-pecuniary losses of any kind or nature.”
In fact, Congress enumerated more kinds of non-economic damages than are normally paid in any single state jurisdiction. Thus, it would be reasonable to expect that payments made under the Victim Compensation Fund would be at least as high, if not higher, than previous awards or settlements for non-economic damages in air crash or terrorism cases. As one example, in the case of the Lockerbie bombing, a spouse was awarded $5 million in non-economic damages. Under DOJ’s plan for the September 11th Fund, a widow and two surviving dependent children would receive only $400,000, subject to reduction by the collateral offset provision.
Shockingly, DOJ tacitly admits that it did not even look at the elements of non-economic damages that Congress required to be compensated. Rather, in the only justification for the presumed award, DOJ’s notice states that “the $250,000 figure is roughly equivalent to the amounts received under existing federal programs by public safety officers who are killed while on duty, or members of our military who are killed in the line of duty while serving our nation.” 66 Fed. Reg. 66279. The regulation then cites to the statutory provision for a group life insurance program under which servicemembers can elect to purchase policies with a death benefit up to a maximum of $250,000, commonly known as the Servicemembers’ Group Life Insurance (SGLI) program, and a newly amended federal statute under which the government pays to the families of fallen public safety officers $250,000—on top of any other amounts they may receive from other sources. Id.
Neither of these programs was intended to, nor does, compensate a victim's family for the full range of non-economic damages identified by Congress in the statute establishing the Fund. DOJ flouted Congress's specific mandate and instead replicated existing, inapposite, and limited federal death-benefit programs. Had Congress intended to base the non-economic loss awards on these other federal programs, it could have easily referenced them in the Act. It did not. Instead, it cited specific tort-based elements of loss that are to be compensated. DOJ’s “justification” in the preamble to the Rule, as well as statements in the press attributed to the Special Master that the level of compensation was negotiated with DOJ, OMB, and the White House, clearly indicate that the statute was simply disregarded. This is improper and illegal.
The absurdity of DOJ’s approach is illustrated by its reliance on SGLI as the basis for the amount awarded. If a serviceman killed at the Pentagon had elected the SGLI at $250,000, the offset of life insurance proceeds required by the Act would wipe out the non-economic damages entirely (unless there were a spouse or other dependents, at $50,000 each under the DOJ scheme). DOJ's approach therefore assumes that Congress intended the non-economic damages to be merely illusory—to be given with one hand and then taken away with the other. Not only is this clearly incorrect—it flies in the face of basic principles of statutory construction. In short, it is the epitome of an arbitrary and capricious approach to implementing the Act.
Presentations made at a recent meeting of the National Association of Forensic Economists, which have been forwarded to DOJ, support our contention that DOJ’s presumed non-economic damage awards are unreasonably low. Simply put, claimants and the relatives of the victims on whose behalf the claims are filed have a right to the non-economic damages specified in the statute. Non-economic damages awards should be consistent with the awards paid for comparable claims in other air crash and terrorism cases.
Moreover, in the context of a rulemaking on aircraft operator security measures that was begun in 1997 and completed in 2001 – a rulemaking specifically designed to help thwart terrorist attacks against aircraft -- the FAA stated that, “in order to provide a benchmark comparison of the expected safety benefits of rulemaking actions with estimated costs in dollars, a minimum of $2.7 million is used as the value of avoiding an aviation fatality (based on the willingness to pay approach for avoiding a fatality).” Aircraft Operator Security; Final Rule, 66 Fed. Reg. 37330, 37353 (July, 17,2001). See also Aircraft Operator Security;Proposed Rule, 62 Fed. Reg.41430, 41746 (August 1, 1997). Interestingly, the willingness to pay approach is one recognized means of calculating hedonic damages, which is but one element of the non-economic damages specified in the act.
Another problem with respect to non-economic damages relates to statements made by the Special Master that the probate laws of the various states will determine the distribution of the entire award among family members and other claimants. While appropriate for some damages (e.g., pain and suffering of the victim), this approach fails to recognize that other non-economic losses are incurred by specific claimants, not by the estate. For example, the surviving spouse suffers loss of consortium. Under the proposal as outlined by the Special Master, payments for loss of consortium could be divided among the heirs and, where there is a will, might be awarded entirely to a claimant other than the spouse. While the Special Master has stated that he reserves the right to overrule the probate courts, it is unreasonable to force a claimant appeal to the Special Master to prevent such an inappropriate distribution of funds.
The approach to distribution contained in the regulations using state laws is appropriate for awards made to the estate for the non-economic losses suffered by the decedent and the economic consequences of his or her death, but as noted above, the Act sets forth its own criteria for non-economic harm suffered by the decedent’s relatives, independent of state law. Thus, state laws simply do not have the necessary mechanisms in place by which to ensure distribution of those awards as Congress intended, absent discrete identification of those awards and their recipients and a clear mandate that those recipients receive the awards granted them. In order to ensure the proper disposition of awards for losses suffered by surviving family members, the attached revisions propose to amend the Rule to provide for specific designation of such awards to appropriate individuals. This proposal recognizes that relatives, including spouses, parents, and dependent and non-dependent children, and siblings suffer from, and are entitled to non-economic damages in their own right.
DOJ’s Plan Significantly Undervalues Economic Damages
DOJ’s proposed awards for economic damages significantly underestimate actual economic losses. We have asked the Special Master for all of the assumptions and methodology used in calculating the “presumptive awards,” in order to better understand and analyze them, because DOJ provided only general guidance on the Fund’s website on how it determined these award levels. We only received this additional information very recently, and will have our economic experts review it to make specific comments. At the Special Master’s invitation, we also tried to arrange a meeting between our economic experts and those who advised DOJ on this issue, but the DOJ advisors were not available for such a meeting prior to the close of the comment period.
It is clear that there are major problems with DOJ’s approach. The National Association of Forensic Economists recently participated in a conference at which experienced economists pointed out significant flaws in DOJ’s methodology. For example, it appears that DOJ unnecessarily relied almost exclusively on federal government data that was out of date and inapplicable to the groups to which DOJ applied it. The presentation of a forensic economist with experience in air crash cases (for both plaintiffs and defendants) indicates that a properly constructed life-cycle earnings estimate for Securities and Financial Services workers (with a college education) in New York/New Jersey would exceed DOJ’s projection by over 100%. Similarly, actual earnings of firefighters and police would exceed the DOJ projection by about 27%, and the earnings of all college graduates would exceed DOJ’s projection by about 30%. DOJ also seriously underestimates “real” (beyond inflation) increases in earnings by administrative support and clerical workers.
Rather than utilizing aggregated national data, this expert advises that readily available data could be used to create 8-12 prototype earning patterns, based on occupation and education, that would much more closely match the expected earnings patterns of the victims.
In the case of high-income victims, the undervaluation of increases in compensation is exacerbated because the regulations arbitrarily cap a victim’s income at $225,000 a year. Thus, DOJ starts off with an artificially depressed earnings level, and then uses unrealistically low growth rates for projecting increases from that level. This cap, for which there is no justification in the statute, would result in some families receiving severely reduced compensation for their actual economic losses. The only justification DOJ has offered for capping incomes is that not doing so would result in awards greater than what the families “need.” The Act contains no reference, express or implied, to “need” based criteria and DOJ has provided no explanation of how it determined these “needs.” The human cost of the income cap is that many widows and some widowers will have to sell their homes, deplete their children’s college funds, give up their plans of being full-time parents while their children are young, and make other wrenching adjustments at a time when they already have more than enough burdens to bear.
In general, there is a significant underestimation of promotions and other increases in earnings for victims. DOJ apparently relied on the Boards of Actuaries of the federal civil service and military retirement systems, which track federal worker incomes and pension requirements, not the higher-paying private sector career paths. See U.S. Department of Justice September 11th Victim Compensation Fund of 2001 Website, link to Presumed Loss Calculation Tables Before any Collateral Offset, at Step Two. Experts at the NAFE conference pointed out that data on federal workers is irrelevant for assessing private sector earnings projections. DOJ’s error, coupled with its emphasis on past 3 years of income (which the Special Master “may average”), makes it appear that DOJ grafted a federal pension approach onto the methodology used to ascertain economic damages, rather than considering the likely income-earning potential of the decedent, as is routinely done in wrongful death cases.
Other problems pointed out by the economists are the fact that the worklife estimates used by DOJ are seriously outdated, particularly for women. DOJ’s aggregation of this outdated data means that its worklife estimates are low for both men and women, thus underestimating awards for both genders. There is also a serious underestimation of the economic value of household services performed by victims, particularly women. These, along with the use of pre-tax discount rate, further widen the gap between DOJ’s flawed approach and a proper valuation of economic loss.
As noted above, we intend to have economic experts review the assumptions and methodology we received very late in the comment period from the Special Master, and may seek to supplement our comments with specific recommendations to reflect that analysis. At a minimum, however, matrices of presumed awards should be expanded to include more finely segmented subpopulations of potential claimants to reflect those diverse educational backgrounds, experiences and domiciles of the victims for which there are ample current and reliable statistical data. Doing so will have the salutary effects of lending credibility to the now-flawed presumptive awards, provide better notice to the victims and their relatives of the probable consequences to them of giving up their rights to sue, and reducing the number of hearings before the Special Master and his designees.
Even in the absence of that specific analysis, the fundamental point is clear: economic damages should include all of those demonstrated by the claimants. That is, prior to collateral payment deductions, the award should reflect the full net present value of all economic damages. Moreover, pensions, which are a form of deferred compensation, should be included in the calculation of economic losses, as should housing allowances, life insurance and other benefits relating to employment.
The Right to a Hearing Must be Meaningful
A particularly insidious notion inherent in the interim final regulations is that a family’s award may be increased above the “presumptive” award only by a showing of “extraordinary circumstances”— which implies that these must somehow be above and beyond the circumstances applicable to other victims or victims’ families. See e.g., Sec. 104.31(b)(2) (“the Special Master or his designee shall utilize the presumptive award methodology . . . but may modify or vary the award if the claimant presents extraordinary circumstances not adequately addressed by the presumptive award methodology.”) and Sec. 104.33(f)(2) This makes the hearing or appeal to the Special Master a mere charade. DOJ has constructed a scheme that provides unduly low awards to those who lost loved ones due to the extraordinary events of September 11, and then, in effect, declares that only in cases that are extraordinary, beyond those already extraordinary events, will awards be increased. This is virtually an impossible standard to meet, especially in light of the Special Master’s statements that he cannot and will not make “Solomon-like” distinctions between the suffering of individuals or families. Because the presumptive award levels are too low for virtually all claimants, it is not “extraordinary,” but rather, “routine” that the presumed awards will not accurately measure a family’s losses.
The standard should be that DOJ compensate each victim and family for the types of damages enumerated by Congress at levels comparable to those recoverable in the tort system the Fund was designed to replace. Legally, this would translate into a standard that the claimant demonstrate, by a fair preponderance of the evidence, the actual economic and non-economic damages sustained by the victim and the victim’s family members. In other words, all a claimant should be required to demonstrate is that the presumed award does not adequately compensate the victim’s estate and the victim’s family for the losses suffered by the victim and the family. If there are deficiencies in the methodologies used to calculate the presumed awards, damages in most, if not all, of the cases will exceed the “presumed award.” The fact that such disparity between actual and presumed damages is routine, should be no bar to an appropriate adjustment in the award. Of course, this underscores the benefit to DOJ, the Special Master, and the claimants and victims’ families, of ensuring that the presumed awards are revised to approximate, as closely as possible, the actual losses sustained by the victims and their families.
Conclusion
DOJ can and should recognize the need to make significant revisions to conform the regulations to the statutory requirements. Specifically, we urge DOJ to (1) increase its non-economic loss award by an order of magnitude to meet the standards of awards and settlements in aircrash and terrorism cases and properly reflect the damages that Congress has determined are compensable, (2) correct the methodological flaws in the calculation of economic damages and use accurate, up-to-date and finely segmented data in making those calculations, and (3) recognize that a claimant should not have to show “extraordinary circumstances” to increase the “presumed award,” but rather, should only have to show that the “presumed award” does not accurately reflect the damages incurred by the victim and his or her family.
We look forward to working with you to improve the regulations to comply with the statute by providing victims and their families with full compensation for their economic and non-economic losses.
Families of September 11, Inc. is a tax-exempt charitable organization and since you received no goods or services in consideration of this gift, your contribution is fully deductible to the extent allowed by law. This letter satisfies IRS requirements for documentation of tax-deductible contributions; we recommend that you retain it as proof of your contributions.
Comments by:
Families of September 11, Inc.
The following are proposed regulations submitted by Families of September 11, Inc. They follow the format and adopt much of the language of the Interim Final Rules issued by the Department of Justice. Footnotes have been provided to explain and comment upon the changes made to the language of the Interim Final Rules issued by the Department of Justice to conform the regulations set forth therein to the language and intent of the Air Transportation Safety and System Stabilization Act, Public Law 107-42.
PART 104--SEPTEMBER 11TH VICTIM COMPENSATION FUND OF 2001
Subpart A--General; Eligibility
104.1 Purpose.
104.2 Eligibility definitions and requirements.
104.3 Other definitions.
104.4 Personal Representative.
104.5 Foreign claims.
104.6 Amendments to this rule.
Subpart B--Filing for Compensation; Application for Advance Benefits
104.21 Filing for compensation.
104.22 Advance benefits.
Subpart C--Claim Intake, Assistance, and Review Procedures
104.31 Procedure for claims evaluation.
104.32 Eligibility review.
104.33 Hearing.
104.34 Publication of awards.
104.35 Claims deemed abandoned by claimants.
Subpart D--Amount of Compensation for Eligible Claimants
104.41 Amount of compensation.
104.42 Applicable state law.
104.43 Determination of presumed economic loss for decedents.
104.44 Determination of presumed noneconomic losses for decedents and beneficiaries.
104.45 Determination of presumed economic loss for claimants who suffered physical harm.
104.46 Determination of presumed noneconomic losses for claimants who suffered physical harm.
104.47 Collateral sources.
Subpart E--Payment of Claims
104.51 Payments to eligible individuals.
104.52 Distribution of award to decedent's beneficiaries.
Subpart F--Limitations
104.61 Limitation on civil actions.
104.62 Time limit on filing claims.
104.63 Subrogation.
Subpart G--Measures to Protect the Integrity of the Compensation
Program
104.71 Procedures to prevent and detect fraud.
Authority: Title IV of Pub. L. 107-42, 115 Stat. 230, 49 U.S.C.
40101 note.
Subpart A--General; Eligibility
Sec. 104.1 Purpose.
This part implements the provisions of the September 11th Victim
Compensation Fund of 2001, Title IV of Public Law 107-42, 115 Stat. 230
(Air Transportation Safety and System Stabilization Act) to provide compensation through their ``personal representatives'' to eligible individuals who were physically injured as a result of the terrorist-related aircraft crashes of September 11, 2001, and to the relatives of deceased individuals who were killed as a result of the crashes. All compensation provided through the Fund will be on account of personal physical injuries or death.
Sec. 104.2 Eligibility definitions and requirements.
(a) Eligible claimants. The term eligible claimants means:
(1) Individuals present at the World Trade Center, Pentagon, or
Shanksville, Pennsylvania site at the time of or in the immediate aftermath of the crashes and who suffered physical harm, as defined herein, as a direct result of the terrorist-related aircraft crashes;
(2) The Personal Representatives of deceased individuals aboard
American Airlines flights 11 or 77 and United Airlines flights 93 or
175; and
(3) The Personal Representatives of individuals who were present at the World Trade Center, Pentagon, or Shanksville, Pennsylvania site at the time of or in the immediate aftermath of the crashes and who died as a direct result of the terrorist-related aircraft crash.
(4) The term eligible claimants does not include any individual or representative of an individual who is identified to have been a participant or conspirator in the terrorist-related crashes of
September 11.
(b) Immediate aftermath. The term immediate aftermath of the crashes shall mean, for purposes of all claimants other than rescue workers, the period of time from the crashes until 12 hours after the crashes. With respect to rescue workers who assisted in efforts to search for and recover victims, the immediate aftermath shall include the period from the crashes until 96 hours after the crashes.
(c) Physical harm.
(1) The term physical harm shall mean a physical injury to the body that was treated by a medical professional within 24 hours of the injury having been sustained or within 24 hours of rescue; and
(i) Required hospitalization as an in-patient for at least 24 hours; or
(ii) Caused, either temporarily or permanently, partial or total physical disability, incapacity or disfigurement.
(2) In every case not involving death, the physical injury must b verified by contemporaneous medical records created by or at the direction of the medical professional who provided the medical care.
(d) Personal Representative. The term Personal Representative shall mean the person determined to be the Personal Representative under
Sec. 104.4 of this part.
(e) Present at the site. The term present at the site (i.e., the
World Trade Center, Pentagon, or Shanksville, Pennsylvania site) shall mean physically present at the time of the crashes or in the immediate aftermath:
(1) In the buildings or portions of buildings that were destroyed as a result of the airplane crashes; or
(2) In any area contiguous to the crash sites that the Special
Master determines was sufficiently close to the site that there was a demonstrable risk of physical harm resulting from the impact of the aircraft or any subsequent fire, explosions, or building collapses
(generally, the immediate area in which the impact occurred, fire
occurred, portions of buildings fell, or debris fell upon and injured
persons).
Sec. 104.3 Other definitions.
(a) Beneficiary. The term beneficiary shall include all persons defined below as Estate Beneficiary and as Non-Economic Loss Beneficiary.
(i)Estate Beneficiary. The term Estate Beneficiary shall mean a person entitled under the laws of the decedent's domicile to receive payments or benefits from the estate of or on behalf of the decedent for non-economic losses suffered by the decedent during his or her life as provided in Sec. 402(7) of the Act and for economic loss as provided in Sec. 402(5) of the Act on whose behalf the claim to the Fund is deemed to have been filed.
(ii)Non-Economic Loss Beneficiary. The term Non-Economic Loss Beneficiary shall mean the spouse, parents, siblings and children of a deceased victim all of whom shall be entitled to compensation for losses suffered by them under Sec. 402(7) of the Act.
(b) Dependents. The Special Master shall identify as dependents those persons who were or, under applicable law could have been, identified by the victim on his or her federal tax return for the year 2000 unless:
(1) The claimant demonstrates that a minor child of the victim was born or adopted on or after January 1, 2001;
(2) Another person became a dependent in accordance with then applicable law on or after January 1, 2001.
(c) Spouse. The Special Master shall identify as the spouse of a victim the person who was or, under applicable law could have been, reported as spouse on the victim's federal tax return for the year 2000, unless the victim was married or divorced in accordance with applicable state law on or after January 1, 2001 and before the injury or death of the victim on September 11, 2001.
(d) The Act. The Act, as used in this part, shall mean Public Law
107-42, 115 Stat. 230 (``Air Transportation Safety and System Stabilization Act''), 49 U.S.C. 40101 note.
(e) Victim. The term victim shall mean an eligible injured claimant or a decedent on whose behalf and on behalf of whose Non-Economic Loss Beneficiaries a claim is brought by an eligible Personal Representative.
Sec. 104.4 Personal Representative.
(a) In general. The Personal Representative shall be:
(1) An individual appointed by a court of competent jurisdiction as the Personal Representative of the decedent or as the executor or administrator of the decedent's will or estate.
(2) In the event that no Personal Representative or executor or administrator has been appointed by any court of competent jurisdiction, and such issue is not the subject of pending litigation or other dispute, the Special Master may, in his discretion, determine that the Personal Representative for purposes of compensation by the
Fund is the person named by the decedent in the decedent's will as the executor or administrator of the decedent's estate. In the event no will exists, the Special Master may, in his discretion, determine that the Personal Representative for purposes of compensation by the Fund is the first person in the line of succession established by the laws of the decedent's domicile governing intestacy.
(b) Notice to beneficiaries. Any purported Personal Representative must, before filing an Eligibility Form, provide written notice of the claim (including a designated portion of the Eligibility Form) to the immediate family of the decedent (including, but not limited to, the decedent's spouse, former spouses, children, siblings, dependents, and parents), to the executor, administrator, and beneficiaries of the decedent's will, and to any other persons who may reasonably be expected to assert an interest in an award or to have a cause of action to recover damages relating to the wrongful death of the decedent.
Personal delivery or transmission by certified mail, return receipt requested, shall be deemed sufficient notice under this provision. The claim forms shall require that the purported Personal Representative certify that such notice (or other notice that the Special Master deems appropriate) has been given. In addition, as provided in
Sec. 104.21(b)(5) of this part, the Special Master may publish a list of individuals who have filed Eligibility Forms and the names of the victims for whom compensation is sought, but shall not publish the content of any such form.
(c) Objections to Personal Representatives. Objections to the authority of an individual to file as the Personal Representative of a decedent may be filed with the Special Master by parties who assert a financial interest in the award up to 30 days following the filing by the Personal Representative. If timely filed, such objections shall be treated as evidence of a ``dispute'' pursuant to paragraph (d) of this section.
(d) Disputes as to identity. The Special Master shall not be required to arbitrate, litigate, or otherwise resolve any dispute as to the identity of the Personal Representative. In the event of a dispute over the appropriate Personal Representative, the Special Master may suspend adjudication of the claim or, if sufficient information is provided, calculate the appropriate award and authorize payment, but place in escrow any payment until the dispute is resolved either by agreement of the disputing parties or by a court of competent jurisdiction. Alternatively, the disputing parties may agree in writing to the identity of a Personal Representative to act on their behalf, who may seek and accept payment from the Fund while the disputing parties work to settle their dispute.
Sec. 104.5 Foreign claims.
In the case of claims brought by or on behalf of foreign citizens, the Special Master may alter the requirements for documentation set forth herein to the extent such materials are unavailable to such foreign claimants.
Sec. 104.6 Amendments to this rule.
In the event that amendments are subsequently made to any section of this Part, claimants are entitled to have their claims processed in accordance with the provisions that were in effect at the time that their claims were submitted under Sec. 104.21(d).
Subpart B--Filing for Compensation; Application for Advance
Benefits
Sec. 104.21 Filing for compensation.
(a) Compensation form; ``filing.'' Except for applications for
Advance Benefits pursuant to Sec. 104.22, no claim may be considered until the claimant has submitted both an ``Eligibility Form'' and either a ``Personal Injury Compensation Form'' or a ``Death
Compensation Form'' and all known Non-Economic Loss Beneficiaries have been given a reasonable opportunity to submit Non-Economic Loss Beneficiary Forms. A claim shall be deemed ``filed'' for purposes of section 405(b)(3) of the Act (providing that the Special Master shall issue a determination not later than 120 days after the date on which a claim is filed), and for any time periods in this part, when a Claims Evaluator determines that the Eligibility Form and either a Personal Injury Compensation Form or a Death Compensation Form and any timely filed Non-Economic Loss Beneficiary Forms are substantially complete. Provided, however, that if a claimant files an Eligibility Form requesting Advance Benefits pursuant to Sec. 104.22 of this part without filing either a ``Personal Injury Compensation Form'' or a ``Death Compensation Form,'' the claim shall be deemed ``filed'' as to, and only as to, such claimant when the Claims Evaluator determines that the Eligibility Form is substantially complete, but the time period for determination and any time periods in this part shall be stayed or tolled as described in Sec. 104.22(g) of this part.
(b) Eligibility Form. The Special Master shall develop an
Eligibility Form that will require the claimant to provide information necessary for determining the claimant's eligibility to recover from the Fund.
(1) The Eligibility Form shall require that the claimant certify that he or she has dismissed any pending lawsuit seeking damages as a result of the terrorist-related airplane crashes of September 11, 2001 (except for actions seeking collateral source benefits) within 90 days of the effective date of this part pursuant to section 405(c)(3)(B)(ii) of the Act and that there is no pending lawsuit brought by a dependent,
spouse, or other beneficiary of the victim.
(2) The Special Master shall require as part of the notice requirement pursuant to Sec. 104.4(b) that the claimant provide copies of a designated portion of the Eligibility Form to the immediate family of the decedent (including, but not limited to, the spouse, former spouses, children, siblings, dependents, and parents), to the executor, administrator, and beneficiaries of the decedent's will, and to any other persons who may reasonably be expected to assert an interest in an award or to have a cause of action to recover damages relating to the wrongful death of the decedent.
(3) The Eligibility Form may require claimants to provide the following proof:
(i) Proof of death: Death certificate or similar official documentation;
(ii) Proof of presence at site: Documentation sufficient to establish presence at one of the crash sites, which may include, without limitation, a death certificate, records of employment, contemporaneous medical records, contemporaneous records of federal, state, city or local government, an affidavit or declaration of the decedent's or injured claimant's employer, or other sworn statement (or unsworn statement complying with 28 U.S.C. 1746) regarding the presence of the victim;
(iii) Proof of death on board aircraft: Death certificate or records of American or United Airlines or other sufficient official documentation;
(iv) Proof of physical harm: Contemporaneous medical records of
hospitals, clinics, physicians, licensed medical personnel, or
registries maintained by federal, state, or local government, and
records of all continuing medical treatment;
(v) Personal Representative: Copies of relevant legal
documentation, including court orders; letters testamentary or similar
documentation; proof of the purported Personal Representative's
relationship to the decedent; copies of wills, trusts, or other
testamentary documents; and information regarding other possible
beneficiaries as requested by the Eligibility Form;
(vi) Any other information that the Special Master deems necessary
to determine the claimant's eligibility.
(4) The Special Master may also require waivers, consents, or
authorizations from claimants to obtain directly from third parties tax
returns, medical information, employment information, or other
information that the Special Master deems relevant in determining the
claimant's eligibility or award, and may request an opportunity to
review originals of documents submitted in connection with the Fund.
(5) Application for Advance Benefits: The Eligibility Form shall
include a section allowing claimants to indicate that they wish to
apply for Advance Benefits. All such claimants must state on the Form facts establishing financial hardship that would justify a
determination that they are in need of Advance Benefits.
(6) The Special Master may publish a list of individuals who have
filed Eligibility Forms and the names of the victims for whom
compensation is sought, but shall not publish the content of any such
form.
(c) Personal Injury Compensation Form, Death Compensation Form and Non-Economic Loss Beneficiary Form.
The Special Master shall develop a Personal Injury Compensation Form
that each injured claimant must submit. The Special Master shall also
develop a Death Compensation Form that each Personal Representative
must submit. These forms shall require the claimant to provide certain
information that the Special Master deems necessary to determining the
amount of any award, including information concerning income,
collateral sources, benefits, and other financial information, and
shall require the claimant to state the factual basis for the amount of
compensation sought. They shall also allow the claimant to submit certain other information that may be relevant, but not necessary, to the determination of the amount of any award. The Special Master shall also develop a Non-Economic Loss Beneficiary Form for spouses, siblings, parents and children of deceased victims seeking an award of non-economic loss damages under Sec. 402(7) of the Act. This form shall require a statement of the relationship of the beneficiary to the victim.
(1) Claimants shall, at a minimum, submit all tax returns that were
filed for the years 1998, 1999, and 2000. The Special Master may, at
his discretion, require that claimants submit copies of tax returns or
other records for any other period of years he deems appropriate for
determination of an award. The Special Master may also require waivers,
consents, or authorizations from claimants to obtain directly from
third parties medical information, employment information, or other
information that the Special Master deems relevant to determining the
amount of any award.
(2) Claimants may attach to the ``Personal Injury Compensation
Form'' and ``Death Compensation Form'' and beneficiaries may attach to the “Non-Economic Loss Beneficiary Form” any additional statements, documents or analyses by physicians, experts, advisors, or any other person or entity that the claimant or beneficiary believes may be relevant to a determination of compensation.
(d) Submission of a claim. Section 405(c)(3)(B) of the Act provides
that upon the submission of a claim under the Fund, the claimant waives
the 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, except for
civil actions to recover collateral source obligations. A claim shall
be deemed submitted for purposes of section 405(c)(3)(B) of the Act
when the claim is deemed filed pursuant to Sec. 104.21, regardless of
whether any time limits are stayed or tolled.
(e) Provisions of information by third parties. Any third party
having an interest in a claim brought by a Personal Representative may provide written statements or information regarding the Personal Representative's claim. The Claims Evaluator or the Special Master or his designee may, at his or her discretion, include the written statements or information as part of the claim.
Sec. 104.22 Advance Benefits.
(a) Advance Benefits. Eligible Claimants may apply for immediate
``Advance Benefits'' in a fixed amount as follows:
(1) $50,000 to Personal Representatives; and
(2) $25,000 for injured claimants who meet the requirements of paragraph (d) of this section.
(b) Credit against award. The Advance Benefit shall be credited against any final compensation award so that the amount of the Advance
Benefit is deducted from the final award under this program.
(c) Application for Advance Benefits. An otherwise eligible claimant may seek Advance Benefits to alleviate financial hardship faced by the claimant (or financial hardship faced by the beneficiaries of the decedent) by submitting an Eligibility Form described in
Sec. 104.21(b) and indicating thereon that he or she is applying for
Advance Benefits.
(d) Eligibility for Advance Benefits. In the case of a Personal
Representative, the claimant may be deemed eligible for Advance
Benefits if a Claims Evaluator or the Special Master or his designee
determines that the claimant is eligible to recover under the Fund. In
the case of an injured claimant, the claimant may be deemed eligible
for Advance Benefits when the Special Master or his designee determines
that the claimant is eligible to recover under the Fund and that the
claimant's physical injury required hospitalization for one week or
more.
(e) Authorization of payments.
(1) Payment in the amount described in paragraph (a) of this
section will be authorized immediately upon a determination that the
claimant is eligible for Advance Benefits and the claimant is:
(i) An injured claimant;
(ii) A Personal Representative who was the spouse of the deceased
victim on September 11, 2001; or
(iii) A Personal Representative who has obtained the consent of the
spouse of the deceased victim (or, if there is no surviving spouse, all
of the dependents of the deceased victim) to file for Advance Benefits.
(2)(i) With respect to other Personal Representatives, payment will
be authorized within 15 days after the determination that the claimant
is eligible for Advance Benefits, provided that no other individual has
asserted a colorable conflicting claim as the Personal Representative
with respect to the decedent and the Personal Representative identifies and has given notice to the beneficiaries to whom such Advance Benefits will be distributed.
(ii) In the event that a colorable conflicting claim has been
asserted, no Advance Benefit will be paid until a final eligibility
determination has been made.
(f) Tolling of 120-day clock and other time periods. A claimant
filing an Eligibility Form requesting Advance Benefits before filing a
Personal Injury Compensation Form or Death Compensation Form will be
deemed to have waived his right to commencement of the 120-day period
in section 405(b)(3) of the Act (providing that the Special Master
shall provide notice to the claimant of his determination within 120
days after the date on which a claim is filed). The 120-day period and
all other time limitations in this part, except those applicable to
Advance Benefit payments, shall be stayed or tolled until such time
that a Claims Evaluator determines that the claimant's Personal Injury
Compensation Form or Death Compensation Form and all timely filed Non-Economic Loss Beneficiary Forms are substantially complete.
Subpart C--Claim Intake, Assistance, and Review Procedures
Sec. 104.31 Procedure for claims evaluation.
(a) Initial review. Claims Evaluators shall review all forms filed
by the claimant and beneficiaries and either deem the claim ``filed'' (pursuant to 104.21(a)) or notify the claimant and any such beneficiary of any deficiency in the forms or any required documents.
(b) Procedural tracks. Each claim will be placed on a procedural
track, described herein as ``Track A'' and ``Track B,'' selected by the
claimant on the Personal Injury Compensation Form or Death Compensation
Form.
(1) Procedure for Track A. The Claims Evaluator shall determine
eligibility and the claimant's and Non-Economic Loss Beneficiaries presumed awards pursuant to Secs. 104.43 to 104.46 of this part and, within 45 days of the date the claim was deemed filed, notify each of them in writing of the eligibility determination, the amount of the presumed awards, and the right to request a hearing before the Special Master or his designee under Sec. 104.33 of this part. After an eligible claimant and Non-Economic Loss Beneficiaries, if any, have been notified of the presumed award(s), the claimant and any such Non-Economic Loss Beneficiaries may either accept the presumed compensation determination as the final determination and request payment, or may instead request a review before the Special Master or his designee pursuant to Sec. 104.33. Claimants and purported Non-Economic Loss Beneficiaries found to be ineligible may appeal pursuant to Sec. 104.32.
(2) Procedure for Track B. The Claims Evaluator shall determine eligibility within 45 days of the date the claim was deemed filed, but shall not determine the claimant's or purported Non-Economic Loss Beneficiary’s presumed award; the Claims Evaluator shall notify the claimant and purported Non-Economic Loss Beneficiary in writing of the eligibility determination. Upon notification of eligibility, the claimant and all Non-Economic Loss Beneficiaries will proceed to a hearing pursuant to Sec. 104.33. At such hearing, the Special Master or his designee shall consider the evidence presented, whether through witnesses or documents, and determine, based upon a fair preponderance of the evidence, the extent of the harm to the injured claimant, the estate of the deceased victim and all Non-Economic Loss Beneficiaries and the compensation to which they are entitled under the Act. There shall be a right of review by the Special Master from determinations made by his designees. There shall be no review or appeal rom a determination made by the Special Master.
(c) Multiple claims from the same family. The Special Master may treat claims brought by or on behalf of two or more members of the same immediate family as related or consolidated claims for purposes of determining the amount of any award.
Sec. 104.32 Eligibility review.
Any claimant deemed ineligible by the Claims Evaluator may appeal that decision to the Special Master or his designee by filing an eligibility appeal on forms created by the office of the Special
Master.
Sec. 104.33 Hearing.
(a) Supplemental submissions. The claimant and Non-Economic Loss Beneficiaries may prepare and file Supplemental Submissions within 21 calendar days from notification of either the presumed award (Track A) or eligibility (Track B). The Special Master shall develop forms appropriate for Supplemental Submissions.
(b) Conduct of hearings. Hearings shall be before the Special Master or his designee. The objective of hearings shall be to permit the claimant and Non-Economic Loss Beneficiaries to present information or evidence that they believe is necessary to a full understanding of the claim. The claimant and Non-Economic Loss Beneficiaries may request that the Special Master or his designee review any evidence relevant to the determination of the award, including without limitation: Factors and variables used in calculating economic loss; the identity of the victim's spouse, children, siblings, parents and dependents; the relevant financial needs of the injured claimant and beneficiaries; facts affecting non-economic loss; and any factual or legal arguments that the claimant or any Non-Economic Loss Beneficiary contends should affect the award. Claimants and Non-Economic Loss Beneficiaries shall be entitled to present evidence through the testimony of witnesses before the Special Master or his designee and submit any statements or reports in writing. The Special Master or his designee may require authentication of documents, including medical records and reports, and may request and consider information regarding the collateral sources received by or available to the victim or the victim's family or other material that the Special Master or his designee deems material to the compensation claims and collateral source issues contemplated by the Act and these regulations.
(c) Location and duration of hearings. The hearings shall, to the extent practicable, be scheduled at times and in locations convenient to the claimant or his or her representative. The hearings shall afford substantial due process to all participants and be of such lengths as are reasonably necessary to prove eligibility and each and every element of loss for which compensation is permitted under the Act. The claimant and Non-Economic Loss Beneficiaries may elect whether so much of the hearings as relate to them shall be public.
(d) Witnesses, counsel, and experts. Claimants and Non-Economic Loss Beneficiaries shall be permitted, but not required, to present witnesses, including expert witnesses. The Special Master or his designee shall be permitted to question witnesses and examine the credentials of experts. The claimant and all Non-Economic Loss Beneficiaries shall be entitled to be represented by an attorney in good standing, but it is not necessary that any of them be represented by an attorney.
(e) Waivers. The Special Master shall have authority and discretion to require any waivers necessary to obtain more individualized information on specific claimants and Non-Economic Loss Beneficiaries.
(f) Track A review of presumed award. For proceedings under Track
A, the Special Master or his designee shall revise presumptive awards to correct all errors and award full and fair compensation, subject to applicable collateral sources, based upon the individual circumstances of the claimant, in all cases where:
(1) There was an error in determining the presumptive award, either because the criteria of the claimant or Non-Economic Loss Beneficiary were misapplied or for another reason; or
(2) The claimant or Non-Economic Loss Beneficiary presents, by a fair preponderance of the evidence, circumstances not addressed or not adequately addressed by the presumptive award.
(g) Determination. The Special Master shall notify the claimant and all Non-Economic Loss Beneficiaries in writing of the final amount of the awards, but need not create or provide any written record of the deliberations that resulted in that determination. There shall be a right of review by the Special Master from determinations made by his designees. There shall be no review or appeal from a determination made by the Special Master.
Sec. 104.34 Publication of awards.
In order to assist potential claimants in evaluating their options
of either filing a claim with the Special Master or filing a lawsuit in
tort, the Special Master reserves the right to publicize the amounts of
some or all of the awards, but shall not publish the name of the
claimants or victims that received each award. If published, these
decisions would be intended by the Special Master as general guides for
potential claimants and should not be viewed as precedent binding on
the Special Master or his staff.
Sec. 104.35 Claims deemed abandoned by claimants.
The Special Master and his staff will endeavor to evaluate promptly
any information submitted by claimants and beneficiaries of deceased victims. Nonetheless, it is the responsibility of the claimant and beneficiaries to keep the Special Master informed of his or her current address and to respond within the duration of this two-year program to requests for additional information. Claims outstanding at the end of this program because of a claimant's failure to complete his or her filings shall be deemed abandoned.
Subpart D--Amount of Compensation for Eligible Claimants.
Sec. 104.41 Amount of compensation.
As provided in section 405(b)(1)(B)(ii) of the Act, in determining the amount of compensation to which a claimant is entitled, the Special
Master shall take into consideration the harm to the claimant and all Non-Economic Loss Beneficiaries, the facts of the claim, and the individual circumstances of the claimant. The individual circumstances of the claimant shall not include the financial needs or financial resources of the claimant or the victim's dependents and beneficiaries. As provided in section 405(b)(6) of the Act, the Special Master shall reduce the amount of compensation by the amount of collateral source compensation the claimant (or, in the case of a Personal Representative, the victim's beneficiaries) or any Non-Economic Loss Beneficiary has received or is entitled to receive as a result of the terrorist-related aircraft crashes of September 11, 2001; provided however, no collateral source reduction of an award to which any beneficiary would otherwise be entitled shall be made unless that beneficiary actually received or is entitled to receive such collateral source. In no event shall an award (before collateral source compensation has been deducted) be less than $500,000 in any case brought on behalf of a deceased victim with a spouse or dependent, or $300,000 in any case brought on behalf of a deceased victim who was single with no dependents.
Sec. 104.42 Applicable state law.
The phrase ``to the extent recovery for such loss is allowed under applicable state law,'' as used in the statute's definition of economic loss in section 402(5) of the Act, is interpreted to mean that the
Special Master shall compensate claimants for those categories or types of economic losses that would be conpensable under the law of the state that would be applicable to any tort claims brought by or on behalf of the victim. Conversely, computation of non-economic loss shall be determined, without reference to the law of any state, but rather shall be based upon the criteria enumerated in Sec. 402(7) of the Act.
Sec. 104.43 Determination of presumed economic loss for decedents.
In reaching presumed determinations for economic loss for Personal
Representatives bringing claims on behalf of decedents, the Special Master shall, for the sole purpose of determining the presumed awards to be made to those electing Track A, consider sums corresponding to the following:
(a) Loss of earnings and other benefits related to employment. The
Special Master, as part of the process of reaching a ``determination'' of the presumed award to which those electing Track A are entitled, shall develop a methodology and publish schedules, tables, or charts that will permit prospective claimants to estimate determinations of loss of earnings or other benefits, including pension, deferred compensation, life insurance, allowances for housing and the like whether or not considered income for income tax purposes, related to employment, based upon as finely segmented and reliable statistical data as is readily available, representative of the victim’s circumstances, including such criteria as: The age of the decedent as of September 11, 2001; the education and experience of the decedent; the place of the decedent’s employment at the time of death; the number of dependents who survive the decedent; whether the decedent is survived by a spouse; the amount and nature of the decedent's income for recent years and lost replacement services. For this purpose, the decedent's salary/income in 1998-2000 shall be evaluated in a manner that the Special Master deems appropriate and shall be adjusted to reflect inflation from whatever base period is chosen. In cases where the victim was a minor child, the Special Master may assume, for this purpose, an average income for the child commensurate with the average income of all wage earners in the United States.
(b) Medical expense loss. This loss equals the out-of-pocket
medical expenses that were incurred as a result of the physical harm
suffered by the victim (i.e., those medical expenses that were not paid
for or reimbursed through health insurance). This loss shall be
calculated on a case-by-case basis, using documentation and other
information submitted by the Personal Representative.
(c) Replacement services loss. Presumed economic loss awards to which those electing Track A are entitled shall include replacement services and similar measures.
(d) Loss due to death/burial costs. This loss shall be calculated
on a case-by-case basis, using documentation and other information
submitted by the personal representative and includes the out-of-pocket
burial costs that were incurred.
(e) Loss of business or employment opportunities. Such losses shall
be addressed through the procedure outlined above in paragraph (a) of
this section.
Sec. 104.44 Determination of presumed noneconomic losses for
Decedents and beneficiaries.
In reaching presumed determinations for non-economic losses the Special Master shall, for the sole purpose of determining the presumed awards to be made to those electing Track A, award sums corresponding to the following:
$_________ for Estate Beneficiaries; plus
$__________ to the spouse and $_________ to each dependant of the deceased victim; plus
$__________ to each non-dependant child, $_________ to each sibling and $__________ to each parent of the deceased victim.
Sec. 104.45 Determination of presumed economic loss for claimants who
suffered physical harm.
In reaching presumed determinations for economic loss for claimants who suffered physical harm (but did not die), the Special Master, for the sole purpose of determining the presumed awards to be made to those electing Track A, shall consider sums corresponding to the following:
(a) Loss of earnings or other benefits related to employment. The
Special Master may determine the loss of earnings or other benefits related to employment on a case-by-case basis, using documentation and other information submitted by the claimant, regarding the actual amount of work that the claimant has missed or will miss without compensation. Alternatively, the Special Master may determine the loss of earnings or other benefits related to employment by relying upon the methodology created pursuant to Sec. 104.43(a) and adjusting the loss based upon the extent of the victim's physical harm.
(1) Disability; in general. In evaluating claims of disability, the
Special Master will, in general, make a determination regarding whether the claimant is capable of performing his or her usual profession and participate in his or her usual daily activities in light of the injuries.
(2) Total permanent disability. With respect to claims of total permanent disability, the Special Master may accept a determination of disability made by the Social Security Administration as evidence of disability without any further medical evidence or review. The Special
Master may also consider determinations of permanent total disability made by other governmental agencies or private insurers in evaluating the claim. The Special Master may require that the claimant submit an evaluation of the claimant's disability and ability to perform his or her occupation prepared by medical experts.
(3) Partial disability. With respect to claims of partial disability, the Special Master may consider evidence of the effect of the partial disability on the claimant's ability to perform his or her usual occupation as well as the effect of the partial disability on the claimant's ability to participate in usual daily activities.
(b) Medical Expense Loss. This loss equals the out-of-pocket medical expenses that were incurred as a result of the physical harm suffered by the victim (i.e., those medical expenses that were not paid for or reimbursed through health insurance). In addition, this loss equals future out-of-pocket medical expenses that will be incurred as a result of the physical harm suffered by the victim (i.e., those medical expenses that will not be paid for or reimbursed through health insurance). These losses shall be calculated on a case-by-case basis, using documentation and other information submitted by the claimant.
(c) Replacement services loss. Presumed economic loss awards to which those electing Track A are entitled shall include replacement services and similar measures.
(d) Loss of business or employment opportunities. Such losses shall be addressed through the procedure outlined above in paragraph (a) of this section.
Sec. 104.46 Determination of presumed noneconomic losses for claimants who suffered physical harm.
In reaching presumed determinations for non-economic loss for claimants who suffered physical harm (but did not die), the Special Master, for the sole purpose of determining the presumed awards to be made to those electing Track A, may rely upon the noneconomic losses described in Sec. 104.44 and adjust the losses based upon the extent of the victim's physical harm.
Sec. 104.47 Collateral sources.
(a) Payments that constitute collateral source compensation. The
amount of compensation shall be reduced by all collateral source
compensation, including life insurance, pension funds, death benefit
programs, and payments by federal, state, or local governments related
to the terrorist-related aircraft crashes of September 11, 2001, provided however, the amount of the reduction shall not include that part of any collateral source compensation paid by or attributable to the claimant or beneficiary.
(b) Payments that do not constitute collateral source compensation.
The following payments received by claimants do not constitute
collateral source compensation:
(1) The value of services or in-kind charitable gifts such as
provision of emergency housing, food, or clothing; and
(2) Charitable donations distributed to the beneficiaries of the
decedent, to the injured claimant, or to the beneficiaries of the
injured claimant by private entities.
Subpart E--Payment of Claims
Sec. 104.51 Payments to eligible individuals.
Not later than 20 days after the date on which a determination is made by the Special Master regarding the amount of compensation due a claimant and Non-Economic Loss Beneficiaries under the Fund, the Special Master shall authorize payment to the claimant of the total amount determined with respect to the claimant and all Non-Economic Loss Beneficiaries.
Sec. 104.52 Distribution of award to decedent's beneficiaries.
The Personal Representative shall distribute so much of the award as is not made to or for Non-Economic Loss Beneficiaries in a manner consistent with the law of the decedent's domicile or any applicable rulings made by a court of competent jurisdiction and shall distribute to each Non-Economic Loss Beneficiary the amount designated for him or her in the award. The Personal Representative shall, before payment is authorized, provide to the Special Master a plan for distribution of any award received from the Fund. Notwithstanding any other provision of these regulations or any other provision of state law, in the event that the Special Master concludes that the Personal Representative's plan for distribution does not appropriately compensate the victim's spouse, children, or other relatives, the Special Master may direct the Personal Representative to distribute all or part of the award to such spouse, children, or other relatives. The Personal Representative shall certify to the Special Master within 30 days of the distribution of the award that he or she has distributed the sums awarded, if any, to the Non-Economic Loss Beneficiaries.
Subpart F--Limitations
Sec. 104.61 Limitation on civil actions.
(a) General. Section 405(c)(3)(B) of the Act provides that upon the submission of a claim under the Fund, the claimant waives the 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, except that this limitation does not apply to civil actions to recover collateral source obligations. The Special Master shall take appropriate steps to inform potential claimants and beneficiaries of section 405(c)(3)(B) of the Act.
(b) Pending actions. Claimants and beneficiaries who have filed a civil action or who are a party to such an action as described in paragraph (a) of this section may not file a claim with the Special Master unless they withdraw from such action not later than March 21, 2002.
Sec. 104.62 Time limit on filing claims.
In accordance with the Act, no claim may be filed under this part
after December 22, 2003.
Sec. 104.63 Subrogation.
Compensation under this Fund does not constitute the recovery of tort damages against a third party nor the settlement of a third party action, and the United States shall be subrogated to all potential claims against third party tortfeasors of any victim receiving compensation from the Fund. For that reason, no person or entity having paid other benefits or compensation to or on behalf of a victim shall have any right of recovery, whether through subrogation or otherwise, against the compensation paid by the Fund.
Subpart G--Measures to Protect the Integrity of the Compensation
Program
Sec. 104.71 Procedures to prevent and detect fraud.
(a) Review of claims. For the purpose of detecting and preventing the payment of fraudulent claims and for the purpose of assuring accurate and appropriate payments to eligible claimants and beneficiaries, the Special Master shall implement procedures to:
(1) Verify, authenticate, and audit claims;
(2) Analyze claim submissions to detect inconsistencies, irregularities, duplication, and multiple claimants; and
(3) Ensure the quality control of claims review procedures.
(b) Quality control. The Special Master shall institute periodic quality control audits designed to evaluate the accuracy of submissions and the accuracy of payments, subject to the oversight of the Inspector General of the Department of Justice.
(c) False or fraudulent claims. The Special Master shall refer all evidence of false or fraudulent claims to appropriate law enforcement authorities.
Dated: January 22, 2002.
At a meeting, the Special Master has asked why we think the Rule provides a cap on economic damages. One reason we think so because DOJ states that “the regulations also provide that the Special Master’s schedules, tables, or charts should identify presumed determinations of economic loss up to a salary level commensurate with the 98th percentile of individual income in the United States,” and that “a claimant should not assume that he or she will receive an award greater than the presumed award simply because the victim had an income that exceeded the income for the 98th percentile.” 66 Fed. Reg. 66278.
This edit is necessary to be sure that non-economic loss awards are made not only to the decedent’s estate, but also to his or her relatives for their losses.
This section is amended to conform with the express language of Sec. 403 of the Act which reads
It is the purpose of this title to provide compensation to any individual (or relative of a deceased individual) who was physically injured or killed as a result of the terrorist-related aircraft crashes of September 11, 2001
and to assure that those specifically enumerated elements of noneconomic loss which were not and could not have been suffered by the decedent (e.g., loss of consortium and loss of society and companionship), are recovered by and paid to the relatives of the decedent that suffered those losses. Such losses simply do not belong to the decedent’s estate. See Sec. 402(7).
See footnote 2. The fact that Sec. 402(7) – Non-economic Losses -- of the Act makes no reference to state law (as does Sec. 402(5) – Economic Losses), the broad array of non-economic loss categories of recoverable damages set forth therein, the express purpose of the Act to compensate relatives of those who died, as well as the undeniable losses that all spouses, siblings, parents and children have suffered and will continue to suffer require inclusion of these relatives (at least) as those entitled to receive compensation for “loss of consortium … loss of society and companionship … and any other nonpecuniary losses of any kind whatsoever.”
There is nowhere in the Act any provision that conditions compensation on having filed a federal tax return, nor is that the rule in any state or federal court. In short there is no rational relationship between the act of filing or not filing a federal income tax return and the harm suffered by the victims and their families or the compensation contemplated by the Act.
See footnote 4.
See footnote 2.
This is required to assure notice is given to all Non-Economic Loss Beneficiaries and to make clear that they need not be dependants to be entitled to receive such notice.
See footnotes 1., 9., and 14. All beneficiaries, including a spouse and emancipated children, siblings and parents must be given a reasonable opportunity to participate in the claims process to assure that they do not lose their rights under the Act.
Since relatives of decedents have claims for loss of consortium and loss of society and companionship under applicable state law as well as under the Act and the filing of the claim by the claimant may affect these right, the claimant should certify that no such claims are pending. This is made simple by the requirement under the Act that all such claims be brought in the United States District Court for the Southern District of New York..
Such notice must be given to assure that all claims for damages arising out of the death of a victim are heard together and that no beneficiary loses an opportunity to assert an interest in an award.
Not all Non-Economic Loss Beneficiaries are dependants – thus the strike out of the word “other.” See footnote 7.
This additional form is required to provide the Special Master with the preliminary information necessary to evaluate the claims for non-economic loss suffered by the relatives of the victim (i.e., spouse, parents, siblings and children), expressly mandated by the Act and implicitly contemplated by the enumeration of categories of non-economic loss belonging only to such relatives (e.g., loss of consortium).
This form is required to provide the preliminary information necessary to evaluate claims for non-economic losses suffered by relatives of the victim (i.e., spouse, siblings, children, and parents) to fulfill the express purpose of the Act and to compensate relatives of deceased victims.
This edit (changing “for” to “to”) is necessary to make clear that the payments may be made to a personal representative for a beneficiary.
See footnote 8.
See footnote 8.
Since the interests of the claimant and the Non-Economic Loss Beneficiaries may not be coincident, each should have a right to a hearing, if requested, and prompt payment, if satisfied with the presumed compensation determination.
This replaces the “extraordinary circumstances” standard with a “fair preponderance of the evidence” standard to assure that the individual circumstances of each claimant are fully developed and fairly considered as required by the Act.
Providing review of all hearing officer determinations will assure fairness and uniformity of standards of compensation.
There is nowhere in the Act any reference, express or implied, to a “need” or “resource” based adjustment to an award. The Act contemplates compensation (i.e., replacement) for loss and simply does not permit “over” compensation of the less fortunate and “under” compensation for the more fortunate.
This change is required to assure that the hearings afforded are not a charade. The Act adverts to both “hearing[s]” and “due process,” each of which terms has well recognized meanings in American Jurisprudence. The regulations must provide those types of hearings and due process. No participant should be exposed to a public hearing unless she or he agrees.
See footnotes 18 and 21. No claimant should be asked to give up his or her right to litigate without being assured a full and fair hearing to determine the award to which she or he is entitled under the Act.
This makes clear that the individual circumstances of the claimant is not interpreted to mean the claimants needs and available resources. There is nothing in the Act to suggest that it is a pseudo welfare program.
This edit ensures that Non-Economic Loss Beneficiaries are also subject to the Collateral Source reduction.
This is intended to assure that collateral sources are offset only against the awards made to those who received or are entitled to receive the collateral source payment(s).
Stating the proposition positively is more consistent with the purpose of the Act.
Since the Act omits reference to state law in the definition of non-economic losses, includes such a reference in the definition of economic loss and enumerates a broad array of non-economic elements of damage, it would defeat the plan language of the Act to exclude from consideration any of the enumerated elements.
These edits are necessary to make the presumed economic loss awards representative of the economic losses actually suffered by those discrete subpopulations of victims for which there is ample, readily available, current and reliable statistical data. Failure to supply more accurate and extensive matrixes will force victims and their families to make uninformed decisions and require vastly increased numbers of unnecessary and unnecessarily lengthy hearings.
This amendment is necessary to ensure that whatever base figure is chosen, the presumed economic loss figures are predicated on real dollar values, otherwise the base figure will be much less than the earning capacity of the decedent at the date of his or her death.
In general, the edits made in this paragraph make clear that the presumed awards and their methodologies apply only in the Track A cases and do not establish the methodologies to be employed on review of Track A awards or in Track B cases. It also includes additional relevant criteria (supplied by credible economists) and eliminates the references to averaging of three past year income for establishing the presumptive awards and eliminates the 98th percentile caps on income.
Replacement services are components of economic loss and are expressly excluded from loss of consortium (non-economic loss) awards. Furthermore, although replacement loss services are a function of the non-work related time one has to commit to them, they are not dependant upon partial or no employment status.
This sum must represent the presumed damages for physical and emotional pain, suffering, inconvenience, physical impairment, mental anguish, disfigurement, injury to reputation and all other nonpecuniary losses of any kind or nature endured by the decedent prior to his or her death and also includes loss of enjoyment of life, hedonic damages and all other nonpecuniary losses of any kind or nature which represent the lost nonpecuniary aspects of life itself. See Sec. 402(7) of the Act. The Special Master is uniquely situated to, can and, in order to effect the compensatory purpose of the Act, must provide an amount that is representative of awards made by juries and judges, performing duties no different than he has been charged with performing, in like (e.g., aircraft terrorist) cases familiar to American jurisprudence.
This sum must represent the presumed loss of society and companionship and loss of consortium (other than loss of domestic service) and all other nonpecuniary losses of any kind or nature suffered by the spouse and other dependants of the victim as provided in Sec. 402(7) of the Act. Among these losses are the mental anguish and grief they have endured and will continue to endure and the loss of care of and nurturing by the decedent. All of these extended relatives are or would benefit from grief counseling. Such counseling in small part replaces the care and nurturing lost to these relatives and, it is worthy of note that the economic productivity of these relatives will likely be materially increased, if they have the resources they need to better cope with their circumstances. See footnote 32.
This must represent the presumed loss suffered by those non-dependant close relatives of the deceased victim (e.g., adult children, parents and siblings of society and companionship and loss of consortium (other than loss of domestic service) and all other nonpecuniary losses of any kind or nature as a result of the death of the victim. See footnotes 32 and 33 and Sec. 402(7) of the Act.
See footnote 30.
This captures the language of subsection (3) of this section.
See footnote 30. The deleted language (i.e. Such presumed losses include any noneconomic component of replacement services loss) is omitted because these losses are economic in nature and there is no support in the Act for including them as part of non-economic loss. The Act defines non-economic loss and makes clear that the only relevant component (i.e., loss of consortium) excludes “loss of domestic services.”
The adjective “charitable” preceding “entities” was deleted to ensure that the exception for charitable donations is not driven by the character of the donor, but rather, by the nature of the payment. The last sentence is deleted, because it simply begs the question of what is a “charitable donation.”
It is the purpose of this edit to make clear that awards for non-economic loss to relatives of deceased victims for their “loss of society and companionship, loss of consortium (other than loss of domestic service) … and all other non-pecuniary losses of any kind or nature” are paid to those to whom they belong (i.e., not the representative of the estate).
This will assure that the Personal Representative distributes the awards to the Non-Economic Loss Beneficiaries.
This edit is intended to ensure that no beneficiary is construed to have lost his or her rights either under the Act or to pursue litigation because of the conduct of the representative of the estate of a deceased victim.
See footnote 41.
This continues the references to two classes of eligible recipients of compensation under the act in the case of a deceased victim (i.e., the legal representative of the decedent and relatives of the decedent who have non-economic damage claims in their own right.