N002368
Tuesday, January 22, 2002 9:58 PM
Kenneth L. Zwick
Director, Office of Management Programs
Civil Division
U.S. Department of Justice
Main Building
Room 3140
950 Pennsylvania Avenue, NW
Washington, DC 20530
Re: Comments to the Interim Final Rule
While overall, I think the interim final rules
represent a good effort to treat victims fairly, I
believe the following changes will solve some of the
issues that remain and bring the rules more into line
with the provisions of the Statute.
After a thorough review of the proposed interim rule,
I have the following comments:
1. Calculation of Income. For purposes of determining
economic losses, a victim & #8217;s base compensation
appears to be his or her pre-tax earnings for the
three-year period 1998-2000, including salary and
bonus plus certain employer benefits. Why would the
formula choose to use 1998 and ignore the victim&
#8217;s most recent salary in 2001? Most of the
victims were employed for nine out twelve months in
2001 and it would be easy to extrapolate the victims
full 2001 salary. In many cases it would seem that the
2001 salary would be more indicative of a victims
actual earning potential than his or her 1998 salary
would. This is particularly true for younger victims
who in most cases would have a much higher salary in
2001 than in 1998. Which year is more relevant? In the
case of many of the victims, certainly the 2001 salary
is more relevant. The regulations should be amended to
allow the claimant to have the option to use either
1998 or 2001 in the three-year average. This can be
done b y amending the second and third sentences of
Part 104.43 of the regulations pertaining to salary to
read:
The Decedent& #8217;s salary/income in 1998-2001
shall be evaluated in a manner that the Special Master
deems appropriate. The Special Master may, if he deems
it appropriate, take the higher of (i) an average of
income figures for the three years 1998 through 2000,
or (ii) an average of income figures for the three
years 1999 through 2001.
The regulations also need to be a little more clear on
what & #8220;certain employer benefits means. It
would seem that all employer costs associated with
compensating the victim should be considered a part of
his or her compensation. This would include employer
premiums paid for health insurance, dental insurance,
life insurance, and workers compensation insurance.
It should also include employer contributions to a
victims pension plan or 401K plan. These types of
payments are no less a part of compensation than a
victims salary was.
2. Victims Engaged to be Married. The treatment of
victims who were engaged to be married at the time
they were killed on September 11 is not addressed in
the interim final rule. Fiances appear to have no
standing under the fund, even though they were often
the person who was the closest person to the victim
and the person whose life was affected the most
dramatically. In addition, the compensation charts
(particularly the calculation estimating how much of
his compensation a victim would have personally
consumed) assume that the victim would not have kept
his or her promise to marry. If a victim was married
without children the interim rules calculate his or
her economic loss using a consumption factor that is
based on the victim sharing his earnings with his
spouse. Meanwhile, a person who is unmarried is deemed
by the charts to have consumed almost all of his
earnings himself. This is so even though the victim is
engaged to be married and planned to have children,
and would not have c onsumed all of his income
himself. While it is speculative to estimate the
number of children, if any, that a victim would have
had, it is not speculative to assume that the victim
would have gone through with his or her promise to
marry and thus have a lifetime of mutual support. If a
victim was engaged to be married the chart showing
Married Decedent with No Dependent Children should
be used. The fact that September 11 cut short the
lives of some of the victims at a time when they had
not yet completed their plans to wed should create be
an assumption that the victims future personal
consumption would have been that of a single person.
3. Calculation of Non-Economic Loss. It appears that
the interim final rules ignored the Statute in
determining non-economic losses. While it is
impossible to scientifically calculate the proper
amount to award for non-economic losses, the amount of
presumed non-economic loss& #8221; of $250,000 plus
$50,000 for each of the victims spouse and dependants
is not in concert with the Statute. The Statute passed
by Congress and signed by the President defined
non-economic losses in twelve categories, including
losses for: - 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 non-pecuniary losses of any kind or nature. -
There is no mention in the final interim rule of any
of these specific losses that the Statute requires to
be awarded. The Statute did not say that victims would
only be awarded the same amount as 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. The victims if September
11 were not public safety officers or members of the
military killed in the line of duty. They were clerks,
waiters, accountants, office workers and executives
who were murdered when innocently going to work one
Tuesday morning in September. They were murdered for
what they symbolized, Americas freedom and economic
success. They were murdered because of a failure by
the airlines, security firms and the government to put
adequate safeguards in place to properly protect the
nation& #8217;s air transportation system.
Since Congress decided that it would be in the best
interest of the nation to prevent the collapse of the
airline industry by limiting lawsuits brought be
victims, these victims are entitled to receive
compensation in line with what Congress spelled out in
the Statute. Although Congress could easily have
written the Statute to state that non-economic awards
should be comparable to awards given to public safety
officers or the military, it chose not to do so.
Rather Congress specifically spelled out the factors
that should be considered in determining the amount of
non-economic damages. Yet, the interim final rules
chose to ignore these factors and substitute the
judgment of Congress with this comparable to the
military calculation. It should also be noted that
awards to public safety officers and members of the
military are not reduced by the amounts of any
additional life insurance that such public safety
officers or members of the military may have purchased
on their own behalf. Thus, f or many victims the
amount they receive under the Fund would be
substantially less than a public safety officer or
member of the military under that federal statute.
There is no doubt that a jury would award a
significantly higher amount for non-economic damages
in a court action (Courts have awarded higher amounts
than this to people who were burned by spilling cups
of coffee on themselves). In many cases the September
11 victims suffered indescribable pain, agony and
mental anguish for prolonged periods of time (up to
several hours). All of this time the victims were
aware that they were going to die a horrible and
painful death. I understand that it would be difficult
to address non-economic pain and suffering on a
case-by-case basis as who is to say which victims
suffered more than other victims. I think having a set
amount for all victims is the fairest result. However,
the amount needs to consider the factors set forth by
Congress in the Statute. One way to come up with an
amount for non-economic damages is to take an average
of what was awarded by juries in any cases where
victims suffered greatly for prolonged periods of
time, knowing that their fate was to die within hours.
Increasing the amount of non-economic damages would
also help to solve two other criticisms of the interim
rules. (1) it would help to close the gap in awards
between highly compensated individuals and lower
compensated individuals, and (2) it would increase the
gross amount of the awards prior to deducting life
insurance and other collateral sources of income
making the fund a more viable alternative to many that
would otherwise file law suits. A significant increase
in the non-economic awards would go a long way toward
bringing the interim final rules into concert with the
Statute passed by Congress. I would like to thank you
and your staff for taking on this very difficult task
and trying to do the right thing by all of the
parties involved. As we all know, no amount of money
could come close to adequately compensating the
families of victims for what they are going through.
The victim compensation fund (the Fund) is an
attempt to provide for fair and just compensation
outside of lawsuits. It is far from a free lunch
though. The Airline Stabilization Act (the Statute)
put severe limitations on a victim& #8217;s ability to
recover from the airlines and from other negligent
parties. The Statute was conceived by Congress as a
way of ensuring that the airlines are not brought to
financial ruin by the immense litigation that would
follow this attack. Such litigation and the financial
collapse of the airlines would have had a devastating
affect on the US economy. The resulting business
slowdown would have deprived the US Treasury of
significant tax receip ts equal to many times more
than the cost of this Fund. Because of this fact, the
existence of the Fund will, without a doubt, save the
taxpayers a significant amount of money.
Thank you for considering the above comments.
Individual Comment
Garden City New York