N002395
January 16, 2002
Mr. Kenneth Feinberg
Special Master of the September 11th Victim Compensation Fund of 2001
U.S. Department of Justice
Main Building, Room 3140
950 Pennsylvania Avenue
Washington, DC 20530
Re: Comments on the Interim Rule of the September 11th Victim
Compensation Fund of 2001
Dear Mr. Feinberg
My son-in-law, died in the September 11 attack on the Pentagon.
I have serious concern that the good intention of Congress in approving the Victim
Compensation Fund of 2001 to assist the families of the victims and also cap the liabilities of the
airlines may be of little financial help to my daughter and her family.
In particular, I am asking your help to correct two inequities in the department of
Justice's Interim Final Rule for the September 11th Victim Compensation Fund of 2001 that will
result in many families receiving no compensation from the fund. This is because (1) the
projected economic and non-economic loss figures are unrealistically low; and (2) the Fund
reduces any award by the amount of money a victim family receives from a "collateral source".
When Congress passed the Air Transportation Safety and System Stabilization Act on
September 22, 2001, it severely restricted September 11 victims' right to sue the airlines, which
bear ultimate responsibility for the tragedy because of lax security procedures. In exchange for
denying victims the right to sue. Congress provided the September 11th Victim Compensation
Fund of 2001. The Fund is supposed to compensate the victims' families for the types of losses
that would have been recoverable in a lawsuit, but without the burden and delay of litigation.
The Interim Rule/Regulation also describes the intention of the law:
"The Fund is designed to provide a no-fault alternative to tort litigation for
individuals who were physically injured or killed as a result of the aircraft
hijackings and crashes on September 11, 2001" {Interim Rule/Regulation,
Summary Paragraph A.I}
"The attached regulations have two objectives: (1) To provide fair,
predictable and consistent compensation to the victims of September 11
and their families throughout the life of the program; and (2) to do so in an
expedited, efficient manner without unnecessary bureaucracy and needless
demands on the victims." {Interim Rule/Regulation, Supplementary
Information.}.
The Interim Final Rule fails to meet the intent of Congress, however, because many
victims' families will net nothing after collateral source funds are subtracted from the already
undervalued economic and non-economic loss projections.
The Interim Final Rule understates economic loss by underestimating the lifetime earning
potential of victims at all income levels. Noted economist at the National Association of
Forensic Economist showed that the Interim Final Rule uses outdated statistics and
inappropriate methods to arrive at low estimates of our loved one's future earnings. An analysis
done by one of these economist showed that the actual earnings growth for firefighters is 27%
higher than the DOJ estimates, the actual earnings growth of all college educated workers is 30%
higher than DOJ indicates, and actual earnings growth for financial professionals is more that
100% higher than the DOJ estimate.
The Interim Final Rule also falls short of Congress's goals for non-economic loss. The
figure for presumed non-economic loss compensation of $250,000 plus an additional $50,000 for
the spouse and each dependant is rationalized as being roughly equivalent to the amounts
received by public safety officers who were killed while on duty, or members of the military who
are killed in the line of duty while serving our nation. With all due respect to such public safety
officers and military personnel, they choose to go into harm's way and their loss is not the result
of corporate negligence. On the other hand, the September 11 victims are victims of negligent
airline
security. Perhaps more realistic guidance as to the value of non-economic loss can be
found in other air crash disaster awards. For example, non-economic losses recovered in other
air crash and terrorism cases commonly result in awards of between $2 million and $5 million.
A more reasonable projection of non-economic loss is probably somewhere between the current
proposal and the historical litigation result.
The Interim Final Rule reduces any compensation awards by the amount of any funds
received from collateral source, including life insurance. The Interim Final Rule does this
because Congress included such a provision in the Air Transportation Safely and System
Stabilization Act. That does not make it fair; that does not make it right. In many states, the
law on "the collateral source rule" has been well settled for over on hundred years. Under that
rule, damages recoverable for personal injury or death, caused by the negligence of another,
cannot be reduced because of compensation received by proceeds of an insurance policy. This
is because the wrongdoer owes full compensation for the injuries inflicted by them and any
payment by a collateral source in no way relieves the wrongdoer of their obligation. In this
instance, the airlines and others at fault owe full compensation for the injuries resulting from
their negligence. Any payment by a collateral source in no way relieves the airlines and others
at fault of their obligation. This collateral source rule, which has been a fundamental part of tort
victim compensation for over a hundred years, needs to be incorporated into the September 11
Victim Compensation Fund.
The Interim Final Rule needs to be adjusted to provide fair, balanced and acceptable
economic and non-economic loss projection. The economic loss charts need to be increased
and expanded depending upon the deceased's job field. The non-economic loss amounts also
need to be increased into a range that accounts for the tragic way in which these innocent
victims died and the shattered lives they left behind. Collateral source recoveries need to be
excluded from consideration by the Fund. Without these changes, the intent of Congress will
not be fulfilled because there will be no reason for many of the September 11 victims families to
participate in the Fund. Without these changes, it will be better for many victim families to take
a change at litigation rather that sign on in a Fund through which they will receive nothing but a
waiver of their right to sue.
Please rectify these inequities. Give the victim families a reason to participate in this
Fund rather than litigate. Change the Interim Final Rule to provide economic and non-
economic amounts at fair, balance and acceptable levels: do not offset Fund awards by
collateral source recoveries; establish a fair appeal process. Finally, please include the specific
calculation formulas, statistics and assumptions within the rule of the explanatory materials.
Thank you for your consideration and I also ask that the letter on this subject from
Congressman Marty Meehan (D-Mass.) be fully supported in your review of the regulations.
Sincerely,
Individual Comment
Kailua, HI