P000316
Thursday, January 31, 2002 9:33 PM
KBW - Comment Letter
Attached please find comments on the Interim Final Rule prepared by the Keefe, Bruyette & Woods Family Group. The original will follow via Federal Express. We appreciate your consideration in extending the deadline to post comments. If you have any questions on the attached please feel free to contact at or at .
Best regards.
Attachment 1:
Keefe, Bruyette & Woods Family Group
c/o Keefe, Bruyette & Woods, Inc.
New York, New York 10019
January 30, 2002
VIA ELECTRONIC MAIL AND FEDERAL EXPRESS
Kenneth L. Zwick
Director, Office of Management Programs
Civil Division
U.S. Department of Justice
Main Building, Room 3140
950 Pennsylvania Avenue
Washington, DC 20530
Re:September 11th Victim Compensation Fund of 2001
The families of Keefe, Bruyette & Woods, Inc. (“KBW”) employees killed in the September 11th attack on the World Trade Center submit these comments in response to the Department's Interim Final Rule regarding the administration of the September 11th Victim Compensation Fund of 2001 (the “Fund”), promulgated under the Air Transportation Safety and System Stabilization Act (the “Act”).
By way of introduction, KBW is a full service broker-dealer that occupied the 88th and 89th floors of Two World Trade Center. Of the roughly 175 employees who worked for KBW in Two World Trade Center, 67 perished. Not a single person who was in KBW’s offices at the time of the attack of the second airplane survived. Of the 67 KBW victims, 33 were married, several were engaged to be married, 28 had children and several had wives who are pregnant. In some cases victims provided some or all of the support to their parents or other family members. Ages of KBW victims ranged from 23 years old to 77 years old: seventeen were in their 20's; thirty-one were in their 30's; thirteen were in their 40's; four were in their 50's; one was in their 60's; and one was in their 70's. The job descriptions of the KBW victims covered the full range of employees, from Chairman to receptionist, and the annual compensation of victims ranged from the low five figures into seven figures.
We believe that the regulations promulgated under the Interim Final Rule regarding the administration of the Fund by Kenneth R. Feinberg, Esq., Special Master of the Fund (the “Special Master”) are, in many respects, a betrayal to and a double victimization of the families that have already suffered enormously as a result of the tragedies of September 11. As outlined below, the regulations fail to implement the basic purpose of the Fund, which is to provide fair and adequate compensation to victims for their economic and noneconomic losses. This letter addresses the following three aspects of the regulations which most egregiously breach the intent of the Act: (i) the calculation of economic loss, (ii) the presumed award for noneconomic loss and (iii) collateral source offsets. We also offer several suggestions on the claims evaluation process.
I. THE CALCULATION OF ECONOMIC LOSS IS UNJUSTIFIABLY RESTRICTIVE
a. The “Cap”
The Act does not empower the Special Master to restrict the calculation of economic loss in any manner. Rather, the Act defines economic loss as “pecuniary loss resulting from harm (including loss of earnings or other benefits related to employment…) to the extent recovery for such loss is allowed under applicable State law.’’ (Act, Sec. 402 (emphasis added)). The Act further requires the determination of a claimant’s economic losses to be based on the individual circumstances of the claimant. In contravention of the express terms of the Act, however, the regulations provide that the maximum amount of annual income that will be recognized for purposes of computing economic loss of a claimant are commensurate with the 98th percentile of the individual income in the US (i.e., $231,000 for the year 2000). (28 CFR §104.43.) Moreover, the preamble to the regulations provides 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” and “claimants should not expect awards grossly in excess of the highest awards listed on the Special Master’s presumed award chart.”
No potentially applicable state law allows for the calculation of economic loss to be based upon a “capped” income, and nowhere in the Act did Congress express an intent to apply such cap. The imposition of an income cap based on national figures blatantly disregards the higher salaries associated with working in New York City and also ignores the higher cost of living in the New York City region. Although the Pentagon was regarded as a military target, it is generally accepted that the Twin Towers were targeted because they symbolized the financial success of America. By extrapolation, our spouses, fiancés, parents, children and siblings died, in part, because they were financially successful. The income cap ignores this fact and undermines the fundamental purpose of the Fund – to fairly and adequately compensate victims for their economic and noneconomic losses. As one of the stated goals of the Fund is to act as a substitute for litigation in tort (and we note that the Act eviscerated our ability to bring lawsuits against the airlines and other potential commercial defendants), the Special Master should be required to determine a claimant’s economic loss in the same manner that such losses are determined in tort litigation, which is the amount of income likely lost by the victim. Any cap on income is both illogical and contrary to the basic principles underlying the Fund. Accordingly, the regulations must be revised to remove the cap.
We are encouraged by comments made by the Special Master in meetings with the KBW Family Group. The Special Master has insisted that there is no “cap” on individual income, and that the income of those victims who earned in excess of $231,000 will be compensated on a proportionate basis to those victims who earned $231,000 or less. When pressed for an example, the Special Master indicated that a victim who earned $1,000,000 annually and was married with two children would receive an award under the Fund of approximately $18,000,000, prior to collateral offsets. We also agree with statements made by the Special Master indicating that earnings in excess of $231,000 are, in fact, extraordinary circumstances. We therefore expect the Special Master to recognize higher salaries as extraordinary economic circumstances which will be compensated under the Fund, and we urge the Department to (i) delete any references to actual or implied salary caps in the Final Rule and (ii) provide assurance in the Final Rule that claimants will be entitled to receive an award greater than the presumed award if the victim had an income that exceeded $231,000.
b. Calculation of Economic Loss
As stated above, the Act provides a broad definition of economic loss. The regulations, however, appear to limit economic loss to the victim’s pre-tax earnings, which include salary, bonuses and “certain other employer benefits (such as premiums for medical coverage paid by the employer).” (See Presumed Economic and Noneconomic Loss Tables, II(A)(1).) It is thus unclear whether the regulations include, as elements of earnings, potentially significant items of income such as profit-sharing plans, stock option grants, equity ownership plans, contributions by the employer to retirement programs and incidental benefits such as insurance payments and meal expenses. The Final Rule needs to provide that such elements of compensation will be included in the Special Master’s determination of economic loss. We note that the determination of economic loss is an analysis routinely performed in courtrooms across our nation (as the Special Master, due to his involvement in the Agent Orange litigation, is undoubtedly familiar). The ability of the Special Master and his designees to perform such an analysis, based on the individual circumstances of each claimant and including all relevant elements of earnings, needs to be clarified in the Final Rule.
The regulations also provide that the decedent’s salary/income in 1998-2000 will be evaluated in a manner that the Special Master deems appropriate. (28 CFR § 104.43.) We believe that this approach may unfairly penalize victims who where either relatively new at their job at the time of the attack or who received significant income increases during the past two years. We propose that the Special Master use the average of the victim’s two highest income levels from the four year period 1998 through 2001, basing the 2001 income level on a 264-day year (i.e., year ending September 11th) to account for victims reduced wages and bonuses in 2001.
c. The Presumed Economic and Noneconomic Loss Tables
The Presumed Economic and Noneconomic Loss Tables (the “Tables”) purport to illustrate awards which would be granted under the Fund. Although perhaps illustrative of typical awards that could be granted under the strictures of the Interim Final Rule, pre-determined and presumptive guidelines capped by maximum amounts cannot, by their nature, take into account the individual circumstances of a claimant. The career path of a particular victim, average wage increases within that victim’s industry, average wage increases given by that victim’s employer, individual consumption rates and the individual habits of savings should all be essential elements in the determination of economic loss. While such information may not lend itself to a chart, the Tables should provide claimants with basic, non-binding benchmarks from which they may base their presumed award. Unfortunately, the Tables are fundamentally flawed in several respects.
First, the Tables provide that, with respect to high wage earners, the Special Master will compute the presumed award based on an average income equal to the minimum amount earned by the top 2 percent of wage earners (i.e., $231,000). As stated above, there is no justification for the economic cap. We urge the Department to revise the Tables to include presumed awards for victims with salaries of up to $1,000,000. This will provide guidance to personal representatives of high-wage earners and remove much uncertainty from the Fund process. It will also help ensure that all claimants are treated in an equivalent manner.
Second, the wage increases included in the Tables are unduly restrictive. Wage increases for victims should be broken down into 5 year periods, and 5.1% annual increases for victims 31 through 50 simply does not reflect the demographics of the victims in the World Trade Center. We are aware that a number of independent economists have determined that the methodology used to create the Tables is antiquated and does not reflect the true economic potential of the World Trade Center victims. We urge the Special Master to revise the Tables, with the assistance of independent economists, to more accurately reflect the demographics of the World Trade Center victims. In addition, to incorporate certain of the economic circumstances which specifically relate to the World Trade Center victims, we also suggest that, when revising the Tables, the Special Master utilize information submitted by employers who lost employees in the World Trade Center.
Third, the Tables do not indicate the expected work life and consumption factor of the victims used to calculate the presumed award. We suggest that both the work life estimates and the consumption factors be included as an appendices to the Tables. Inclusion of such charts as appendices to the revised Tables will provide all claimants with a better understanding of the factors used to establish the presumed award, thereby erasing much confusion surrounding the Fund and creating a more transparent award process.
Finally, the methodology utilized by the Special Master to determine the presumed award is somewhat vague. As stated above, to provide a fair alternative to litigation and to justly and adequately compensate claimants, the Special Master needs to create and maintain a transparent, clearly understandable award process. We therefore urge the Special Master to fully disclose the methodology utilized to determine the presumed award so that potential claimants can better assess the award they could receive under the Fund. We note that the recently published FAQ sheet provides information regarding the calculation of presumed economic loss. We request, however, that the Department provide more detailed information and hypothetical examples to help explain the various steps in the process.
d. The Track A Hearing Process
The preamble to the regulations provides that:
If a claimant seeks review of a [Track A] presumed award, the Special Master may consider a range of information, including demographic information on retirement trends for high wage earners, the individual’s historical expenses, savings, and any other factors he deems relevant, including economic trends, information available from the Bureau of Labor Statistics, the Census bureau and other entities on average income and retirement age for the victim’s profession or even for the victim’s employer. (emphasis in original)
This statement seems to indicate that the Special Master may either increase or reduce the presumed award, based on the factors cited above. The Final Rule need to provide that the Special Master will not award the claimant an amount less than the presumed award, prior to collateral source offsets. In addition, the Final Rule should provide that a claimant may submit any additional factors specifically relating to the victim – as an individual – which the claimant deems appropriate. This comports with the Act’s requirement that the Special Master determine awards based on the individual circumstances of the claimant.
e. The Track B Hearing Process
The regulations provide that “at such [Track B] hearing, the Special Master or his designee shall utilize the presumptive award methodology as set forth in Sections 104.43 to 104.46 of this part, but may modify or vary the award if the claimant presents extraordinary circumstances not adequately addressed by the presumptive award methodology.” (28 CFR § 104.31.) As stated above, the presumptive award methodology does not adequately reflect the true amount of economic loss suffered by a claimant. In addition, as also stated above, personal representatives of high wage earners are not even provided with a benchmark award for which to base a presumptive Track B award. This unfairly penalizes such claimants vis-à-vis claimants of victims whose salary was $231,000 or less.
Furthermore, use of the phrase “may modify or vary the award” implies that the Special Master may decrease the amount of the presumptive award. Unless the language is changed to “may increase the amount of the award”, the Special Master, when faced with two virtually identical fact patterns, may grant two grossly disparate awards. This is a clear violation of the purpose of the Fund and no claimant who seeks a Track B hearing should receive an award which is less than the applicable amount set forth in the revised final Tables (prior to collateral offsets).
Finally, the regulations provide that the Special Master may “request and consider information regarding the financial resources and expenses of the victim ’s family”. (28 CFR § 104.33.) It is unclear what benefit this information will serve, and the regulations need to indicate why such information should be proffered. We note that Congress did not empower the Special Master to grant smaller awards to families with larger financial resources, nor did it instruct the Special Master to grant larger awards to families with higher expenses.
f. Public Response
We note that members of the public have questioned why government funds should be used to compensate the victims of September 11, and some have callously suggested that victims’ families are “greedy”. We respond that Congress eviscerated our constitutional right to sue commercial defendants in tort litigation. In exchange, Congress decreed that the United States would compensate victims of the September 11 attacks. Had Congress not effectively stripped our right to litigate September 11th-related claims we would have filed suit against the airlines and others. Although it is impossible to predict the results of any such lawsuits, recent suits against commercial defendants in the United States have resulted in jury awards multiple times larger then potential awards under the Fund (e.g., $240 million was recently awarded to nine plaintiffs in asbestos-related lawsuits, over $10 million was recently awarded to a plaintiff in a lawsuit against Firestone, and plaintiffs have received millions of dollars in tobacco-related and silicone breast implant-related litigation). Here, however, Congress protected potential commercial defendants and, in return, mandated that claimants receive fair and adequate compensation under the Fund, the details of which were left to the Department to promulgate. Accordingly, the Fund is not a “gift” or “federal subsidy” from Congress to the claimants, but a federally-mandated exchange; the government will stand in the place of commercial defendants and the government, not the potential commercial defendants, will provide compensation to victims’ families. We urge the Department not to be swayed by the misguided sentiments of an uninformed public. Congress took away our constitutional right to sue in tort litigation and, in return, ordered the Department to ensure that victims’ families were fairly and adequately compensated.
II. THE PRESUMED AWARD FOR NONECONOMIC LOSSES DOES NOT ADEQUATELY COMPENSATE THE VICTIMS
a. The Amount of the Presumed Award for Noneconomic Losses
The regulations most glaring insult to the Congressional commitment made to the families of the Victims of September 11th is the treatment of noneconomic losses. As with economic losses, the Act does not limit or cap the recovery of noneconomic losses to a pre-determined or presumptive amount. Rather, the Act requires that the award for such noneconomic losses will be based upon the individual circumstances of each claimant, and nothing in the Act empowers the Special Master to arbitrarily place a pre-determined amount upon any of these statutorily prescribed elements of recovery. Despite this absence of permission, the regulations arbitrarily dictate that a victim’s life is worth only $250,000. (28 CFR §104.44.) While we recognize the difficulty in trying to differentiate noneconomic losses amongst the victims, we simply do not accept using $250,000 as the base amount for noneconomic losses. The preamble to the regulations acknowledges the pain and suffering of the victims:
Each person who was killed or injured in the September 11 attacks suffered grievous harm, and each person experienced the unspeakable events of that day in a unique way. Some victims experienced terror for many minutes, as they were held hostage by terrorists on an airplane or trapped in a burning building. Some victims had no warning of what was coming and died within seconds of a plane hitting the building in which they worked.
Given the horrific nature of the tragedy, and the fact that the victims were killed in the buildings in which they worked, $250,000 is a woefully inadequate award for noneconomic loss. In addition, the $50,000 award for the loss of the spouse and each dependent of the victim is also sadly insufficient. Although we agree that the Department should attempt to compensate claimants for the awful loss of a spouse and/or parent, the compensation should more closely resemble awards given in tort litigation. For instance, courts in New York have routinely given awards well in excess of $100,000 in respect of the loss of parental care and guidance of a minor child.
Families searched for their loved ones for days and even weeks after the attacks of September 11. Countless telephone calls and visits were made to hospitals, morgues and triage centers throughout the tri-state area. Family members spoke to the victims before, during and after the attacks, and many watched in horror, in person or on television, as the Twin Towers collapsed. The award for noneconomic loss proffered by the Special Master does not reflect the tragedies suffered on September 11th. We therefore urge the Department to increase the base amount of the presumed award for noneconomic losses to an amount which more adequately reflects the horrors suffered by the victims and their families. The regulations should be revised to provide that the presumed noneconomic losses for each decedent is $1,000,000, plus an additional $100,000 for the spouse and each dependent of the victim.
b. Comparison to Existing Federal Programs
The regulations apparently derived the $250,000 presumed award for noneconomic loss by comparison to existing federal programs. “That $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.” (See the preamble to the regulations, Noneconomic Losses.) While an award for pain and suffering is always subjective, it is hard to understand how the suffering of a group of civilians killed in the offices in which they worked, completely unprepared for the risk of violent deaths and injuries which they suffered, could be equated with public safety officers who have voluntarily chosen to put themselves at the risk of injury and even death as part of their daily job. Indeed, many public safety officers and members of our military choose their profession, in part, because of the excitement and inherent dangers involved. Moreover, public safety officers and military personnel are cognizant of those risks and, either though employment incentives such as lifetime salary and benefits payable to their families in the event of their death or through other private means, they are able to make provisions to financially support their families in the face of such tragedy. Employees in private industry have never before been forced to make such provisions. The situations are not analogous and any attempts to draw such analogy are insulting to the victims of the September 11th attacks.
III.COLLATERAL OFFSETS ARE UNCLEAR
a. The Definition of Collateral Sources
The Act provides that collateral source compensation will include life insurance, pension funds, death benefit programs and payments by federal, state, or local governments related to the attacks, but the Act does not address whether certain other types of payments constitute collateral source compensation. While we question the wisdom of Congress for including life insurance proceeds in the definition of collateral sources, we recognize that the Special Master has little discretion to alter this regrettable rule. We believe, however, that collateral sources can be better defined, thus removing some of the mystery from the award process and creating a more transparent program. For example, the Final Rule should clearly state that employee-funded 401(k), IRA or similar plans are not collateral sources. The cost of life insurance premiums paid by the victim should also be excluded as a collateral offset, which would take away some of the sting from families of victims who have been unfairly penalized because their loved ones purchased life insurance policies. As more fully explained below, vested pension or retirement benefits (essentially a form of savings account which belong to an employee) and amounts such as deferred compensation rights or the cash value of a life insurance policies which were actually paid for by the employee in cash or service should also be excluded as collateral source compensation. In addition, voluntary employer payments or medical benefits provided to victims’ families and other similar gifts should be excluded as collateral source deductions, as the inclusion of such payments would have the unusual effect of encouraging employers and potential gift-givers to withhold such payments and gifts until after claimants have received their awards under the Fund.
An additional omission in the definition of collateral sources is the failure to address periodic governmental payments received over an extended period of time, such as workers’ compensation or social security benefits. As the Special Master is no doubt aware, workers’ compensation and social security benefits are predicated on a variety of factors which are subject to change (e.g., the marital status of the recipient and the number of the recipient’s dependents). Any attempt to assess a value to such payments will be no better than a blind guess. Accordingly, such payments should be stricken from the determination of collateral source deductions.
Finally, although the Interim Final Rule apparently caps economic loss, no attempt is made to cap collateral source offsets. As noted above, we believe that any cap on income used in the calculation of economic losses are contrary to the Act. Even if the Act had permitted the use of income caps, the use of such income caps without a corresponding cap on collateral source deductions is simply illogical. We therefore urge the Special Master to limit the amount of collateral source compensation which may be deducted against a claimant ’s award.
As adopted, the definition of collateral source compensation is, at best, capricious. Although the Act perversely rewards victims who did not provide for their family by obtaining life insurance, by clarifying – and restricting – the definition of collateral source deductions the Special Master can alleviate certain of the inequities inherent in the Act and furthered in the Interim Final Rule.
b. Pension Funds
The regulations provide that pension benefits will be considered a collateral source, but no guidance is provided as to how pensions will be fixed in value. The Final Rule should provide that the present value of pension funds paid over time will be reduced by the same discount value cited in the Tables (5.13%). More importantly, the regulations make no attempt to define pension benefits. While certain pension funds are true retirement programs, other pension funds are more appropriately characterized as additional forms of employee savings (i.e., 401(k) plans) or compensation. For instance, although an employer’s profit sharing plan may be deemed a “pension fund” under ERISA rules, if a victim’s interest in such a plan would have vested after a certain period of time (e.g., six years), and if the victim thereafter would have been permitted to withdraw funds from the plan at any time and without any statutorily imposed penalties, such plans should not be considered “pension funds” – and thus should not be collateral source offsets – for purposes of the Fund. Indeed, such plans should be properly characterized as an additional form of the victim’s compensation. Simply using an ERISA definition to determine whether or not an employer’s “pension fund” should be deemed a pension fund for purposes of the Act obscures the myriad ways that certain employers compensate their employees. We would therefore ask the Special Master to make the advance determination that plans such as the KBW Profit Sharing Plan – the salient characteristics of which are summarized above – will not be considered a “pension fund” for purposes of determining awards pursuant to the Fund and will instead be deemed additional sources of employee compensation.
IV. THE CLAIMS EVALUATION PROCESS
a. Track “C”
In addition to the two-track system provided under the regulations we propose a third track, which would essentially be a non-binding trial run. Claimants would meet with the Special Master or his designee to review the claimant’s salient facts, such as the age of the victim, the victim’s income, the victim’s marital status and the number of dependents which the victim left behind. The claimant would also have an opportunity to question the Special Master or his designee about the claimant’s potential collateral source offsets. Certain evidence could be presented but the meeting should last no longer than one hour. The Special Master or his designee would then tabulate a presumptive award, which would be given to the claimant in writing at the end of the meeting. The award would not be binding on the Special Master but the claimant would be allowed to present the award in his or her Track A or Track B submission, if applicable. Establishing a Track “C” process would afford claimants an opportunity to better assess the award which they could receive under the Fund. As the claimants are required to waive their right to litigation upon entering the Fund, the Track “C” process is essential to allow claimants to make an informed decision about whether to file a claim under the Fund or to file a lawsuit in tort.
b. Review Panel
To ensure that awards are granted in accordance with the regulations promulgated under the Fund, the Special Master should create a five member review panel (the “Panel”). The Panel should be chaired by the Special Master and would be composed of the Special Master, one of his designees, two representatives of victim family groups and one independent member chosen by the other four members. The Panel would meet once a week and would review a specified number of representative awards to determine that the awards are being granted in a uniform manner. The Panel would have final discretion to order a new hearing where warranted. The use of a Panel will provide a neutral “check” on the award process and will help ensure that all claimants are treated in an equivalent manner.
c. Publication of Awards & Binding Precedent
The regulations provide that the Special Master may publicize the amounts of some of the awards. (28 CFR §104.34.) We urge the Special Master to publicize the amount of all awards granted under the Fund in a manner which is easily assessable by all potential claimants (e.g., the Department’s website and in national newspapers). Such publication should not only cite the size of the award but should also contain a detailed list of the victim’ s relevant factors which determined the award (e.g., age and salary at time of death, marital status, number of dependents and amount and general type of collateral source offsets) and the name of the hearing officer who determined the award. Such detailed publication will help achieve the goal of creating a fair and transparent award process. The regulations also provide that the name of the claimant and the victim name will not be published, which is sensible, and we suggest that the Special Master develop safeguards to assure that such information remains confidential.
The regulations further provide that the awards should not be precedent binding on the Special Master and his staff. We disagree with this position and argue that it does not serve public policy. Claimants who present cases with similar facts and circumstances should receive similar awards. One of the methods to assure that such claimants receive similar awards is to require that all rewards should be viewed as precedent binding on the Special Master and his designees. If prior awards do not serve as binding precedent it is possible that claimants who submit claims earlier in the award process will receive larger awards than claimants who submit awards later in the award process, or vice versa, based on factors not relevant to either claimant, such as the amount of money then allocated to the Fund. Moreover, claimants should not be subject to the whims or capriciousness, at any particular time, of the Special Master or his designees. By making prior awards binding precedent the award process will be more impartial, more transparent and more comprehensible.
d. Egregious Mistakes/Manifest Error
The regulations provide that there will be no review or appeal of the determination of an award after the hearing. The regulations should provide an exception in the event of an egregious mistake or manifest error. The Special Master would be required to determine whether or not such appeal should be granted. We note that this suggestion is implicitly recognized in Subpart G of the regulations, which requires the Special Master to implement procedures to assure accurate and appropriate payments to eligible claimants.
CONCLUSION
The victims we knew and loved in the World Trade Center were among the most highly motivated people in our country. Their families supported their dreams of excellence and sacrificed time with their loved ones to enable them to reach a pinnacle of professional achievement. Many of the victims paid taxes at the highest rates and never anticipated or desired being at the mercy of the government of the United States. Shockingly, several comment letters have taken the position that the Fund will unjustly enrich claimants at the expense of the public. Unfortunately, this shocking position has found an advocate in the regulations.
The establishment of the Fund reflected the desire of Congress to protect the airlines and other potential commercial defendants who suffered financial losses in the attack, and the desire of our nation to respond in a positive manner to the outrage caused by the attacks on our country and its civilians. By placing statutory limitations on damages recoverable in tort litigation, however, Congress knowingly left the Fund as the only viable alternative for claimants to recover their financial losses. Our government thus made an affirmative policy decision that the financial losses incurred in the attack would not be paid by our nation’s industries but would instead be paid by our nation’s treasury. Congress then left its noble intention to provide a fair alternative to tort litigation in the hands of the Department and required the Department to develop regulations which would provide fair and adequate compensation to claimants based on the individual circumstances of each victim. The Interim Final Rule has instead created a trade-off, not envisioned by Congress or the President, which has turned the Act on its head – potential commercial defendants have been financially protected from lawsuits but individual claimants have been prevented from recovering the full value of their economic and noneconomic losses. The limitations on litigation, which have never before been forced upon our legal system, have thus benefited major industry at the cost of individual claimants, and have only further victimized the victims.
We urge the Special Master and the Department to reverse this injustice, to act in a manner that is consistent with the Act and to honor the memories of our loved ones and the many other victims in the manner intended by Congress and the President. The regulations must be revised to implement the fundamental purpose of the Fund – to provide fair and adequate compensation to victims for their economic and noneconomic losses, based on the individual circumstances of each victim.
Respectfully submitted,
Comment by:
Keefe, Bruyette & Woods Family Group
New York, NY