1 72QYWTCP 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------------------------------x 2 3 IN RE: SEPTEMBER 11 LITIGATION 3 4 21 MC 97 (AKH) 4 5 IN RE: SEPTEMBER 11 PROPERTY 5 DAMAGE AND BUSINESS LOSS 6 LITIGATION 6 7 ------------------------------x 7 8 9 10 11 February 26, 2007 11 10:20 a.m. 12 12 13 14 15 Before: 15 16 HON. ALVIN K. HELLERSTEIN 16 17 District Judge 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2 72QYWTCP 1 APPEARANCES 1 2 FLEMMING ZULACK WILLIAMSON ZAUDERER LLP 2 Attorneys for WTCP 3 One Liberty Plaza 3 New York, New york 4 CATHI A. HESSION, ESQ., 4 RICHARD A. WILLIAMSON, ESQ., 5 JASON T. COHEN, ESQ., 5 Of counsel 6 6 7 QUIRK AND BAKALOR, P.C. 7 Attorneys for United Airlines 8 845 Third Avenue 8 New York, New York 9 JEFFREY J. ELLIE, ESQ., 9 Of counsel 10 10 11 CONDON & FORSYTH LLP 11 Attorneys for American Airlines 12 7 Times Square 12 New York, New York 13 DESMOND T. BARRY, JR., ESQ., 13 Of counsel 14 15 - - - 16 THE COURT: It seems to me that the question whether 17 or not the World Trade Center Properties parties were negligent 18 or not in the context of the security precautions they did or 19 did not take prior to and on 9/11 have nothing to do with 20 whether or not the aviation parties were negligent or not on or 21 about 9/11. The loci of activity were different and there was 22 no interrelationship in terms of security arrangements between 23 one and the other of which I have been informed or of which I 24 know of. 25 I could have done this by simple endorsement. I asked SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 3 72QYWTCP 1 you to come here to argue because it seemed that there might be 2 other grounds which conceivably might be negligent. 3 There are claims between the World Trace Center 4 Properties and cross-claims against the airlines and I was not 5 able to think through in my own mind whether there might or 6 might not be relevance in terms of that issue. 7 Since you are here you can argue whatever you like, 8 but that was the issue that I was not able to think through in 9 advance, therefore, I called you in. 10 MS. HESSION: Your Honor, Cathi Hession for the World 11 Trace Center Properties cross-claimants. 12 To direct myself to your question, your Honor, the 13 claims against World Trace Center Properties as a defendant as 14 opposed to a cross-claim plaintiff relate not to security 15 procedures of people going in and out of the building, but they 16 relate to evacuation orders, perhaps design factors, things 17 that came into play in terms whether people in the building got 18 out in a timely manner and have nothing at all to do with the 19 security procedures that were employed by the World Trade 20 Center Properties cross-claim plaintiffs and commercial 21 landlords, business visitors, tenants coming in and out of the 22 building. 23 THE COURT: All right. 24 MR. ELLIS: Jeffrey Ellis. At least I will start. 25 Your Honor, I guess I'm -- just to be clear on what SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 4 72QYWTCP 1 you initially indicated to us. 2 The discovery we sought from them is not to show that 3 they were negligent per se with respect to what they did as to 4 evacuation proceedings or things like that, really, it is 5 discovery to explore their claims that they asserted against 6 us, because to Mr. Williamson is the largest claim in this 7 litigation. 8 In essence they are claiming, it just boils down to 9 the fact they claim we didn't do good enough security to 10 protect their building, and what we are doing is, in essence, 11 looking at the security that they provided for their building 12 and more specifically the standards by which they, as a private 13 party, decided upon what security was necessary so as to -- 14 THE COURT: Let's suppose you prove they were 15 negligent, does that bar their suit? 16 MR. ELLIS: Of course not. But more to the point, 17 Judge -- 18 THE COURT: What does that have to do with whether or 19 not you were negligent? 20 MR. ELLIS: What it has to do with, your Honor, not so 21 much whether or not they were negligent, but, quite frankly, 22 whether they weren't negligent. 23 We are not here to claim that they were negligent -- 24 THE COURT: I can't see the relationship. That is the 25 first part of what I said before. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 5 72QYWTCP 1 I mean, their choice of tenants, their choice of their 2 design, their decisions in terms of how to evacuate or not to 3 evacuate have no relationship to what you did or did not do on 4 or before 9/11. 5 MR. ELLIS: Yes, your Honor, you are right, but that's 6 not what we are taking discovery about. 7 What we are taking discovery about is simply that they 8 are suing us and claiming that our checkpoints were accessed 9 control security to keep or prevent or deter weapons from going 10 from one area beyond the checkpoint, all right, in essence the 11 same thing they were doing. 12 THE COURT: Maybe you were both negligent. 13 MR. ELLIS: Or they were not negligent, your Honor. 14 THE COURT: You can't boost yourself up by the 15 standards that were in existence or not in existence on the 16 part of the World Trace Center Properties. 17 MR. ELLIS: Your Honor, they have not defined, quite 18 frankly, what the standards are which we will be judged by. 19 What they stated in their contention interrogatories we 20 violated federal law and common law. They have not specified 21 what the common law is. 22 THE COURT: That is a different issue. 23 MR. ELLIS: Well, okay. Then I will address that 24 issue. 25 That issue is if the claim under the common law which SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 6 72QYWTCP 1 they have not yet defined, and I would submit to your Honor 2 according to the case law that we both agree on you must define 3 the specific claim you are making in order to decide 4 relevancy -- 5 THE COURT: That's not why I brought you here for. 6 That is a different issue, which maybe if you ask me, I would 7 give you a good ruling on, but that's not what you are here 8 for. You are here because the World Trace Center Properties 9 said you should not be allowed to examine World Trade Center 10 people on the standards that were in effect and were applied by 11 the World Trade Center people on or before 9/11, and I hold 12 that there is nothing in that series of questions that has 13 anything to do with what the airline people and the aviation 14 people did on and before 9/11. 15 MR. ELLIS: But, your Honor, implicit in answering 16 that question is an agreed upon definition of what the 17 standards are that both parties would be judged by. 18 THE COURT: No, it's a factual point. 19 MR. ELLIS: If it is a factual point, your Honor, then 20 quite frankly, the discovery we started to embark upon and that 21 we would like to continue have indicated a couple of things: 22 Number one, foreseeability. It certainly is relevant 23 for us to depose them on the question of foreseeability since 24 that is relevant to both of the claims -- the claims against us 25 and it certainly is relevant to what they were doing because SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 7 72QYWTCP 1 they said they were concerned about future terrorists attacks. 2 THE COURT: I don't agree. 3 Foreseeability is a question of fact in terms of what 4 you foresaw, but more than that, if is it reasonable 5 foreseeability it's an issue of law that can be formed by 6 custom and practice throughout the aviation industry. It's not 7 going to be formed on what particular building projects did or 8 did not do or what they foresaw or did not foresee. 9 MR. ELLIS: If it is a question of fact, the fact of 10 the matter is we contend, and not yet been defined, but we 11 contend that our foreseeability came from the government. We 12 claim that as a matter of law that's the way the federal system 13 works. 14 THE COURT: I understand that. 15 MR. ELLIS: The World Trace Center Properties have 16 hired and was in place prior to 9/11 the head of the FBI 17 counterterrorism center. They claimed their papers when they 18 moved to dismiss, the papers asserted against them that these 19 attacks were unforeseeable. If they are claiming these attacks 20 were unforeseeable and they hired the head of the FBI terrorist 21 center, one then believes one would be relevant to conduct 22 discovery of the individuals who we have noted, one of whom is, 23 Mr. Wharton met with that individual and told Mr. Levy, the one 24 person we deposed, that he wouldn't speak to Mr. Levy, he would 25 let us ask questions of him at a deposition. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 8 72QYWTCP 1 Well, if that individual can't be deposed, we don't 2 know what the conversation was between him and the head of the 3 FBI counterterrorism section. All we know is they claim as a 4 matter of law that the 9/11 attacks were not foreseeable. That 5 certainly is directly relevant to the claims that are asserted 6 against us and our defense. 7 THE COURT: I understand it. 8 Who is the witness? 9 MR. ELLIS: Jeffrey Wharton. He was the CEO of World 10 Trace Center Properties. 11 THE COURT: And what do you want to elicit? 12 MR. ELLIS: Among other things, Judge, we would like 13 to question him about his conversations with John O'Niel, who 14 was the former head of the FBI counterterrorism center who, 15 unfortunately, lost his life on 9/11, and we would like to ask 16 him, since they were concerned about terrorists attacks on the 17 Trade Center, what it was that Mr. O'Niel communicated to 18 Mr. Wharton. 19 THE COURT: Are there any conversations that were had 20 between any one of the airlines and O'Niel? 21 MR. ELLIS: Your Honor, all of that discovery insofar 22 as the information we received from the FBI is the subject of 23 our discovery demands to the government and the government at 24 this point is still going through the demands that we have made 25 so we can obtain it from them. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 9 72QYWTCP 1 THE COURT: At this point I am not going to allow you 2 to go through the back door. You have to deal with the 3 information that the airlines got from the government and that 4 will certainly inform what the airlines did and it will 5 certainly be relevant to the claim of reasonableness in terms 6 of what the airlines practiced. But the conversations between 7 Mr. O'Niel and Mr. Wharton are not relevant. 8 MR. ELLIS: Your Honor, the other subject of discovery 9 that we would like to go into is, they are claiming that we 10 should have done more to protect weapons from going through the 11 checkpoint. 12 We believe that it would be appropriate to take 13 depositions of them to determine what are the standards that 14 they use to determine that the measures they had at their 15 checkpoints were adequate for detecting weapons. 16 THE COURT: I reject that for the same reason as 17 before. The threshold of sensitivity in whatever precautions 18 were taken by the operators of the building have a different 19 focus of issues than the issues that involve the airlines, 20 different entities, different times, different settings, 21 different context. 22 MR. ELLIS: Your Honor, we have specifically put to 23 the plaintiffs in this action whether or not they claim that we 24 are being sued under federal standards or under common law 25 standards, and if so tell us what they are so that we can focus SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 10 72QYWTCP 1 our discovery. 2 THE COURT: That is a set of contention 3 interrogatories which maybe I grant the motion. Maybe I 4 require the World Trace Center Properties to state their 5 conceptions and if they haven't stated them properly in 6 response to previous contention interrogatories, you can ask me 7 to issue a ruling on that. 8 MR. ELLIS: Your Honor, if we were to -- if you were 9 to see your way to requiring more specific responses to those 10 contention interrogatories, would we have leave, if 11 appropriate, depending on what the answers would be, to renew 12 this motion for further discovery? 13 THE COURT: My rule is that nothing is final until we 14 have a decision that is on the merits at the end of the case. 15 Like all other people, I make my share of errors, 16 maybe more than other people. So if you have something new to 17 tell me, you have leave to tell me. That goes to everything I 18 do in all cases I do. And I think you may have sensed that the 19 way I conduct my activities here. 20 We won't get anywhere if we are constantly re-arguing 21 points that are already decided. So if you want to bring 22 something else to my attention for a ruling, it should be based 23 on something new, something that was not available to you now. 24 MR. ELLIS: Absolutely, your Honor. 25 THE COURT: I don't see the point in this area. As I SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 11 72QYWTCP 1 told you before, I was uncertain on the issues of contributory 2 negligent, mitigation of damage, other kinds of defenses that 3 could have an affect on the lawsuit between the World Trace 4 Center Properties and the airlines, both the lawsuit and the 5 cross-claims, but I have not heard anything on that point and 6 so I go along with my original sentiment of granting the 7 protective order and holding that the security practices of the 8 World Trace Center Properties parties, whatever they were, have 9 no relevance to the measures that were taken by the aviation 10 defendants. 11 MR. BARRY: Your Honor, can I just -- I understand 12 your ruling and I just want to -- 13 THE COURT: You respectfully disagree. 14 MR. BARRY: Well, I do. It's a rare occasion, Judge, 15 but I do. 16 I think the essential issue here is the evidence that 17 we need for our defense. This is discovery and your ruling is 18 now cutting off our right to discover into these areas. 19 Let me just give you a couple of examples. 20 The plaintiffs in this case, of which I include 21 Mr. Williamson and his client, are alleging that the aviation 22 defendants considered costs in developing their security 23 programs. 24 I think to defend ourselves against that claim, the 25 claim you shouldn't consider costs, you should spend everything SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 12 72QYWTCP 1 you could, we should be entitled to inquire whether they 2 considered cost. 3 THE COURT: If they considered or didn't consider 4 costs, what relevance did they have whether or not you 5 considered costs? 6 I would think, Mr. Barry, in case you have any doubts, 7 that everything has a cost, there is no free lunch. 8 MR. BARRY: Exactly, exactly my point. But if -- 9 THE COURT: You don't need discovery for that. 10 MR. BARRY: Don't you think the jury is entitled to 11 know other people considered costs as well as us? 12 THE COURT: No. 13 MR. BARRY: When they are suing us for ten billion 14 dollars? 15 THE COURT: They are making an issue of contributory 16 negligent, I said that before, but I am not hearing anything on 17 contributory negligence. 18 MR. BARRY: I am saying it is evidence for our 19 defense, your Honor, to show -- 20 THE COURT: I disagree and I ruled. 21 MR. ELLIS: I am not going to beat dead horse, but 22 wouldn't that be impeachment evidence? 23 If the plaintiff in this case, if Mr. Williamson 24 stands up and makes an argument and they present evidence that 25 says the defendants should have been spending more money on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 13 72QYWTCP 1 security, should have been doing more than what we were doing, 2 isn't it relevant for impeachment purposes for us to be able to 3 say that the people that are suing us and saying we never 4 should have considered costs -- 5 THE COURT: I don't know that anyone can argue that 6 cost is not a factor. Of course cost is a factor. Not only 7 cost, but amount of people in line, the whole context of the 8 times. 9 I won't go into this because none of the plaintiffs 10 are here, but I think the context is in all in a decision on 11 reasonableness. But what other parties did or did not do is 12 not relevant. 13 MR. ELLIS: Your Honor, forget about the wrongful 14 death plaintiffs, we are just talking about the property damage 15 plaintiffs that are here -- 16 THE COURT: I would think that if Mr. Williamson says 17 cost has no bearing on whether you do not, I probably would 18 object. 19 MR. ELLIS: Your Honor, if that issue comes before the 20 jury, is there any more powerful evidence to drive home the 21 point that cost is an issue -- 22 THE COURT: I made my ruling on that point. 23 MR. ELLIS: Fine, your Honor. 24 THE COURT: And Mr. Williamson knows now the ground of 25 the objection. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 14 72QYWTCP 1 MR. BARRY: One last point, your Honor. 2 THE COURT: Yes, sir. 3 MR. BARRY: Direct assessment of the threat. Fourteen 4 years ago today the World Trade Center was bombed. From 1993 5 until 2001 what did World Trade Center do to assess the threat 6 of -- 7 THE COURT: That is going to be an issue with regard 8 to people suing the World Trade Center, it's not an issue 9 between them and you or what people have to prove or not prove. 10 MR. BARRY: What if I got an admission from them that 11 that was the government's responsibility, not our 12 responsibility? 13 THE COURT: That is their contention. 14 MR. BARRY: What? 15 THE COURT: That's their contention. 16 MR. BARRY: That's our contention, it's a government 17 responsibility. 18 THE COURT: I have to deal with it in terms of each 19 parties' contentions. But what some party did or did not do or 20 may or may not be negligent in relation to that is not relevant 21 to my judgment to the situation of another party. 22 MR. BARRY: I understand that's your ruling, Judge, 23 but threat assessment, foreseeability, if they agree with us 24 that threat assessment of a terrorist Islamic attack is the 25 government's function, that goes to our defense and I think to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 15 72QYWTCP 1 preclude discovery on that issue is a very severe sanction. 2 THE COURT: It's not a sanction, it's a ruling. 3 MR. BARRY: Ruling. 4 THE COURT: All right. 5 MR. BARRY: Sanction comes next if I don't shut up. 6 THE COURT: No, no, not from me. 7 All right. So we are finished with this. 8 Does anybody else have something to say? 9 (Pause) 10 Anything else I should do now? 11 MS. HESSION: No. Thank you, your Honor. 12 THE COURT: Thank you. 13 - - - 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300