1 31OQSepC 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------------------------------x 2 3 IN RE SEPTEMBER 11 LITIGATION, 3 4 4 21 MC 97 5 5 ------------------------------x 6 6 January 24, 2003 7 1:20 p.m. 7 8 Before: 8 9 HON. ALVIN K. HELLERSTEIN, 9 10 District Judge 11 12 12 APPEARANCES 13 13 KREINDLER & KREINDLER 14 Attorneys for Plaintiffs Committee 14 BY: MARC S. MOLLER 15 BRIAN J. ALEXANDER 15 16 16 BAUMEISTER & SAMUELS, P.C. 17 Attorneys for Plaintiffs Committee 17 BY: MICHEL F. BAUMEISTER 18 19 19 SPEISER, KRAUSE, NOLAN & GRANITO 20 Attorneys for Plaintiffs Committee 20 BY: FRANK H. GRANITO, JR. 21 22 HANLY & CONROY, LLP 22 Attorneys for Plaintiffs 23 BY: PAUL J. HANLY, JR. 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2 31OQSepC 1 APPEARANCES (Continued) 2 2 BAUM, HEDLUND, ARISTEL, GUILFORD & SCHIAVO 3 Attorneys for Plaintiff Passengers 3 BY: MARY F. SCHIAVO 4 JOHN A. GREAVES 5 6 NESS MOTLEY PROFESSIONAL ASSOCIATION 6 Attorneys for Plaintiffs 7 BY: RON MOTLEY 8 9 WARDEN TRIPLETT GRIER 9 Attorneys for Plaintiffs Certain Underwriters & Lloyds 10 BY: MICHAEL J. KUCKELMAN 11 12 ROSENBERG, MINC, FALKOFF & WOLFF, LLP 12 Attorneys for Plaintiff Ana L. Taha 13 BY: ARTHUR O. TISI 14 15 SULLIVAN, PAPAIN, BLOCK, McGRATH & CANNAVO, P.C. 15 Attorneys for Plaintiffs Adams, et al. 16 BY: MICHAEL N. BLOCK 17 18 SACKS & SACKS, LLP 18 Attorneys for Plaintiffs Thomas Hickey & Francis Hickey 19 BY: MITCHEL D. GROTCH 20 21 ROBERT J. PECORA 21 Attorney for Plaintiff Estate of Barbara Edwards 22 23 LAW OFFICES OF JOSEPH GIARAMITA 23 Attorneys for Plaintiff Joseph Davi 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 3 31OQSepC 1 APPEARANCES (Continued) 2 LAW OFFICES OF BARASCH McCARY 2 Attorneys for Plaintiffs 3 BY: MICHAEL BARASCH 4 4 LAW OFFICES GENNET, KALLMANN, ANTIN & ROBINSON, P.C. 5 Attorneys for Defendant Aegis, et al. 5 BY: MICHAEL L. BRAUNSTEIN 6 7 CARLENE McINTYRE 7 Attorney for Defendant Port Authority 8 9 FLEMMING, ZULACK & WILLIAMSON, LLP 9 Attorneys for Defendants Porth Authority and WTC 10 Properties, LLC 10 BY: RICHARD A. WILLIAMSON 11 M. BRADFORD STEIN 12 12 MICHAEL A. CARDOZO 13 Corporation Counsel for the 13 City of New York 14 BY: GARY SHAFFER 14 KEN BECKER 15 LARRY KAHN 15 Assistant Corporation Counsel 16 17 WERTHEIMER ASSOCIATES, P.C. 17 Attorneys for Baiano, et al. 18 BY: ROBIN M. WERTHEIMER 19 20 HUNTON & WILLIAMS 20 Attorneys for Burns Int'l Services Corp. and Burns 21 International Security Services Corp. 21 BY: BRIAN V. OTERO 22 23 JAMES B. COMEY 23 United States Attorney for the 24 Southern District of New York 24 BY: SARAH SHEIVE NORMAND 25 DANIEL S. ALTER 25 Assistant United States Attorneys SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 4 31OQSepC 1 APPEARANCES (Continued) 2 2 CONDON & FORSYTH, LLP 3 Attorneys for Defendant American Airlines 3 BY: DESMOND T. BARRY, JR. 4 5 DEBEVOISE & PLIMPTON 5 Attorneys for American Airlines 6 BY: ROGER E. PODESTA 7 8 QUIRK AND BAKALOR, P.C. 8 Attorneys for Defendant United Airlines 9 BY: JEFFREY J. ELLIS 10 11 MAYER, BROWN, ROWE & MAW 11 Attorneys for Defendant United Airlines 12 BY: SUSAN NYSTROM 13 14 CAMPBELL, CAMPBELL, EDWARDS & CONROY 14 Attorneys for Defendant U.S. Airways, Inc. 15 BY: KATHLEEN M. GUILFOYLE 16 17 JONES, HIRSCH, CONNORS & BULL, P.C. 17 Attorneys for Defendant Globe Aviation Services Corp. 18 BY: JAMES P. CONNORS 19 20 SATTERLEE, STEPHENS, BURKE & BURKE, LLP 20 Attorneys for Defendant Airtran 21 BY: ROBERT M. CALLAGY 22 23 CONNELL FOLEY, LLP 23 Attorneys for Defendant Colgan Air, Inc. 24 BY: JEFFREY L. O'HARA 24 JONATHAN P. McHENRY 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 5 31OQSepC 1 APPEARANCES (Continued) 2 2 DOMBROFF & GILMORE, P.C. 3 Attorneys for Defendants City of Portland, Metropolitan 3 Washington Airport Authority 4 BY: MARK A. DOMBROFF 4 RAYMOND L. MARIANI 5 6 O'MELVENY & MYERS 6 Attorneys for Defendant Mass. Port Authority 7 BY: JOHN L. ALTIERI, JR. 8 8 CHADBOURNE & PARKE, LLP 9 Attorneys for Defendant Pinkerton's Inc. 9 BY: JOHN NYHAN 10 PAOLA M.G. de KOCK 10 11 11 SUSMAN GODFREY, LLP 12 Attorneys for Defendant Huntleigh 12 BY: H. LEE GODFREY 13 14 ALTIER & VOGT, LLC 14 Attorneys for Defendant John Rementeria 15 BY: PHILIP P. VOGT 16 16 McLAUGHLIN & STERN, LLP 17 Attorneys for Defendant ICTS 17 BY: JON PAUL ROBBINS 18 19 19 PAUL, WEISS, RIFKIND, WHARTON & GARRISON, LLP 20 Attorneys for Fiduciary Trust Franklin Resources 20 BY: LESLIE GORDON FAGEN 21 22 Also Present: Richard Allen - Pro Hac Vice 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 6 31OQSepC Argument 1 (In open court) 2 THE COURT: Good afternoon. Each of you should have a 3 copy of the proposed agenda. If any of you do not, we have 4 some extra copies and we can provide them. 5 Is there anyone who does not have a copy of the 6 agenda? 7 I'm going to go down the discussion points one by one, 8 and as has been the practice previously, whoever has any point 9 to make or wishes to add may do so. 10 The first major category has to do with a series of 11 complaints and removals that have been coming to our attention 12 in the last several weeks. These are cases largely based on 13 the environment in the clean up process at the World Trade 14 Center site. Some of these cases are filed with summons and 15 complaint in the state court, some are failed with a summons 16 alone, a summons and notice, which is a permissible practice 17 under the New York Civil Practice Law and Rules. 18 The City and sometimes the Port Authority, I believe 19 the Port Authority as well, has been removing, and at least one 20 such case, Hickey v. City of New York and Port Authority has 21 been the subject of a motion to remand. I set February 10 as 22 an argument date in that case. 23 I'd like to establish a procedure to create a better 24 efficiency and coordination of the situations of removals and 25 remands. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 7 31OQSepC Argument 1 The problem exists that in Title 28, there's, I 2 believe, a 30-day period within which to remove and failure of 3 which can be a waiver. The problem that a removing party has 4 is whether or not a summons with a notice is a sufficient 5 indication of a federal claim. 6 The federal act involved here is not clear of what the 7 source of law is, whether it's federal or state, but it is 8 clear that that which is within the scope of the act is within 9 the exclusive jurisdiction of this Court. 10 So what I'm suggesting here is a procedure by which 11 the City can better know that there is a federal claim in its 12 opinion which it can remove, and hopefully my decision when it 13 is delivered in the Hickey case will establish some better 14 grounds within which to evaluate the removal. 15 So what I propose, where there is an existing remove 16 case that does not have a complaint, that case is within my 17 Rule 16(b) power, and I want to set February 14, 2003 as the 18 deadline within which a complaint has to be filed. A notice 19 will not be sufficient. 20 Where the cases that are hereafter removed, where 21 there is only a notice, the plaintiff will have 30 days from 22 the time of removal for the date of service, whichever is 23 later, to serve and file a complaint. 24 And for future cases in the state court, I would like 25 the City, subject to my jurisdiction over the City here, to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 8 31OQSepC Argument 1 serve notice under CPLR Section 3012(b) demanding a complaint 2 so that there will be a better ability to identify that which 3 is federal and which is not. And the order I will propose to 4 enter -- who represents the City 5 MR. SHAFFER: Gary Shaffer, your Honor. 6 THE COURT: Welcome. I would like the City to propose 7 an order establishing this procedure and providing that the 8 time, the 30-day period within which to remove will date from 9 the filing of the complaint, provide and take advantage of the 10 Section 3212(b) procedure. 11 MR. SHAFFER: We will do that, your Honor. 12 THE COURT: I also want you to be very disciplined 13 with respect to granting extensions. When you serve the 14 notice, there shall be no extensions. We have to be 15 disciplined, otherwise there will be lagging proceedings, and 16 we will be unable to deal in the coordinated fashion. 17 I think there's a hand raised in the back. Identify 18 yourself. 19 MR. BARASCH: My name is Michael Barasch from the firm 20 of Barasch McCary. I just wanted to know if the Court was 21 aware of the months of negotiations that we were involved in 22 with a bunch of other firms in state court before Judges 23 Silverman, Evans and Stallman wherein we agreed that no 24 complaints would be filed before November 3rd, and the deadline 25 would be, I think, December 23rd, so as to give the victims' SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 9 31OQSepC Argument 1 compensation fund a chance to resolve the rescue worker's 2 cases? 3 THE COURT: I will have to talk with them. Who are 4 the judges? 5 MR. BARASCH: Judges Stallman, Judge Sara Evans and 6 Judge Jackie Silverman. 7 THE COURT: I gather Jacqueline Silverman is in charge 8 of this? 9 MR. BARASCH: Yes, although I think she has asked 10 Stallman to be in charge of it for her, but one of the two of 11 them. Certainly you would understand the reason behind that 12 stipulation. 13 THE COURT: Thank you for advising me. I will be in 14 touch with the appropriate justices in the Supreme Court. We 15 have a procedure that has already been developed in the Port 16 Authority cases. It allows cases on file to be in suspense so 17 as not to cause a waiver of those rights. I think it's 18 important in order for me to be first in these cases, for me to 19 supersede that procedure and follow the outlines I just 20 mentioned. And I will accommodate in the same way as I have 21 accommodated the cases against the Port Authority to keep alive 22 the petitioner's right to get in the victim's compensation. 23 MR. BARASCH: Your Honor, with all due respect to your 24 decision, the City has preserved its right to object to an 25 omnibus complaint wherein one complaint would be brought on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 10 31OQSepC Argument 1 behalf, for instance, my office represents over a thousand 2 firefighters. This is going to start us down the road that our 3 negotiations tried to avoid, wherein the City would then object 4 to our one complaint, we would put in papers, and before you 5 know it, you are going to be pretty busy answering a bunch of 6 motions. 7 THE COURT: I will deal with this under 1(d). I will 8 deal with it now. 9 MR. SHAFFER: Your Honor, can I raise one point that 10 has to do with the removal of cases? 11 As your Honor is aware, we removed the cases from 12 state court to this Court upon the summons of notice, which we 13 believe in fact gave us sufficient notice of the content of the 14 action, since, then the 30 day period would be triggered and 15 removal was required. 16 With regard to any new procedure, I think that same 17 situation provides, although we certainly could demand a 18 complaint, I think we would be concerned about not removing 19 those cases upon the service of a summons with notice, assuming 20 that we knew it was one relating to the World Trade Center 21 attacks. 22 THE COURT: If you have an intention to remove, my 23 purpose is to cause you and force you to exercise that removal 24 promptly. I will develop a procedure for an appropriate 25 suspension. I will follow the procedure we established in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 11 31OQSepC Argument 1 Port Authority. I want a complaint. I want the issues to 2 find. And if there's a decision at some later point to proceed 3 with the litigation, I want to be in a ripe position to do 4 that, not to play catch up. 5 MR. SHAFFER: I think it may be two different issues. 6 We have no problem with plaintiffs being served. We just want 7 to be sure the removal of the existing action is within the 30- 8 day period required by the federal rules. 9 THE COURT: That's why I say the order will provide 10 the right to removal, will not be exercised until the filing of 11 a complaint, because you really can't be sure until the 12 complaint is filed whether there is or is not a federal claim 13 to relieve. 14 MR. SHAFFER: I understand that, your Honor. There is 15 Second Circuit law that triggers the 30-day period upon the 16 filing of summons with notice. That's our hesitation. 17 THE COURT: How do you know from the filing of a 18 summons and notice that there is a federal claim? 19 MR. SHAFFER: It depends on the content of the notice. 20 I believe the summons of the notices that were filled here were 21 very broad and explicit and gave us full notice on what these 22 actions were about, and we believe it's appropriate in this 23 Court. 24 THE COURT: If you feel you have got a right to 25 remove, remove. If you feel you can't, I want a procedure that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 12 31OQSepC Argument 1 speedily let's you know what you can or can't remove. 2 So your order can allow you to remove earlier, but it 3 will also enable you to demand a copy of the complaint. And 4 the order will have to provide that a complaint thus filed will 5 not compromise the right of a plaintiff to decide within the 6 time provided in the victims' compensation act to reply to 7 Special Master Feinberg. There is no objection to that? 8 MR. SHAFFER: We will work something out. 9 THE COURT: Follow the model we have already 10 established. 11 MR. SHAFFER: Thank you, your Honor. 12 THE COURT: Now, in terms of master complaints and the 13 like, again, I'd like you to follow that order. We have 14 individual complaints, followed by a comprehensive master 15 complaint. And we've established a way of filing individual 16 answers and (b)(2) answers to save time. I want the same 17 procedure with the City. 18 From the plaintiffs' point of view, and that gentleman 19 rises again, Mr. Barris, is it? 20 MR. BARRIS: Yes. 21 THE COURT: We need a liaison counsel. We need 22 coordination of those cases. We need an identification of who 23 wishes to go forward and who wishes to be on suspense. And I 24 need to look to one source as a way of giving notice. 25 MR. BARRIS: Serves me right. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 13 31OQSepC Argument 1 THE COURT: No good deed left unpunished. 2 I'm not saying it has to be you, but I want as part of 3 the City order, an identification of who will serve as liaison 4 counsel. You need to work it out with your colleague. I take 5 it that you have already been talking to one another? 6 MR. BARRIS: Yes. 7 THE COURT: So you know each other, and you can work 8 this out. So follow the same order that's established with 9 Mr. Moller and his co-plaintiffs. 10 MR. BARRIS: I will talk to Mr. Shaffer afterwards. 11 THE COURT: And Mr. Moller as well. We already have a 12 procedure that, to the greatest extent, I would like to see 13 followed. 14 With regard to those cases that will move forward, we 15 need a coordination of discovery. I think you need to provide 16 membership on the executive committee of the representative of 17 these environmental cases suffered -- allegedly suffered by 18 those who worked on the clean up. 19 That completes all I wanted to say in 1a through d, 20 unless there's some further comment, question or criticism. 21 MS. WERTHEIMER: Your Honor, my name is Robin 22 Wertheimer of Wertheimer Associates. 23 THE COURT: Is Flora Wertheimer your mother? 24 MS. WERTHEIMER: Yes. 25 THE COURT: Tell her I miss not seeing her. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 14 31OQSepC Argument 1 MS. WERTHEIMER: I wish she was here in my stead also. 2 We have been served with a notice of removal. We have 3 filed a complaint in state court. We don't believe that we 4 belong before your Honor, as much as we would like to be. Will 5 your Honor be entertaining motions for remand? 6 THE COURT: Yes, Hickey v. City of New York and Port 7 Authority raises that very issue. The complaint in Hickey 8 alleges claims under the labor law, within the New York Labor 9 Law, purportedly a state claim, and it was removed on the basis 10 of a federal act which causes us all to be here. 11 Following that, the plaintiffs in Hickey made a motion 12 to remand. The City has filed its opposition. I don't believe 13 I have had a reply yet, but we set February 10 for argument. 14 Now, if you would like to participate, get your papers 15 in. You may be covered in the same way, and clearly you would 16 be invited to attend, if you wish to speak. I will entertain 17 anything that was not brought up by counsel for Hickey. 18 It raises the interesting issue in federal removal 19 jurisdiction of a claim for relief that is purportedly stated 20 in these allegations but is nevertheless covered by an abrasive 21 federal statute. There are precedents under the Labor 22 Management Relations Act dealing with these kinds of cases and 23 Supreme Court cases that tend to say opposite things which 24 makes life interesting. But I will deal with that on February 25 10. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 15 31OQSepC Argument 1 Mr. Barris? 2 MR. BARRIS: Not that I'm looking to dig myself any 3 deeper, your Honor, but would you entertain the attorneys for 4 the rescue workers participating in that argument as well with 5 the chance that we can argue, based on our summons with notice, 6 not a complaint, that our cases should be back in State Supreme 7 Court? 8 THE COURT: If you want to file your motions, please 9 do so. I can relax that February 10th date that you all come 10 forward with your papers and you work out of that procedure. 11 MR. BARRIS: I was kind of hoping you would relax the 12 February 14 date. 13 THE COURT: What happens on February 14? 14 MR. BARRIS: According to this, we are supposed to 15 file a complaint. 16 THE COURT: No, I don't want to do that. 17 MR. BARRIS: It doesn't give us a lot of time though 18 between the 10th and the 14th, if the argument is going the 19 other way, to file a thousand complaints. And it's not just my 20 office, there are a half a dozen offices here. 21 THE COURT: What do you suggest? 22 MR. BARRIS: Perhaps a month after the Hickey 23 decision? 24 THE COURT: You want to wait for Hickey? 25 MR. BARRIS: Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 16 31OQSepC Argument 1 THE COURT: You will be observers of Hickey. If you 2 want to get together on an amicus brief, I will entertain it. 3 MR. BARRIS: That I would like to do. 4 THE COURT: You can do that. If you need some more 5 time, talk to Ms. Park, Sondra Park, my law clerk in charge of 6 this issue. 7 MR. SHAFFER: Your Honor, with regard to the remand 8 motion or motions, as they turn out to be, my concern is simply 9 having enough time to submit opposition papers. Today is 10 January 24th. The oral argument is scheduled on Hickey. 11 Obviously, we have submitted our opposition papers on that. 12 THE COURT: Get together with Mr. Barasch and suggest 13 a schedule that makes sense to you. Obviously, I need to do 14 that early, because a lot of people are waiting for that. But 15 I will work with you. 16 MR. SHAFFER: Okay, thank you, your Honor. 17 THE COURT: Anybody else on paragraph 1? 18 MR. WILLIAMSON: Richard Williamson; Flemming Zulack, 19 & Williamson for Port Authority. Just so your Honor knows, the 20 Port Authority is also opposing the motion for remand in 21 Hickey. We will work with Mr. Shaffer. 22 THE COURT: You haven't submitted papers, have you? 23 MR. WILLIAMSON: Yes, we think so. 24 THE COURT: You have filed papers? 25 MR. WILLIAMSON: Our concern that you didn't mention SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 17 31OQSepC Argument 1 us, I thought I would bring it to your attention and double 2 check with Ms. Park. 3 THE COURT: Have you filed courtesy copies? 4 MR. WILLIAMSON: I think the office has, but we will 5 double check. 6 THE COURT: I haven't seen them. 7 Anything else in Part 1? 8 All right, let's go to the second category, two, of 9 the defendant, United Airlines and U.S. Airways, filed for 10 protection under the bankruptcy law; the United Airlines in the 11 Bankruptcy Court for the Northern District of Illinois and 12 where is U.S. Airways filed? I hope U.S. Airways are here. 13 MS. GUILFOYLE: Kathleen Guilfoyle for U.S. Airways. 14 It's in the Eastern District of Virginia. 15 THE COURT: Is anyone from United Airlines here? 16 MR. ELLIS: Jeffrey Ellis on behalf of United 17 Airlines. 18 THE COURT: I feel that the bankruptcy judges are 19 going to defer to me on these claims against both your clients 20 and allow the plaintiff to proceed here, because otherwise it's 21 not going to be a good way of liquidating those claims. 22 So the trick is to suggest a useful schedule by which 23 you or adversaries will obtain a stay to allow the cases 24 against your client to proceed in this Court. 25 MR. ELLIS: Your Honor, Jeffrey Ellis. Your Honor, on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 18 31OQSepC Argument 1 behalf of United, and I have spoken to Mr. Alexander and 2 Mr. Moller, and I know that U.S. Airways has also communicated 3 with them, and Mr. Alexander has informed me that some draft 4 language that was circulating is being reviewed by the 5 attorneys on their side, and we are having the bankruptcy 6 lawyers on United's side look at it, and I would think if we 7 have some reasonable amount of time, we may be able to work out 8 some kind of a stipulation, your Honor, that might be able to 9 allow us to go forward rather expeditiously. 10 THE COURT: Is two weeks reasonable time? 11 MR. ELLIS: Since I'm not the bankruptcy lawyer, your 12 Honor -- 13 THE COURT: Nothing moves in bankruptcy court in two 14 weeks. 15 MR. ELLIS: Yes, I will make every effort to move this 16 as expeditiously as possible, and I'm sure Mr. Alexander on 17 their side will do the same. 18 THE COURT: What's the name of the bankruptcy judge? 19 MR. ELLIS: Judge Wedoff in the Northern District of 20 Illinois. 21 THE COURT: Ms. Guilfoyle? 22 MS. GUILFOYLE: Your Honor, there actually is a 23 procedure in place already, your Honor, because these claims in 24 the 9/11 cases were all filed after U.S. Airways had already 25 filed for bankruptcy. There was a procedure put in place SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 19 31OQSepC Argument 1 whereby in connection with other personal injury claims, the 2 people cosign stipulations whereby they agree to proceed only 3 against insurance proceeds and then the stay is automatically 4 lifted. That was ordered and entered by the bankruptcy court 5 in Virginia on September 30th. We provided that stipulation, 6 which was revised by U.S. Airways bankruptcy counsel, to cover 7 the 9/11 claims to all of the plaintiffs in this case. 8 THE COURT: Is that a condition that plaintiffs 9 accept? 10 MR. MOLLER: Mark Moller for the plaintiffs, your 11 Honor. I think it's a condition we are forced to accept, 12 because the victims' compensation fund statute limits us to 13 recover only insurance proceeds. So we expect to have 14 stipulations worked out in a couple of days with both bankrupt 15 defendants, which will allow us to go forward. There are some 16 wrinkles in the stipulation: Is the victims' compensation fund 17 statute ultimately going to be upheld? Is it going to be 18 attacked? Are there any other issues? But basically we are 19 going to be acceding to the stipulation and get it before you, 20 I think, in a matter of days. 21 One of the things, obviously, that we have in mind is 22 that United is before this Court when motions to dismiss are 23 considered. Right now, I don't see anything from United. 24 THE COURT: Mr. Ellis? 25 MR. ELLIS: Yes. Well, because of the stay, the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 20 31OQSepC Argument 1 bankruptcy lawyers felt that there was a risk of waiver of the 2 stay if we were to participate in the motion. I'm not a 3 bankruptcy lawyer. 4 THE COURT: No, they are correct, and they also have 5 an issue of contempt. They have to abide by the stay. 6 MR. ELLIS: So in deference to that decision, we 7 didn't enjoin, sign on to the motion, although we fully support 8 it, but I expect we will join in that motion in all respects as 9 soon as this stipulation is worked out. Hopefully we can agree 10 on some language. 11 The only thing I have to note to your Honor is the 12 fact that I have to not only present any kind of a stip. to the 13 debtor's attorney, but, of course, to the creditors' committee 14 attorneys as well for their approval. I can't imagine that 15 what we have been talking about in terms of language is going 16 to create an issue there. But all I'm saying, your Honor, is 17 there are a number of different interests because of the 18 particular nature in the United bankruptcy and the way they 19 were owned at the time that involves a number of different 20 people. But I would hope we can do that expeditiously so we 21 can join in the motion immediately. 22 THE COURT: You are going to follow the procedure that 23 has been established for U.S. Airways. It doesn't seem to me 24 that the creditors' committee and United Airlines bankruptcy 25 will have any interest in saying no. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 21 31OQSepC Argument 1 MR. ELLIS: There's nothing that you said, your Honor, 2 that I would disagree with. 3 THE COURT: I will call Judge Wedoff on Monday and see 4 if I can speed that up. 5 MR. ELLIS: I will immediately notify the bankruptcy 6 attorneys of what we discussed today, your Honor, and as soon 7 as I hear back from Mr. Alexander or Mr. Moller as to what 8 procedure and/or language is acceptable to them, I will, of 9 course, immediately communicate that to the attorneys as well. 10 THE COURT: It seems to me I should expect and want 11 quick approval in the bankruptcy court so that you can be part 12 of the motions. Otherwise, the motions will move away from 13 you, and you will be arguing to me that there is some 14 additional reason why you shouldn't be bound. You won't get 15 very attentive ears. If you are going to be part of this 16 motion, make yourself ready for it. 17 MS. GUILFOYLE: Excuse me, your Honor, I just want to 18 add that U.S. Airways as well would like to be part of the 19 motion once the stay has been lifted. 20 THE COURT: Mr. Barry is right there. I am sure he 21 will help you. 22 Yes, Mr. Moller? 23 MR. MOLLER: U.S. Airways was not a carrier who 24 carried passengers. The liability of U.S. Airways may be 25 different, and whether the victims' compensation fund SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 22 31OQSepC Argument 1 limitation applies to U.S. Airways is an element of the case 2 that has to be somewhat isolated. 3 THE COURT: U.S. Airways is in this case how? 4 MR. MOLLER: U.S. Airways is in this case, because 5 they were one of the airlines on the airport that had a 6 security obligation shared with the other airlines that were 7 carrier airlines. 8 THE COURT: So they are partly responsible as alleged 9 for the security apparatus? 10 MR. MOLLER: At the airport. 11 THE COURT: At the airport. So they are in the same 12 position as some of the others? 13 MR. ALEXANDER: Brian Alexander. Your Honor, another 14 theory, their relationship with Colgan Air puts them directly 15 in the mix. There is an allegation that some of the hijackers 16 came through Colgan Air through Portland, the City of Portland, 17 and came through the City that way. 18 THE COURT: The City of Portland has made a motion 19 claiming it has no duty to the ground victims, and the security 20 companies have made a motion similarly. It would seem to me 21 that U.S. Airways is similarly situated to one or both of them. 22 MS. SCHIAVO: Mary Schiavo. Actually, no, they are a 23 carrying carrier insofar as they were carrying tragically, not 24 necessarily a co-share, but part of their operation included a 25 flight on Colgan Air. Colgan Air carried the hijackers, not SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 23 31OQSepC Argument 1 just doing security, but actually providing flight for part of 2 the segment. 3 THE COURT: But whatever it is, U.S. Airways may be in 4 separate categories? 5 MR. MOLLER: That's the only point I'm trying to make. 6 THE COURT: But I suspect that one or all of those 7 categories are already involved in motions that have already 8 been filed, but I welcome any additional participation that you 9 would like to make Ms. Guilfoyle. 10 MS. GUILFOYLE: Thank you. 11 THE COURT: We are finished with part 2. 12 Part 3 deals with the motions to dismiss made by the 13 defendants with regard to their claim that they did not have a 14 duty to one or more categories of plaintiffs. 15 I would understand that since the issue of duty is 16 involved, that there should be no discovery that's necessary 17 with regard to this determination. Does anybody find any 18 difference with that? 19 MR. MOLLER: No, we've reached a consensus at a 20 meeting yesterday, your Honor, shared by all of the members of 21 the plaintiffs' executive committee. And when I say 22 "consensus," it was a hard issue to come to grips with, but we 23 ultimately concluded by consensus that we will not seek 24 discovery at this time in order to respond to the motion. 25 There are two things I would like to say: SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 24 31OQSepC Argument 1 First, I don't want to find in motions or in the reply 2 some attack upon the sufficiency of the pleadings. Because if 3 there is a suggestion that the pleadings don't frame an issue 4 adequately or the facts aren't alleged in a way that the 5 defendants feel is appropriate, we don't want to be faced with 6 that kind of an argument. So we are assuming -- 7 THE COURT: Well, if there's a pleading deficiency, 8 you would undoubtedly be given leave to fix it up. 9 MR. MOLLER: Exactly. In order to keep the dates in 10 the schedule, if the defendants has some suggestion or argument 11 or claim or concern about sufficiency of the pleadings, I would 12 like them to tell us that very early in the game, not wait 13 until replies or what have you. That's number one. 14 THE COURT: Well, it seems to me that it's the subject 15 of a main motion and main brief. It's on its face something 16 that comes up by surprise. And I think you are entitled to 17 that kind of notice, but I'm not going to make any ruling on 18 that. 19 MR. MOLLER: I'm addressing the Court but letting the 20 defendants know that we don't expect to be met with sufficiency 21 of pleading arguments on this motion, and obviously we expect 22 that the defendants -- 23 THE COURT: You allege duty, don't you? 24 MR. MOLLER: Yes, absolutely. That's what I think 25 we've got. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 25 31OQSepC Argument 1 And the other is that I obviously assume that the 2 defendants will not challenge any of the allegations in the 3 complaint, the factual allegations in the complaint, otherwise 4 they are converted into a summary judgment motion. 5 THE COURT: It will be a 12(b)(6) motion. I have no 6 intention to suggest an election for summary judgment. 7 MR. MOLLER: I have one caveat to the no discovery 8 commitment. That is, with respect to Mass. Port and Portland 9 and the Port Authority, we have not yet seen the Port Authority 10 of New York/New Jersey's motion. I expect that we will be able 11 to enter into the same understanding that we will not need 12 discovery, but I'm waiting to see their motions in that regard. 13 Likewise -- 14 THE COURT: Let me interrupt. 15 I suggest a schedule in 3b. February 7 for all 16 motions. February 28 for oppositions. March 12 for replies 17 and oral argument March 27 at two o'clock. 18 MR. MOLLER: I would like, if I could, ask for some 19 elasticity in the dates. I would like to have the plaintiffs' 20 reply due on March 7th; the defendants' response on March 28th 21 and argument any time convenient to the Court after April 4. 22 THE COURT: I don't think there needs to be opposition 23 to a reply. 24 MR. MOLLER: Moving papers will be in on the 7th. We 25 will file our opposition on March 7th. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 26 31OQSepC Argument 1 THE COURT: No, the opposition papers are on February 2 28. 3 MR. MOLLER: Right, and the defendants' reply on March 4 28th. 5 THE COURT: I don't understand. I suggested March 12. 6 MR. BAUMEISTER: We were just asking for an extension, 7 your Honor, for a couple of days, that's all. 8 THE COURT: What do you want? 9 MR. MOLLER: We want to put our papers in on March 7th 10 and for the defendants to have until March 28 for their reply 11 and argument any time after April 4. 12 THE COURT: I see you want a month for your opposition 13 papers? 14 MR. MOLLER: Right. 15 THE COURT: Okay, that's reasonable. And I don't want 16 to give 21 days for reply, that gives you too much opportunity 17 to give me lengthy reply papers. 18 MR. BARRY: Your Honor, we promise to keep the reply 19 papers within the page limit, if you give us the time to 20 prepare them. We have got a lot of cooks in this kitchen. 21 THE COURT: I will give you the time. I don't oppose 22 page limits, but I have my own page limits in how much I read, 23 and I don't tell you those. 24 So when you stop being interested and start being 25 repetitive, I stop no matter what the page is. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 27 31OQSepC Argument 1 MR. BARRY: I fully understand. 2 THE COURT: So that will be the sequence, and April 14 3 at four o'clock for the argument. 4 MR. MOLLER: At four p.m? 5 THE COURT: At four o'clock. I have a trial that day 6 scheduled. If the trial disappears, I will send out a notice 7 for a two o'clock hearing date. Keep it free, if you can, but 8 right now it's scheduled for four. 9 The motions so far that are filed; American Airlines, 10 AMR Corp., Continental Airlines, AirTran Airline, Burns 11 International Services Corp., Burns International Securities 12 and Services Corp., Globe Aviation Services Corp., Globe 13 Airport Security Services, Huntleigh USA Corp. and Pinkerton's 14 Inc.; Massachusetts Port Authority and Metropolitan Washington 15 Airport Authority, and the City of Portland, Maine. 16 Boeing has sent me a letter that it opposes it. 17 Mr. Barry? 18 MR. BARRY: Your Honor, Colgan Air has joined in the 19 aviation defendants' motion, so they are a part of the American 20 Airlines, AMR. And Argan Bright has also joined in that motion 21 recently. 22 THE COURT: Yes, I saw that, okay. I just mentioned 23 these names to give you a heads up to where we are. 24 So anyone who wishes to file, must do so, and I 25 strongly urge you to get together with Mr. Barry on that filed SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 28 31OQSepC Argument 1 by February 7th. 2 That completes category three. Anything anybody wants 3 to say in regard to that? 4 After argument in the motions for pro hac vice 5 admission on the part of Ness Motley and motions to disqualify 6 Ness Motley by reason of their prior engagement by the Port 7 Authority, I was told to hold up further deliberation, because 8 Ness Motley proposed to withdraw. 9 Ness Motley also has time to address with me, and I 10 would be glad to hear whatever you wish to say. I just want to 11 say that I understand a stipulation is being prepared with the 12 Port Authority to cover the issue of Ness Motley's withdrawal. 13 I need to have an identification of cases, to whatever extent 14 Ness Motley remains counsel in any capacity, and I understand 15 that Harry Huge is here -- 16 MR. HANLY: Paul Hanly. He is not here today, your 17 Honor. 18 THE COURT: -- is to be substituted. 19 Any clarification for that? 20 Mr. Motley, do you wish to address me 21 MR. MOTLEY: I don't believe so, your Honor. 22 THE COURT: I am not disappointed in hearing from you, 23 because we have a lot to do. 24 Where do we stand with the stipulation? 25 MR. HANLY: Paul Hanly, your Honor. The Port SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 29 31OQSepC Argument 1 Authority through Ms. McIntyre sent me a draft stipulation 2 yesterday. I have spoken to her today in the courtroom. There 3 are some probably minor issues that I'd like to discuss with 4 her, and I am confident that we will be able to work something 5 out. 6 THE COURT: And is it proposed that Ness Motley will 7 remain counsel on some cases? 8 MR. HANLY: Yes, your Honor. 9 THE COURT: And they will be specifically identified? 10 MR. HANLY: We will specifically identify those cases, 11 your Honor. 12 THE COURT: And Mr. Moller, is there a protocol that 13 has to be developed with regard to whether Ness Motley remains 14 as counsel? 15 MR. MOLLER: I don't know what the cases are. I 16 frankly doubt it. I think that they are going to be in a 17 separate category with issues distinct from the 9/11 issues 18 that the plaintiffs' executive committee is grappling with, but 19 if there is -- 20 THE COURT: Speak louder. 21 MR. MOLLER: I said I don't believe that a protocol 22 will be necessary. I don't know exactly which cases will be 23 isolated. As soon as we know what they are, if a protocol is 24 necessary, we will submit it. Mr. Huge, I should add, will 25 join the plaintiffs' executive committee when Mr. Motley SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 30 31OQSepC Argument 1 withdraws. 2 THE COURT: Is there any issue with Mr. Huge? 3 MS. MCINTYRE: Your Honor, I did not prepare the Court 4 response. I do believe the Port Authority has asked for 5 clarification of Mr. Huge's relationship with the Ness Motley 6 firm, and I believe the response may be forthcoming. I have 7 not certainly seen it, so we can work towards making sure that 8 we do see it. 9 THE COURT: This is an issue that has to be clarified 10 fairly quickly. 11 MR. HANLY: Your Honor, if I may, I sent a clarifying 12 letter pursuant to your Honor's order through to Mr. Barry, and 13 I believe directly to Mr. Harris some time ago, in which I 14 answered all of the inquiries which had been proposed to us 15 through Mr. Barry, and I can put them on the record. It's 16 quite simple. 17 THE COURT: Go ahead. 18 MR. HANLY: Mr. Huge has never been involved in 19 asbestos litigation of any sort, and accordingly, has never had 20 any involvement with the Port Authority, allied suit or 21 anything else insofar as his relationship to Ness Motley is 22 concerned. 23 With respect to his relationship to Ness Motley, 24 Mr. Huge is cocounsel with Mr. Motley and my firm and other 25 firms in the so-called terrorist lawsuit pending before Judge SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 31 31OQSepC Argument 1 Robertson in the District of Columbia. He has never been a 2 partner, nor an associate, nor of counsel to the Ness Motley 3 firm and otherwise has no relationship to the firm except 4 working with it on these cases. 5 In the interests of full disclosure, I further told 6 the parties that Mr. Huge's son, Theodore Huge is an associate 7 in Mr. Motley's law firm. But Mr. Huge has no involvement -- 8 had no involvement in the Port Authority lawsuit, and has no 9 involvement in the 9/11 cases at all. 10 MS. MCINTYRE: What we are going to have to do is -- I 11 apologize to the Court. Mr. Harris is engaged in a trial 12 before Judge Kaplan today, and so I'm here substituting on this 13 matter and some other matters. We would like to review that 14 correspondence and have a discussion with Mr. Hanly on the 15 representations he has just made. 16 THE COURT: He probably will want to add a 17 representation that no work product will be transferred from 18 Mr. Motley's firm. 19 MS. MCINTYRE: You were reading my mind, your Honor. 20 I would want to, in light of those representations, revisit the 21 stipulation which we're now drafting and make sure that the 22 stipulation covers that. We have added a paragraph in the 23 stipulation to make sure that the documents are turned over and 24 we received cooperation. We have started down that path. But 25 in light of this relationship, we want to make sure that all SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 32 31OQSepC Argument 1 bases are covered, because we don't want to be back before the 2 Court with this issue. 3 THE COURT: When will I see the stipulation? 4 MR. HANLY: Your Honor, I expect I will be able to 5 discuss with Ms. McIntyre late in the day on Monday and 6 hopefully have something mid to late next week to the Court. 7 THE COURT: Friday hence will be the deadline. 8 MR. HANLY: Yes, your Honor. 9 MR. MOLLER: Your Honor, I don't think in fact we need 10 a protocol, if Mr. Motley is not part of the executive 11 committee. 12 THE COURT: We may not. We will see what happens. 13 That concludes category four. 14 Category five deals with a space of litigation there, 15 about 25 cases so far involved, 20 listed and several more. 16 These involve late notices of claim filed with the Port 17 Authority where for one reason or another, some provided by 18 statute, some otherwise, people have been asking for leave to 19 file late notices of claim and complaints against the Port 20 Authority. 21 Magistrate Judge Theodore Katz has graciously agreed 22 to decide those applications and will make reported 23 recommendation to me following his hearing and determination of 24 those motions. There are three more cases than those listed 25 where we do not know what the position of the Port Authority SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 33 31OQSepC Argument 1 had been with regard to those cases. 2 Sondra, could you read out the names -- I have them 3 here. Laura Brow, Ellis Koglan, Jerry Glagdogna, those three. 4 Are you familiar with them? 5 MR. WILLIAMSON: Richard Williamson. 6 It may be, and indeed we know there are somewhere 7 people didn't follow the Mulligan order procedure that your 8 Honor set forth, and they simply have gone and made these 9 motions. They never applied. I don't know off the top of my 10 head whether those three are in that category. I will look at 11 the transcript. 12 THE COURT: After this session, take down their names 13 and numbers and check. And the City has also been involved, 14 and there are different issues involving the City with which I 15 confess I don't have familiarity. 16 Mr. Shaffer is gone? 17 MR. SHAFFER: No, I'm still here. 18 There are, I think one so far, but there will be more 19 of plaintiffs who have not filed claims in the requisite time 20 period with the City or some other procedure deficient with 21 regard to that issue. There are some outstanding motions right 22 now for late notices of claim. Most of those are in the state 23 court. There are three that are actually before your Honor at 24 this time; one in Bell, one in Johnson, I believe it is, and 25 one that arises -- I'm sorry, it's Gault and Johnson, and then SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 34 31OQSepC Argument 1 Leon Stevenson. The Leon Stevenson motion arises from an 2 unusual posture in that Mr. Stevenson is one of about 40 3 firefighters who are part of an action commenced by the firm of 4 Talmomish, Yasso & Roberts. The plaintiffs filed separate 5 motions for each firefighter, which was appropriate, with 6 separate index numbers. However, the index number for 7 Mr. Lebry was the same as the index number used on the summons 8 with notice, which contained all the firefighters listed as 9 plaintiffs. Therefore, when the action was removed, 10 Mr. Stevenson's motion for a late notice of claim was also 11 removed. Is that clear? 12 THE COURT: Well, no. I'm going to refer those also 13 to Judge Katz. We will follow the same procedure. 14 MR. SHAFFER: I will just note that the Stevenson 15 motion is one of approximately 35 other motions that are being 16 heard by Judge Stallman in the state court and the issues will 17 be identical. 18 THE COURT: I have no reason to take those motions 19 away from Judge Stallman. But I should talk to him about those 20 motions. 21 MR. SHAFFER: It has also come to our attention, your 22 Honor, that there is at least one Southern District Court case, 23 the case decided by Judge Sand, where he decided that the Court 24 did not have jurisdiction to decide a late notice of claim 25 motion. However, there are also other district court cases SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 35 31OQSepC Argument 1 that decided late notice of claim motions under the general 2 municipal law that do not address the jurisdictional issue. 3 THE COURT: It would be a nice issue if Judge Stallman 4 can decide those and we will. 5 MR. ALEXANDER: Brian Alexander from the Kreindler 6 firm. We met with certain members of the defense team 7 yesterday, and in the interest of efficiency, put out the 8 possibility of a determination of all of these actions 9 vis-a-vis the Port Authority. We didn't get into a discussion 10 about the City. I'm anticipating I might be putting it in 11 front of you, rather than Magistrate Judge Katz. And I want to 12 stay focused on the major motions, thinking that if the Port 13 Authority does not survive the motions, those could be 14 addressed at that time. If they do survive, there's no need to 15 address the motions, obviously. 16 THE COURT: If the Port Authority survives the motion 17 on the ground that there's no duty owed -- 18 MR. ALEXANDER: If they were in the game, we can deal 19 with these. If they are out, there's no need to go this far. 20 THE COURT: I would prefer that they both move 21 forward. 22 MR. ALEXANDER: Fine, your Honor. 23 THE COURT: These motions are all interesting, but 24 they are, as we say, embarked, which involves getting into the 25 merits of the case, and I think there's enough people with SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 36 31OQSepC Argument 1 enough interest to move these cases, and I should accommodate 2 those interests. 3 We are finished with category five. 4 We are on category 6. This is a detail. There are 5 several cases which we have identified that are here with two 6 numbers. I would like counsel to eliminate the second filed 7 number. Failing that, I will do it myself. 8 MR. SHAFFER: Your Honor, if I may, Mr. Williamson and 9 the Law Department have worked out, and Ms. Rogerson from our 10 office have worked out a stipulation that would eliminate the 11 duplicative docket numbers. 12 THE COURT: Excellent can you do it by Friday next? 13 MR. SHAFFER: Yes. 14 THE COURT: Thank you. And 6b involves three lawsuits 15 which were tried and filed in federal court and removed in 16 state court. Would you cover those as well if they are within 17 the province of the City? 18 MR. WILLIAMSON: We are already working on that, your 19 Honor, and we have stips in place on two of them, and we will 20 take care of the third. Richard Williamson. 21 THE COURT: We are in category 7, treatment of the 22 property and subrogation cases. There are three cases of which 23 I'm aware of filed before the Court, one before me, the Aegis 24 Insurance Services case; one before Judge Daniels, which has 25 been transferred to me, the Certain Underwriters and Lloyd's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 37 31OQSepC Argument 1 case, and another one that was the first to be filed before 2 Judge Koeltl, the Industrial Risk Insurers case. I identified 3 these on the agenda. All these cases involve World Trade 4 Center No. 7. This is the building that had the large diesel 5 generator, and I think the building collapsed almost a day 6 after the impact. Their arguments suggest that all these cases 7 should come before me. There are arguments that suggest that 8 it's an overload here and should go elsewhere. 9 I'd like to hear from counsel involved in these cases 10 to help me guide how to deal with this and how to recommend to 11 Judge Koeltl that he deal with it. 12 MR. BRAUNSTEIN: Michael Braunstein from the firm of 13 Gennet, Kallmann, Antin & Robinson with the attorneys from the 14 Aegis Insurance Services. I have had discussions with both 15 Mark Brunel, who is from IRI plaintiffs, as well as plaintiffs 16 for certain underwriters, as well as the Port Authority. While 17 we have not discussed whether the case should remain with you 18 or Judge Koeltel or anyone else, we did discuss we believe, 19 because it's one related to 7 and the interests are in great 20 part different than 1 and 2 in property and subrogation claim, 21 we all seemed to agree it should be on a separate track as for 22 discovery purposes and scheduling purposes. Personally, me and 23 my firm have no preference in terms of which Judge gets stuck 24 with these cases. But we all seem to be in agreement, both 25 plaintiffs and the defendants, in terms of the track on which SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 38 31OQSepC Argument 1 the discovery should be, even if delaying it relieves some of 2 the pressure on your Honor. 3 THE COURT: I'm not worried about the pressure. 4 Really, my outlook is to save expense of the clients. These 5 cases are very expensive to run and promoting an inefficiency 6 won't help. I would like to do whatever makes sense. You are 7 not going to sacrifice anything having Judge Koeltl. He is one 8 of the best judges in the courthouse, and he moves his cases 9 very well. 10 If you think that these cases should run on a separate 11 track and will involve different types of discovery, and 12 Mr. Williamson on behalf of the Port Authority, the named 13 defendant here, the only defendant agrees, I will certainly 14 follow your suggestion. If I talk to Judge Koeltl, we will 15 accept the transfer. 16 MS. MCINTYRE: The Authority would agree to do that at 17 your Honor's preference. 18 THE COURT: Move to Judge Koeltl? 19 MS. MCINTYRE: We will do so, your Honor. 20 THE COURT: It's not my preference. I told Chief 21 Judge Mukasey we had these cases, that as long as I thought I 22 was creating efficiency for the Court and for the litigants, I 23 would take these cases. And if at a later time there are 24 inefficiencies, I would ask him to transfer segments of the 25 cases or all category of cases to someone else. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 39 31OQSepC Argument 1 So I think I want you to decide what's best for your 2 cases. I think you know more than I would know. I hear from 3 both of you that there are namely separate and distinct issues 4 in a different track that will argue very persuasively for 5 having a different Judge involved. 6 MR. BECKER: Your Honor, may I be heard? My name is 7 Ken Becker with the New York City Law Department. Claims have 8 been brought against the City of New York by what I believe are 9 the same plaintiffs that have commenced actions against the 10 Port Authority in connection with the destruction of 7 World 11 Trade Center. The City and these claimants have entered into 12 standstill agreements, I guess delaying -- in effect delaying 13 the statute of limitations for approximately one year until 14 December of this year. I wanted your Honor to be aware of 15 that. 16 The other concern that I have is based on discussions 17 with counsel, I was under the impression that there was the 18 distinct possibility that claims would be brought in the 7 19 World Trade Center case that would involve the destruction of 20 the towers, and that there would be some significant degree of 21 overlap between the cases. Those claims have not been made, 22 but I want the Court to be aware that there was at least a 23 concern of mine, a concern of ours that there would be that 24 overlap. 25 THE COURT: I'm concerned that before the pleadings SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 40 31OQSepC Argument 1 end, the third-party pleadings and cross-claims are going to 2 weave a very intricate web and entangle us all unless we find 3 ways to separate them. 4 My preliminary view is that I would have to organize 5 this case according to the main claims and not the cross-claims 6 and third-party claims and seek help from other judges with 7 regard to those kinds of claims. I think they will involve 8 other issues. They may, they may not. 9 For example, the Port Authority might propose to sue 10 the airlines in the same way that passengers of the airlines 11 are suing or ground victims are suing that would suggest an 12 organization similar to what we already have. There may be 13 property claims or subrogation claims that raise different 14 kinds of issues. I don't know. The World Trade Center set of 15 issues in terms of the collision of two airplanes with towers 1 16 and 2 leading to their collapse suggests a distinctiveness from 17 the type of event that caused, from what we hear, 7 World Trade 18 Center to collapse. I understand the differentiation. 19 I should add also that Judge Koeltl and I will be 20 talking to each other frequently, and if coordination is 21 affected, we could affect it in many ways, and we will. 22 MR. ALLEN: Your Honor, my name is Richard Allen. I 23 represent Industrial Risk Insurers. Your Honor, I'm in the 24 process of being admitted pro hac in Judge Koeltl's Court. I 25 ask permission to address you at this time. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 41 31OQSepC Argument 1 THE COURT: Yes, you have it. 2 MR. ALLEN: I'm not admitted in front of you yet. 3 THE COURT: You are now, and if you want to stay here, 4 you will just file your papers with the clerk. 5 MR. ALLEN: Thank, you, I appreciate that. 6 As you observed, the World Trade Center 7 case, all 7 three of the complaints that have been filed. Only two have 8 been served. A complaint has not been served. We are trying 9 to effect the service of the complaint. These are aggravation 10 of damages claims. You hit the nail on the head a moment ago. 11 We are not alleging any claim against any security company or 12 any airline or anything else. We would ask you to continue to 13 permit us to work out our investigation and a resolution of 14 issues that are needed to go forward. 15 THE COURT: I know that Judge Koeltl has given a 90 16 day order. 17 MR. ALLEN: He gave us a 10 day continuance, which 18 will run to May 9. I don't mean to speak at all for counsel 19 for the other two plaintiffs in front of me, but I understand 20 they are considering a standstill, or at least it's being 21 discussed, is it not, with the Port Authority. What it 22 reflects is World Trade Center 7 has got some unique factual 23 issues. 24 Secondly, the nature of the claims and the damages are 25 not based on airplane crashes, but significantly what happened SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 42 31OQSepC Argument 1 afterwards. So I guess just on behalf of IRI, I would ask you 2 to permit us to continue for now in front of Judge Koeltl. 3 THE COURT: These three cases will be transferred to 4 Judge Koeltl. 5 We will finish with the agenda except to select a next 6 date. 7 Mr. Alexander? 8 MR. ALEXANDER: Yes, your Honor, Brian Alexander. 9 There are three stipulations that I have been asked by the 10 respective committees to bring to the Court's attention that 11 will have some bearing on what you might anticipate by way of 12 motions to dismiss that the parties are actively working on. 13 The first is a stipulation between the plaintiffs and 14 the noncarrying airline defendants to effectively stay the 15 proceedings as to those defendants while the motion is being 16 decided. 17 The second is a similar stipulation with respect to 18 the security company parents that are alleged in both master 19 and certain individual complaints. 20 And the third is a stipulation, relatively minor by 21 comparison, with the Silverstein defendants that were 22 substituted, which we are working toward filing probably next 23 week. 24 THE COURT: If the motion is decided in favor of you, 25 what happens next with regard to the subject of the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 43 31OQSepC Argument 1 stipulation? 2 MR. ALEXANDER: The stipulation contemplates that 3 those defendants will not have a second bite of the apple 4 vis-a-vis motions joined now. 5 THE COURT: They will not. 6 MR. ALEXANDER: They will not. 7 THE COURT: They will abide by the decision. 8 MR. ALEXANDER: Yes, your Honor. 9 THE COURT: I want to make that clear. I'm not going 10 to entertain motions that cover the same ground as the pending 11 motions. Anyone who has motions to file arguing that there is 12 no duty has to file them now or be barred. I understand that 13 these are attacks on the claim for relief, but the next time I 14 will entertain them will be at trial. 15 MR. ALEXANDER: That's not to exclude others. We are 16 not waiving other motions. 17 THE COURT: Only on the issue of duty. Were the 18 parents of the security companies similarly advised by the 19 decision? 20 MR. ALEXANDER: That's my understanding, your Honor. 21 THE COURT: That's the category of the Silverstein 22 defendants. 23 MR. ALEXANDER: They are basically, as I understand 24 it, joined with the Port Authority collectively and will have 25 their motion by February 7. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 44 31OQSepC Argument 1 MR. WILLIAMSON: Richard Williamson. That's right. 2 MR. ALEXANDER: There is a question of the proper 3 parties. Apparently, it's been brought to your attention by 4 the Flemming firm that World Trade Center Properties Limited is 5 the proper party. We will substitute parties. They will file 6 their motions by the 7th. 7 THE COURT: I would think the natural order of events 8 you would be standing for all parties like Silverstein and 9 lessees and various categories. One way or another, it would 10 come back to you. 11 MR. WILLIAMSON: Yes, your Honor. I think what 12 Mr. Alexander said was right in terms of getting the proper 13 parties in. He is right. We will be making our motion by 14 February 7. 15 THE COURT: That's satisfactory. 16 MR. ALEXANDER: The last thing, sorry, there's another 17 category of defendants related to the Port Authority and 18 building owner Silverstein. They are what I call the 19 architects and engineers. We recently filed a Rule 41(a), 20 voluntary motion to dismiss those cases, for the very reasons 21 you just, I think, subsumed the motions addressed here, and 22 they would address the merits in the case. 23 THE COURT: They will come in, Mr. Williamson, if the 24 Port Authority wants them to? 25 MS. MCINTYRE: That is correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 45 31OQSepC Argument 1 THE COURT: I take it from what you are telling me is 2 there will be a standstill agreement with regard to those 3 potential third-party defendants? 4 MS. MCINTYRE: For the moment. We weren't party to 5 this precise agreement. We learned that plaintiffs decided to 6 dismiss without prejudice their claims against these other 7 defendants. 8 MR. ALEXANDER: Inasmuch as we're moving to dismiss 9 rather than answer, we hadn't crossed the bridge and hope never 10 to have to cross it, whether to cross-claim against those 11 defendants, your Honor. 12 Ergo, we haven't even thought about whether we would 13 implead them in the unhappy event that we will not win the 14 motion. 15 THE COURT: What happens if you would implead them and 16 as is plaintiffs' right, plaintiff again wishes to claim for 17 relief against them and then make motions to dismiss on the 18 ground of no duty? 19 MR. ALEXANDER: Again, I don't believe we would 20 differentiate if your Honor moves in our favor. I can't keep 21 them from doing that your Honor. We had other efficiencies in 22 mind behind our thinking as to why we dismissed them now. 23 Frankly, our understanding was we are going to address 24 the merits of what would be their motion to dismiss and by 25 addressing the merits of the Port Authority and Silverstein SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 46 31OQSepC Argument 1 defendants' motion to dismiss. While I can't cut off their 2 ability to do that, should we bring them back in -- 3 THE COURT: I will sign the stipulation. I think if 4 they at a later time bring a separate motion, there probably 5 will be other issues implicated, and I will deal with those. 6 MR. WILLIAMSON: In fairness, I should tell your 7 Honor, having worked with those defendants' counsel on the 8 committee, as we told Mr. Alexander and Mr. Moller yesterday, 9 they did have some particular sui generis grounds on which they 10 were contemplating moving. They would not apply to the Port 11 Authority or the World Trade Center properties or Silverstein 12 properties defendants. But I think that Mr. Alexander is still 13 right, that it does make sense at this point to go ahead with 14 the stipulation that he crafted. 15 THE COURT: Mr. Moller, where does discovery stand? 16 MR. MOLLER: We haven't done any formal discovery 17 beyond serving the master of discovery requests. 18 THE COURT: So you served the requests? 19 MR. MOLLER: Yes, they were served. 20 THE COURT: What is to be expected? Are parties 21 waiting until I rule? 22 MR. MOLLER: That's essentially what's happening, 23 because much of the discovery implicates SSI, and we are trying 24 to avoid having to get embroiled in an SSI dispute until we 25 know what the scope of it has to be, which follows up on your SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 47 31OQSepC Argument 1 ruling. 2 THE COURT: Would it be unfair to ask defendants to 3 state all other objections other than SSI until we get that out 4 of the way? 5 MR. BARRY: I don't think that's unreasonable, your 6 Honor. 7 MR. MOLLER: That would be wonderful for us. 8 THE COURT: Could that be done? 9 MR. BARRY: Yes. 10 MR. WILLIAMSON: What's the question, your Honor, I'm 11 sorry? 12 THE COURT: Mr. Moller doesn't want to deal with the 13 obligation to produce until he has to. 14 MS. McINTYRE: The SSI material access to it, that's 15 right. 16 THE COURT: So what I want to propose is that other 17 than objections grounded upon security information, all other 18 objections to the discovery requests should be made. There 19 should be meet and confer on all those other issues as well. 20 So promptly after I rule on the issue of duty, assuming I rule, 21 if I rule in favor of the plaintiffs, you will be in a position 22 to immediately bring up the SSI issue, and I will be able to 23 deal with all other issues of discovery. 24 MR. WILLIAMSON: The concern, your Honor, with respect 25 to that is that what was served in terms of plaintiffs' master SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 48 31OQSepC Argument 1 discovery first set was not at all as we thought. You had made 2 it clear it should be tailored to what he might need in order 3 to oppose the anticipated motions to dismiss, but rather it 4 consists of hundreds and hundreds of combined interrogatories, 5 document requests, and, if you were to count, subparts. 6 THE COURT: I understand that, because there's no 7 discovery on duty. Duty is a matter of law that's raised from 8 the allegations of the pleadings. 9 MR. WILLIAMSON: Right. So my concern is we don't 10 frankly want to be distracted from finishing the motion to 11 dismiss. Nor one could fairly say, as you have noted before, 12 being put to the expense of dealing with hundreds and hundreds 13 and hundreds of requests. 14 THE COURT: I think given the prolixity of issues 15 here, you should go ahead. I think the cases need to move, and 16 I think the people here have enough personnel to deal with most 17 sets of issues. I would like you to create a schedule for 18 requiring defendants to review the discovery requests, 19 objections other than the SSI objections, which will be the 20 government's objections anyhow. 21 MR. MOLLER: If counsel will agree, we will get a 22 proposed schedule for that back to you within a week, and the 23 schedule will cover dates for responses, objections to our 24 discovery, other than SSI objections, by a date certain. We 25 will comment and meet and confer, and if there's a motion SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 49 31OQSepC Argument 1 necessary, we will follow up. 2 MR. BARRY: I understood, your Honor, that we were 3 talking about the written responses to the discovery requests, 4 and that we would include in those written responses any 5 additional objections we would have in addition to the 6 objections that those requests seek SSI, is that correct? 7 THE COURT: That's correct, and I'd like you to meet 8 and confer so that if Mr. Moller and his colleagues are able to 9 revise a discovery request to take care of all or part of the 10 objection, he has time to do that. 11 My goal is that if I decide in favor of the plaintiffs 12 on the issue of duty, I can quickly go on to rule on pending 13 discovery requests so that you can get this case moving. If, 14 of course, I decide there's no duty, the defendants will have 15 wasted money. You are right, Mr. Williamson, but I think they 16 will so rejoice at having emerged victorious at such an early 17 stage, that it will be well worth it. 18 MR. MOLLER: But it's interesting to note that the 19 airline defendants' motion is directed only to ground victims, 20 so discovery will proceed whether you decide one way or 21 another. They are in the case. 22 THE COURT: There's no reason why it shouldn't. But 23 if it doesn't, I'm not going to rule on those issues until I 24 finish with the duty. 25 MR. WILLIAMSON: Our motion will be as to all cases, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 50 31OQSepC Argument 1 so if we win, we are out completely. 2 THE COURT: So you will be victorious and therefore 3 your client won't mind spending some more money. 4 I have completed my agenda. 5 One more point is selecting the next day. But before 6 I do that, is there any person here who wishes to bring 7 anything else to my attention, any issuing problem? 8 MR. HANLY: Paul Hanly. I need to correct something 9 that I said on the record. While I was sitting here, I was 10 reflecting on it, the issue of Mr. Huge, Mr. Harry Huge. 11 I had said concerning his son, which I think is 12 irrelevant to the issues before the Court, but in any event, I 13 described that his son is an associate in Mr. Motley's firm. 14 And I said that he does not work on the 9/11 cases, and that is 15 true. 16 I believe I also said that he had nothing to do with 17 the Port Authority Allied lawsuit. And while I was sitting 18 here, I seemed to recall that in Mr. Bialick's affidavit, he 19 lists a number of Ness Motley attorneys who worked on the case, 20 and I believe he referenced Mr. Theodore Huge. 21 Once again, Judge, I don't think that if you will, the 22 sins of the son get visited upon the father, so I don't think 23 it's relevant, but I certainly did not want to leave the record 24 with what may be a misstatement. 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 51 31OQSepC Argument 1 MS. MCINTYRE: Carlene McIntyre. I appreciate 2 Mr. Hanly clearing that up, your Honor. I believe he is 3 exactly right. We also don't disagree that the sins of the son 4 should not be visited on the father. 5 THE COURT: There should be an affidavit by both 6 Mr. Theodore and Mr. Harry Huge with regard to the conduct of 7 Theodore Huge in the case, and to whatever extent he and his 8 father discussed the case. 9 MS. MCINTYRE: Thank you, your Honor. 10 MR. HANLY: Thank you, your Honor. 11 THE COURT: All right, what's a good next date, 12 Mr. Barry? Mr. Moller? Anybody else? Talk off the record. 13 (A discussion was held off the record) 14 MR. BARRY: Your Honor, we've conferred, and our 15 recommendation to you would be not to schedule anything until 16 oral argument of the motions. 17 MR. MOLLER: And if we need the attention of the Court 18 to any issue, we can raise it by letter, and you can decide 19 whether a hearing is necessary to resolve it. 20 THE COURT: The only problem with that is there are 21 some people here and so many schedules that it would be good 22 for planning purposes to have a date. I am going to hear the 23 motions on April 14. I hope to rule from the bench. 24 (Pause) 25 THE COURT: May 2 at one. May 2 at one o'clock. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 52 31OQSepC Argument 1 Folks, two more minutes and we'll wrap it up. 2 Let me review where we are, and let me ask Mr. Moller 3 and Mr. Barry to cooperate in proposing an order, a case 4 management order. 5 On category one, Mr. Shaffer will propose an order. 6 MR. SHAFFER: Sorry, what date, your Honor? 7 THE COURT: I want another status order similar to the 8 ones I have had in the previous case management meetings. 9 On paragraph 1, I am going to look to you, Mr. Shaffer 10 to propose an order, probably in the area you mentioned before, 11 I will talk to either Justice Stallman and Justice Silverman 12 about that issue, and also the issue with regard to leave to 13 file against the City. 14 Secondly, with regard to the bankruptcies of United 15 Airlines and U.S. Airways, I don't think anything needs to be 16 done with U.S. Airways, except that stipulation that is about 17 to be given. 18 With regard to United Airlines, Mr. Ellis, I'm going 19 to call Judge Wedoff. And I'd like to give you two weeks, but 20 if you can't do it, you will ask me for longer so I can keep 21 control of it, two weeks from today to either obtain leave from 22 the bankruptcy court to allow United Airlines to participate 23 here, or to ask me for a specific extension of time. 24 MR. ELLIS: Yes, your Honor. 25 THE COURT: With regard to category three, category SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 53 31OQSepC Argument 1 three, Mr. Moller, I will wait for an order from you. 2 With regard to category four, there's going to be a 3 stipulation that the Port Authority and Mr. Hanly and 4 Mr. Motley are going to submit, and I have given them until 5 next Friday to do that. 6 With regard to the late notices of claim against the 7 Port Authority, Mr. Williamson, I look to you to work with 8 Mr. Shaffer to give me an order that will deal with that issue. 9 MR. WILLIAMSON: Yes, your Honor. 10 THE COURT: Mr. Shaffer, you will work with 11 Mr. Williamson? 12 MR. SHAFFER: Yes, your Honor. 13 THE COURT: And I would like that to be given to me by 14 Friday also. 15 Category six, I understand there's going to be 16 stipulations by next Friday that eliminate all those technical 17 problems. 18 Category seven, we will simply transfer those cases to 19 Judge Koeltl. So Mr. Moller and Mr. Barry, at this time, it 20 will be easy with category three. 21 Do you have anything else for me? 22 Thank you very much for your attention. 22 o0o 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300