1 633rsepc 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------------------------------x 2 3 In re: SEPTEMBER 11 PROPERTY 21 MC 101 (AKH) 3 DAMAGE AND BUSINESS 4 LOSS LITIGATION 4 5 ------------------------------x 5 New York, N.Y. 6 March 3, 2006 6 1:00 p.m. 7 7 Before: 8 8 HON. ALVIN K. HELLERSTEIN 9 9 District Judge 10 10 11 SPEAKERS 12 12 KREINDLER & KREINDLER 13 Attorneys for Plaintiffs' Executive Committee 13 100 Park Avenue 14 New York, New York 10017 14 (212) 687-8181 15 BY: MARC S. MOLLER, ESQ. 15 BRIAN ALEXANDER, ESQ. 16 JUSTIN GREEN, ESQ. 16 17 17 BAUMEISTER & SAMUELS 18 Attorneys for Plaintiffs' Executive Committee 18 1 Exchange Plaza, 15th Floor 19 New York, NY 10006 19 (212) 363-1200 20 BY: DOUGLAS A. LATTO, ESQ. 20 21 21 CLIFFORD LAW OFFICES 22 Liaison counsel for property damage plaintiffs 22 120 North LaSalle Street, 31st Floor 23 Chicago, Illinois 60602 23 (312) 899-9090 24 BY: ROBERT A. CLIFFORD, ESQ. 24 TIMOTHY S. TOMASIK, ESQ. 25 GREGORY P. JOSEPH, ESQ. 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2 633rsepc 1 SPEAKERS 2 2 MOTLEY RICE 3 Attorneys for Individual Plaintiffs 3 321 S. Main Street 4 Providence, Rhode Island 02903 4 (401) 457-7709 5 BY: DONALD MIGLIORI, ESQ. 5 6 6 BAUM HEDLUND 7 Attorneys for Individual Plaintiffs 7 12160 Wilshire Boulevard 8 Los Angeles, California 90025 8 (310) 207-3233 9 BY: DONALD L. GOLDMAN, ESQ. 9 10 10 SCHIFF HARDIN 11 Attorneys for Defendant The Port Authority of New York and New 11 Jersey in the World Trade Center 7 litigation 12 623 Fifth Avenue 12 New York, New York 10022 13 (212) 753-5000 13 BY: BETH D. JACOB, ESQ. 14 14 15 DEBEVOISE & PLIMPTON, LLP 15 Attorneys for Defendant American Airlines 16 919 Third Avenue 16 New York, New York 10022 17 (212) 909-6000 17 BY: ROGER PODESTA, ESQ. 18 18 19 CONDON & FORSYTH LLP 19 Attorneys for Defendant American Airlines 20 7 Times Square 20 New York, New York 10036 21 (212) 894-6770 21 BY: DESMOND BARRY, ESQ. 22 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 3 633rsepc 1 SPEAKERS 2 2 FLEMMING ZULACK WILLIAMSON ZAUDERER LLP 3 Attorneys for Defendants World Trade Center Properties LLC and 3 The Port Authority of New York and New Jersey 4 One Liberty Plaza 4 New York, New York 10006 5 (212) 412-9500 5 BY: RICHARD A. WILLIAMSON, ESQ. 6 M. BRADFORD STEIN, ESQ. 6 7 7 BETH GOLDMAN, ESQ. 8 SARAH SHEIVE NORMAND, ESQ. 8 Attorneys for Defendant ATS 9 U.S. Department of Justice 9 86 Chambers Street 10 New York, New York 10007 10 (212) 637-2709 11 11 12 CAMPBELL CAMPBELL EDWARDS 12 Attorneys for Defendant US Airways 13 One Constitution Place 13 Boston, Massachusetts 14 (617) 241-3000 14 BY: RICHARD CAMPBELL, ESQ. 15 15 16 QUIRK & BAKALOR 16 Attorneys for Defendant United Airlines 17 845 Third Avenue 17 New York, New York 10022 18 (212) 319-1000 18 BY: JEFFREY J. ELLIS, ESQ. 19 19 20 SIMPSON THACHER & BARTLETT 20 Attorneys for Defendant Argenbright Security 21 425 Lexington Avenue 21 New York, New York 10017 22 (212) 455-3203 22 BY: JOSEPH WAYLAND, ESQ. 23 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 4 633rsepc 1 (Case called) 2 THE COURT: Good afternoon. I have set out an agenda 3 before you, and I intend to go down it as much as possible. 4 The first category deals with the settlements. I have been 5 given to understand that nine cases were settled yesterday, at 6 least they have agreed to settling. All the cases handled by 7 the Baum Hedlund firm were successfully negotiated with Mr. 8 Barry and his colleagues and with the very substantial 9 assistance of Sheila Birnbaum. There is a very busy schedule 10 that is ahead of us, and perhaps Mr. Barry you would like to 11 report on it. 12 MR. BARRY: Yes. Thank you, your Honor. Good 13 afternoon. 14 THE COURT: I don't mind if you turn around to speak 15 to everyone else or use the podium. 16 MR. BARRY: Nobody has ever accused me of speaking too 17 softly. 18 We have had 31 mediations in the past two weeks and 19 successfully settled 9 of those 31. We have an additional 15 20 or so mediations scheduled over the next two to three weeks, 21 second visits in respect of some cases that have had first 22 mediations, some additional ones. We are planning on going to 23 Washington, D.C., to have mediations where the clients 24 themselves will attend, which we think would be beneficial. 25 Those are second mediations. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 5 633rsepc 1 We have a full schedule coming up for the next three 2 weeks or so with Sheila Birnbaum. 3 THE COURT: Give me an idea of the dates that are 4 involved. 5 MR. BARRY: The entire week of March 13, the entire 6 week of the 20th. Both weeks have been set aside for 7 mediations, those two weeks. We have the last week of March. 8 THE COURT: Next week you are off to absorb what has 9 been done? 10 MR. BARRY: Yes. 11 THE COURT: The week starting Monday the 13th you have 12 a full week? 13 MR. BARRY: Full week, full week the following week. 14 THE COURT: So two full weeks. Then you have a week 15 off? 16 MR. BARRY: Yes. 17 THE COURT: In those two weeks, how many cases do you 18 think you will be able to reach? 19 MR. BARRY: It depends on how many new cases we get. 20 I think the week of the 13th we have about 14 scheduled. No, 21 I'm sorry, it is more than that, because we have additional 22 Motley Rice cases. I would say probably close to 20 -- 23 -- 23 scheduled that week. 24 THE COURT: Thank you, Mr. Barry. 25 There are a number of comments and questions that we SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 6 633rsepc 1 need to discuss with regard to these settlements. First, there 2 is the objective of working out our procedures so that money is 3 actually paid out to the beneficiaries as quickly as possible. 4 In one case, the Salvo case, a fee dispute held up 5 some of the money, a fee dispute between successor lawyers in 6 the case and original lawyers. I have worked out an 7 arrangement where the plaintiffs themselves will be paid their 8 portion of it, and that should happen very quickly. The fee 9 dispute itself will be on a separate schedule. No one but the 10 two lawyers are affected by that, or two sets of lawyers. 11 One objective is to make arrangements so that the 12 plaintiffs entitled to the settlement proceeds are paid as 13 quickly as possible. 14 Second, we still have not developed an adequate 15 procedure with regard to my approvals that are required with 16 settlements. Mr. Stein has objected. I received a letter from 17 Mr. Stein, and I suppose others of you know about this letter 18 as well, complaining that he is not getting enough information 19 to be able to review those effectively and to decide whether or 20 not to file objections. Since money can't be paid out, at 21 least under the procedures that we have now, until everyone who 22 is entitled to object has an opportunity to review, we need to 23 develop better procedures with regard to that. 24 Those are two items. 25 The third item is to perhaps regulate a time problem. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 7 633rsepc 1 There is a very ambitious schedule of 30(b)(6) deposition 2 notices. I feel responsible for causing that ambitious 3 schedule because of critical comments that I have made in the 4 last two meetings. I am given to believe that I can't expect 5 you to observe both the deposition schedule and the mediation 6 schedule. If something has to give, I would like the 7 mediations to go forward as a priority issue. 8 Another issue has to do with a very difficult problem 9 in settlements, the tension between treating each case 10 individually and not rewarding holdouts who prefer to settle 11 later rather than earlier in the hope that they might be able 12 to use leverage to gain additional funds later on. It is a 13 very dangerous game, because everybody can play it. That means 14 that only the needy settle quickly and possibly cheaply and a 15 premium is given to holdouts. That is not a conscionable way 16 to proceed in this case. 17 Whatever I can do to cause disadvantage to that 18 procedure, I will do it. I think there has to be a rationality 19 to the settlement so that there is no jockeying among different 20 lawyers for advantage. Clients have to be brought up first, 21 and there has to be some rational basis so that disparities 22 among similarly situated clients don't arise because of 23 settlement strategies as to timing of negotiations or intensive 24 negotiations. 25 Having laid out all these different criteria, I think SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 8 633rsepc 1 the first way to start this is to discuss Mr. Stein's issue 2 with regard to settlements. Earlier, I had suggested in light 3 of the confidentiality that plaintiffs wish to have with regard 4 to settlement amounts, and for different reasons, good reasons, 5 that settlements will be banded together in groups of five and 6 the motion would then be made in respect of that band, with 7 notice to all interested parties and with the ability of each 8 of them to raise objections if need be. 9 The problem is that it is not a good idea for 10 settlements to wait. It is a better idea for settlements to be 11 approved and moneys paid out with dispatch. Not only is this a 12 good idea for people who have been suffering and waiting, but 13 it is also a good idea because of the dynamic that is created 14 to improve the settlement process. I created a tension between 15 two objectives, and I am not sure I have resolved that tension 16 in a way that is fair to everyone. 17 MR. WILLIAMSON: Good afternoon, your Honor. Richard 18 Williamson for the World Trade Center Properties defendants, 19 responding specifically to the issue address in Mr. Stein's 20 letter. We have been still searching to develop a protocol 21 that will be acceptable to all parties following on the heels 22 of the acceptable protocol that was presented to your Honor and 23 so ordered for the approval of the Salvo and Lewin settlements. 24 That was hammered out with everybody. It was done in pretty 25 short order. Our clients as well as the insurers, once they SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 9 633rsepc 1 had the necessary information, had no objections to the 2 settlements sailing through, and they all acted very 3 expeditiously, because there was a time concern on the part of 4 the plaintiffs. 5 We would like to replicate that with respect to future 6 settlements coming down the pike. To that end, we have had on 7 the table for a couple of months now a proposed settlement 8 stipulation protocol that would be so ordered if everybody 9 could find it acceptable, modeled on the Salvo and Lewin 10 protocol. We don't have agreement on it yet. Plaintiffs' 11 counsel, we understand, these particular plaintiffs' counsel, 12 have some reluctance to following the same procedure. 13 We would like our clients as well as the insurers to 14 have different information than we had before. We are trying 15 to be open-minded about it and see if it is possible to reach 16 some mutual agreement. We know Mr. Alexander was away. He is 17 back now. We sent him a letter responding to his latest 18 proposal. We hope to find out maybe next week whether we can 19 work out something that is less than what our clients and the 20 insurers think they are entitled to. 21 THE COURT: See if we can resolve it now. Mr. 22 Alexander? Mr. Moller? Mr. Alexander. 23 MR. ALEXANDER: I thought we made a very reasonable 24 proposal. I just learned last night that the proposal was 25 rejected, for reasons I don't quite understand. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 10 633rsepc 1 THE COURT: Let's not do it by assigning fault. Just 2 give me the issue. 3 MR. ALEXANDER: I'm telling you where we are. I will 4 give you what we offered. You can tell us if it is reasonable. 5 We offered narratives, the exact same narratives produced to 6 defendants which contained essentially the same information 7 that was so ordered by the Court back in March of last year. 8 That consists of decedents' employment and earnings, date of 9 birth of the decedent survivors and heirs, marriage information 10 where appropriate, educational information where appropriate, 11 information on decedents' employer-provided benefits, pension 12 plan, a summary of decedents' health, details concerning 13 household service and any other circumstances relevant to 14 damages that are addressed in the narratives, the same ones 15 that were provided to the aviation defendants further to both 16 the mediation and settlement discussions. 17 THE COURT: My guess is that it may be too difficult 18 to figure out the noneconomic apportionment of the damages. 19 MR. ALEXANDER: The narratives are exactly what go to 20 that in great detail. These are some 14 cases 20-to 30-page 21 narratives with photographs. The bulk of the narratives are 22 actually spent on the noneconomic side. I don't know what else 23 you could possibly give to further inform them on the good 24 faith basis for those. 25 THE WITNESS: Mr. Williamson. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 11 633rsepc 1 MR. WILLIAMSON: Your Honor, what we believe we are 2 entitled to, what we got before, was a set of settlement 3 evaluation materials. It has become a defined term at this 4 point. Those are the materials that were referred in your 5 Honor's order of March 16, 2005, that were to be provided by 6 plaintiffs to defendants. The categories that were listed 7 there were worked out with Mr. Moller. 8 THE COURT: What in Mr. Alexander's proposal is 9 missing? 10 MR. WILLIAMSON: I will tell you. The raw data. 11 Instead of giving us the data that we can evaluate ourselves, 12 the proposal now is that we would get an unsworn narrative of a 13 rendition of what the data would show if we were looking at it. 14 Without playing it out here chapter and verse, your Honor, we 15 can take the sample -- 16 THE COURT: Supposing that information that Mr. 17 Williamson wants were given under a protective order so that 18 only counsel could see it. 19 MR. WILLIAMSON: May I respond? Salvo-Lewin, that is 20 exactly how we did it, with the sole additional exception that 21 we could show it to the insurers and they had to acknowledge 22 that they were bound by confidentiality and the client so that 23 they could see it. There have been no problems since we showed 24 it to them and they gave us permission to approve the 25 settlements. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 12 633rsepc 1 THE COURT: The merits of the protective order 2 approach, I could take this issue plaintiff by plaintiff. Mr. 3 Clifford. 4 MR. CLIFFORD: Your Honor, Robert Clifford. Just so 5 the record is clear, we have concluded from our perspective the 6 standing that Mr. Williamson's clients have on this issue is no 7 different from the rest of the property damage claims. From 8 our perspective, and most of us have a vast background as 9 plaintiff lawyers as well, we think the proposal by Mr. Moller 10 and Mr. Alexander is more than sufficient for the purpose for 11 which the information is being sought, and it is actually 12 slowing things down. That is our perspective on it. 13 THE COURT: What Mr. Williamson is proposing has an 14 aspect of simplicity to it, that there doesn't need to be a 15 translation of raw data if the raw data can be supplied. This 16 data is probably captured somewhere on a computer document. 17 MR. CLIFFORD: But that begs the question of whether 18 or not he has standing or we have standing to object to these 19 settlements. What is going to happen when he says we think too 20 much money was paid? Is he going to go in reverse and say the 21 settlements are too light? 22 THE COURT: This is a unique procedure. In every 23 procedure I know, the judge is looking to see if too little was 24 paid. This procedure looks to whether too much was paid. 25 MR. CLIFFORD: Right. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 13 633rsepc 1 THE COURT: It is an anomaly. It is not clear to me 2 that Mr. Barry likes to spend the client's money. Maybe if he 3 likes it, Mr. Podesta will certainly tell him no. 4 MR. PODESTA: That is exactly what I did, your Honor. 5 THE COURT: It is kind of chimerical. Nevertheless, 6 since we have caps, and since all these settlements will go 7 against the caps, I have to approve the settlement. 8 Maybe Mr. Williamson is asking too much, maybe not. I 9 am trying to see if a procedure could be developed that will 10 arrive at a consensus. 11 I see two issues here. One is the natural sensitivity 12 that people have to having sensitive data made public. I know 13 I wouldn't like it; therefore, I think that most people 14 wouldn't like it. That, as I understand it, is somewhat, but 15 only a little bit, ameliorated by the approach of translating 16 it to a lawyer's rendition. But it still remains. 17 So I ask myself whether the information can be 18 conveyed under a protective order that would pledge that the 19 recipients of the information must keep the information 20 private, to be shared only with a limited group of people who 21 would also agree to keep it private, with a commitment not to 22 make copies or to make a limited number of copies, and to 23 reduce the copies maybe just to one to be kept as a record. 24 But something along that line. That would give me an ability 25 to approve settlements as they are made, and that means money SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 14 633rsepc 1 can go much more quickly to plaintiffs. 2 MR. ALEXANDER: Your Honor, I would add it is our 3 understanding this only applies to Flights 11 and 75. I can 4 report that with respect to all the cases that have settled at 5 this point, they would agree if an appropriate protective order 6 was put in place to provide I guess what we will call the raw 7 data from the March 14, 2005 letter. But as to the 8 remaining -- 9 THE COURT: The other two flights are those that went 10 into Shanksville and -- 11 MR. ALEXANDER: Flights 93 and 77. 12 THE COURT: -- and the Pentagon. 13 MR. ALEXANDER: Yes, your Honor. 14 THE COURT: What is the issue there? 15 MR. ALEXANDER: There is no reason for them to have a 16 concern over those cases. The same information is not 17 required. 18 MR. LATTO: Doug Latto, Baumeister & Samuels. I 19 raised this issue with the Court at the last conference with 20 respect to 93 and 77. Your Honor directed that the defendants 21 were not entitled to, and Mr. Williams did not object -- 22 THE COURT: He is not entitled and Mr. Clifford is not 23 entitled. 24 MR. ALEXANDER: There are no property claims. 25 MR. LATTO: There are no property claims, so the issue SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 15 633rsepc 1 of the cap doesn't relate to 93 and 77. 2 THE COURT: It only affects other plaintiffs. 3 MR. LATTO: Yes. 4 MR. CLIFFORD: Your Honor, that is true, although 5 currently there now are some issues being raised about whether 6 or not that coverage might nevertheless be applicable for the 7 PD claims. But we are not raising that here as a basis for 8 having that data. We are sufficiently satisfied -- 9 THE COURT: It seems to me, if you are not raising it, 10 nobody is raising it, I can approve settlements reached in 11 those two flights as those settlements are made. 12 MR. LATTO: That is correct, your Honor. 13 MR. CLIFFORD: Yes, sir. 14 THE COURT: The question is, what about other 15 plaintiffs in those cases? Maybe the first five settlements 16 could exhaust all the settlement moneys. 17 MR. LATTO: I haven't heard any other plaintiff 18 objecting to any other co-plaintiff settlement in 93 and 77. 19 When I raised this issue last time with the Court, your Honor 20 directed me to file a motion with respect to one of the 21 settlements reached in Flight 93. I believe that that motion 22 was filed with the Court on February 13th and is pending before 23 your Honor. We spoke to your Honor's law clerk earlier in the 24 week and were advised that your Honor is considering that 25 application. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 16 633rsepc 1 MR. ALEXANDER: Judge, we are not aware of any other 2 plaintiff that would call for that information. 3 THE COURT: So I can sign that order now? 4 MR. LATTO: Absolutely, Judge. 5 MR. WILLIAMSON: May I be heard, your Honor? 6 THE COURT: Yes, Mr. Williamson. 7 MR. WILLIAMSON: It is a nonissue. Mr. Latto is 8 correct, it was raised at the last conference, correct your 9 Honor ruled that we could proceed, correct to say we didn't 10 object. No problem. We have no issue with it. 11 If I understood Mr. Alexander correctly, on the other 12 two flights, if he is agreeable, we will just take the raw 13 data. We are not asking for it on these two flights. Mr. 14 Podesta had originally raised the point, and your Honor and I 15 agreed there was no objection. 16 THE COURT: I signed this on February 22. 17 MR. WILLIAMSON: It has already been granted? 18 THE COURT: Yes. I signed that. 19 MR. LATTO: We haven't received a signed order, your 20 Honor. 21 THE COURT: It's done. 22 MR. LATTO: Thank you, your Honor. 23 MR. ALEXANDER: Your Honor, if I might, I just want to 24 clarify what I agreed to. It was not all that, but I am not 25 retracting it. It was not for all cases. It was only for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 17 633rsepc 1 those cases that have settled to this point. We would like to 2 continue our dialogue with the Port Authority as to the 3 remainder of the cases. 4 THE COURT: Why can't you do the same thing? 5 MR. ALEXANDER: Because certain of the plaintiffs who 6 have remaining cases object. 7 THE COURT: How many people would be entitled to 8 receive this information? Mr. Clifford? 9 MR. ALEXANDER: It would be all other plaintiffs. 10 MR. CLIFFORD: Theoretically all the property damage 11 plaintiffs. 12 THE COURT: That is too many. 13 MR. CLIFFORD: Too many, exactly. 14 THE COURT: You are liaison counsel, Mr. Clifford? 15 MR. CLIFFORD: Correct. 16 THE COURT: I think Mr. Clifford should have it and 17 Mr. Williamson should have it. Anybody else entitled to it? 18 MR. WILLIAMSON: Only our clients look at it and the 19 insurers. That's it. 20 THE COURT: Mr. Clifford, how many people do you have 21 to supply? 22 MR. CLIFFORD: We have a very small group run by a 23 dictator. 24 THE COURT: So you can give the dictator the 25 information. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 18 633rsepc 1 MR. CLIFFORD: Right. If they ask, we will tell them. 2 If they don't ask, we won't volunteer. Seriously. We have 3 been working very well. We don't have a big issue with it. 4 THE COURT: Mr. Alexander and Mr. Moller, I think you 5 have it. Plaintiffs get notice, Clifford gets notice. They 6 can share it with a limited number of people who they will 7 identify. Deal with the copies and the restriction on number 8 of copies. I think you can do it. 9 MR. ALEXANDER: If that is what you are going to 10 order, your Honor, that is fine. I can only agree to a certain 11 group of the plaintiffs. There was an objection from part of 12 our group, which is why we didn't come with a position. Mr. 13 Migliori is the objecting party. 14 MR. MIGLIORI: Good afternoon, your Honor. Don 15 Migliori for the Motley Rice plaintiffs. My only concern is 16 last night apparently Brian received the proposal, and we 17 haven't seen it yet. We do know of the order the Court entered 18 a year ago. My concern would have to deal with some of those 19 plaintiffs in the raw data that might be subject to HPPA. 20 THE COURT: Subject to -- 21 MR. MIGLIORI: I don't remember if there are medical 22 records considered raw data. I just would like a little time 23 to sit down with Mr. Williamson and Mr. Clifford and see what 24 they mean by "raw data" when we start to get into some other 25 potentially problematic confidentialities, like medical SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 19 633rsepc 1 records, how far back in years we are talking about in terms of 2 tax records, and the like. I don't foresee a problem in 3 working this out with either Mr. Williamson or Mr. Clifford. I 4 would just like to sit down and see what the scope really means 5 when they say raw data. 6 MR. WILLIAMSON: May I offer a thought? 7 THE COURT: Go ahead. 8 MR. WILLIAMSON: I am happy to speak with Mr. 9 Migliori. I suspect, if I am right in my recollection, that 10 Motley Rice has no cases involving these two flights because of 11 the earlier motion. If that is right, this is a nonissue. But 12 we are happy to double-check that with him. 13 MR. MIGLIORI: We have over a dozen for both flights. 14 We have not sued on behalf of ground victims on those two 15 flights, but we do have almost 25 cases -- 16 MR. WILLIAMSON: No cases against the Port Authority 17 or World Trade Center Property defendants. 18 MR. MIGLIORI: Other than for Flight 93, that's 19 correct. So Mr. Clifford and we can work out an arrangement. 20 THE COURT: You don't have to deal with Mr. 21 Williamson, since you are not suing them. 22 MR. MIGLIORI: If we are not subject to the order, I 23 withdraw my objection that I conveyed to Brian. 24 MR. ALEXANDER: Then we have an agreement, your Honor. 25 MR. LATTO: Your Honor, it is a separate issue. With SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 20 633rsepc 1 respect to the payment of the settlement, we are still having 2 some issues concerning the release. For example, now that your 3 Honor has executed the order, we are still working with the 4 defendants on some indemnification language which is proving to 5 be somewhat difficult to work out. 6 THE COURT: Let me hold that for the moment. 7 Mr. Alexander, your issue is resolved? 8 MR. ALEXANDER: I believe it is, your Honor. I am 9 going to take him at his word though. He says that if they are 10 not a defendant in the case, we don't have to provide them the 11 information. 12 MR. WILLIAMSON: I didn't say that. 13 MR. ALEXANDER: Yes, you did. 14 MR. WILLIAMSON: Let me try it again. We did this two 15 conferences ago. 16 THE COURT: Since I don't remember too well, do it for 17 my benefit. 18 MR. WILLIAMSON: Flight 11 and Flight 75, if one of 19 those cases is settled, we have sought and been told we can 20 receive the information. If it is one of the other two 21 flights, as we just said when Mr. Latto raised the issue, we 22 are not seeking the information; your Honor resolved that at 23 the prior conference. 24 MR. ALEXANDER: If that is his position, your Honor, I 25 offer this up for solution for the time being. The cases have SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 21 633rsepc 1 already settled and probably all of the Motley Rice cases for 2 the time being. You can enter the order that we would provide 3 the information from the March 14th letter subject to a 4 protective order, but also allowing for an objection for cause 5 if there is some portion of the information that the Motley 6 Rice firm does not want to provide, and that can be argued at 7 that time. 8 THE COURT: I want to tell you this. Having signed on 9 to this, it bothers me that a lot of very personal information 10 is being conveyed. I don't know how to resolve the tension. 11 Yes, there must be an outlet for cause. If somebody has some 12 kind of a disease, for example, and wants to keep that 13 confidential, that should be respected. 14 I think the way to do this is do -- let me step back. 15 I take it that from each plaintiff there is some sort of a file 16 document in a computer system that has all the essential data 17 that is being used to negotiate OKs. 18 MR. ALEXANDER: That's correct, your Honor. 19 THE COURT: It should be easy to deliver that 20 electronically in a PDF format, so that there can't be any 21 copying, to Mr. Williamson. Mr. Williamson then could take 22 whatever notes he wishes, which must be kept confidential, for 23 the purpose of sharing it with his insurer. Any relaying of 24 information should also be done in a PDF format or the 25 equivalent so that there cannot be copying or manipulation of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 22 633rsepc 1 information. Thus assured, there is integrity of information 2 that allows evaluation and allows response. 3 I want this done quickly, because I want to approve 4 settlements quickly as they are made. I want money to be paid 5 quickly. 6 MR. ALEXANDER: With all due respect, your Honor, I'm 7 not so sure that that procedure is any more secure just by 8 virtue of being electronic and PDF. You can make copies of the 9 prospective orders and restrict them from making copies, but 10 you are still transmitting it downstream electronically and can 11 get it anywhere. That is the crux of the problem. It is 12 private information that I frankly don't see they need to 13 necessarily evaluate the circumstance. But your Honor has 14 already ruled on that. 15 THE COURT: It is a strange procedure. But if there 16 is going to be a right to object, the party objecting has to be 17 able to see the information. 18 MR. CLIFFORD: Your Honor, from the property damage 19 plaintiffs' perspective, what we would prefer the Court to 20 consider is that the resolution of the tension you described 21 may never be complete and therefore from our view you should 22 give deference to these victims who are being put in a position 23 of discomfort with uncovering their sensitive information and 24 that, when in doubt, their concern about disclosure should be 25 honored. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 23 633rsepc 1 THE COURT: I don't believe so, Mr. Clifford. The 2 very idea of the lawsuit is to deal with the prospect of 3 putting information in the public file. People had the option, 4 if they wished to really honor confidentiality, to go to the 5 special master. These people have opted to sue. Opted to sue 6 means that there is a risk of publicity. 7 I have to have a procedure that is fair to everybody. 8 That means that there has to be a right to object, and that 9 means the party objecting should be able to make an intelligent 10 evaluation. I need to resolve this issue by providing that 11 information but to guard it so that it doesn't go into hands 12 that won't be very careful with it. 13 MR. CLIFFORD: Fair enough. 14 MR. GOLDMAN: Ron Goldman from Baum Hedlund. I 15 believe that the information that should be supplied should be 16 no greater than the information that we supplied to the 17 defendants in the negotiation process. I think it should be 18 limited to that so we don't get -- 19 THE COURT: I don't know what it is, and I don't want 20 a different rule for every different case. I want one rule, I 21 want one protocol, and I want to be fair about it. 22 MR. GOLDMAN: It seems to me that if it is limited to 23 what was supplied to the defense for their evaluation -- 24 THE COURT: I can't monitor that, Mr. Goldman. I 25 can't go along with that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 24 633rsepc 1 Mr. Barry, what is your thought on this? 2 MR. BARRY: Your Honor, I think Mr. Goldman's 3 suggestion is fine with us. I believe, based on the letter 4 that Mr. Alexander wrote, that all of the information that is 5 set forth in his letter is the type of information that he gave 6 to us. I am at a loss to really understand what raw data Mr. 7 Williamson is looking for. 8 The narratives that Mr. Alexander is talking about I 9 believe is the damage brochure that he would give to me and the 10 other defendants to permit us to evaluate the settlement value 11 of the case. I think in giving that to Mr. Williamson, he 12 should have every bit of information he needs to see if our 13 settlement was reasonable. 14 THE COURT: I have difficulty understanding the 15 difference between raw data and the narrative. 16 MR. BARRY: So do I. I don't know if he is talking 17 about tax returns or something else. A narrative describing 18 the family unit, describing the decedent involved, describing 19 his work history, describing his earnings, describing his age, 20 his survivors is all that we as defendants look at in obtaining 21 a preliminary value on the case. Of course, we get into more 22 information during a mediation. But in terms of evaluative 23 material, it is everything that Mr. Alexander is talking about. 24 THE COURT: You are given a lot of information orally 25 also. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 25 633rsepc 1 MR. BARRY: Perhaps during negotiations, your Honor. 2 It is more give-and-take in terms of questions that we might 3 have. But in terms of evaluating the case from a settlement 4 value and jury verdict exposure, if you will, the information 5 as set out in Mr. Alexander's letter is the type of information 6 that we as defendants use, and I think it is the same 7 information that Mr. Williamson has used when he is a 8 defendant. 9 THE COURT: In point of fact, how do you receive the 10 information from the plaintiffs? 11 MR. BARRY: How do we receive it? We get a damage 12 brochure, which could be this thick. 13 THE COURT: Two inches. 14 MR. BARRY: Depend on the case, attaches tax returns, 15 describes the family history, etc. It gives us all the basic 16 information which we need to evaluate the case. 17 THE COURT: If the plaintiff were to give that exact 18 same package to Mr. Williamson and Mr. Clifford -- 19 MR. CLIFFORD: That would suffice. 20 MR. GOLDMAN: That was my suggestion. 21 MR. BARRY: That is what Mr. Goldman suggested and I 22 think it is perfectly proper. 23 MR. CLIFFORD: Property damage plaintiffs agree, your 24 Honor. 25 MR. WILLIAMSON: That is what we have been asking for. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 26 633rsepc 1 THE COURT: You would be satisfied with it? 2 MR. WILLIAMSON: Give us exactly what you gave as a 3 plaintiffs' counsel to the aviation defendants, the same 4 universe of documents and data, no more, no less, and that 5 should include the 13-point item that is in the March 2005 6 order which we participated in the negotiation of, and we will 7 be fine. Give us the same documents. 8 THE COURT: I don't remember, what is that 13. 9 MR. BARRY: The same as you raised in your letter. 10 MR. ALEXANDER: It is the same information that you so 11 ordered. 12 THE COURT: The rule will be that Mr. Williamson and 13 Mr. Clifford will receive an identical package to that which 14 was supplied to Mr. Barry. 15 MR. ALEXANDER: We would like to have a time limit, 16 your Honor, on the time in which they can object upon receiving 17 the information. 18 THE COURT: You tell me. What time? 19 MR. ALEXANDER: We would like to say ten days. 20 MR. WILLIAMSON: That is already set forth in the last 21 protocol. 22 THE COURT: Mr. Williamson, stop. 23 MR. WILLIAMSON: It is out -- 24 THE COURT: The protocol that I set out is not 25 satisfactory. You are complaining about it. So let's get one SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 27 633rsepc 1 that we can live with. First of all, you are not getting paid 2 until I get an opportunity to hear objections, so you want to 3 have it very quickly. 4 MR. ALEXANDER: That's right, your Honor. That is why 5 we thought within 10 days would be appropriate. 6 MR. CLIFFORD: We agree. 7 MR. GOLDMAN: We would agree to that. 8 THE COURT: Then how much time should you have? 9 MR. WILLIAMSON: The last time we had checked with the 10 insurers, I don't have it in my head, I think it was 30 days. 11 It might have been 21, and then we were asked to do it faster 12 for those two cases as a courtesy and we did. But I know we 13 were trying to check how much time other people needed. Our 14 law firm can turn this around on a dime. We are not the 15 problem. 16 THE COURT: 20 days, Mr. Williamson, 20 days. 17 MR. WILLIAMSON: 20 days, yes, your Honor. 18 THE COURT: Mr. Clifford, 20 days. 19 MR. CLIFFORD: Yes, your Honor. 20 MR. ALEXANDER: Yes, your Honor. 21 THE COURT: Plaintiffs have 10 days from the date a 22 settlement is agreed to to turn this same package over to Mr. 23 Clifford and Mr. Williamson. Put in a provision of 24 confidentiality that will satisfy you. I think we have talked 25 about it, identified the people who can see it. Limit the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 28 633rsepc 1 number of copies, require the return of copies, provide that no 2 further copies can be made. 3 MR. ALEXANDER: Your Honor, I don't know if you are 4 inclined to address it now, but in the event there was an 5 objection, will there be a procedure? 6 THE COURT: Yes. Mr. Williamson and Mr. Clifford, 7 anybody else who is entitled to receive notice must within an 8 additional 10-day period -- 9 MR. WILLIAMSON: Fine. 10 THE COURT: -- file their objections. That means that 11 within 40 days after settlement, subject to any delay on my 12 part, which I hope there will be none, I can give an order that 13 will enable payment to be made. There has to be, I guess, an 14 appeal period for objections. We can regulate the appeal 15 period also. I guess we shouldn't cut it down. So it is 30 16 days. 17 Mr. Barry? 18 MR. BARRY: Your Honor, I think that is set forth, the 19 30-day period to appeal. I think that has to stay. 20 THE COURT: So you have enough. You can give me an 21 order to sign on consent. 22 MR. GOLDMAN: Will plaintiffs have the option of 23 sending it in PDF format or hard paper? 24 THE COURT: It seems to me that PDF would be an 25 excellent format. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 29 633rsepc 1 MR. ALEXANDER: We will draft an order, your Honor. 2 Thank you. 3 MR. WILLIAMSON: We will be happy to look at it. The 4 only other point is if they still want to proceed in bands of 5 five cases and lock the settlement amount in -- 6 THE COURT: We don't need that anymore, do we? 7 MR. WILLIAMSON: If they will do it individually, that 8 is even faster. 9 MR. ALEXANDER: Your Honor, I think we still want the 10 bundling procedure. There are other reasons, which we set 11 forth previously, why we would like to stick to that. It goes 12 to the heart of what you raised earlier about confidentiality, 13 even as between plaintiffs, frankly. We want to keep that as 14 confidential as possible. The bundling was, in effect, helpful 15 in accomplishing that. 16 THE COURT: What happens if you reach three settle- 17 ments and then it takes time to get the fourth and fifth? I am 18 very much interested in working with expedition. I also feel 19 that if this idea of rationality among settlements, this idea 20 of distributive justice, makes sense, it would be good to know 21 the individual settlements also among those involved in the 22 process. 23 I have been making this point a long time and 24 deferring to plaintiffs. I make it again. All these questions 25 build delay into the system. I feel strongly that the best way SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 30 633rsepc 1 we will have successful settlements is to create an inertia 2 favoring them. One of the most powerful ways of creating 3 inertia is when individual cases settle and people starting 4 talking about their settlements. 5 MR. ALEXANDER: I don't disagree, your Honor, but it 6 totally undermines keeping things confidential. 7 THE COURT: It does. 8 MR. ALEXANDER: You are talking about opening it up if 9 you go case by case. 10 THE COURT: It does. 11 MR. ALEXANDER: The number is right out there. 12 THE COURT: We have a protective order and we have a 13 limited number of people who will see these. 14 Mr. Goldman? 15 MR. GOLDMAN: We think that it would be contrary to 16 our understanding to have individual settlement numbers put 17 forth, your Honor. We would object to it. 18 THE COURT: I will accept that, Mr. Goldman, 19 reluctantly. I accepted it before, I accept it again. The 20 bands of five make sense. Except if there is a group of three 21 which settle, give me the three. Let's move the process. 22 MR. ALEXANDER: OK, your Honor. Thank you. 23 MR. GOLDMAN: Thank you, your Honor. 24 MR. WILLIAMSON: We did have with the last two cases 25 plaintiffs' attorneys who were willing to expedite it by giving SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 31 633rsepc 1 us the individual numbers. Those have never become public, and 2 we were able, as I say, to turn around on a dime and get 3 consent. Whatever they want to do. I just wanted to nail it 4 down. 5 THE COURT: I think it is nailed. 6 MR. WILLIAMSON: Very well. Thank you, your Honor. 7 THE COURT: Next comment on this. It is a very 8 delicate subject. I don't know what all the fee arrangements 9 have been. I have seen the fee arrangements in the few cases 10 that I have. I have not done anything about them. They are 11 individual cases. But as groups come to be tendered, I would 12 like us all to be sensitive about contingent fee numbers. 13 The public will watch this. What we do here is very 14 important in terms of the public perception. It was very bad 15 publicity in regard to the tobacco cases when the press 16 displayed some of the numbers involved. At some point I may 17 inject some attitude about this aspect of the settlements. 18 I would like you to know that I am thinking about 19 this, and I would like you to feel that if you can reduce the 20 percentage to something that will objectively look more 21 appropriate than the traditional numbers, it would go far to 22 the viewing of this process. 23 I don't think I need to say anything more about this. 24 Everyone knows what I am talking about. I have heard that some 25 people have already made appropriate adjustments. I applaud SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 32 633rsepc 1 those. I would like many others to consider that this might be 2 a very useful thing. We want to do what is right. We also 3 want to do what appears to be right. 4 I think we have pretty much finished with Ia. I have 5 one more point. I would like to have a public tally of 6 aggregate amounts of settlements. So far, for example, we have 7 how many cases settled, Mr. Barry? 8 MR. BARRY: 21, your Honor. 9 THE COURT: Would it be appropriate to identify that 10 there have been the 21 cases out of X number that have settled 11 and that so much and so much has been paid? 12 MR. BARRY: I don't think that would be appropriate, 13 your Honor. I wouldn't want that publicly disclosed. I don't 14 see what purpose it would serve. 15 THE COURT: OK. 16 MR. LATTO: Your Honor, Doug Latto again. Before we 17 leave the issue of settlement, I raised a second ago, and you 18 asked me to hold off on it for a minute, the issue of the 19 release. After your Honor signed the order in the case that 20 you just signed the order in, we now have to deliver a general 21 release to the defendants. 22 I don't want to put the defendants on the spot. I 23 want to give them time to work out the issue. It seems to be 24 there is a long delay and our clients are calling us and 25 getting anxious, since our cases were resolved some months ago. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 33 633rsepc 1 THE COURT: What is the issue with the release? 2 MR. LATTO: It has to do primarily with an issue of 3 indemnification. The language for the indemnity was too broad 4 in the release. 5 THE COURT: What is the indemnification about? 6 MR. LATTO: I don't think there should be any 7 indemnification personally unless someone claims a right to 8 collect money. For example, in the case that you signed there 9 was an improper beneficiary paid. Things along those lines. 10 The defendants are grappling with indemnification 11 issues. All I request is that they move at some speed to get 12 the issue resolved so that we can expedite payments to our 13 clients. 14 THE COURT: Who wishes to speak on that? 15 MR. ELLIS: Jeff Ellis on behalf of United. Mr. Latto 16 has, representing his clients, raised an issue that has not 17 been raised with respect to some of the language that we have 18 used in other cases. We are discussing it with American as 19 well as the security companies. I hope that we have an 20 agreement very shortly so that Mr. Latto will be satisfied. 21 THE COURT: Mr. Ellis, when you make a settlement in a 22 typical airline case, you face the prospect that the real party 23 entitled to receive money is not the one that gets the check. 24 How do you deal with that issue? 25 MR. ELLIS: There is generally some indemnification SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 34 633rsepc 1 language, Judge. That is what we have here. I don't have the 2 language in front of me. We do have some agreements with some 3 parties. 4 Mr. Latto has raised an issue. Quite frankly, we are 5 trying to deal with it. I think we are get close to dealing 6 with it. Think we are pretty much resolved. We have some 7 language that we have circulated among all the parties that are 8 paying the money. Hopefully, it is going to resolve the issue. 9 That is the best I can say. We are waiting for an answer back. 10 THE COURT: I think the party cutting the check is 11 entitled to some peace of mind that someone else won't sue on 12 the same cause of action. 13 MR. LATTO: Your Honor, they get that. We are 14 certainly willing to provide an indemnification that if anyone 15 claims that they should have been paid on behalf of my client 16 instead of my client being paid, our client, as the 17 administrator or the executor of the estate, will indemnify the 18 insurers in that regard. The indemnification that was 19 forwarded was qualitatively different than that type of 20 indemnification. 21 THE COURT: Settle this within the next 10 days. If 22 you can't, bring it to me. 23 MR. LATTO: I will, your Honor. I am just waiting on 24 the language. 25 THE COURT: Mr. Goldman? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 35 633rsepc 1 MR. GOLDMAN: I was going to request for suits that 2 have been settled that we should rather immediately be provided 3 with copies of the releases, at least in the boilerplate, the 4 form they intend to use, so we don't have to have a delay at 5 the other end in reviewing the release, in the language. 6 THE COURT: I want all this resolved within 10 days. 7 If it doesn't get resolved -- 8 MR. LATTO: I think it should be. 9 THE COURT: -- I would like you to call Ms. Cheatham 10 to make an appointment for me to hear this and get it resolved. 11 MR. LATTO: I will do that. Thank you, your Honor. 12 MR. GOLDMAN: Thank you. 13 THE COURT: We are now complete with item I. Now we 14 are on to item II, the involvement with depositions. 15 I have a calendar which was given to me and it shows a 16 schedule for March 8 and 9, Wednesday and Thursday of that 17 week, and then 9 out of the next 10 days starting with March 18 20. I know that the week of March 20 is the week that Ms. 19 Birnbaum has set aside for mediation. Should we go ahead with 20 March 8 and 9, Mr. Barry? 21 MR. BARRY: Your Honor, I know you have dealt with 22 this about three times with me and Mr. Moller. 23 THE COURT: Part of my job. 24 MR. BARRY: I must repeat the arguments that I made to 25 you before on this. That is, to require us as defendants to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 36 633rsepc 1 prepare a 30(b)(6) witness for deposition when we have been 2 engaged in mediations for the last two weeks -- 3 THE COURT: I will stop you short. When should they 4 begin? 5 MR. BARRY: Your Honor, truthfully, if we can agree 6 with the plaintiffs to doing this on a rolling basis with a 7 30(b)(6) witness. They have about 15 categories of subject 8 matter that they want these witnesses to testify to. My 9 suggestion would be give us the rest of this month to finish as 10 many mediations as we can, start with 30(b)(6) witnesses that 11 they want in April with the limited category of issues in the 12 first instance, three or four, and then add it on to that. 13 Other than that, it is going to take us an inordinate 14 amount of time to prepare a 30(b)(6) witness for the 15 questioning on the subjects of which they have noticed. I 16 really think that, as we demonstrated this past week, we can 17 make progress. 18 THE COURT: When in April do you want to start? April 19 3rd? 20 MR. BARRY: First week in April. 21 THE COURT: April 3rd is the first Monday in April. 22 MR. MOLLER: May I be heard? 23 THE COURT: Mr. Moller. 24 MR. MOLLER: We have to file a petition in the Second 25 Circuit with respect to the TSA SSI issues on April, 8th or SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 37 633rsepc 1 10th. Think the 8th is a weekend day, and therefore the date 2 for filing is the 10th. 3 THE COURT: April 8 is a Saturday, so it is the 10th. 4 MR. MOLLER: The filing is April 10th. One of the 5 reasons to take the depositions is to establish a record that 6 we can use in going up to the Second Circuit. We were 7 prepared, or are prepared, let me put it that way, we are 8 prepared to take the deposition of an American and a United 9 30(b)(6) witness on the limited areas that Mr. Barry proposed 10 when we were trying to work this out. Not the 15, but 4. 11 Mr. Barry, I believe, took the language out of our 12 30(b)(6) notice to include warnings and information supplied to 13 the carriers by the FAA -- 14 THE COURT: Say again. To include what? 15 MR. MOLLER: -- the warnings and information supplied 16 to the U.S. carriers by the Federal Aviation Administration 17 about the threat of hijackings, including terrorist hijackings 18 prior to 9/11. 19 Second, all airport passenger screening procedures 20 which were utilized, including checkpoint screening procedures 21 prior to and after 9/11. 22 Next, the so-called common strategy in the event of a 23 threatened hijacking. 24 Next, the identity of documents submitted to the TSA 25 to determine whether they contain sensitive security SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 38 633rsepc 1 information. 2 We are prepared to start with that limited area. 3 THE COURT: I want to ask Mr. Goldman and Ms. Normand, 4 if those questions were put and you were present, which you 5 will be -- 6 MS. GOLDMAN: Your Honor, the parties here know how 7 this procedure is going to work. The questions themselves do 8 not contain SSI. It is a question of what is in the answer. 9 TSA has no role to play with respect to the questions. It may 10 be that some of these questions have answers that don't involve 11 SSI. 12 That being said, we would not, and I think your Honor 13 saw the letter that we sent to the parties earlier this week, 14 TSA does not intend to be at the depositions. I do not 15 understand Mr. Moller's position that somehow he is going to 16 create a record that will go to the Second Circuit in 17 connection with his petition for review. 18 THE COURT: Let's say he asks those questions and the 19 30(b)(6) witness will bring with him various documents. I 20 would suspect that you would want to see the documents that 21 were being produced before they were produced and file 22 objections to them. 23 MR. BARRY: I think I could cut that short, your 24 Honor. If he asked any question about those categories, the 25 witness would have to be instructed not to answer by me or Mr. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 39 633rsepc 1 Podesta or Mr. Ellis, because the TSA said they are not going 2 to be there. So all he has for his record -- 3 THE COURT: Why would you be entitled to instruct him 4 not to answer? 5 MR. BARRY: Because the answer would contain SSI, and 6 I have an obligation to protect SSI. 7 THE COURT: Why don't you submit written questions, 8 Mr. Moller? 9 MR. BARRY: That was my suggestion. 10 MR. MOLLER: Whatever you tell us to do, we will do, 11 but I don't want to do that. I think the defendants 12 underestimate the kind of questions that the plaintiffs can ask 13 that will help make a record that the Second Circuit can use to 14 appreciate that the TSA's position is unbelievably arbitrary, 15 capricious, unreasonable, and just plain wrong. 16 The order that the TSA issued is structurally, 17 structurally internally inconsistent and a violation of the 18 statute. There is a lot of stuff that we can ask about with 19 the 4 categories that have been presented that will inform the 20 Second Circuit. Even answers and objections that say we can't 21 answer on the grounds of SSI will become transparently hollow, 22 because the information that they are now seeking to protect 23 might be in other documents that are already in the public 24 record. 25 THE COURT: On the 8th you propose a 30(b)(6) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 40 633rsepc 1 deposition of American Airlines. On the 9th you propose a 2 30(b)(6) deposition of United Airlines. 3 MR. MOLLER: We will see how far it goes. 4 THE COURT: Supposing I allow those two, Mr. Barry. 5 MR. BARRY: Your Honor, I have two days to prepare a 6 witness? I don't know what the protocol is with the TSA. 7 THE COURT: You just told me that you are going to 8 instruct. 9 MR. BARRY: Then why couldn't we get written 10 questions? 11 MR. CLIFFORD: Why should you -- 12 MR. BARRY: Whoa. I'm talking to the judge right now. 13 THE COURT: Wait. We are in a ceremonial courtroom. 14 Let's act accordingly. 15 MR. PODESTA: Your Honor, could I make one point? 16 THE COURT: Yes. 17 MR. PODESTA: The record that underlies the TSA's 18 final order is complete. 19 THE COURT: I understand what you are saying, Mr. 20 Podesta. I think Mr. Moller feels that the record will be 21 substantially enhanced by the dynamic of an actual question put 22 to an actual witness. 23 MS. GOLDMAN: Your Honor, our position would be that 24 it would not be part of the record. It would be not be part of 25 the record on the final order issued and it will not be part of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 41 633rsepc 1 the record of the only two orders that are about to be issued. 2 THE COURT: Mr. Moller? 3 MR. MOLLER: The TSA wants it both ways. 4 THE COURT: I said, who settles the record? The Court 5 of Appeals settles the record. 6 MR. MOLLER: That's right. 7 THE COURT: Ms. Goldman, that may be your attitude, 8 you may be right. But Mr. Moller is going to put the issue to 9 the Second Circuit, and the chances are high that they are 10 going to allow the record to be settled, because not to do so 11 will be a ruling on the merits. They will reserve decision 12 until the argument, so the record will be made. 13 MR. MOLLER: One of the things that we are doing is we 14 are taking a page out of your play book, your Honor, because 15 you noted early on that one of the reasons -- 16 THE COURT: Not fair, Mr. Moller -- 17 MR. MOLLER: -- one of the reasons for the deposition 18 is to flesh out the record. 19 MR. BARRY: There is another issue, your Honor, that 20 Mr. Ellis has to bring to your attention. 21 MR. ELLIS: Judge, my 30(b)(6) witness is under 22 subpoena in a criminal case in the Eastern District of 23 Virginia. Beyond that I can't state, but the subpoena calls 24 for him to be available as of March 6th. 25 MR. BARRY: The same goes for an American witness, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 42 633rsepc 1 your Honor. Same thing. 2 MR. CLIFFORD: If it gets canceled, it gets canceled. 3 If that is the basis for canceling it, it gets canceled and it 4 is continued to another time. 5 MR. BARRY: I think we have agreed to try and do this 6 at some time in the future, your Honor as opposed to rushing 7 into it next week. 8 THE COURT: If you took these two depositions on April 9 3rd and April 4th, you would be able to make your record and 10 you would be able to put it to the Second Circuit. It would be 11 intensive work, but you could do it. So why don't we have 12 peremptory dates of April 3 for American and April 4 for 13 United. You will make whatever record you can. Ms. Goldman, 14 if she wishes, can come. If she doesn't want to, she won't. 15 She will decide that. 16 Mr. Joseph. 17 MR. JOSEPH: Just one technical issue, your Honor. 18 That trial that is going on -- 19 THE COURT: The people in the back can't see you if 20 you all bunch, so let's take seats. Otherwise, everyone will 21 come forward. 22 MR. JOSEPH: If it will be clear from your Honor's 23 order that they will present a witness on April 3 and 4 and not 24 say that those happen to be the days that the trial in the 25 Eastern District of Virginia is going on and there is only one SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 43 633rsepc 1 possible person who is going to be their designee. 2 THE COURT: If those depositions have to be taken in 3 West Virginia, they will be taken in West Virginia. April 3 4 American, April 4 United. 5 MR. JOSEPH: Thank you. 6 MR. MOLLER: Let me ask one other. Since the 7 defendants have more time, can the areas of inquiry be 8 expanded? 9 THE COURT: I think you can make your record on those 10 four areas. 11 MR. MOLLER: I will live with that. 12 THE COURT: Do you need an order, or is that clear 13 enough? 14 MR. MOLLER: That is enough. 15 THE COURT: Thank you. April 3 and April 4. 16 MR. CLIFFORD: Your Honor, one other thing, if I may. 17 THE COURT: Yes. 18 MR. CLIFFORD: Apparently within the last ten days or 19 so the Court had a scheduling telephone conference with Mr. 20 Barry and Mr. Moller on the subject of the depositions. Going 21 forward, should it come to pass that you are going to be 22 talking to them about discovery, we would ask for the 23 opportunity to join in. 24 THE COURT: Yes. It is highly improper for a judge to 25 select a number of counsel when there are many more, but this SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 44 633rsepc 1 judge does it from time to time. 2 MR. CLIFFORD: I will rely on Moller. I'll blame him. 3 THE COURT: Tell Moller to get you involved. 4 I don't mean to be glib about it. Presiding over 5 these cases is the most challenging activity that I remember 6 ever having been involved in, and I have had a pretty rich 7 experience. I need to have a certain degree of flexibility to 8 be able to talk to a limited number of people with the idea of 9 moving these things along. 10 I try to be fair and representative in what I do. 11 But, obviously, the more people that have to be involved, the 12 more difficult it is to have these conversations. I depend on 13 them to tell others what has been involved and what is 14 happening. 15 I think we are fortunate in having Mr. Moller and Mr. 16 Barry do this kind of work. My impression, very strong 17 impression, is that they have been fair to all their colleagues 18 in the way information has been disseminated. We try to 19 supplement that with an active Web page posting so everyone 20 knows what is going on. 21 I have done my best to do this, but I need to have 22 that degree of flexibility to be able to reach out and have a 23 quick, informal telephone conversation which, although not on 24 the record, is not intended to be private and confidential. 25 The information gets disseminated. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 45 633rsepc 1 MR. MOLLER: Your Honor, I have one other question to 2 ask. We have noticed some nonparty witnesses and put them 3 under subpoena within the past couple of days. Those nonparty 4 depositions have been noticed largely during the week of the 5 27th, if I am correct. 6 A VOICE: Two weeks, week of the 20th and the week of 7 the 27th, your Honor. 8 MR. MOLLER: There is one nonparty witness noticed. 9 THE COURT: The 20th is going to be a blank week, 10 because that is a mediation week. I don't want any events 11 scheduled for that week, because mediations are going forward, 12 and there is nothing more important in this case than 13 successful mediations. 14 MR. MOLLER: What about the week of the 27th? Can we 15 continue to hold to the noticed nonparty depositions the week 16 of the 27th? 17 THE COURT: If there is a bleeding over of mediation 18 into the week of the 27th, I want that to be paramount. If 19 there isn't, I don't know these nonparty witnesses and I don't 20 know what is involved, so I can't respond. 21 MR. CAMPBELL: Richard Campbell, counsel for US 22 Airways. I have a couple of problems with that proposal. 23 THE COURT: Which part of the proposal, sir? 24 MR. CAMPBELL: As I look at the schedule for that week 25 that was just described, it would involve travel to Illinois, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 46 633rsepc 1 Massachusetts, which is not a problem for me, the District of 2 Columbia, Oregon, and Maine to conduct those depositions. 3 Those are transcontinental flights back and forth over a very 4 short period of time, literally, I submit, impossible to do. 5 THE COURT: Suppose we cut this down to two. 6 MR. CAMPBELL: That is better, your Honor. 7 THE COURT: Mr. Moller? 8 MR. MOLLER: We will cut it down. 9 THE COURT: Who would you take? 10 MR. GREEN: Your Honor, in terms of travel, I think 11 the schedule was put together with the understanding that more 12 than one lawyer would participate in these depositions, based 13 on the last conference. 14 THE COURT: What is your name, sir? 15 MR. GREEN: Justin Green with Kreindler & Kreindler. 16 At the last conference we talked about double tracking these 17 depositions. This schedule was put together with the 18 understanding that with the number of lawyers in this 19 courtroom, we would be able to field enough people for these 20 depositions. It is a totally doable schedule. 21 In terms of who the witnesses are, your Honor, we are 22 talking about people that checked -- 23 THE COURT: Frankly, I am sensitive to the problems 24 that Mr. Barry and Mr. Podesta and Mr. Ellis have. Those two 25 weeks of mediation will be exhausting. I don't want to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 47 633rsepc 1 overload them. Mr. Barry has represented to me that he has not 2 created a delegation for these cases because his clients don't 3 want him to. 4 At a different time I might have felt differently. I 5 pushed you as hard as I did because TSA had not come out with 6 its final determinations. We have a different situation now, 7 because they have, and those final determinations have been 8 quite broad. I would like to do something like I did with the 9 American Airlines and United Airlines case. If you want these 10 also to be added to the record, then pick two of them and do 11 them April 5 and April 6. 12 MR. MOLLER: We will do that and work it out. 13 THE COURT: So you are going to be working April 3, 14 April 4, April 5, and April 6 on depositions. April 3 and 4 on 15 American and United respectively, and April 5 and 6 on nonparty 16 witnesses. I would like you to nominate who they are rather 17 quickly so that everyone will know, and publish them. 18 MR. MOLLER: There is one other significant and 19 important issue that bears upon the depositions. That is the 20 protocol to be observed when an SSI objection is the 21 interposed. In Ms. Normand's -- 22 THE COURT: Could I have both of you seated, Mr. 23 Podesta. 24 MR. PODESTA: I was going to speak to that point. 25 THE COURT: I will let you speak, but people can't SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 48 633rsepc 1 see. 2 MR. MOLLER: In I think it was Ms. Normand or Ms. 3 Goldman's letter to us, copy to the Court, there was a 4 suggestion, in effect, that when an SSI objection is 5 interposed, counsel for plaintiffs leave the room so that the 6 witness can answer that question, and that in some fashion 7 creates some kind of a record. I want to register the 8 strongest opposition to that protocol at this time. 9 THE COURT: What is your offer? 10 MR. MOLLER: Our suggestion is very simple. A 11 question is asked, it is answered. If the answer has an 12 objection, we move on to the next question. When the 13 deposition is concluded, if there is need to approach the 14 Court, either this Court or the appellate court, for rulings on 15 the objections, we will do so. 16 I don't think that it would be helpful, in fact I 17 think it would be detrimental, if answers in the absence of 18 counsel are placed on the record to which we can neither object 19 nor know the substance of. We will take the depositions as 20 they flow and take it up in that fashion. I don't know if I 21 have an agreement on that from Mr. Podesta, but that is the 22 plaintiffs' strong view. 23 THE COURT: We will find out. 24 MR. PODESTA: Actually, let me heatedly agree with Mr. 25 Moller on that point. We are very concerned about the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 49 633rsepc 1 suggestion -- 2 THE COURT: I have never known you to be heated, Mr. 3 Podesta. 4 MR. PODESTA: Then you have not seen me outside of the 5 court, your Honor. 6 We are very concerned about a situation where an SSI 7 issue is raised. Everyone leaves the room except perhaps for 8 counsel for the witness, and the witness answers the question 9 on the record in full, and then the record is sealed and sent 10 to the TSA for editing, taking out words from a sentence or 11 sentences from a paragraph of the answer and then releasing 12 that edited answer that doesn't represent the actual words of 13 the witness for litigation use. That, to us, is a serious 14 problem. 15 We also think it is a very serious problem if you have 16 the lawyers leaving the room and answers given, sealed, and 17 then the lawyers are expected to come back in the room and 18 conduct a deposition picking up on the sealed answer. That is 19 very difficult to deal with, particularly if you are going to 20 conduct a cross-examination. 21 Mr. Barry and Mr. Ellis and Mr. Campbell are excellent 22 cross-examiners, but it is very hard for them, even impossible 23 for them, to conduct an effective cross-examination of a 24 witness whom they have not interviewed and whose answers they 25 have neither heard nor read. I fear that what you would find SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 50 633rsepc 1 is that these depositions -- and these are nonparty witnesses 2 for the most part. 3 THE COURT: Is George Orwell in the audience? 4 MR. PODESTA: Mr. Stein, I am sure, would have equal 5 difficulty. The inevitable result of these depositions is that 6 if that protocol were used, these witnesses would have to come 7 back again once the TSA released its edited transcript, and 8 people might even want these nonparty witnesses back a third 9 time if the TSA's final order were substantially modified on 10 appeal. I think that is really, utterly impractical. 11 One other thing on these third-party witnesses. In 12 the absence of a TSA lawyer, you are relying on the defense 13 counsel to make the SSI objection. But some of these nonparty 14 witnesses may not have lawyers, may have lawyers that are 15 unfamiliar with SSI, and may even have lawyers who are not 16 entitled to receive SSI. 17 THE COURT: Mr. Podesta, if you have a client 18 responding to a deposition and the question is not 19 objectionable, as Ms. Goldman says, but you or your witness has 20 a good faith belief that what they say might constitute SSI, 21 what is your legal obligation? 22 MR. PODESTA: I believe that my legal obligation would 23 be to protect the SSI. 24 THE COURT: Would it? 25 MR. PODESTA: And also be to protect the record. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 51 633rsepc 1 THE COURT: Why can't you rely on the absence of the 2 government to come to the conclusion that the government 3 doesn't care? 4 MR. PODESTA: Because the government, first of all, 5 has indicated that it does care. 6 THE COURT: So why shouldn't they be present to make 7 objections? 8 MR. PODESTA: That is not for me to answer. 9 THE COURT: What I am saying is that maybe if they are 10 not there, there is no fair objection to be made. If they want 11 to make an objection, they have to be there. 12 MR. PODESTA: But we are bound by the statute and the 13 regulations that require us not to disclose SSI. I don't 14 believe that the absence of a -- 15 THE COURT: There is no SSI unless they declared it. 16 MR. PODESTA: I don't think that is the government's 17 position. 18 THE COURT: Let's hear it. I don't know. I have not 19 studied this. 20 MS. GOLDMAN: Your Honor, it is our position and has 21 been our position throughout, and it is right in the regs, that 22 a covered party and a covered party's counsel has the 23 obligation to prevent the disclosure of SSI. If counsel 24 believes that a witness is about to give an answer that 25 contains SSI, it is their obligation to make sure that that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 52 633rsepc 1 doesn't happen. 2 THE COURT: How does the counsel know that? 3 MS. GOLDMAN: That brings up a different point, which 4 is the parties have documents that TSA has now redacted, so 5 they know which parts of the documents are SSI and which are 6 not. They have other public documents that they know are not 7 SSI. Answers based on that kind of information, to the extent 8 they know it, they can rely on that information. But if they 9 have any doubts, there is no doubt that their obligation is to 10 say that there is an SSI objection. 11 That is why we suggest that we get the answers on 12 paper, so that TSA can then review them and give some guidance 13 as to whether it is or is not. This notion that we are going 14 to have a deposition with the idea that everybody knows there 15 aren't going to be any answers to the questions for purposes of 16 setting up some procedure that somebody might try to get before 17 the circuit, when it is not a final order, I think it is a bit 18 of a sham, your Honor. 19 THE COURT: It seems to me that to require counsel for 20 a witness to decide that an answer that in the counsel's 21 opinion should be given for the benefit of his client can't be 22 given because the government classifies it as SSI puts that 23 client into an untenable conflicting position. That is not 24 fair. 25 MS. GOLDMAN: What we are saying is that they need to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 53 633rsepc 1 state the objection. It doesn't mean the question can't be 2 answered outside the presence of -- 3 THE COURT: But that lawyer, in representation of a 4 client, may feel that it is in the client's best interest to 5 answer, and that way what may be in the client's best interest 6 may not be in the government's best interest. How can you 7 create a conflicting position for a lawyer? 8 MS. GOLDMAN: I don't believe that we are creating a 9 conflict any more than any other privilege creates conflict. 10 If there is an attorney privilege -- 11 THE COURT: Sure, because the information belongs to 12 the client. That makes the whole difference. A client can 13 weigh the relative advantage of asserting the privilege or 14 giving the answer. Here that isn't the case, it's different. 15 MS. GOLDMAN: That is correct, your Honor. But the 16 way the system has to work for sensitive security information 17 is that there are people in the field who are going to have 18 this information and they have an obligation by law to protect 19 it. If the lawyers for those clients aren't going to protect 20 it, then the system is not going to work. It cannot be that 21 you need to have TSA there in order for this information to be 22 protected. 23 THE COURT: Why? 24 MS. GOLDMAN: Because the burden is on the defendant. 25 American Airlines cannot reveal that information without TSA SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 54 633rsepc 1 reviewing it. If a witness were to object to that and a lawyer 2 were to allow it, they would be doing a terrible disservice to 3 their client. 4 THE COURT: Mr. Migliori, come up to the podium. 5 MR. MIGLIORI: Thank you, your Honor. In this context 6 the client can in fact waive the privilege, because there is a 7 provision that allows TSA to create a need-to-know status for 8 plaintiffs who are prosecuting these cases. And there are 9 plenty of protections, as in Moussaoui case, where information 10 like this is protected and handled properly for purposes of 11 moving forward in the litigation. 12 THE COURT: The decision-maker here is the TSA. 13 MR. MIGLIORI: That's right. The TSA can resolve this 14 problem by using the protocol they actually offered up in the 15 beginning of this. 16 THE COURT: That is just my point. It should be the 17 TSA's lawyer who relays the information and discusses with TSA 18 whether to waive or not to waive. It can't be a lawyer in the 19 case, because the lawyer has only one master, the lawyer's 20 client. 21 MR. MIGLIORI: We think that the initial protocol 22 offered by TSA, clearing some people, would resolve all of 23 this. 24 THE COURT: They don't want to do that, Mr. Migliori. 25 I understand that. I think Mr. Moller's point of being excused SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 55 633rsepc 1 from the room and Mr. Podesta's point of being excused from the 2 room while the witness answers the question on a sealed record 3 is ridiculous, and I am not going to order that. 4 I don't know the regulation of which Ms. Goldman 5 speaks. I have a sufficiently high regard for Ms. Goldman's 6 representations not to want to make an order without carefully 7 studying what it is I need to know. But I think this procedure 8 is anomalous. 9 MR. PODESTA: Your Honor, I think it is important that 10 before these depositions go forward, for the protection of all 11 concerned, counsel and witnesses, there be some form of written 12 protocol from the TSA, approved by the TSA or by the Department 13 of Justice on behalf of the TSA and also approved by the Court 14 in its capacity as the judicial body that is responsible for 15 ensuring fair and efficient discovery and protection of the 16 witnesses. 17 THE COURT: What I would like, Mr. Moller, is for the 18 plaintiffs to propose a protocol for the deposition. To the 19 greatest extent that you can provide a consented-to procedure, 20 at least from the point of view of the defendants, please do 21 so. Identify that which is agreed to and that which is subject 22 to differences of opinion. Then I would like Ms. Goldman and 23 Ms. Normand to have an opportunity to comment. Then I would 24 probably want to make a ruling on how depositions should be 25 conducted. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 56 633rsepc 1 MR. CLIFFORD: Your Honor, if we may, yesterday 2 plaintiffs' counsel met and we discussed this matter at length, 3 which is how we reached the conclusion of we will ask a 4 question, we will take the objection and go forward with a new 5 question and not leave the room. 6 THE COURT: Who will state the objection? 7 MR. CLIFFORD: Counsel for American or United, 8 according to Ms. Goldman, has a regulatory, federal obligation 9 to do so. 10 THE COURT: Mr. Podesta says he feels very 11 uncomfortable doing that. 12 MR. CLIFFORD: Frankly, that is a problem Mr. Podesta 13 and his clients have to reconcile. 14 THE COURT: No. 15 MR. CLIFFORD: That is number one. What do you do 16 about the nonparty witnesses as well? 17 THE COURT: Let's deal with the parties first. 18 MR. CLIFFORD: OK. 19 THE COURT: I am not imposing that obligation on Mr. 20 Podesta, because it creates a conflict. 21 MR. CLIFFORD: We agree with that. Quite candidly, 22 before each of these depositions we do have for purposes of the 23 record some observations that we will make about that. 24 However, that being the case, the TA is more than welcome to be 25 there, of course, for the justice department. If they do not SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 57 633rsepc 1 have that obligation, that is some of the inherent unfairness 2 about the TSA not willing to solve this in a fashion they know 3 they could. 4 THE COURT: They don't want to submit to my 5 jurisdiction. That is their problem. 6 MR. MOLLER: With great respect, I don't want to 7 invite the TSA any further into the depositions now, since they 8 have said they don't want to appear. If we give them approval 9 over the protocol, we will be here for another two months while 10 they figure out what they can or can't do. And we know from 11 what has been said that what we are going to hear is the 12 regulations imposed upon counsel representing the witness the 13 obligation to tell them not to answer. 14 I think the simple way to proceed, as we have 15 suggested, and the way to get counsel off the hook, so to 16 speak, is maybe that counsel will not instruct the witness not 17 to answer but advise the witness what the SSI issue is, and the 18 witness can follow that advice in all likelihood. But for the 19 TSA to be invited in by saying what the regulations say is not 20 going to advance the ball at all. 21 The reason we took what I think is the simplest 22 approach -- 23 THE COURT: It will help you make your record, Mr. 24 Moller, which is what this is all about. 25 Mr. Podesta, would you feel comfortable in objecting SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 58 633rsepc 1 on the basis of the possibility that information that your 2 client might wish to supply might also be SSI? 3 MR. PODESTA: I believe that we would have to do that 4 in order for the depositions to proceed at all, so we would do 5 that. But we would simultaneously make a record that we were 6 doing so only because we are compelled by federal regulation, 7 and that if we had our druthers, we might have the witness 8 answer the question. 9 MR. ELLIS: Your Honor, may I add something? 10 THE COURT: Yes, Mr. Ellis. 11 MR. ELLIS: The point you brought up with respect to 12 the conflict is a very telling one, because the penalties for a 13 lawyer are criminal penalties if they assist in the disclosure 14 of SSI. So any time we raise an objection that it may be SSI, 15 we may be acting out of our own self-interest. 16 THE COURT: Plus you create a conflict. 17 MR. ELLIS: Yes. I don't know how you resolve it, to 18 be honest with you. I heard Mr. Moller's suggestion about 19 advising the witness. But we are also there to defend the 20 witness. I am not there to advise him -- 21 THE COURT: I was hoping you would say you would be 22 uncomfortable, Mr. Podesta. 23 MR. PODESTA: I would be uncomfortable. 24 THE COURT: To offset that discomfort, you may be 25 seated. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 59 633rsepc 1 MR. GREEN: Your Honor, Justin Green from Kreindler & 2 Kreindler again on one issue. My notes from before say that we 3 are going to go forward with depositions the week of April 3, 4 4, 5, and 6 with two nonparties. But we have a lot of other 5 nonparties that were on the March schedule. I just want to be 6 clear with the Court that we intend to start noticing and 7 subpoenaing those witnesses for the weeks after. 8 THE COURT: Let me deal with one thing at a time, Mr. 9 Green. I am talking about 3, 4, 5, and 6 at the moment. Let 10 me stay with that. 11 MR. GREEN: All right, your Honor. 12 THE COURT: I would like you to propose a protocol. 13 If the defendants' counsel feel they cannot perform this 14 function that is being asked of them without becoming involved 15 in a conflict, they should state that very clearly in their 16 submission to me. Then I would like the government's response 17 as well. Then I will make a ruling. If one or another party 18 is displeased with the ruling, you can mandamus me. But we are 19 going to move ahead and see where we go. 20 Mr. Green, I think if we do 3, 4, 5, and 6, American, 21 United, two nonparties, the record that Mr. Moller wants to 22 develop will have been developed and the argument in the Court 23 of Appeals will be enriched. 24 MR. GREEN: I agree with that, your Honor. 25 THE COURT: I don't think we need any further SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 60 633rsepc 1 depositions, except maybe for security companies. 2 MR. GREEN: Your Honor, I just wanted to say that 3 there are other issues that are non-SSI that we can get out of 4 these depositions. Some of these witnesses are the witnesses 5 that were there on 9/11 and checked the terrorists on board and 6 can tell that story, which they frankly have already told. It 7 is already in the public record, but we can get it into 8 testimony in this case. 9 THE COURT: Let's do that after the 10th. 10 MR. GREEN: Yes, your Honor. The other issue that Mr. 11 Moller asked me to raise with you is to set a time line for us 12 to give the deposition protocol and for TSA to get back to us. 13 THE COURT: Suggestion? 14 MR. GREEN: I think ten days, your Honor, or by 15 Wednesday, according to Mr. Moller. 16 THE COURT: Off the record for a minute. Why don't 17 you talk. 18 (Discussion off the record) 19 THE COURT: By the end of Monday, by 4 o'clock, I want 20 a schedule of when submissions are to be made to me. Please 21 consult with Ms. Goldman and Ms. Normand, too, because they are 22 vital in this story as well. 23 MR. MOLLER: Fine. 24 THE COURT: They are going to have more difficulty 25 where they have got to be instructed. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 61 633rsepc 1 What is the program in the Second Circuit? What is 2 the briefing schedule in the Second Circuit? 3 MR. BARRY: It has to be filed on the 10th. 4 THE COURT: Mr. Moller, what is the briefing schedule? 5 MR. BARRY: The petition I think has to be filed by 6 the 10th of April. 7 MR. JOSEPH: The petition will be brief, a two- 8 sentence form. That is be filed by the 10th of April. Then we 9 will have a conference. Additional depositions may actually be 10 useful in connection with other orders as well. 11 THE COURT: I am receptive. Do what you want to do. 12 MR. JOSEPH: Our preference would be that we be 13 permitted after the week of the 10th to continue to notice 14 depositions so that we will have a 60-day period -- 15 THE COURT: Tell you what, Mr. Joseph. We don't know 16 what Ms. Birnbaum's availability is. We don't know what is 17 going to happen with the other mediations. I feel fairly sure 18 that there will be mediation schedules. I am willing to meet 19 with the parties here sometime in April to go forward and 20 develop this. We also need to have in mind that some of us, 21 including the judge, are going to be away for Passover. 22 MR. JOSEPH: Your Honor, you have identified a couple 23 of weeks in April when depositions may go forward. If there 24 are going to be mediations in the other part of the month at 25 that time, we would like to have a couple of weeks in May, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 62 633rsepc 1 because again that would be within the 60-day period that would 2 be useful to us. 3 THE COURT: I favor that. See if you can work it out. 4 If you can't, come to me. 5 MR. JOSEPH: Thank you. 6 THE COURT: By Monday at 4 o'clock work out a schedule 7 involving the government TSA so I know and you know what will 8 be submitted. 9 MR. MOLLER: Just so the security companies know, we 10 will be renoticing the 30(b)(6)s of the security companies 11 consistent with what you have just suggested as considerations. 12 THE COURT: IIe talks about production of airline 13 insurance -- 14 MR. WAYLAND: Joe Wayland of Argenbright Security 15 Company. 16 THE COURT: Come up, Mr. Wayland, please. 17 MR. WAYLAND: Your Honor, I just want to be clear, 18 because there was a little bit of an offhanded comment at the 19 end saying something about including the security companies in 20 the 30(b)(6) process. As I understand it, we have these four 21 depositions you have approved for April 10th and then we will 22 come back and talk to you more after that. 23 THE COURT: If you do it on your own, that is OK, too. 24 MR. WAYLAND: Thank you, your Honor. 25 THE COURT: I think we are down through IId. Do we SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 63 633rsepc 1 have anything more up to IId? We are up to IIe, production of 2 airline insurance policies. Mr. Clifford. 3 MR. CLIFFORD: Thank you, your Honor. We are asking 4 that all of those policies be produced. I can talk to Mr. 5 Barry about this. It is conceivable that we may wish to take a 6 30(b)(6) deposition of the individual that gathers those 7 together. 8 We don't mind if the policies are produced in a 9 confidential way that prevents disclosure elsewhere, but there 10 are some coverage issues. We have many coverage specialists 11 within our camp that think review of the policies would be 12 beneficial to understanding what, if any, applicable insurance 13 is available for these claims, to cover these claims. 14 MR. TOMASIK: Good afternoon, your Honor. Tim Tomasik 15 on behalf of the property damage plaintiffs. I believe we have 16 all of the American policies. If that can be confirmed, that 17 would be great. We are still waiting for the United Airlines 18 policies. It is also our understanding that the bankruptcy 19 stay in the USAir case may be lifted next week in regards to 20 this litigation. We would also be seeking those policies. 21 MR. ELLIS: Your Honor, may I just state on behalf of 22 United that we are pretty much finished gathering and we will 23 be forwarding them shortly. 24 On a somewhat related matter, we have issues with 25 respect to the property damage claims here, particularly SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 64 633rsepc 1 claimed by reinsurers, subrogation claims. 2 THE COURT: Can we do one thing at a time? 3 MR. ELLIS: It involves their policies, Judge. We 4 have a document dump of 40 disks of documents which purportedly 5 may have some of the insurance information for the reinsurers, 6 which are very important for our coverage people to look over 7 to see whether or not there was a right to bring these claims. 8 The bottom line is we are going through in a 9 painstaking way these 40 disks worth of documents. It would 10 seem to me appropriate that since we want to resolve these 11 issues as quickly as possible -- right, Tim? -- maybe we could 12 get from the property damages people just the policies from the 13 reinsurers to start with, and then we made need 30(b)(6) on 14 those policies as well. That would not involve any SSI, Judge. 15 MR. TOMASIK: We would be happy to work with counsel 16 in the production of certain documents, including the policies. 17 However, the issue he is speaking of in regards to standing is 18 a little bit more complex than that. It is our position that 19 they don't have the standing to bring such an objection on 20 behalf of their client. 21 THE COURT: It is discovery. Give it. 22 MR. TOMASIK: Very well, Judge. 23 THE COURT: What do I need to know about TSA? Item 24 III. 25 MR. MOLLER: I think, in fact I know, that there are SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 65 633rsepc 1 documents that have just been submitted to TSA within the past 2 couple of weeks. I would like to know when we are going to get 3 rulings on those. Also, if I recall correctly, there was a 4 representation made that after the first order which came out 5 February 7th, there would be successive orders. We haven't 6 seen those yet. 7 THE COURT: Ms. Goldman was squirming in her seat as 8 if to want to come up to speak. 9 MR. MOLLER: That is probably only because she 10 couldn't see you. 11 MS. GOLDMAN: Your Honor, the additional two final 12 orders will be issued next week. After that, at that point TSA 13 will then evaluate all of the materials it has been receiving 14 in the last few weeks, which include third wave documents, of 15 some volume it appears, from United and American, as well as 16 discovery responses by various other parties who seek review. 17 Once we have figured out how much there is to review, 18 we will either come back to the Court and make an application 19 to put off that review until after the Second Circuit rules or 20 figure out where we are going from there. We just don't have a 21 sense yet of what the volume is. 22 That's it for us. 23 THE COURT: Mr. Moller, it seems to me that the more 24 final orders that are issued, the more complicated your 25 appellate process will become. If there is an interest to go SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 66 633rsepc 1 to the Court of Appeals quickly, you are probably better off 2 using the orders that you have already received. Your choice. 3 The likelihood is that the Court of Appeals will 4 consolidate all the different appeals. If they feel 5 apprehensive that there will be more final orders issued, it 6 will take longer to get a briefing schedule that will be 7 reliable. 8 Maybe take Ms. Goldman's representation at her word 9 that there will be two more final orders issued this week and 10 freeze it. That way TSA won't issue any more orders, won't do 11 any more reviews, and you will all wait and see what the Court 12 of Appeals does. 13 I don't think you need to tell me right now what you 14 are going to do. And I don't know that I have to issue any 15 orders about this either, unless someone wants me to. I think 16 we have Ms. Goldman's information. I will expect two more 17 orders this week. You may want to adjust your date of April 10 18 to accommodate not only the 4 depositions that are going to be 19 had the week of April 3 but also these 2 additional final 20 orders. Two, Ms. Goldman? 21 MS. GOLDMAN: Yes, your Honor. Next week. You said 22 "this week," but I assume you understand next week. 23 THE COURT: Yes. Then go ahead. I suggest that you 24 find out from Ms. Goldman what is coming and make your own 25 decision about what to do. I don't think I am involved with SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 67 633rsepc 1 it. 2 We are up to number IV, creation of document 3 depository. 4 MR. MOLLER: Mr. Barry and I chatted about that. We 5 are going to work that out. There is a spot behind his desk. 6 We may use that. 7 THE COURT: Put it on the Web. Give it to Ms. 8 Cheatham, and she will put it up on the Web. 9 MR. TOMASIK: Judge, it is my understanding that the 10 property damage plaintiffs tendered all the documents that were 11 required in December. I think he is still waiting for some 12 documents from the defendants so he can expand the existing 13 database. Once those are tendered by the defendants, we can 14 move forward with the database. 15 THE COURT: Did anybody bring anything else up? We 16 have to get a new date for the meetings. Ms. Jacob. 17 MS. JACOB: Beth Jacob. We are the liaison for the 18 ground defendants at World Trade 7, your Honor. I know that is 19 not on the agenda. I just wanted to bring to the Court's 20 attention, in case you haven't seen, that we were instructed to 21 submit a case management order to the court with respect to the 22 World Trade Center. 23 THE COURT: I signed it. 24 MS. JACOB: Thank you. There was an issue as to the 25 scope of the expedited discovery. I don't know if the Court SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 68 633rsepc 1 dealt with that yet. That was a separate letter. 2 THE COURT: I didn't. Is there objection? 3 MS. JACOB: We submitted a letter which has a 4 statement from Citigroup, a statement from the Silverstein-Port 5 Authority, and a statement from my firm. 6 THE COURT: Ms. Jacob, did you also make a request for 7 ECF treatment? 8 MS. JACOB: Yes, we did, your Honor. We thought that 9 would facilitate filing and service. 10 THE COURT: Have you spoken with the clerk? 11 MS. JACOB: No, I have not. 12 THE COURT: It is good for us, it is good for you. I 13 just don't know what burden it places on the clerk. 14 MS. JACOB: We will talk to them. 15 THE COURT: If it is OK with the clerk, it is OK with 16 us. 17 MS. JACOB: Thank you. 18 MR. BARRY: One thing while Ms. Jacob is here, your 19 Honor. I did notice, quickly in looking at the case management 20 order, that it calls for us to produce both hardcopy and 21 electronic to you. 22 MS. JACOB: It does not cover the aviation discovery, 23 your Honor. 24 MR. BARRY: You don't want hardcopies from us, right? 25 MS. JACOB: No, we do not. We have a stack of disks, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 69 633rsepc 1 and that is fine. It is not intended to cover the aviation 2 discovery. If it was misdrafted, I will say on the r