1 2a30fric 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------------------------------x 2 3 HELEN FRIEDLANDER, 3 4 Plaintiff, 4 5 v. 02 Cv. 7171(AKH) 5 6 UNITED AIRLINES, et al., 6 7 Defendants. 7 8 ------------------------------x 8 9 October 3, 2002 9 4:25 p.m. 10 10 Before: 11 11 HON. ALVIN K. HELLERSTEIN 12 12 District Judge 13 13 APPEARANCES 14 14 KREINDLER & KREINDLER 15 Attorneys for Plaintiffs 15 BY: MARC S. MOLLER 16 JAMES P. KREINDLER 16 BRIAN J. ALEXANDER 17 17 BAUMEISTER & SAMUELS, P.C. 18 Attorneys for Plaintiffs 18 BY: DOROTHEA M. CAPONE 19 19 SPEISER, KRAUSE, NOLAN & GRANITO 20 Attorneys for Plaintiffs 20 BY: KENNETH P. NOLAN 21 22 (Continued on next page) 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2 2a30fric 1 APPEARANCES 2 (continued) 3 3 FLEMMING, ZULACK & WILLIAMSON, LLP 4 Representing The Port Authority 4 of New York and New Jersey and 5 Silverstein Properties, Inc., 5 in certain cases but none before 6 the court today because neither 6 of our clients have been served 7 in any of these eight cases 7 BY: RICHARD A. WILLIAMSON 8 CATHI A. HESSION 8 JASON T. COHEN 9 9 CONDON & FORSYTH, LLP 10 Defense liason counsel 10 BY: DESMOND T. BARRY, JR. 11 11 UNITED STATES DEPARTMENT OF JUSTICE 12 MARY JO WHITE 12 United States Attorney for the 13 Southern District of New York 13 BY: SARAH SHEIVE NORMAND 14 Assistant United States Attorney 14 15 THE PORT AUTHORITY OF NY & NJ 15 Law Department 16 BY: KEITH E. HARRIS 16 17 HANLY & CONROY, LLP 17 Attorneys for Plaintiffs in Mulligan 18 BY: PAUL J. HANLY, JR. 18 19 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 3 2a30fric 1 (In open court) 2 THE DEPUTY CLERK: Friedlander v. United Airlines. 3 Counsel, please state your appearances for the record. 4 MR. MOLLER: Marc Moller, liason counsel, Kreindler & 5 Kreindler, for the plaintiffs. 6 MR. ALEXANDER: Brian Alexander, Kreindler & 7 Kreindler, for the plaintiffs. 8 MR. KREINDLER: Jim Kreindler, Kreindler & Kreindler, 9 for the plaintiffs. 10 MR. NOLAN: Kenneth Nolan, Speiser, Krause, Nolan & 11 Granito, for the plaintiffs. 12 MS. CAPONE: Dorothea Capone from Baumeister & 13 Samuels, for the plaintiffs. 14 MR. BARRY: Desmond Barry of Condon & Forsyth, defense 15 liason counsel. 16 MS. NORMAND: Sarah Normand from the United States 17 Attorney's Office on behalf of the Transportation Security 18 Administration. 19 MR. WILLIAMSON: Richard Williamson of Flemming, 20 Zulack & Williamson. We represent the Port Authority of New 21 York and New Jersey and also Silverstein Properties in certain 22 cases and are appearing here today, but our clients have not 23 been served in any of the eight cases for which this conference 24 is called pursuant to your honor's September 25th order. 25 Although with the understanding that you thought it would be SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 4 2a30fric 1 helpful for us to be here -- 2 THE COURT: Thank you. 3 MR. WILLIAMSON: -- we are here. 4 THE COURT: Thank you. 5 MS. HESSION: Cathi Hession, Flemming, Zulack & 6 Williamson. 7 MR. COHEN: Jason Cohen, Flemming, Zulack & 8 Williamson. 9 MR. HARRIS: Keith Harris, in-house counsel for the 10 Port Authority. 11 THE COURT: Mr. Harris, although they are tripling up 12 on some parts, I think you have a space at the table somewhere. 13 I don't want Ms. Normand in the back. 14 MS. NORMAND: Thank you, your Honor. 15 THE COURT: I have distributed an agenda, but as 16 before, the purpose of the agenda is not to foreclose anyone 17 from raising any issue that that person thinks significant. In 18 order to create an efficient structure to allow this case to go 19 forward with as much efficiency as possible and with at least 20 expense as possible, I would like to get everyone's ideas out 21 in the open for discussions so that we can get the best 22 consensus possible. 23 Mr. Williamson raised the issue of service, and 24 perhaps Mr. Moller or someone else can tell me what are the 25 issues of service and when service will be completely effected. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 5 2a30fric 1 MR. MOLLER: Good afternoon, your Honor. 2 We have effected service on the Port Authority in the 3 cases that will be in suspense. The other cases where service 4 has not yet been completed is in the process of being 5 completed. One of the reasons to slow down the service or 6 process procedure was the order requiring a referral of cases 7 to the magistrate for consideration with the client. 8 THE COURT: We changed that. 9 MR. MOLLER: That's right. Since that is now behind 10 us and no longer the procedure, we are going full board to have 11 the service of process effected upon the Port Authority and all 12 of the other defendants in the active cases. 13 THE COURT: Your colleagues are doing the same? 14 MR. MOLLER: I presume so, and I believe that service 15 will be effected within a week or ten days. 16 THE COURT: I have spoken with Chief Judge Mukasey and 17 with Judge Francis about the need to continue the allocution by 18 the magistrate judge to make sure that people are aware of the 19 alternatives of proceeding either with the Victims Compensation 20 Fund or litigation. And based what I have been told by a 21 number of people, including a letter from Mr. Moller, I do not 22 believe that there is continued efficacy in forcing people to 23 go through the allocution where those people already know their 24 rights and have made a conscious choice. It is their right 25 what to do, and the court is not interested in dissuading SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 6 2a30fric 1 anyone from doing what any particular person conceives of to be 2 in his or her best interests. 3 On the other hand, there may be people who are not so 4 clear about their rights. The special master is 5 extraordinarily forthcoming in working with people and 6 impatiently -- and with patience, not with impatience, but with 7 great deal of patience are leading them through the procedures 8 of the Victims Compensation Fund. 9 So I will depend on everyone here being alert to any 10 hesitancy on the part of any particular party, as long as there 11 is an option open, that that person should feel free to invoke 12 the help that Special Master Feinberg is willing to give. 13 MR. MOLLER: May I raise a question on that subject? 14 THE COURT: Yes. 15 MR. MOLLER: At the first conference, when you took 16 the time to analyze the provisions of the Air Transportation 17 Safety Act which created the option of litigate or go to the 18 fund or fund, litigate, you noted that there was a lacuna in 19 the statute which created, at the very least, an ambiguity as 20 to whether a suit started now could be terminated and then 21 could allow a person to go to the Victims Compensation Fund. 22 That ambiguity suggests that there may be a benefit to 23 people who file, at least in the near term, to not requiring 24 that issue be joined or to effect service but not necessarily 25 require the defendant to answer. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 7 2a30fric 1 I believe in the next couple of weeks, that the levels 2 of compensation from the Victims Compensation Fund may become 3 better understood and that some people who have filed, and they 4 are not necessarily our clients, but others who have filed -- I 5 understand from Mr. Barry that approximately 61 clients, 61 6 actions have been filed for airplane victims. Maybe there is a 7 total of 100 lawsuits filed. It is possible that the 8 opportunity that you are suggesting exists may be one that 9 people want to take advantage of. 10 Would you entertain a delay in the answer for those 11 people so that they might withdraw and then go into the fund to 12 deal with the concerns which led you to appoint the magistrate 13 or have the allocution process? 14 THE COURT: Any comments from any of the defendants? 15 I have no objection to that. Congress has given 16 people until late in 2003 to decide what to do. And to the 17 best extent I can, I would like to preserve that period of 18 time. On the other hand, there are people who wish to 19 litigate, and those people are entitled to move their cases, 20 and I would like to help those people move those cases. 21 So there is a conflict that is presented. I would 22 feel that a reasonable period of time could well elapse of the 23 order of magnitude of 60 days, let us say, before answers are 24 required. 25 You will see as we discuss this that I believe a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 8 2a30fric 1 master complaint would be appropriate because of the variety of 2 issues that have been alleged in various lawsuits, and we 3 could, with a good deal of justification, defer the date for 4 the filing of a master complaint to take in whatever actions 5 are yet to be filed and will be filed in the near future. 6 The issue of preclusion arising from proceeding with a 7 lawsuit and then seeking to go into the Victims Compensation 8 Fund arises under the law of the election of remedies, which is 9 a well-known doctrine in arbitrations. And it is generally 10 held that an election to proceed with a lawsuit is inconsistent 11 with an arbitration clause in a contract, and the courts will 12 often find that there has been a waiver of the right to 13 arbitrate. 14 I have not studied the issue here as it applies to the 15 Victims Compensation Fund, but if there is an analogy, at some 16 early point in time a good argument for the waiver can arise. 17 Whether that has passed I don't know, and we don't need to 18 decide at this point. 19 So I think to sum up this particular point, let us say 20 that the plaintiffs will have 60 days from today to file a 21 master complaint. And the time to serve and file answers will 22 be 60 days after the filing of the master complaint. And that 23 will give us a window of 120 days to allow people to better 24 sort out what they want to do. 25 MR. MOLLER: I think that would be very helpful, your SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 9 2a30fric 1 Honor. 2 THE COURT: Is there anyone that would object to that 3 procedure? 4 Who is going to be the scribe that will submit an 5 order at the end of the session in a few days? 6 MR. MOLLER: I will undertake the order. 7 THE COURT: Thank you, Mr. Moller. And of course you 8 will clear it with the defendants. 9 MR. WILLIAMSON: Your Honor, excuse me. If I may? 10 THE COURT: Yes. 11 MR. WILLIAMSON: With the understanding that we don't 12 appear for anybody in this case today, but since your Honor has 13 on the agenda -- 14 THE COURT: Well, you hope to appear, don't you, for 15 clients, Mr. Williamson? 16 MR. WILLIAMSON: I think that will happen. 17 But with respect to number 3 being on the agenda, the 18 advisability of whether filing a master complaint is really 19 appropriate, your Honor has stated your thought that it may 20 well be that it is. But if we might, we would like to address 21 that. 22 THE COURT: Yes, that would be a good idea. I just 23 wanted to make one more point. I was looking down at my notes. 24 MR. WILLIAMSON: Yes. 25 THE COURT: We've attached the sample of a web page. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 10 2a30fric 1 Are there enough copies to go around of this agenda to 2 the public as well? 3 That will enable anyone having a computer at home or 4 at the office to dial up the web page and to see what is going 5 on. As you can see, there is already an order regarding Port 6 Authority cases that is on the web page that reflects what we 7 did the last time with the cases against the airlines and the 8 security companies. This order will also go on the web page as 9 well. So that will be the way that you will all get notice. 10 We will be giving notice to liaison counsel and liason 11 counsel -- 12 MR. BARRY: Thank you. 13 THE COURT: -- to the government. And liaison counsel 14 will in turn provide notices to others. But all of those who 15 wish to have notice should be in touch with the web page. We 16 are going to work out an ability so that you will have easy 17 communication with the web page to see what notices there are. 18 I am not entirely sure at this point just how that will work, 19 but we will try to make it work. 20 All right. Now, Mr. Williamson, on the master 21 complaint, I don't know for sure if that is a good way. I 22 think it is a helpful way. A lot of the problem is that we are 23 compressing in one proceeding different cases. There are cases 24 that talk about alleged design defects in the creation of the 25 towers, alleged construction defects in the building of the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 11 2a30fric 1 towers. There are operating defects with regard to plans to 2 evacuate the towers. There is a typo. We have the word 3 evaluate. We meant evacuate. And so on. And today I have 4 seen a complaint that has been filed complaining about toxic 5 fumes in the cleanup operation injurious to the health of the 6 plaintiffs who were construction workers who were workers at 7 the site. 8 So there is a wide variety of lawsuits, and it may be 9 that one master complaint is too general of a vehicle to do 10 that. 11 I do think it is handy to have one place where 12 everything is alleged, because it will be convenient for people 13 to look. I also will suspect that, just as you, 14 Mr. Williamson, representing the Port Authority also represent 15 the Silverstein interests, at least to some degree, that there 16 may be other instances where other construction contractors may 17 also be defendants in some kind of consolidated fashion. 18 This case has to sort out. There are issues of 19 cross-claims and third-party complaints that need to be sorted 20 out, and there is going to be a fair degree of complexity. And 21 it may be that we may have to revisit the issue of one master 22 complaint. Maybe there have to be several. Where efforts for 23 comprehension may cause prejudice to people, we have to be 24 careful that we don't overly concern ourselves with ease of 25 comprehension. So the fact that we make some provision orders SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 12 2a30fric 1 today should not be considered as precluding the people from 2 raising points in light of the experience that we have in 3 working with these cases. 4 Let's go down to 2 b. I want to call on Mr. Moller to 5 talk about the structure, to the extent that you thought it 6 through, of not so much the liaison counsel, but the creation 7 of executive committees and subcommittees to deal with this 8 case and to coordinate whatever needs to be coordinated with 9 the cases against the airlines and the security companies. 10 MR. MOLLER: I circulated a plaintiffs' and 11 defendants' joint status report this morning to all counsel to 12 comment on and expect to file that with the court on 13 October 7th, as you requested. 14 The contemplation of the parties now is that on the 15 plaintiffs' side, we will have an executive committee composed 16 of approximately seven law firms, and those law firms are the 17 Kreindler & Kreindler firm; Baumeister & Samuels; Speiser, 18 Krause, Nolan & Granito; Ness, Motley's firm; Baum, Hedlund, 19 Aristei, Guilford & Schiavo; Hanly & Conroy; and Warden, 20 Triplett & Grier. Warden, Triplett & Grier represents property 21 in subrogation interests that have been made known to the 22 court. 23 The executive committee accepts its responsibility for 24 the overall management and conduct of the litigation for the 25 plaintiffs' side. And its duties will be described in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 13 2a30fric 1 order, but they are what you would expect them to be; pretrial 2 discovery, management of the litigation, etc. 3 We intend to break down the responsibilities into four 4 categories. There will be an American Airlines subcommittee, 5 which will focus upon the liability of American Airlines, its 6 employees, agents and independent contractors, and any other 7 people or entities within the security umbrella that the 8 plaintiffs claim was breached. And I presume that as we look 9 into this, it will include, in all likelihood, Mass Port and 10 the other governmental agencies or authorities that are 11 involved in the security that was supposed to protect American 12 Airlines and its passengers. 13 THE COURT: And folks in Logan? 14 MR. MOLLER: Pardon? 15 THE COURT: And Logan? 16 MR. MOLLER: And Logan. Well, Logan and -- Logan 17 Airport. And United was at Logan and elsewhere. For the 18 moment I can't think. Each set of planes left from two 19 airports. But all the governmental authorities that are 20 involved here will be investigated or studied by the American 21 Airlines subcommittee and by the United Airlines subcommittee. 22 That will be the second subcommittee. Those two subcommittees 23 will break down further to focus on flight 11 and 77, which are 24 the American flights, and 175 and 93, which are the United 25 flights. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 14 2a30fric 1 There will be a third subcommittee, which will focus 2 on the World Trade Center towers issues. And those are the 3 ones that you have called into focus in item 2 a of your agenda 4 of today. We also have a subcommittee -- 5 THE COURT: And you will include the issue of toxic 6 fumes. 7 MR. MOLLER: Anything that relates to the liability 8 of, directly or indirectly, people in, at or near the World 9 Trade Center during the immediate aftermath of the terrorist 10 attack or the toxic tort issues that arise or the toxic fumes 11 issues that arise in the cleanup phase. 12 We have a fourth subcommittee. And mind you, we have 13 not yet discussed these, so this is somewhat fluid. I accept 14 to have further conversations between now and Monday with the 15 members of the committee to see if they agree. But the 16 feedback I have gotten so far is that there is general 17 agreement with this outline. 18 We will have a fourth subcommittee which will focus 19 upon issues relating to the legal liability of the United 20 States, if any, and issues that relate to sensitive security 21 information. And while there are subcommittees, obviously the 22 members of the executive committee will be intimately involved 23 in the activities of each of the subcommittees. So we should 24 be able to sort it out. 25 As we get going, we will be able to see how we should SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 15 2a30fric 1 fractionate the committee to focus on discrete subjects within 2 each area of concern. You will see in the order that we submit 3 on Monday that the plaintiffs' committee recognizes that there 4 may be a need to expand the committees or narrow their scope or 5 alter the membership as we get going. But I think for 6 starters, we've got a pretty good handle on an efficient way to 7 move forward. 8 THE COURT: Mr. Barry? You are not at the point where 9 Mr. Moller is, but -- 10 MR. BARRY: Well, we are very close, your Honor, 11 because we met with Mr. Moller yesterday to discuss with him 12 both the structure on the plaintiffs' side and the structure on 13 the defendants' side. 14 The defendants have met as well and formed an 15 executive committee, which will be comprised of attorneys 16 representing the two airlines, two major carrier airlines; the 17 three security companies; the airport authorities; Mass Port 18 and the Metropolitan Washington Airports Authority; also a 19 representative from the Port Authority; a representative could 20 be the same for the Silverstein interests; and a representative 21 lawyer for what we will call the noncarrier defendants who have 22 been sued in a few cases. 23 So we've organized our executive committee that way. 24 And it is going to have to be a little bit different from the 25 plaintiffs in that we are going to propose to your Honor and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 16 2a30fric 1 include in this joint order that we intend to submit with the 2 plaintiffs on Monday that there be a primary counsel on the 3 executive committee and a first alternate counsel for each 4 party. We have designated the executive committee to be a 5 party represented committee rather than one just of lawyers. 6 We think that is a little bit easier to -- 7 THE COURT: I think you should each work out what is 8 most efficient and best for each side. 9 MR. BARRY: Then we have subcommittees, two major 10 subcommittees broken down by the aviation interest subcommittee 11 and the nonaviation interest subcommittee. And that is 12 basically the outline of the defense committee structure. 13 THE COURT: The order should provide that parties 14 plaintiff and parties defendant make sure that the liaison 15 counsel have current copies of all pleadings. 16 MR. BARRY: Yes. That would be helpful, your Honor, 17 because at the moment I do not have all the pleadings. 18 (Pause) 19 THE COURT: Ms. Park is going to call liason counsel, 20 Mr. Desmond Barry. We will have a day next week and we will 21 deposit all the pleadings that we know of here so that it will 22 be easy for you to find out what we have. 23 MR. BARRY: Great. Thank you, your Honor. 24 THE COURT: I am not sure we have everything either, 25 but to the extent we do. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 17 2a30fric 1 We also would like to have from each of you complete 2 lists of all counsel involved in the cases. You don't have to 3 do that in the order, but each make a separate submission to us 4 of that. 5 MR. MOLLER: We are struggling to do that as well. 6 That is always a little more complicated than it seems. But we 7 are in the process of doing it. 8 THE COURT: I have motions to admit pro hoc vice by 9 Hanly & Conroy, members of the Motley firm, and the Port 10 Authority has possibly raised objections. The motions are 11 sitting on my desk and we have a date. 12 But is it intended now that the Port Authority will 13 serve objections, Mr. Williamson? Do you know? 14 MR. WILLIAMSON: I think the answer is, your Honor, 15 they are still considering it, but they definitely will meet 16 the court's deadline of October 8th. 17 THE COURT: So I will hold the applications until 18 then, and we will hopefully get that resolved in that time. 19 MR. WILLIAMSON: Yes. And then there is the question 20 of whether it needs to be resolved as a motion to disqualify in 21 the event that they appear or -- 22 THE COURT: I don't think it makes any difference. I 23 have to rule on whether either they can appear on a motion pro 24 hoc or they can't. It doesn't make a difference whether it is 25 a motion to disqualify or a motion to admit. It is the same SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 18 2a30fric 1 issue. 2 MR. WILLIAMSON: The only reason it might, your Honor, 3 is because of the way in which the motions were made. They 4 were made -- even though Mr. Motley has appeared before your 5 Honor in other cases, the motions were only made, as I 6 understand it, in two flight 93 cases, and Mr. Hanly's 7 follow-up letter urging speedy decision, I believe, has 8 captioned three of the cases instead of two. 9 THE COURT: Mr. Hanly, it seems to me that in a case 10 of this nature, either there has to be a general admission for 11 all purposes or not. It doesn't really make sense for pro hoc 12 motions to be limited to a specific case. I say that without 13 having thought it through, but -- 14 MR. HANLY: Well, your Honor, Paul Hanly. And I 15 regret I did not enter my appearance because I didn't realize 16 until I saw this, and I am not in any of these cases, that your 17 Honor would call upon me. 18 Judge, that is probably true with respect to any of 19 the flight cases, of the aircraft cases. However, as your 20 Honor knows from the Mulligan case, there are other potential 21 claims against the Port Authority, and the legal analysis with 22 respect to any motion to admit pro hoc or for disqualification 23 would be, as a factual matter, substantially different. 24 THE COURT: I can understand that. But as a practical 25 matter, if Mr. Motley is either disqualified because of prior SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 19 2a30fric 1 engagements for the Port Authority on some segments of these 2 cases and is not so disqualified on other segments of the 3 cases, it is going to create and administrative a problem. And 4 I am not sure that it is worthwhile to incur that problem. 5 MR. HANLY: Well, Judge, with the utmost respect, I 6 think we would disagree with the court with respect to that 7 because the nature of the claims -- 8 THE COURT: Would you address that argument -- 9 MR. HANLY: I certainly would, your Honor. 10 THE COURT: -- in papers? It is premature to force 11 anyone to do it at this point in time. 12 There are two interests here, maybe three. One is the 13 client's interest in having the lawyer of choice. Mr. Motley 14 has a great reputation in the field, and I could understand why 15 a client would want Mr. Motley to act for the client. There is 16 also the relationship with the court, and there is also the 17 very complicated and difficult administration of these cases 18 with many, many lawyers. 19 There is going to be a lot of sharing in the issues, 20 and there is a risk, more so than in other cases, that 21 information could be shared with people who may not be 22 qualified to receive such information because of issues of 23 confidentiality and privilege. 24 So I don't want to say how I will rule because I 25 really don't know how I will rule. I just want to flag these SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 20 2a30fric 1 issues so that they could be properly addressed. 2 MR. HANLY: Yes, your Honor. And in that regard, we 3 would then propose to address all of the potential issues that 4 could arise with regard to the entire panoply of prospective 5 cases. 6 THE COURT: Fine. 7 MR. WILLIAMSON: I think that does make the most 8 sense. Because to try to cast it in just one particular case 9 or two or three, and then at the same time have Mr. Motley be 10 on the executive committee overseeing all of the cases that 11 have been consolidated -- 12 THE COURT: I think I have the point, Mr. Williamson. 13 MR. WILLIAMSON: Yes. 14 THE COURT: We don't need to argue it now. 15 MR. WILLIAMSON: Yes. 16 THE COURT: But I will be concerned about these kinds 17 of issues. 18 MR. WILLIAMSON: In view of the fact, your Honor, that 19 the Port Authority then would be addressing it as a general 20 issue and not circumscribed to the three cases, would it be 21 possible for them to have a few additional days to recast the 22 papers that they have been working on? 23 THE COURT: Yes. Work out with Mr. Hanly and with 24 Mr. Motley what time you need. 25 MR. WILLIAMSON: Thank you. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 21 2a30fric 1 THE COURT: Let Ms. Park know. We will adjust any 2 argument dates. 3 MR. WILLIAMSON: Will do. 4 MR. HANLY: Thank you, your Honor. 5 THE COURT: I think I am down to point 4. And 6 Mr. Williamson, it may be premature, but what do you think is 7 likely to be the situation with cross-claims and third-party 8 complaints? 9 MR. WILLIAMSON: I've given it a lot of thought, your 10 Honor, and if I may, I'd like to defer to my partner, Cathi 11 Hession, to address that question. 12 THE COURT: Please, Ms. Hession. 13 MS. HESSION: Your Honor, we think it is extremely 14 likely that there will be many cross-claims and/or third-party 15 complaints. Especially in the personal injury cases where we 16 have Article 16 limited liability for noneconomic loss, I think 17 people are going to want everyone on the verdict sheet. And 18 that would include everybody from the terrorists on the 19 airlines all the way down the list. I don't think any of these 20 cases are going to be tried in a discrete vacuum. I think you 21 are going to see a mixing and an intermingling. 22 THE COURT: As you know, Judge Schwartz -- I am sorry 23 for cutting you off. Were you finished? 24 MS. HESSION: Yes. 25 THE COURT: Judge Schwartz has the cases against the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 22 2a30fric 1 terrorists. I have declined jurisdiction considering that 2 there was already too much to handle here. But the issue comes 3 up if you are going to be cross-claiming against the 4 terrorists, and those cases are going to be prosecuted in some 5 fashion, we will have to work out, Judge Schwartz and I, how to 6 handle those in some fashion. I don't want to include those 7 cases here because I think the problems of management would be 8 exacerbated. 9 MS. HESSION: Even without cross-claims, your Honor, 10 certainly I am sure that defendants will want to assert their 11 Article 16 rights to have people who could have been sued and 12 who have some relative culpability put on the verdict sheet for 13 the purpose of apportioning the relative liability in everybody 14 who may have been involved. 15 So whether a terrorist is a party to the case by way 16 of cross-claim or whether they are brought in on a third-party 17 complaint or whether they simply are a party asking the jury to 18 apportion liability to them under Article 16, I think you are 19 going to see everybody in most of these cases in one way, shape 20 or form. 21 THE COURT: I would like you to entertain and 22 recommend to me whether it ought to be required that 23 cross-claims and third-party complaints be alleged soon after 24 issue is joined on the complaint and the answers or at some 25 later date. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 23 2a30fric 1 I foresee that if there are third-party pleadings and 2 cross-pleadings as part of the structure of the issues, it will 3 be much more difficult for people to coordinate their efforts 4 and work together, and it may be wise to postpone the date for 5 filing such pleadings. 6 You have more wisdom than I do, more experience than I 7 do with these kinds of cases. I don't know what the practice 8 is with regard to these kinds of pleadings. I know in 9 securities litigation they are often postponed. 10 MS. HESSION: We will consider that and make a 11 recommendation, your Honor. 12 I do note, as I pointed out, that even without a 13 cross-claim or a third-party claim, you still have the Article 14 16 issue. In a verdict sheet in one of these cases, people are 15 going to want every name on the verdict sheet, even if there is 16 not a cross-claim, for purposes of determining their own share 17 of relative liability in the case. 18 So it is a rather complicated question. We will 19 consider it and we will try to make an intelligent 20 recommendation to the court. 21 THE COURT: Do the plaintiffs have any suggestion on 22 this? 23 MR. MOLLER: The suggestion is that we think about it. 24 It is a complicated question, and it raises, A, serious 25 administrative issues, liability issues, discovery issues, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 24 2a30fric 1 scope of discovery, place of discovery. I would like to see 2 what the Port Authority recommends and then respond to it. 3 THE COURT: The convenience of discovery will be 4 served by postponement. The thoroughness and finality of 5 discovery with regard to each witnesses will be served by 6 requiring people to do all the discovery they want with those 7 witnesses in one shot. I think I would rather see them 8 deferred and will possibly do so without prejudicing anyone's 9 rights, but I think you need to work it out. 10 Mr. Moller has raised the issue, and I wanted to bring 11 it to your attention as well, of what to do with the vast mass 12 of information that has been developed in the discovery before 13 Judge Martin. 14 Do you have any suggestions, Mr. Moller? 15 MR. MOLLER: We would like to, on behalf of the 16 plaintiffs, have access to the materials that have been 17 gathered in the case before Judge Martin, have our people be 18 able to review it, and make whatever copies of it they believe 19 are relevant to this litigation. 20 THE COURT: Mr. Barry, how do the defendants see this? 21 MR. BARRY: I'm sorry, your Honor? 22 THE COURT: How do the defendants see this issue? 23 MR. BARRY: Well, if the plaintiffs are going to be 24 provided access, we would certainly want the same access, your 25 Honor. So I think that is the only position we could take. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 25 2a30fric 1 THE COURT: How about a joint subpoena to all the 2 counsel and parties in that case? 3 MR. MOLLER: We can do that. 4 MR. BARRY: That is fine. And the other thing we are 5 concerned about is -- 6 THE COURT: If you would like me to sign it, I will. 7 MR. MOLLER: I appreciate it. 8 THE COURT: Mr. Williamson? 9 MR. WILLIAMSON: We don't appear for anyone in that 10 case, your Honor, but we understand that there's a 11 confidentiality order that's been signed by Judge Martin. I 12 think that's correct. 13 THE COURT: My interest is that the documents be 14 preserved, and that will be served by a subpoena. 15 MR. WILLIAMSON: It may well be that it could be 16 stipulated to for all I know. But I just note that I believe 17 that there is a confidentiality order that regulates some of 18 the material in that case. 19 MR. MOLLER: To the extent that there are 20 confidentiality orders that bind any party, we will agree to be 21 bound by them as well. 22 THE COURT: Well, I think the initial way to proceed 23 is for Mr. Barry, Mr. Moller and perhaps Mr. Williamson to 24 speak with Wachtell and Ostrager, Herbert Wachtell and Barry 25 Ostrager of Wachtell, Lipton and Simpson, Thacher, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 26 2a30fric 1 respectively, and see what you can get out of that. And if 2 there are other people that need to be consulted, consult them 3 as well. If a joint subpoena is appropriate, prepare it. I 4 will sign it. But I think the interest is making sure that 5 those records are preserved for adjudication either by Judge 6 Martin or me in terms of how to deal with it. 7 The last item I have here is what to do where a 8 suspended case is desired to become an active case. And I 9 suggest that the procedure we should have is that there should 10 be notice of intent served on the Port Authority with copies to 11 liaison counsel and filing with the court, followed by which I 12 will issue an order lifting suspension of the case. That 13 should be a simple enough procedure which lets everybody know 14 the seriousness of intention. Since it is clearly a matter of 15 individual intention, what I am going to do is to lift the 16 suspension. 17 I've filed orders of suspension in each of the 18 suspended cases. So this would be a modifying order. 19 Is that satisfactory? 20 MR. MOLLER: Yes. 21 MR. WILLIAMSON: Let me just note I think your Honor 22 dealt with it in the Mulligan order. I know Mr. Baumeister 23 wrote you a letter about it, but I think you covered it 24 earlier. 25 THE COURT: Yes, I did. I did, but I wanted to make SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 27 2a30fric 1 it a general issue. 2 In discussing the various cases that have been filed 3 against various contractors and with the Port Authority and the 4 World Trade Center, I think I mentioned this last time but I 5 will mention it again. I have issued a decision in Graybill v. 6 World Trade Center, I think, or Graybill v. The Port Authority 7 holding that the injuries suffered by a construction worker 8 arising from alleged negligence of a -- I don't know the 9 technical word for the hydraulic lift, but a steel beam dropped 10 from some derrick and injured a construction worker. 11 I held that since the complaint was drawn under the 12 New York laws regarding workers' safety, and since there was no 13 allegation of any special risk or injury arising from the 14 terrorist-related aircraft crashes, that based on the complaint 15 itself, that this was a state matter and not a federal matter, 16 and I remanded the issue to the state court. 17 I've had a motion to reconsider that. I don't think 18 we've issued a decision on that. And there are related cases 19 or two that raise somewhat of the same issue, which we will 20 decide and post on the web so anyone who is interested can 21 follow it. 22 So far, and subject to reconsideration, and 23 recognizing that the line is difficult to draw, the issue of 24 toxic fumes in the cleanup operation I am considering as 25 arising from the terrorist-related aircraft crashes. And SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 28 2a30fric 1 injuries on the job site which implicate duties owed to 2 construction workers that are much the same as on any 3 construction site and injuries suffered by construction workers 4 which are much the same as suffered on any construction site 5 are matters for the New York supreme court, even recognizing 6 that there may be some extra risk involved -- there probably 7 were some extra risks involved -- in the efforts of cleanup at 8 the World Trade Center site. 9 Now, the motions for reconsideration pointed out that 10 there was a congressional intent which allegedly was to 11 concentrate and coordinate the litigation and enjoy the benefit 12 of the cap in damage recoveries. And that is the point that I 13 have to reconsider and rule on. I wanted all of you to know 14 what is happening here with regard to those issues. 15 There is not too much precedent to guide me, so we are 16 trying to do the best we can. 17 I have finished my agenda. Is there anything else 18 that someone wants to bring up? And it could be anyone who is 19 in this room; it doesn't have to be at counsel table. 20 MR. MOLLER: The only thing I would like to alert the 21 court to is that in the course of our discussions of the time 22 schedule that you laid out tentatively in your agenda of 9/20, 23 we are beginning to find that that time schedule is a little 24 ambitious. 25 THE COURT: Adjust it. Adjust it to serve your SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 29 2a30fric 1 convenience. And since we are adjusting it now, the same 2 interests will apply. 3 MR. MOLLER: I just want you to know that we are 4 struggling with a schedule. 5 THE COURT: Adjust it. 6 Mr. Williamson? Ms. Hession. 7 MS. HESSION: Your Honor, if I may, I believe your 8 Honor also issued a remand order in the Spagnuolo case. May we 9 have permission, since reconsideration is still on the table, 10 apparently, to move for reconsideration of that decision as 11 well? 12 (Pause) 13 THE COURT: You don't need permission. Just do it. 14 MS. HESSION: Thank you, your Honor. 15 THE COURT: Does anybody have anything else or 16 questions or comments? If not, we are completed. 17 Now, we should, without adjourning yet, fix another 18 date for the next meeting. What do we have in the other case, 19 Mr. Moller? 20 MR. MOLLER: I thought that you had a date scheduled 21 for November 1st -- 22 THE COURT: What is appropriate here? 23 MR. MOLLER: -- at 2:15. 24 THE COURT: If the adjusted schedule requires 25 postponement of that, let me know and I will do that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 30 2a30fric 1 Could you and Mr. Barry, and I will include 2 Mr. Williamson as well, consider what might be an appropriate 3 date for the next meeting and suggest it in the order, and I 4 will try to fix a date around then. 5 Ms. Normand, does the government have anything to 6 suggest? 7 MS. NORMAND: No, your Honor. 8 THE COURT: We will undertake the obligation to notify 9 the government when we notify liason counsel. 10 MR. BARRY: I will do that, your Honor. 11 THE COURT: Worse comes to worse, we will have two 12 notices to the government. Fine. If you can do that too. 13 That is it then. We have nothing more. Thank you 14 very much for your attention. 15 (Adjourned) 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300