WTC Jury Delivers Partial Verdict: One Event
The jury deliberating in the federal trial in New York City pitting World Trade Center leaseholder Larry Silverstein against more than a dozen of his property insurers delivered a partial verdict as this edition went to press.
The 11-member jury, however, still had not reached a verdict on the status of coverage from Swiss Reinsurance Company, the largest player in this case. The jury was sent home after delivering the partial verdict and will not resume deliberations until May 3.
The jury, on the seventh day of its deliberation, found that among the insurers on trial that are bound by the Willis “Wilprop” form, which defines the terrorist attack on the World Trade Center as one insured event (along with the dollar amounts of their policies using a single-occurrence basis) include:
Lloyds of London underwriters, $662.8 million.
Federal Insurance Company, $254.3 million.
Employers Insurance of Wausau, $64.9 million.
QBE International Insurance Ltd., $12.5 million.
Lexington Insurance, $5 million.
Copenhagen Reinsurance Co. Ltd., $4 million.
On the other hand, the jury found that the following companies are not bound by Wilprop:
Royal Specialty Underwriting, $178 million.
Zurich American Insurance Co., $45.7 million.
o Twin City Fire Insurance Company, $2.5 million.
These carriers will face an additional trial over whether the terrorist attack was one or two events, legal sources said.
The verdict on Swiss Reinsurance Company, with $778.1 million in coverage, was not reached last week. Judge Michael Mukasey had decided to accept the jurors partial findings and to send the jury back to resume deliberating on the Swiss Re issue on May 3.
In notes, jurors had indicated that debates over Swiss Re had taken up a majority of their deliberating days, but to no avail. “We have focused efforts on this one insurer for the majority of the last five days with great diligence, but in spite of our best efforts have not been able to reach a unanimous decision,” the jury said in a note to the court.
“This trial involved a great investment of time, effort and expenditure,” the judge told the jurors. “If you fail to reach a verdict, this case will have to be tried again as to Swiss Re, and that will only serve to increase the cost to both sides.”
Throughout the trial, insurers have argued that they are bound to the Wilprop form, which specifically defines “occurrence” and would limit Mr. Silversteins WTC claim to one event with a total limit of $3.55 billion in coverage.
Mr. Silverstein, on the other hand, has been arguing that the insurers represented in the case were bound by a form from Travelers, which helps Mr. Silversteins claim that the two planes crashing into the Twin Towers at separate times represent two reimbursable events worth some $7 billion.
The insurers in the trial had not signed final policy documents before terrorists took down the towers on Sept. 11, 2001.
Reproduced from National Underwriter Edition, April 30, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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