Orders Renegotiation of Settlement for People Sickened by Dust from World Trade Center; Says $657M Insufficient

March 19, 2010
CBSNews.com

A federal judge on Friday rejected a legal settlement of more than a half-billion dollars for people sickened by ash and dust from the World Trade Center, saying the deal to compensate 10,000 police officers, firefighters and other laborers didn't contain enough money for the workers.

"In my judgment, this settlement is not enough," said U.S. District Judge Alvin Hellerstein.

The judge also said he was concerned too much of the deal would be eaten up by legal fees and that ground zero responders were going to be pressured into signing on before they knew how much they stood to receive.

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The settlement proposal would have given the workers $575 million to $657 million, but each person's amount was based on a complicated point system that would give some workers only a few thousand dollars while others might qualify for $1 million or more.

A third or more of the amount set aside for the workers was expected to go to their lawyers. Some plaintiffs had agreed at the start of the case to give as much as 40 percent of any judgment to cover fees and expenses.

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Under the terms of the deal, workers were given just 90 days to decide whether they wanted to participate — a time Hellerstein suggested was too short to figure out one of the most important decisions of their lives.

"I will not preside over a settlement that is based on fear or ignorance," he said.

Hellerstein, who presides over all federal court litigation related to the terror attacks, ripped into the agreement after hearing from several ground zero responders speak tearfully of their illnesses, and receiving letters and phone calls from others expressing confusion about the deal.

It wasn't immediately clear whether the judge's actions, which he announced from the bench, would kill the settlement entirely.

The deal had taken years to negotiate and was announced last Thursday, with about two months to go until the first trials.

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Last Friday, a representative of one victims' group expressed reservations that deal doesn't contain enough cash.

"From what I've seen, I don't think you're going to get 95 percent of the people to opt in," said John Feal of the Long Island-based FealGood Foundation. He noted that some workers could wind up getting only a few thousand dollars for illnesses that will bother them for life.

"This is far from fair," he said. "Look, if you've got cancer and are going through chemo and medical bills, $1 million goes pretty fast."