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Judge Hellerstein's Ruling on the September 11 Suits:
Is It Right About New York Tort Law?

Monday, Oct. 06, 2003

In my last column, I explained why U.S. District Judge Alvin Hellerstein in New York City has been placed in a very difficult position: He has to decide every motion that has been filed in the lawsuits arising out of the attacks of September 11. (Congress consolidated all the lawsuits that could have been filed around the country into Judge Hellerstein's courtroom when it created the September 11 Victim Compensation Fund.)

Some of the lawsuits seek compensation for property damage and lost profits against the airlines whose planes were hijacked - as well as Boeing, the manufacturer of all the planes; the owner and operators of the World Trade Center; and a few other defendants. The suits are longshots brought on behalf of insurers who want to recapture some of the estimated $40 billion in property and business losses that occurred when the WTC towers were struck.

The corporations who brought these suits are, of course not the plaintiffs who should be worrying Judge Hellerstein. Rather, the plaintiffs who are doubtless foremost in the judge's mind are the families of those killed on September 11 - either on the hijacked planes, or on the ground in New York and Washington, D.C..

These families gave up their right under the Victim Compensation Fund to receive guaranteed compensation, in order to pursue lawsuits against the various defendants named in the complaint. And these lawsuits - there are many of them - are all before Judge Hellerstein.

Why Judge Hellerstein Will Affect Many September 11 Families' Fates

The way Judge Hellerstein handles the families' suits will not only affect the families themselves, but also influence how hundreds of families, waiting on the sidelines, will behave.

Applications to the government fund must be received by December 22 of this year. Thus, any family who is considering a lawsuit as an alternative to the fund has only a few more months to make up its mind. After December 22, the only alternative to a lawsuit will be nothing at all.

Judge Hellerstein is a federal judge, and as such, he is supposed to act independently of the Justice Department. Nonetheless, it is obvious that what he says--and how he says it--is of tremendous importance to anyone trying to understand whether litigation against the defendants named in the September 11 suits has any future. And from this perspective, I do not think he has fulfilled his obligation to its fullest extent.

The Issues Judge Hellerstein's Recent Ruling Did Not Resolve

On September 9, Judge Hellerstein issued an opinion denying the motion to dismiss filed on behalf of all of the defendants in the September 11 suit. Before I discuss what the opinion meant, it's important to briefly discuss the sets of issues it did not reach.

First, the motion to dismiss did not ask the judge to dismiss suits brought by the families of any airline passengers against the airline. Instead, the airlines conceded that they had a duty to their passengers. They maintain only that they had no duty to persons on the ground.

Second, despite some confusion on this point, the motion to dismiss - and Judge Hellerstein's subsequent opinion - had nothing to do with parallel suits that have been brought against various Saudi Arabian individuals and entities for "aiding and abetting" the hijacking. The Saudi lawsuits were not consolidated with the families' suits. (Indeed, they could not have been, because Congress chose to treat suits against the hijackers and those who knowingly helped them, separately from negligence and products liability claims arising from the attack.)

The Problem with Judge Hellerstein's Recent Ruling

That brings us to the topics and arguments the motion - and the opinion - did reach. I discussed some of these topics in my previous column. In this column, I will explain why I believe that Judge Hellerstein's opinion - while it may have reached the right conclusion - may still be misleading to the families.

At the end of the opinion, Judge Hellerstein that his decision to allow the case to go forward is based on the simple claim, by the plaintiffs, that discovery (that is, the unearthing and exchange of evidence in the case) is needed before the judge can really say with certainty that, as a matter of law, the plaintiffs had no claim.

But that claim simply cannot be correct. Under New York law, there are very good reasons to think that the suits by the ground plaintiffs could have been dismissed even without discovery.

Why Judge Hellerstein's Analysis of the Duty Issues Is Superficial

To see why Judge Hellerstein is wrong, I will examine his argument for refusing to dismiss the suits against the airlines by the families of victims on the ground, in particular. I choose this portion of the consolidated suit because it illustrates the point I want to make most clearly.

For obvious reasons, discovery may not yield many material facts that directly relate to how the hijackers took over the planes; much of that information is lost forever. Yet, in the popular media, many of the families who have explained their reasons for bringing suit have explained that they want to use litigation to prove that the airlines could have done more to protect the public. In this goal, they may be disappointed.

In support of his holding that the airlines may have had a duty to persons on the ground, Judge Hellerstein notes that airlines not only have always accepted that they have a duty to their passengers to ensure that they reach their destination safely, but have also been held to have a duty to avoid imposing foreseeable risks on persons on the ground as well. For instance, cases allowing lawsuits against airlines for personal injuries and damage to personal property have been brought in New York and other states when airplanes crashed into cars and houses near airports - a foreseeable type of catastrophe.

Judge Hellerstein thus concludes that, under New York law, at least, the airlines owed the people and businesses in and around the World Trade Center a duty to exercise the same precautions that they owed their passengers. The airlines argued, however, that the fact that there was an intervening actor in the tragedy of September 11--criminal hijackers--makes the duty they owe to ground victims different than if there had been no such actor.

On their view, then they might have had a duty to those on the ground had the crashes occurred as a result of a mechanical malfunction or pilot error. But, on their view, they did not have a duty to those on the ground in light of the intervening crimes that caused the planes to be employed in the attacks.

Judge Hellerstein dismissed this objection, arguing that if the risk against which the defendant had an obligation to protect the plaintiff included an intervening act by a criminal, then the duty remains. (A building owner's duty, for example, to provide secure locks on the front door to protect his tenants' safety is not altered by the fact that the locks are necessitated by the criminal activities of others.)

So far, Judge Hellerstein's analysis of duty under New York law is perfectly reasonable but it is nonetheless superficial. The main issue raised by the airlines is whether their acknowledged duty - the duty to exercise reasonable care to ensure that their planes were not flown into the ground - extended to anyone within reach of their planes once they were airborne. In debates over tort law, another way of asking this question is whether or not the airlines owed a duty to "the world" - or just owed that duty to a subset of the persons and corporations in the world.

As a matter of logic, it might be the case that if an airline owes a duty to the persons who live near airports (and perhaps even directly under well-known flight paths), they owe a duty to those who live in parts of America that can be reached by an airplane. After all, suppose it is foreseeable - as courts have held - that a negligently flown airplane can crash a quarter mile from an airport. If so, isn't it also foreseeable that a plane whose passengers have been negligently screened at check-in may fly - and crash hundreds of miles from its intended destination, either because the criminals on board want to crash it, or just because they can't properly maintain control of the plane?

The answer is that duty in New York is not just a matter of logic. As Judge Hellerstein himself recognizes, it is a matter of many considerations, of which logic is only one. The odd thing about Judge Hellerstein's decision on September 9 is that, although he recognized that New York law requires him to balance a number of factors, his balancing act was ill informed and appeared quite partial.

The Problem with Judge Hellerstein's Balancing of the Various Factors

Judge Hellerstein began his analysis of New York's complex test of duty by looking at a case called 532 Madison Ave. Gourmet Foods, Inc. v. Finlandia Center, Inc. This case concerned claims by businesses in mid-town Manhattan who lost profits because of two different construction-related accidents near them.

The 532 Madison Ave. decision is very interesting but it is not directly about the test for duty in cases in which a wide range of victims suffer personal injury or property damage. Rather, it is a case about the test for duty in cases in which a wide range of victims suffer pure economic loss.

The September 11 lawsuits do not allege pure economic loss. Thus, 532 Madison Ave. is at best only vaguely relevant to the question Judge Hellerstein was required to answer.

Even stranger still, Judge Hellerstein did not even discuss one case that is highly relevant to the question raised by the September 11 suits. It is a 1985 decision called Strauss v. Belle Realty Company.

In Strauss, an elderly man fell down some negligently maintained stairs during the great New York City blackout of 1977. He sued his landlord and Consolidated Edison for his personal injuries. Con Ed moved to be dismissed from the suit, on the basis that it owed no duty to the plaintiff, since it had a contract with the landlord, not with the plaintiff, who was a tenant. It won its motion.

In Strauss, the New York Court of Appeals noted that, ever since the early Twentieth Century, "in fixing the bounds of that duty, not only logic and science, but policy play an important role." It considered the consequences of allowing the plaintiff to sue, given the many injuries that may have arisen from the blackout. It declared there was no duty.

Many scholars, myself included, think Strauss is poorly reasoned. But it is an important part of New York's law of torts. (Indeed, it has been cited in 129 state and federal cases in New York). Indeed, all the other cases upon which Judge Hellerstein relies in his opinion are in one way, or another, a response to Straus.

You can't ignore Strauss itself when dealing with its progeny. But that is just what Judge Hellerstein did.

Strauss Is Not the Only Precedent Judge Hellerstein Ignores

I am not claiming that Strauss alone demands that the September 11 ground victims' suit must be dismissed. Since 1985, the New York Court of Appeals (New York's highest court) has tried to make sense of Strauss in the context of a number of different fact patterns.

Some of these cases are discussed in Judge Hellerstein's opinion, but some are not.. Judge Hellerstein relies heavily, for example, on the well-known case of Strauss Is Not the Only Precedent Judge Hellerstein Ignores

I am not claiming that Strauss alone demands that the September 11 ground victims' suit must be dismissed. Since 1985, the New York Court of Appeals (New York's highest court) has tried to make sense of Strauss in the context of a number of different fact patterns.

Some of these cases are discussed in Judge Hellerstein's opinion, but some are not.. Judge Hellerstein relies heavily, for example, on the well-known case of Palka v. Servicemaster. There, the Court of Appeals held that Strauss did not bar a suit by a nurse injured by the defendant maintenance company's failure to properly repair a light. But the judge ignores the lesson of Milliken v. Consolidated Edison Company of New York, which later held that the plaintiff in Palka survived the public policy hurdle only because she was a member of a "narrowly defined class" of victims.

And Judge Hellerstein also ignores post-Strauss cases in which the Court of Appeals has clearly indicated that limitations on duty based on public policy fall more heavily on plaintiffs who have property claims than personal injury claims. This holding strongly suggests that Judge Hellerstein could - and perhaps should - have dismissed the property damage suits even at this stage of the litigation.

But what about the September 11 families' suits? To figure out what to do in these suits, one must follow the reasoning of all these precedents - not just some of them. .

And if one does indeed follow that reasoning, one cannot help but conclude that the New York Court of Appeals' approach is this: It balances the benefits of allowing liability "to the world," against the consequences to the defendant of paying for that liability. And that approach, sadly, does not bode well for the September 11 families' claims.

In the context of the September 11 suits, the duty demanded by the plaintiffs is literally "to the world," and the consequences of liability, but for Congress's intervention, would have been huge. In the middle of his opinion, Judge Hellerstein suggests that because Congress capped damages for all the defendants, he can ignore the potential liability that determination of duty would have entailed. But that is a mistake. His responsibility is to determine duty according to the law of New York as it was at the time of the accident.

This suggests that the New York Court of Appeals - if the question were referred to it by the U.S. Court of Appeals for the Second Circuit, as it likely would be--might well find that the benefit of imposing a duty "to the world" outweighs the cost of doing so. Thus, it might hold there is no such duty - and leave the on-the-ground plaintiffs in the suits against the airlines with nothing at all.

It is impossible to say for certain what the Court of Appeals would do, if asked this question. But Judge Hellerstein should have warned current and future plaintiffs that it might find no duty. After all, these plaintiffs have only until December 22 to decide whether to give up their claims on the Victims' Compensation Fund.

Anthony J. Sebok, a FindLaw columnist, is a Professor of Law at Brooklyn Law School, where he teaches Torts, among other subjects. Professor Sebok has written a number of columns relating to the September 11 Victims' Compensation Fund, September 11 lawsuits, and Judge Hellerstein's difficult task, all of which can be located in the archive of his columns on the site.

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