New York Post
August 6, 2006

WTC Fund Blows $40M as Ill Get Nil


The $1 billion insurance fund created for the World Trade Center cleanup has now spent more than $40 million on overhead and lawyers — while still refusing to pay a single ill Ground Zero responder.

The WTC Captive Insurance Co., controlled by Mayor Bloomberg, last week justified its mounting expenses — including nearly $30 million in legal fees — as part of its "duty to defend" the city and its contractors against lawsuits.

"Because of the sheer number of individual plaintiffs and the huge volume of documents, this work is inevitably costly — but no more so than in most mass tort litigations," said company president and CEO Christine LaSala.

The company's latest financial reports, obtained by The Post, list $27.3 million in legal fees and expenses by outside law firms since 2004, and millions more on overhead and claims analysis.

In April, May and June , the company spent $5.2 million on lawyers, including a motion in Manhattan federal court to dismiss all WTC suits. The city is claiming immunity in the disaster.

The soaring expenses infuriated Rep. Carolyn Maloney (D-N.Y.), who contends Congress approved the $1 billion for the city to compensate WTC workers — thousands now sick from toxic exposure and dozens who have died — not fight each one.

"It's outrageous," Maloney said Friday. "Do they mean to say that in all the cases pending there aren't any valid claims of injured workers that should be paid? It defies belief."

Paul Napoli, a lawyer for nearly 8,000 WTC responders in a class-action lawsuit against the city, said, "They're paying more for Post-Its than for sick Ground Zero workers."

Napoli, in a letter last week to the state Insurance Department, said a city lawyer told him the city will continue battling the ill rescuers and recovery workers in court, and that "the claims of most workers would not start being paid, if at all, until 2015 and beyond."

City Corporation Counsel Michael Cardozo called Napoli's letter "totally misleading."

"It ignores that, through no efforts of the plaintiffs' lawyers, the city has and will continue to pay millions of dollars in disability payments to city employees who worked at the WTC, has established an extensive program tracking the health of WTC workers, and provides free medical treatment to all WTC workers," the city's top lawyer said.

"Moreover, despite the city's urging, the federal government did not establish a compensation fund for all those who became sick. Instead, Congress determined that if, despite the city's extraordinary September 11 response, the city was found to have acted improperly, there would be a $1 billion insurance fund available to help the city and the contractors pay these claims.

"Mr. Napoli, whose firm would receive more than $300 million if his lawsuit is successful, should make his complaint to Congress, not the city."

After The Post reported last week that Rep. Jerrold Nadler (D-N.Y.) called for a Homeland Security probe of the company's practices, Sen. Chuck Schumer wrote a blistering letter to LaSala.

"These workers were injured serving our country in its time of greatest need, and we must not turn our backs on them now," he wrote.