Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Title A name given to the resource Department of Justice Emails Description An account of the resource The Department of Justice received more than 11,000 e-mails in response to the agency's public solicitation for comments upon its plans to distribute the September 11th Victim Compensation Fund of 2001 established by Congress to benefit the victims of September 11 and their families. These e-mails have been organized here by date. September 11 Email September 11 Email: Body The basic content, as unstructured text; sometimes containing a signature block at the end. January 22, 2002 Kenneth L. Zwick Director Office of Management Programs Civil Division U.S. Department of Justice 950 Pennsylvania Avenue Washington, D.C. 20530 Dear Mr. Zwick: I am writing to provide Sandler O'Neill & Partners, L.P. ("SOP") response to the Interim Final Regulations adopted to implement the September 11 Victims Compensation fund. Our main office was located on the 104th floor of Two World Trade Center in New York. SOP is a full service investment bank and broker dealer that prior to September 11, 2001, had 148 employees in New York and an additional 23 employees in four smaller offices throughout the country. SOP lost sixty-six employees and four guests in the terrorist attack. Before the airplane crashed into Two World Trade Center, approximately seventeen employees on the 104th floor who had been in the office had left the building . Another twenty-five employees witnessed the events unfold from the street as they arrived for work. No SOP employees on the 104th floor at the time of the second crash survived. At this time, only fourteen of the SOP victims have been found and positively identified. Although there are numerous portions of the Interim Final Regulations that could be the subject of comment, we would like to confine our comments to three very critical areas: the inherent limitations and caps on awards built into the regulations; the negative impact of an expansive reach in determining collateral source reductions; and the use of artificially low guidelines for the determination of pain and suffering. Sandler O'Neill Unfair Imposition of Caps and Limitations Within days after the September 11, 2001 attacks on the World Trade Center and Pentagon and the related crash in Shanksville, Pennsylvania, Congress passed, and the President signed into law, the Air Transportation Safety and System Stabilization Act. As this name suggests, a key purpose of this legislation was to provide the United States airline industry financial grants and guaranteed loans, as financial protection against the negative impact of the hijackings and terrorist attacks. The legislation was heavily supported through aggressive lobbying efforts on behalf of the airline industry. One aspect of the unprecedented financial protection granted to this industry was to limit the potential impact of liability lawsuits against the airlines to the liability insurance they carried covering these incidents. This liability protection went hand in hand with another purpose of this legislation. This was the creation of the September 11th Victim Compensation Fund, an unlimited commitment of our government to use our Treasury to provide a no-fault alternative to litigation. The Fund would compensate the victims of these terrorist attacks and their families for their economic and non-economic losses. At the time the legislation was adopted and signed into law, estimates of potential victims reached as high as twelve to fifteen thousand. Fortunately, the ultimate number of victims and the related cost of the Compensation Fund is much lower than what had been expected. It is clear that Congress and the President, in providing a fair no-fault alternative to protracted negligence litigation, anticipated paying awards similar to those that would be recovered in court proceedings. While the statute contained a more expansive definition of collateral sources, the law generally relied on the same state laws that would be used to determine loss in conventional litigation. There was no limit or ca on the compensation for loss that may be awarded. There can be an endless debate about whether the enactment of this legislation was an appropriate allocation of public resources. After all, airlines have far greater resources than just the insurance available per plane. They have paid massive negligence awards in many cases in the past. Even if the financial impact of these attacks led to airline bankruptcy, we have seen numerous major airlines suffer this fate without a catastrophic effect on our economy. Nonetheless, there is no question that these actions of Congress and the President also reflected the very noble and true outrage of our Nation and a heartfelt desire to aid the victims of these attacks, as well as a desire to protect an industry. The drafters and signer of this legislation clearly understood that the targets of this attack by foreign hostile forces represented the essence of our system-the government and the financial industries of our country. In subsequent airport security legislation, Congress and the President similarly limited the risks of litigation for other potential defendants. No non-terrorist defendant would have liability in excess of applicable insurance. Sandler O'Neill Because of the unprecedented reach of this legislation, the unknown losses that may be faced and the speed with which it was drafted and signed into law, the actual law left the establishment of rules for the operation of the Victims Fund to the Department of Justice. An independent Special Master was appointed, with broad powers to implement and oversee the system. A basic principal of regulation is that the regulations not contradict or override the purpose of the statue. Unfortunately, in the current case, the Interim Final Regulations have ignored the clear intention of the statute to use conventional methods in the calculation of losses in conformity with current state laws. Instead, the regulations have imposed inherent caps under Track A and a clear intention to abide with those caps under Track B, based solely on the assumed resources available to the claimants. Such a regulatory action is in clear contravention of the statute designed to compensate for losses in a manner consistent with that applied in litigation. The Interim Final Regulations undermine the intention of Congress and the President to provide a full and fair alternative to litigation for all victims. The Interim Final Regulations replace this clear statutory purpose with a concept more akin to that applied under I.R.S. regulations governing the dispensing of charity benefits-a "need" based standard, as opposed to a loss based standard. The DOJ in adopting the regulations made very strong statements that the size of awards would be limited for persons who earned above the 98th percentile of national income because they were likely to have the resources to protect themselves and didn't need to be fairly compensated for their loss. Unfortunately, in addition to ignoring the statute, the imposition of such a cap ignores both the financial realities of living in many communitities in the New York City area and the fact the Trade Center Victims were chosen as targets precisely because of their financial success. It is easy to understand that using a 98th percentile national cap had a far greater limiting effect in the New York area for the many employees of companies in the Trade Center. For example, this would imply that only 2%, or approximately 60, of the victims made over this amount. Our company, as well as several others, provided compensation histories for many victims in the Trade Center prior to the adoption of the Interim Final Rules. Our firm was among a roster of companies with offices in the World Trade Center that reads like a "Who's Who" of the financial sector of the economy. In essence, these employees were exactly the kind of people Osama Bin Laden and his Al Qaeda network wanted to target-those Americans who represented our capitalist system and the American dream. The families of the people who were living this dream are now dealing with tremendous grief due to the loss of their loved ones, as well as concerns over the enormous financial challenges they will face in the months and years ahead. It was therefore completely clear to the DOJ and Special Master that many times that number of persons made over the unrealistic limit used in the regulations. In addition to ignoring the statute's intention regarding the meaning of "loss", the purported justification of imposing such limits to not unnecessarily use public resources Sandler O'Neill also ignores the fact that a significant portion of the governments cost may be paid by the private sector. Section 409 of the statute provides that the United States is subrogated to any claim paid under the statute. Since we can assume the government would seek to minimize public expenditures, it would seem likely that the government will negotiate with insurers for significant under these subrogation rights. Overly Expansive Application of Collateral Sources As written, the Interim Final Regulations adopted a very broad reach for the definition of collateral sources. For example, voluntary survivors benefits that are paid by employers would be included in collateral sources. This will obviously have the effect of discouraging employers from making such payments. For example, our commitment to pay for health insurance of families may similarly reduce their awards from the Fund. This will force us, and other companies, to reconsider such voluntary efforts. This is, simply, cruel and unnecessary. In addition, the regulations penalize those responsible persons who saved in pension funds and purchased insurance by deducting the full amounts of these benefits from the awards they could receive under the fund. The statute clearly would allow a narrower scope in defining collateral source in the regulations. For example, the definition of collateral source could have excluded vested pension or retirement benefits (which are essentially nothing more than a form of savings account which belong to an employee) or other amounts (such as term life insurance or previously unvested interests in a retirement fund). As adopted, the regulations are capricious and can serve no public policy purpose. The victims who were spendthrifts who never saved are rewarded with fewer reductions from the awards, as compared to persons who made voluntary contributions to pension funds or purchased whole life insurance as a savings and investment vehicle. It was never the intent of our Congress and the President for the presumption of need to replace the measurement of economic loss. Unfair Pain and Suffering Assumptions The adopting release for the regulations provides that pain and suffering awards have been fixed consistent with standards applied to law enforcement and military personnel. While pain and suffering awards are always subjective, it is hard to understand how the suffering of a group of civilians, completely unprepared for the risk of violent deaths and injuries, could be equated with persons who have voluntarily chosen to put themselves at risk of such death and injury as part of their daily job. This type of an assumption is, again, completely inconsistent with the language of the statute regarding compensation for non-economic loss. It imposes an unrealistically low Sandler O'Neill an inapplicable standard whose sole purpose is to limit the size of the award without providing adequate compensation by any reasonable standard for civilians. Conclusion The statutory limitations on litigation designed to protect certain industries left the Victims Compensation Fund as the only viable alternative to recover losses. The noble intentions of Congress and the President to provide a fair alternative were structured to provide restitution without limit. The Interim Final Regulations have been expressly designed to alter the intended effect of the statute. This has put the squeeze on many victims and families. The victims we knew in the Trade Center were among the most highly motivated people in our country. Their families shared their motivations and dreams. Most paid taxes at the highest rates and never asked for, wanted or anticipated being on the government dole. Quite a few comment letters sent to the DOJ prior to adopting the Interim Rules took the shocking position that these people were being unjustly enriched at the public expense. Unfortunately, this shocking position has found its way into the Interim Final Rules. The statute would have provided support to companies likely to be defendants in lawsuits and just compensation for victims. This reflected national interest in preserving the airline and other industries and national outrage on the attack on our American system. Our government, through the legislative process, made a policy decision that the costs were properly placed on our Nation's Treasury. What has happened through the Interim Final Regulations is a trade-off, not envisioned by Congress or the President, which has turned the legislation on its head-potential commercial-defendants have been protected at a cost to individual victims. A strong argument can be made that such limitations on awards, which have never before been found in our American litigation system, only further victimized the victims. We urge the Special Master and DOJ to reverse this injustice and act consistent with the legislation and honor the memories of the many unfortunate victims. Very truly yours, Comment by: Sandler O'Neill & Partners, L.P. New York, NY September 11 Email: Date The local time and date when the message was written. 2002-01-22 Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Title A name given to the resource dojN002447.xml 911DA Item Elements describing a September 11 Digital Archive item. Status The process status of this item. approved Consent Whether September 11 Digital Archive has permission to possess this item. full Posting Whether the contributor gave permission to post this item. yes Copyright Whether the contributor holds copyright to this item. yes Source The source of this item. born-digital Media Type The media type of this item. email Created by Author Whether the author created this item. yes Described by Author Whether the description of this item was submitted by the author. no Date Entered The date this item was entered into the archive. 2002-01-22