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american lawyer media news service New york-A federal judge has given a cool initial reception to arguments that Special Master Kenneth R. Feinberg has improperly limited payments to the families of high-income workers who were killed in the Sept. 11, 2001, attack on the World Trade Center. Judge Alvin Hellerstein complimented one of the lawyers arguing in three separate cases challenging the way Feinberg has administered the no-fault Victim Compensation Fund, and echoed the attorney’s key argument in pressing the U.S. Justice Department lawyer defending the special master. But when questioning the attorneys, the judge suggested that Feinberg had done his “best” in construing “individual circumstances,” an admittedly ambiguous phrase. “Who am I to say it’s arbitrary and capricious?” he interjected. “It looks reasonable to me.” The arguments focused almost exclusively on claims that Feinberg is impermissibly imposing a cap on the compensation he is willing to award high-income families. The families’ lawyers pointed to remarks he has made in explaining the fund’s rules that in most cases an award of more than $3 million or $4 million would be inappropriate. They said that several times in meetings with lawyers, Feinberg indicated that he would not approve an award of more than $6 million. The families’ lawyers said their claim that that a “cap” is being imposed is bolstered by Feinberg’s approach of defining presumptive awards for people with incomes of less than $231,000, but requiring individuals with incomes above that amount to justify their awards with a individualized presentation. Ninety-eight percent of American workers earn less than $231,000 per year. Slightly more than 3,000 people were killed in the attacks. As of April 11, 1,581 families of those killed or injured have submitted claims. The fund has issued 358 awards, of which 224 have been accepted. The average award to the families of those killed has been $1.5 million, with the largest individual award being $6 million. The fund, however, has approved an award of $6.7 million to someone injured in the attacks. The provision of the law setting up the federal September 11th Victim Compensation Fund mandates several factors to be considered in calculating awards. They require Feinberg to determine economic and noneconomic losses and “the individual circumstances of the claimant.” In his rule-making, Feinberg stated that he could look to the needs and resources of the dependents and beneficiaries of those who died in the attacks under the rubric of “individual circumstances of the claimant.” The lawyers for the families charge that he has looked to those needs and resources, and determined that when they are ample, a “de facto” limit should be imposed on an award no matter what a straight mathematical computation of economic losses might yield. Feinberg has also limited noneconomic losses to $250,000 for each person killed and $100,000 for each family member, but those limits were not challenged in the three suits before Hellerstein. The first of the lawsuits was filed as a class action for 2,800 people killed in the towers. Arguing for the seven named plaintiffs in Colaio v. Feinberg, No. 03-0558, all of them families of Cantor Fitzgerald employees, was John F. Cambria of New York’s Salans.

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