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Just before Christmas last year, the window for filing applications to the September 11th Victim Compensation Fund closed. After vigorous, 11th-hour efforts to persuade the remaining eligibles to enter the program, approximately 97 percent of the death claimants and more than 4,000 personal injury claimants did so. Of the nonfilers, some 48 took the tort option and are suing the airlines and others whom they hold responsible for their losses; some of them will probably drop their suits and file claims against the fund. Others filed with the fund but then withdrew their claims; some of them may have then sued in tort. At the filing deadline, the fund believed that about 30 potential claimants had not pressed their claims in either forum, perhaps out of grief or in fear of the daunting application form. The Sept. 11 fund formally goes out of business on June 15, so all claims must be processed by next week. It’s not too early to begin assessing the fund as a unique policy tool — as a model of a distinctive technique for compensating personal injury and death victims. This preliminary assessment can also shed light on how well the fund has performed the specific duties that Congress mandated in the Airline Transportation Safety and System Stabilization Act, a statute enacted with great haste and little deliberation less than two weeks after Sept. 11, 2001. A DIFFICULT TASK As its name suggest, the law’s chief aim was to keep the airlines aloft in an unprecedented crisis. Several provisions addressed liability and insurance threats to the industry. First, the law limited airlines’ tort exposure to the amount of liability insurance already in force on Sept. 11 ($6 billion). Second, the law provided a remedial alternative to the tort system for victims of physical harm or death caused by the plane crashes. Setting the fund within the U.S. Department of Justice, the statute authorized administrators to compensate victims under a number of rules, including a requirement that they waive their tort claims in order to be eligible for compensation. The fund’s special master, Kenneth Feinberg, was vested with enormous discretion in the interpretation of the statute and the framing of regulations. Some of these rules were consistent with the tort system, and the statute used many terms taken from tort law. Other rules might be considered “tort-plus.” For example, the law defined economic loss very broadly to include not only the usual out-of-pocket costs but “loss of business or employment opportunities” (presumably meaning future income or profit), where allowed under state law. It also compensated “nonpecuniary losses of any kind or nature,” apparently even where state law did not allow it. Other fund rules departed from tort system principles. Thus, awards were reduced by “all” collateral sources, including life insurance (but not including private charity). The fund had to make awards within 120 days after the claim application was substantially complete. No judicial review was permitted. In death cases, a $250,000 minimum award for pain and suffering applied. Finally, some of the fund’s features deviated sharply from tort law. Unlike the tort system (but like some social insurance schemes), the act decoupled the goals of compensation and deterrence. Many lawyers have represented claimants without fee. And the fund’s administrator and staff have viewed themselves as victims’ advocates — vigorously encouraging claims, revising their rules in response to victims’ criticisms, and seeking to humanize an irreducibly bureaucratic process. By almost all accounts, the fund has succeeded admirably in a difficult and morbid task. PLAYING FAIR From its inception, however, the fund has raised a host of important questions about our society’s most fundamental notions of corrective and distributive justice, questions that are worth revisiting now that the fund has almost shut its doors. Perhaps the most basic is the issue of what policy analysts call horizontal equity, constitutional theorists call equal protection, and common lawyers call analogical reasoning: whether the system treats like cases alike. On this important criterion, Congress gets a failing grade. It is not simply that the fund compensates the victims of one set of terrorist attacks, but not victims of other terrorist attacks on American and foreign soil (Oklahoma City, Khobar Towers, etc.). It is also that the fund compensates the Sept. 11 victims while most other innocent victims of crime, intentional wrongdoing, or negligence must suffer without remedy unless they are “lucky” enough to have been injured by someone who can be held liable under the tort system’s peculiar, often arbitrary rules and who is sufficiently insured or secure financially to pay the judgment. As already noted, the Sept. 11 fund’s awards are far more generous and quickly and easily obtained than most tort remedies. This is particularly true where, as in litigation against the airlines and the World Trade Center, any fault-based liability is highly doubtful and would in any event take many years to establish, and where one-third of any recovery would probably go to the lawyers. As a political matter, of course, Congress’ vastly superior treatment of the Sept. 11 victims is perfectly intelligible. After all, Congress wanted to protect the airlines against potentially massive liability. It also saw the Sept. 11 victims as a symbol of a unique trauma inflicted on the nation’s collective psyche, trauma that had to be repaired as swiftly as possible. But as a matter of fair and equal treatment of equally innocent victims, the fund’s scheme seems morally obtuse and impossible to justify. Special Master Feinberg has made it clear that he is keenly aware of this dilemma. He has wondered how he should reply if a family whose loved one had died in any accident other than Sept. 11, including a terrorist incident, were to ask, “Why not us?” One possible reply to at least some of them — the families of soldiers killed in Iraq and Afghanistan, for example — is that compensation for such a loss is already available under social insurance programs such as workers’ compensation and Social Security (or its military equivalent). These programs, like the fund, pay victims on a no-fault basis and usually with little delay. Again, however, such programs are far less generous than the tortlike awards that the fund provides to the families of Sept. 11 victims. WHOSE MISFORTUNE? This difference between tort and the fund, in turn, highlights one of the most important questions concerning the approach of American society to misfortune. Under what conditions should society (1) provide victims with an individually tailored, full-compensation remedy, (2) provide victims with a remedy that treats them as members of broad categories receiving awards addressed only to their basic needs, or (3) leave victims to private charity, self-insurance, or other forms of self-protection? This is an immensely difficult and controversial issue; here are just a few of the complications. First, the concept of “misfortune” is highly contested in courtrooms, legislatures, and private discourse. Are smokers who die of lung cancer victims of misfortune? What about unbelted drivers who suffer injuries that would otherwise have been prevented? Or people whose genetic endowment makes them more vulnerable to certain illnesses? A second and related point is that we disagree sharply about the roles that government and private entities or individuals should play in bearing risks, even those widely viewed as misfortune. Third, there is little consensus on the nature, extent, and merits of tort law as a rights-oriented, fault-based system for compensating certain types of injuries. Small wonder, then, that American society has deployed such a messy, ostensibly incoherent, if not unprincipled, mixture of institutions and approaches — tort law, social insurance, private insurance, contracts, charity, private savings, categorical programs — for remedying misfortunes of one kind or another. The Sept. 11 fund reflects this characteristically American eclecticism and the extraordinary circumstances of its sudden birth. As noted, the fund combined many features of tort with some elements more characteristic of social and private insurance. The result is what Stanford Law School’s Robert Rabin aptly calls a “hybrid” system, with both individualized, case-by-case determinations leading to compensation at tort (or tort-plus) levels, and the benefits — and some constraints — of collective compensation at lower levels through a relatively inexpensive and riskless administrative process. It is doubtful whether a future program for victims of a large-scale catastrophe would be as flexible, personalized, and anti-bureaucratic as the Sept. 11 fund has been. HELPFUL HISTORY Yet this is hardly the first time that American government has addressed private misfortune. Conventional wisdom looks to the New Deal era, when the federal government responded to the Great Depression with multiple programs that put all levels of government into the business of bearing and spreading risks of misfortune previously borne by individual citizens and families. Harvard sociologist Theda Skocpol takes this story back further in time, to pensions for Civil War veterans at the federal level and an array of social welfare programs in the early decades of the 20th century at the state level. An intriguing footnote to the decision to create the Sept. 11 fund is the research of Michele Landis Dauber, a lawyer-sociologist at Stanford Law School. Dauber has unearthed a surprising number of relevant federal laws going back to the early days of the republic — laws that, mutatis mutandis, grew out of analogous social misfortunes and in some ways prefigured the Sept. 11 fund. In Dauber’s telling, both the nature of the crisis and the political-legal response that led to the Sept. 11 fund (and the kinds of criticisms the fund has aroused) have historical antecedents. Although many of the early compensation laws were private bills to relieve a relatively small number of individuals, compensation was also sometimes provided on a more categorical basis through administrative mechanisms that, she contends, foreshadowed the modern welfare state. The triggering events were often fires, floods, storms, earthquakes, and similar disasters, but also foreign raids on American communities, the early 19th century equivalent of Sept. 11. A particularly arresting example was a law enacted by Congress in 1816 to compensate citizens for property lost, captured, or destroyed by British troops and their Indian allies during the War of 1812. As Dauber shows, the public justifications advanced were similar to those advanced for compensating the Sept. 11 victims. Even more interesting from today’s vantage point, the administrator of the 1816 law, Richard Bland Lee, had to make numerous eligibility decisions of a kind all too familiar to Kenneth Feinberg. Lee’s decisions, moreover, generated a furious backlash in Congress strikingly reminiscent of the contemporary politics of welfare entitlement programs. In 1817, Lee’s authority under the increasingly unpopular law was severely curtailed. Feinberg’s political and administrative skills evidently exceed Lee’s. Although Feinberg has been criticized and was sued by some high-income families angry at both the life insurance offsets and the fund’s informal cap on high-end compensation, he and the fund have benefited from strong bipartisan support. The prospect for similar programs, in a future where terrorist attacks may become all too common, is unclear. Perhaps Sept. 11 will continue to be seen as sui generis, limiting the power of the next victims’ “Why not us?” to obtain a similar remedy. We must pray that there will be few of them. Peter H. Schuck is the Simeon E. Baldwin professor at Yale Law School and author of Diversity in America (Harvard University Press, 2003). He can be reached at [email protected]. This article first appeared in the June issue of The American Lawyer.

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