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Lawyers for World Trade Center leaseholder Larry Silverstein and 13 of the insurers who wrote coverage for the complex gave their opening statements Monday in the jury trial that will ultimately determine whether Silverstein gets $3.5 billion to rebuild the site or twice that amount. The insurers are arguing that they provided coverage limited at $3.5 billion per occurrence under a policy form provided by Silverstein’s insurance broker, Willis Group Holdings Ltd., that defines an occurrence as “one cause” or “one series of similar causes.” Silverstein claims another form, provided by one of the insurers, was operative at the time of the terrorist attacks. The “Travelers form,” Silverstein is arguing, would define the attacks as two separate occurrences. Silverstein signed a 99-year lease on the World Trade Center from its owners, the Port Authority of New York and New Jersey, in July 2001, just weeks before the terrorist attacks. Before a packed Manhattan courtroom overseen by Southern District Chief Judge Michael Mukasey, Barry Ostrager of Simpson Thacher & Bartlett laid out the insurers’ case to the jury on behalf of Swiss Re International, which has more than 20 percent of the exposure on the World Trade Center policy and which sued Silverstein over the coverage issues in October 2001. Ostrager said Robert Strachan, the risk manager for Silverstein Properties, the brokers at Willis and the bankers that financed Silverstein’s lease all knew the Willis-provided form, known as the Wilprop, governed the coverage. He said he would be calling them to testify to that effect. “We are going to prove our case out of the mouths of the witnesses of the other side,” Ostrager told the jury. The Wilprop form was the one the insurers had when the insurance became effective July 17, Ostrager said. He also showed the court several e-mails sent out by Strachan and brokers at Willis suggesting that the Wilprop form was being used by most of the insurers, except for Travelers. Among the e-mails was one dated Aug. 12, 2001, but which Ostrager said was sent Sept. 12, 2001. In the e-mail, Strachan said the Silverstein company was going with the definitions in the Wilprop form. Silverstein’s lawyer, Herbert Wachtell of Wachtell, Lipton, Rosen & Katz, seized on that e-mail late in his opening statement, telling the jury in a tear-choked voice that the mistaken date and the acknowledgement of the Wilprop definitions were symbolic of the tumult and trauma that Strachan and others at Silverstein were experiencing a day after the attacks killed so many of their friends and colleagues. “He wasn’t thinking clearly,” said Wachtell, “but elsewhere other people were thinking very clearly.” Wachtell devoted much of his opening to arguing that Silverstein would have preferred that the insurers had accepted the Wilprop form. Most insurers prefer to cover multiple occurrences, he said, because they can then apply multiple deductibles. In contrast, those seeking coverage prefer single-event definitions that invoke only a single deductible. But because of the amount of coverage demanded by the banks, as well as the World Trade Center’s past history as a terrorist target, Wachtell said the Silverstein group did not expect the insurers would agree to the Wilprop terms. In fact, he said, the insurers had received the Travelers form by July 23, 2001, because Silverstein wanted to have “concurrency” among the policy terms for the different insurers. By now claiming the Wilprop form governed their coverage, the insurers “were trying to rewrite history,” Wachtell said. Another group of London insurers, headed by Lloyds of London, was represented yesterday by David Boies of Boies, Schiller & Flexner, based in Armonk, N.Y. Boies said there was “simply no doubt Wilprop” governs because it was the only policy form sent to the London insurers. But Wachtell said the London insurers waived further negotiations on the policy form and therefore signalled their acceptance of later changes to the form. The first day of the trial ended with Ostrager calling Strachan to testify. His testimony is expected to continue today. The trial is expected to last eight weeks. If the jury finds the Travelers form rather than the Wilprop form governs for any of the insurers, another proceeding before a second jury will determine whether the Sept. 11 attacks were, in fact, two events. A third stage would determine damages. Silverstein suffered a setback in September when the U.S. Court of Appeals for the Second Circuit ruled that three insurers were bound by the Wilprop form. Wachtell said yesterday that those insurers were bound by Wilprop in part through an oversight. An e-mail sent to several Willis brokers and stating that the World Trade Center policies should be governed by Travelers was apparently not sent to Willis’ man in Bermuda, who proceeded with the Wilprop forms.

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