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Opening statements began Monday in the second trial pitting real estate developer Larry Silverstein against insurance companies over the amount owed for the destruction of the World Trade Center. The statements, at times combative and interrupted by a spate of objections, underscored what is at stake. If Silverstein and the World Trade Center owner, the Port Authority of New York and New Jersey, win, they stand to recover up to $2.2 billion from the nine carriers involved in the case. If they lose, they will recover, at most, half that amount. Silverstein entered into a 99-year lease with the Port Authority in July 2001 and purchased property insurance upon the commencement of his lease. The parties did not finalize the terms of the policies before the Sept. 11, 2001, terror attacks, making it unclear how much the insurance companies would have to pay for the losses suffered. In the first round of litigation, a jury before Southern District of New York Judge Michael Mukasey held that under the inchoate terms the parties had agreed to, the attacks constituted one “occurrence.” The terms used in the form governing the insurance policies, known as the WilProp form, covered 13 of the 24 insurers. The verdict put a dent in Silverstein’s attempt to receive $7 billion, or twice the minimum amount he had insured, from all of the insurance carriers. Two other carriers settled their cases. This second trial, also presided over by Mukasey, includes nine insurance carriers excluded from the previous case. The jury will have to determine whether under the insurance forms in place at the time of the attack the insurers will have to cover one or two occurrences. The trial is expected to last several weeks. Before a jury of 10 women and two men, Silverstein’s lead attorney, Bernard Nussbaum of Wachtell, Lipton, Rosen & Katz, began opening statements using a rapid-fire technique that relied on a succession of crescendos ending with a verbal exclamation point on the terms and phrases he wanted to emphasize for jurors. Nussbaum’s partner, Herbert Wachtell, led the Silverstein team in the first trial. “Two things are the heart of this case,” he said. “What actually happened on 9/11″ and “what the insurance forms say and do not say.” There were two buildings, planes, crashes, fires and collapses, he said, conspicuously repeating the number two in describing the events of that day. “Let me emphasize this … each collapse was independent of each other,” he continued, in building his case that the attacks constituted two occurrences. The terrorists orchestrated a coordinated attack, he acknowledged, “but here the terrorists used two separate weapons to strike two separate buildings.” At this point, Harvey Kurzweil of Dewey Ballantine, arguing on behalf of Travelers, one of the lead defendants, made one of several objections claiming that Nussbaum was making an argument rather than presenting evidence. Closing remarks, not opening statements, allow lawyers to present arguments to jurors. JUDGE INTERVENES Judge Mukasey agreed, interrupting Nussbaum’s momentum. After a few sentences, he recovered his speed and began to build to his point. “After the first crash,” he said, “it was not inevitable that there would be a second crash.” Kurzweil again objected and Nussbaum shifted his focus to the terms of the unfinished insurance policies. Nussbaum parsed through several clauses in the policies to show jurors that the insurance companies, which drafted the initial versions of the policies, failed to characterize the attacks resembling the ones committed on Sept. 11, 2001, as one “occurrence.” “I’ve been talking a lot about what the insurance policies do not say,” said Mr. Nussbaum a few minutes later, “now I’m going to show you something the policies do say.” He pointed to a clause he claimed defined the losses suffered at the World Trade Center as two occurrences. When Nussbaum began to pre-emptively rebut statements put forth by the defense team, he was targeted with a barrage of objections that were mostly sustained. For example, at one point Nussbaum said: “The notion that our client is underinsured is ridiculous” — prompting a quick objection from Kurzweil. Finally, when Nussbaum argued that the terms used in the WilProp form did not apply in this case, the judge stepped in: “Mr. Nussbaum, you’re done. Take your seat.” After a sidebar requested by Nussbaum, the judge allowed him to continue but he received more warnings before finishing. Kurzweil’s style was in sharp contrast to that of Nussbaum. He delivered his statements free from objections in a monotone voice and modest pace. He characterized the case differently. “You heard the counsel refer to the number two over and over again,” he said referring to Nussbaum’s opening, but this case was “a single coordinated attack.” The insurance coverage envisioned by Silverstein’s insurance team, he said, required consistent coverage and premium payments among all 24 insurance carriers. Whether the WilProp form applied to these nine insurers was irrelevant, he continued, because these carriers employed the same terms as requested by Silverstein’s team. Another attorney, Michael Barr of Sonnenschein Nath & Rosenthal who represents Royal Indemnity Co., echoed Kurzweil’s statements during the recess. The defense claim, he said, relied not on whether the WilProp form applied but that the carriers in this case used the same terms as the WilProp form. During the recess, Nussbaum also explained the difference between the two cases. “This case deals with what is an occurrence,” he said. “The other case dealt with what insurance form applied.”

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