United, American owe World Trade Center developer billions: lawyer

Joseph Ax, Reuters

The developer rebuilding the World Trade Center in New York told a federal appeals court on Wednesday that he is entitled to recoup billions of dollars from two airline companies, even though he has already collected $4 billion in insurance money for the September 11, 2001, attacks that destroyed the site.

Lawyers for Larry Silverstein and his World Trade Center Properties urged the 2nd U.S. Circuit Court of Appeals in New York to overturn a lower court ruling barring him from pursuing damages against United Continental Holdings Inc (UAL.N) and American Airlines Group Inc (AAL.O), whose planes crashed into the World Trade Center’s twin towers.

But the airlines said the insurance money was more than enough to compensate Silverstein for the fair market value of the lease he held for the World Trade Center property. Separately, Silverstein’s lawyers also argued his insurers should hand over $1.2 billion they won from the airlines and airport security companies.

The two-front appeal is the latest in a years-long legal battle Silverstein has waged over the site, which saw its new flagship skyscraper, One World Trade Center, previously known as the Freedom Tower, open in November.

Silverstein has argued that the lease included a contractual obligation that he rebuild the site. He claims he is entitled to money for those costs, as well as for lost rent revenue, in addition to compensation for the value of the buildings themselves.

In July 2013, U.S. District Judge Alvin Hellerstein said Silverstein could not recover damages from United Airlines, now United Continental, and American Airlines, which Silverstein accused of negligence.

Four months later, Hellerstein ruled Silverstein had no right to the money his insurers had collected from the airlines as part of their own claims.

The three-judge panel did not indicate how it would rule, though Circuit Judge Chester Straub expressed skepticism about the airlines’ position.

The cases are World Trade Center Properties v. United Airlines et al., Nos. 13-3619 and 13-3782, and World Trade Center Properties v. Industrial Risk Insurers London Syndicates Numbered 1212 et al., No. 13-3972, all in the 2nd U.S. Circuit Court of Appeals.

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