WTC’s Silverstein Vows to Rebuild on Site Despite Losing to Insurers

Saying a court defeat was “not a defeat for rebuilding,” World Trade Center leaseholder Larry Silverstein has vowed to complete a rebuilding plan even after a jury ruled he could not double most of his $3.5 billion insurance policy to fund it.

The jury in U.S. District Court in Manhattan dealt Silverstein two tough blows in as many weeks. In two separate rulings, the jury found that the company’s policy was bound by the so-called WilProp form that defined the Sept. 11, 2001, terrorist attack as a single event.

Silverstein’s lawyers wanted to count it as two attacks for each plane that demolished a 110-story tower. They contended that the form was switched to another one in July 2001 that doesn’t define the word “occurrence.”

In its first ruling, the jury reached a partial verdict in which it concluded that 11 insurers signed binders based on the single-event WilProp form, and three insurers did not. However, the jury was unable to reach a decision regarding the trade center’s largest insurer, Swiss Re International Business Insurance Co. Limited, in its first round of deliberations.

In its second ruling, issued on May 3, the jury also said that the $877 million owed by Swiss Re could not be doubled.

With the two ruling combined, the jury found that more than $1.87 billion of the $3.5 billion insurance policy could not be doubled.

In a second trial, possibly to start in August, a new jury will determine whether the trade center attack can be considered two events for insurance purposes for additional companies holding more than $1 billion in coverage.

Jacques Dubois, president of Swiss Re’s U.S. component, said he was pleased with the jury’s finding.

“This is very important for the insurance industry,” he said. “You cannot change the insurance contract after the loss.”

He said Silverstein insured the trade center as if it were a single house with a loss limit worth less than the value of the property.

Disappointed
Silverstein said in a statement that he was disappointed that the jury “did not see things our way with respect to most of the insurers” in the trade center coverage.

“But let me be clear. A defeat in the courtroom is not a defeat for rebuilding,'” he said. “Whatever happens in court, we are determined to rebuild the World Trade Center, under Gov. (George) Pataki’s leadership and in keeping with the master plan.”

The plan announced late last year includes a twisting 1,776-foot glass tower topped by energy-generating windmills and a spire meant to evoke images of the Statue of Liberty.

Pataki said the structure “will show the world that freedom will always triumph over terror.”

Silverstein pledged to break ground in coming weeks for the Freedom Tower, the world’s tallest building, saying it will be built as scheduled by 2009.

Kevin M. Rampe, president of the Lower Manhattan Development Corp., the agency in charge of rebuilding ground zero, echoed his sentiments.

“We can, we must and we will rebuild,” Rampe said. “This is not a responsibility contingent upon the outcome of any lawsuit but a moral obligation borne of the worst terrorist attacks in our nation’s history,” he said.

Rampe said government and private resources were available to make sure the full rebuilding plan could be completed.

In a statement, Pataki said: “We will move forward. Nothing will stop us from keeping our commitment to the heroes we lost on that day.'”

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