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March 6, 2009 4:00 PM

High Praise for Skadden's Work in 9/11 Cases

Posted by Brian Baxter

By Ben Hallman

A U.S. district court in Manhattan praised mediator Sheila Birnbaum of Skadden, Arps, Slate, Meagher & Flom for her three years of work on litigation related to the terrorist attacks of September 11, 2001.

The obstacle to settlement for many of the 95 families of 9/11 victims who chose to opt out of the victim's compensation fund was that they had not had a chance "to tell the story of their loss" to the airlines, or to personally receive condolences from an airline representative, according to Birnbaum, the Skadden partner who was called in to mediate the cases three years ago.

Birnbaum's final report on the 9/11 opt out cases--all but three of which have settled--was accepted this week by Manhattan federal district court judge Alvin Hellerstein. "What was at stake was more than a financial settlement," Birnbaum told The New York Law Journal.

Birnbaum's report details the effort that produced 92 settlements totaling  $500 million. She reported that the families of the those killed in the attacks "probably" obtained higher settlements by litigating rather than going through the compensation fund established by Congress after the attacks, but Birnbaum said "it is impossible to judge whether people similarly situated" did better or worse "regardless of any differences in gross settlement amounts."

(The compensation fund, which was administered by Special Master Kenneth R. Feinberg, handled the claims of about 97 percent of the 9/11 victims, awarding $7 billion on 5,560 claims.)

Birnbaum held mediation sessions with family members and airline representatives in Washington, D.C., Boston, and New York, including some that were attended by Judge Hellerstein. She described the sessions in her report as a "heart-wrenching and emotionally draining experience for all involved."

In his order approving Birnbaum's report, Hellerstein lauded the Skadden litigator for her work. "Without her patience, skill, empathy, and persistence, these results would not have been achieved," he wrote.

Thomas Fox, of counsel at Skadden, worked with Birnbaum throughout the process. Fox told the Litigation Daily on Friday that families opted out of the federal fund for various reasons.

Some "needed to be personally involved in the process," he said. "The litigation had become difficult to get beyond, it had become the legacy of their lost one."

Some families of high earners who died in the attacks opted out of the compensation fund because they felt it didn't provide adequate awards. Birnbaum's approach, Fox said, was to go into settlement talks "family by family."

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