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NY judge blocks Sept. 11 claims against airlines

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TOM HAYS | July 19, 2013 09:36 AM EST | AP


NEW YORK — The owners of the World Trade Center can't demand billions of dollars more in insurance money for the destruction caused by the Sept. 11 attacks, a federal judge decided Thursday.

Judge Alvin Hellerstein ruled after hearing testimony by economic experts for the trade center owners and for the airlines linked to the planes that were hijacked in the attacks. The non-jury trial was held to decide whether the owners could collect more than the nearly $5 billion they've already received toward reconstruction.

In ruling against developer Larry Silverstein and World Trade Center Properties, the judge cited state laws that bar "windfalls and double recovery on the same loss."

The judge said that though he was ruling against the trade center owners, they deserved credit for spearheading the recovery effort at the 16-acre lower Manhattan site.

"You were dealt a very severe blow," the judge said of the attack, which turned the trade center into an inferno and destroyed the twin towers. Since then, the developer's workers have labored to "create beauty out the ashes of the destruction," he added.

A spokesman for Silverstein Properties said the developer was "deeply disappointed" by the ruling and would appeal but remains committed to the ongoing construction projects on the site.

"We will not rest until we have exhausted every option to assure that the aviation industry's insurers pay their fair share toward the complete rebuilding of the World Trade Center," said the spokesman, Bud Perrone.

During the four-day proceeding, Silverstein's attorneys had insisted that the aviation companies owed at least $3.5 billion for letting hijackers board planes that destroyed three skyscrapers on Sept. 11, 2001: the prominent twin towers and 7 World Trade Center, a 47-story building that caught fire after debris from one of the jet crashes pierced its facade and collapsed hours later.

Attorney Roger Podesta, speaking for companies including United Airlines Inc., US Airways Inc., American Airlines Inc. and its parent company, AMR Corp., had argued that making aviation companies pay would amount to double compensation.

He said an $8.5 billion total recovery would be more than two and a half times the fair value of the buildings that fell.

But attorney Richard Williamson, representing World Trade Center Properties, said damages from the attacks had totaled at least $7.2 billion.

The trade center owners say it has cost more than $7 billion to replace the twin towers and more than $1 billion to replace the third trade center building that fell.