In re World Trade Center Disaster Site Litigation, Case No. 21 MC 100 (S.D. N.Y. 2008)

Following the attacks on September 11, 2001, thousands of workers came to the World Trade Center site to participate in clean-up tasks. Many of these workers allegedly suffered respiratory and other injuries and filed lawsuits, seeking a portion of the one billion dollar insurance fund created by FEMA. Approximately 10,000 such cases were before Judge Hellerstein, who rendered the decision discussed here.

Due to the magnitude of the action, the Court appointed Special Masters to assist with the progress of the cases. In support of the Special Masters’ appointment, the Court cited Fed. Rule of Civ. Proc. 53; In re Peterson, 253 U.S. 300, 312-13 (1920) (“Courts have . . . inherent power to provide themselves with appropriate instruments required for the performance of their duties. This power includes authority to appoint persons unconnected with the court to aid judges in the performance of their specific judicial duties” including Special Masters); and the Manual for Complex Litigation §11.52 (4th ed. 2004).

In the World Trade Center case, the Special Masters, with the aid of an approved consultant, recommended that the Court retain an independent technology vendor “to build, maintain and operate a database” to store the tremendous volume of discovery the parties had begun to produce. Plaintiffs raised concerns, particularly as to expense, noting that Plaintiffs and Defendants were each already paying $20,000 per month for the Special Masters’ services. Plaintiff feared that with the addition of the vendor’s services, the total of all expenses could reach $1,000,000 per year and Defendants’ portion of that would cut too deeply into the insurance fund while Plaintiffs’ counsel could not absorb their portion.

The Court expressed its sensitivity to the costs of the litigation and the potential reduction of the insurance fund, which in turn would limit recoveries. The Court nonetheless approved the appointment of the vendor, noting:

There is no substitution for an independently created and managed database. Without a common core of reliable information, the approximately 10,000 cases that are before me will be increasingly difficult to manage. Disputes will proliferate, and progress will be slowed. Depositions and other discovery will become necessary, as each side tries to prove facts that their separate databases treat in different ways. The cases will take years longer to progress towards trial or resolution. Expenses to each side will rise in uncontainable ways, making present complaints insignificant.

Opinion at 4.

We likely will see more courts marshaling resources, such as Special Masters and/or independent vendors, to create efficiencies and economies when warranted by E-Discovery in complex litigation and/or large class actions. Insurance companies, which often find themselves as parties to these types of lawsuits, as either plaintiff or defendant, may benefit from the additional resources, but must be mindful of the cost allocations associated therewith.

Read the Opinion

For further discussion of issues pertaining to the cost of discovery, readRadical Change to the Federal Rules Proposed By Trial Lawyers in the Wake of E-Discovery Costs May 15, 2009.