The lessees of several World Trade Centre buildings have persuaded the US Court of Appeals for the Second Circuit to remand two damages issues back to the New York Southern District Court.

The defendants, including American Airlines, United Airlines and various airport security firms are being pursued for allegedly negligently maintaining airport security checkpoints on the morning of 11 September 2001, thus enabling terrorists to hijack flights AA11 and UA175 and to fly the aeroplanes into the Twin Towers. The Appeal Court held that the diminution in the plaintiffs’ leasehold interests had been improperly valued by the lower court, and that interest on the resulting damages had been under calculated: these issues are now referred back to Circuit Judge Hellerstein for reconsideration, thus (subject to any appeal) possibly paving the way for further recoveries from the defendants.

Large parts of the lower court’s judgment were upheld, including its ruling that New York Civil Practice Rules required the plaintiffs to offset their property damage insurance recoveries against the recovery from the defendants so as to reduce the corresponding damages award (and in this respect New York differs from the many jurisdictions where damages in tort are not diminished by the injured’s party’s insurance indemnity).

It was also affirmed that United Airlines had no liability in respect of flight AA11 and its destruction of 7 World Trade Centre. The two terrorists who had flown from Portland International Airport to Boston (Logan), before boarding flight AA11, had passed through the Portland security checkpoint where Delta Airlines (and not United Airlines) had responsibility for passenger screening. They had obtained boarding passes for flight AA11 at the American Airlines desk at Logan and passed through a further security screening checkpoint, operated by Globe Aviation Services under a contract with American Airlines. United Airlines therefore had no connection to flight AA11 or its hijackers.

The case is In re: September 11 Litigation, 2nd U.S. Circuit Court of Appeals, Nos. 13-3619, 13-3782.