Wachtell Lipton buys more time in Twin Towers insurance battle

Herbert Wachtell of Wachtell Lipton Rosen & Katz, acting for the leaseholder of the World Trade Center (WTC) Larry Silver-stein, has won his application for the trial on whether the attacks on the towers represented one or two events to be postponed until next year.
As first reported on www. thelawyer.com/lawyernews on 1 October, Wachtell, head of the firm's 53-strong litigation department, wanted to adjourn the trial, which was set to begin on 4 November, until an appeal court reviews Southern District judge John Martin's recent summary judgment in favour of three insurance companies.
That judgment held that documents signed before 11 September clearly indicate that the insurance purchased for the buildings covered damage by “one cause or one series of similar causes”.
Wachtell also hopes to reverse an April ruling that found the one or two-event issue should be decided by a jury rather than a judge.
Meanwhile, hundreds of reinsurers are gearing themselves up for claims to hit the UK. These claims should be assisted by a early neutral evaluation scheme drawn up by Michael Payton, senior partner of Clyde & Co, which aims to be more effective than mediation or litigation.
Silverstein, a childhood friend of Wachtell, took over the lease on the WTC just under two months before the attacks. He hired the well-known broker Willis Group Holdings to find coverage to satisfy his lenders, and came up with an insurance cover of $3.55bn (£2.3bn) split between 25 insurers.
By 11 September, final policies had not been circulated to any of the 25 insurers. The insurers' claim that Willis's insurance form, which states that the more damage that can be lumped into one occurrence, the fewer deductibles policy-holders will have to pay, prevails. Wachtell favours the policy of one of the 25 insurers, Travelers Indemnity Company, which allegedly states that the WTC collapse constitutes two events.
Two Bermudian insurers have paid out their policy cover for one event worth $350m (£222.9m) to Silverstein. US federal judges are desperately seeking to settle the case without trial.
Next year's trial will bring in Simpson Thacher & Bartlett acting for Swiss Reinsurance, which underwrote around 22 per cent – $780m (£496.8m) – of the WTC insurance. The war of words between Simpson's litigation head Barry Ostrager and Wachtell includes allegations of “unconscionable interference by Wachtell” and “corruption of the discovery process”.