## Facts

- Eighty-two workers employed in buildings surrounding the World Trade Center during and after the September 11, 2001 terrorist attacks brought claims for respiratory and gastrointestinal illness.
- The workers alleged that their illnesses resulted from working in close proximity to the disaster site and related dust and contaminants.
- The litigation proceeded in a coordinated federal proceeding in the Southern District of New York managing many related 9/11 exposure cases.
- The workers were represented by two law firms with significant experience handling mass-tort matters, including 9/11-related litigation.
- The parties conducted discovery before attempting to resolve the claims.
- Settlement negotiations occurred with the assistance of court-appointed special masters.
- The negotiations produced an aggregate settlement totaling more than $53 million for the 82 workers.
- The settlement provided for payments in different amounts under a detailed distribution plan that considered each worker’s employment location, medical condition(s), severity of injury, and health history.
- The workers’ attorneys agreed to reduce their contingency fee from 33⅓% to 25% and sought court approval of the fee arrangement and reimbursement of litigation expenses along with approval of the settlement.

## Issues

1. Whether the proposed aggregate settlement and allocation plan were fair and reasonable for the 82 workers given the individualized differences among claims and the risks of continued litigation.
2. Whether the attorneys’ reduced 25% contingency fee (and expenses) were reasonable and should be approved by the court.

## Decision

- The court approved the aggregate settlement as fair and reasonable.
- The court approved the allocation plan that varied payments based on work location, medical conditions, injury severity, and health history.
- The court approved the reduced 25% contingency fee and allowed reimbursement of litigation expenses as reasonable in the circumstances.

## Legal Principles

- A federal district court supervising coordinated mass-tort litigation may review a non-class aggregate settlement to ensure the resolution is fair and the process protects individual claimants.
- In assessing fairness, a court may look to factors commonly used in class-action settlement review as a reference point, including the stage of the case, discovery completed, litigation risks, and the rationality of the distribution method.
- An allocation plan is more likely to be approved when it uses claim-related criteria and differentiates awards based on medically supported conditions, severity, and exposure-related circumstances.
- Court involvement through special masters and a structured negotiation process supports approval by reducing the risk of collusion and by improving transparency in how settlement terms were reached.
- Contingency fees in aggregate settlements are subject to court scrutiny for reasonableness, including consideration of the results obtained, risks assumed, and work performed.
- A voluntary reduction from a higher contracted contingency percentage may support a finding that the requested fee is reasonable.

## Conclusion

In In re World Trade Center Lower Manhattan Disaster Site Litigation, the Southern District of New York approved an aggregate settlement exceeding $53 million for 82 workers alleging respiratory and gastrointestinal illness from working near the World Trade Center disaster site, and it approved a detailed allocation plan tied to individualized factors as well as a reduced 25% contingency fee and expenses after a fairness-focused review.


In re World Trade Center Lower Manhattan Disaster Site Litigation, 2015 WL 3606032 (2015)