September 11th Victim Compensation Fund
| Company type | Government fund |
|---|---|
| Industry | Victim compensation |
| Founded | 2001 |
| Founder | U.S. federal government |
Key people | Kenneth Feinberg (Special Master) |
| Products | Financial restitution for 9/11 victims and families |
| Parent | United States federal government |
The September 11th Victim Compensation Fund (VCF) was established by the U.S. federal government through an Act of Congress shortly after the September 11 attacks in 2001. Its primary objective was to provide financial restitution to victims and their families in return for relinquishing the right to pursue legal action against airline companies such as American Airlines and United Airlines. Functioning similarly to the Social Security Administration, the VCF allocates a portion of the annual United States federal budget to settle claims under stringent oversight. Coverage includes medical care for respiratory conditions like asthma and sleep apnea, along with all types of cancer.
Attorney General John Ashcroft appointed Kenneth Feinberg as special master, entrusting him with the development of regulations and management of fund operations. The enabling legislation authorized payments totaling up to $7.375 billion, encompassing administrative expenses.
Establishment and Procedures
The Air Transportation Safety and System Stabilization Act (49 USC 40101) served as the legislative foundation for creating the September 11th Victim Compensation Fund.
Feinberg calculated compensation based on each victim’s projected lifetime earnings. Families who accepted settlements waived their rights to sue or appeal against airlines. Those unhappy with initial offers could request informal hearings, with Feinberg personally overseeing over 900 such cases. Ultimately, approximately $7 billion was distributed to 97% of claimant families. Settlement contracts contained provisions barring any future litigation against airlines concerning security or safety matters.
A notable issue arose because many victims were highly compensated professionals in finance, causing some families to perceive the settlement amounts as inadequate compared to potential court verdicts. This concern had to be balanced against the lengthy, complex, and uncertain nature of litigation, including risks that airlines or insurers might become financially insolvent.
It is important to distinguish this fund from similarly named entities such as the September 11th Fund and the World Trade Center Captive Insurance Company.
The eight-part Feinberg plan
In his book What is Life Worth?, Feinberg detailed an eight-step strategy implemented in administering the September 11th Victim Compensation Fund.
(i) Designate a specialist with profound expertise in mass tort mediation and settlements, drawing on Feinberg’s background in political advocacy and his role in Agent Orange compensation.
(ii) Follow Congressional directives mandating victim compensation proportional to estimated future earnings, supported by a dedicated team of accountants and lawyers handling each claim individually.
(iii) Gather all documentation, applications, and counterclaims to facilitate direct compensation, noting key distinctions from previous cases like Agent Orange.
(iv) Exercise informed judgment to ensure that no more than 15% of claimants receive 85% of funds, applying the principle of reducing disparities between the highest and lowest awards.
(v) Establish this program as a consistent precedent for future victim compensation efforts.
(vi) Uphold meticulous legal standards and intellectual integrity throughout the process.
(vii) Acknowledge continuous support from Edward Kennedy during fund administration.
(viii) Actively discourage lawsuits to preserve Congressional intent aimed at expediting victim compensation claims.
Additional compensation
Although the 9/11 Commission Report dismissed claims of Saudi Arabia’s involvement, several families pursued legal action against the Saudi government in 2016, seeking damages for wrongful death.
In February 2022, the Biden administration approved a $3.5 billion fund derived from Afghanistan’s government assets to benefit 9/11 victims. However, in February 2023, a U.S. court halted the allocation of these funds, stating that doing so would amount to acknowledging Taliban governance.
In popular culture
- Worth (2020 motion picture)
See also
Publications
- Kenneth Feinberg, Who Gets What: Fair Compensation after Tragedy and Financial Upheaval, PublicAffairs, June 2012, New York City, ISBN 9781586489779
- Kenneth Feinberg, What is Life Worth?: The Unprecedented Effort to Compensate the Victims of 9/11, Perseus Books Group, 2005, ISBN 9781586484514