One Terror Attack, Or Two?

February 10, 2004 / 3:19 AM EST / AP

A lawyer for Travelers Indemnity Co. said Wednesday that one hijacked airliner could have felled both the World Trade Center towers because they shared a six-story basement and that the Sept. 11 attack merits only one insurance payout.

After a plane hit the first tower on Sept. 11, it "may well have rendered the second building unusable even in the absence of a second airplane," the attorney, Harvey Kurzweil, argued in a federal court hearing.

World Trade Center leaseholder Larry Silverstein is arguing that the attacks on the two 110-story towers constituted two events under his insurance policy. Consequently, he says, he should receive two insurance payouts of $3.55 billion each.

Barry Ostrager, a lawyer for Swiss Reinsurance Co., the trade center's lead insurer, agreed with the Travelers attorney that the destruction of the trade center towers was a single event. He called causation of the towers' collapse "a factually complex issue."

But Herbert Wachtel, Silverstein's lawyer, called the issue "a total and complete red herring."

Swiss Re, which was responsible for 22 percent of the coverage under the trade center's multilayer policy, filed suit on Oct. 22 asking Judge John Martin to declare that the two-plane attack on the trade center was one occurrence.

Silverstein countersued Swiss Re and filed a separate suit against Travelers.

Silverstein is seeking a summary judgment in the Travelers suit because, his lawyers say, the Travelers policy does not define the word "occurrence," and absent such a definition, they believe New York state case law is in their favor.

At Wednesday's hearing, the judge gave Wachtel two weeks to prepare his motion for summary judgment and Kurzweil two months to respond to it.

The judge also granted a request from Wachtel to add the names of 19 other insurers to Silverstein's suit against Swiss Re.