Putting a Price on Sept. 11’s Human Loss

Michael James kissed his wife goodbye on Sept. 11 as she left for her two-hour train ride to New York City. Hours later, this loving husband became a grieving husband. Now, as the financial dust of America’s most deadly terrorist attack begins to settle, the 48-year-old New Jersey gym teacher has become a “lead case.”

James--whose wife, Gricelda, was killed on the 79th floor of the World Trade Center’s south tower--was one of 10 pro bono clients selected by the American Trial Lawyers Assn. in February to test the waters of the federal compensation program for relatives of those who died Sept. 11. He is expected to be among the first dozen or more awards--averaging $1.5 million each--to be announced as early as today.

For this small group, the complex paperwork is complete. Hearings have been held, experts consulted. And as a lead case out of a potential pool of more than 3,000 trade center applications for the dead and injured, James stands to receive more than $1 million.

“I guess you could say this is liberating, because I won’t have to deal with this situation anymore--a load off my shoulders, I guess, in a way,” James said.

He paused, trying to sum up the year he has had to think every day about Gricelda and the wrenching phone call she made to him from her office after the planes had hit, terrified that she was going to die.

“I am pretty sure that they have tried to do this in the best way they can,” James said. “But I don’t see there being a ‘best’ way. There is no best way.”

Kenneth R. Feinberg, the special master assigned to oversee the victims’ fund, said the initial awards were chosen because they were “the easiest, the most complete and those that came in first.”

More than 650 claims have been filed, he said, out of “roughly 3,300” possible submissions. Feinberg said many families may not have filed claims because they are still paralyzed by grief, and others may be waiting to see what the first awards look like. The government announced its first official settlement this month, a $1.04-million payment to the family of an unnamed male victim in his 20s.

Claimants relinquish the right to sue the federal government, Feinberg said, but may sue foreign nations or individuals. After the compensation program ends in December 2003, he said, “anybody who has not filed a claim is cut off.”

Once awards are announced, families may challenge the amount by requesting a hearing. When a settlement is accepted, a check usually will be delivered within weeks.

James and his lawyer said they believe his settlement will be somewhat below the average figure. Whatever the sum, James will split the money with Gricelda’s two adult sons from her first marriage. He also will make sure her elderly parents in Honduras are taken care of. He views the settlement with a sense of numbness.

“There’s no value, there’s no value for Gricelda,” said James, whose 44-year-old wife of three years perished in the real estate office where she worked as an administrative assistant. “If gold is the best that we have in this world, she was gold. If there’s something better than gold, she was that too.”

But the cold calculations of the compensation system left little accommodation for sentiment. The victims ranged from chief executives to busboys, from executives at the peak of multimillion-dollar careers to middle-aged women like Gricelda James, who earned $30,000 a year.

The daunting nature of the process of recovering damages was what prompted the trial lawyers to found TLC--Trial Lawyers Care. Volunteer lawyers have provided free legal assistance to about 1,300 relatives of victims.

In the case of Michael James, “we thought it would be beneficial to be a lead case, for Ken Feinberg to consider our case first,” said Anthony Marchetti Jr., who has represented James since February. “It’s a new law, and you can’t have a new law with every detail and every circumstance written into it. There are issues in which the master has to make policies.”

Eight years out of law school, Marchetti, 33, practices civil law in a small firm in southern New Jersey. The day after the towers collapsed, Marchetti knew he had to do something to help, and soon volunteered his legal services.

“I’m a lawyer. I don’t move metal. I don’t own a tractor and I can’t dig,” he said. “I care, and I wanted to do something.”

Soon after the tragedy, James received an emergency handout of “a few thousand dollars” from the Red Cross to help him pay credit card bills and his mortgage. The Red Cross also paid for James to fly to Honduras, where he held a memorial service for Gricelda and brought her 18-year-old son, Jairo Castro, back to the U.S. to live with her other son, Jacobo Castro, 26, in Boston.

Every two weeks, James received $1,200 from New York state’s Crime Victims Board. The Salvation Army gave him a onetime payment of less than $1,000. His weekly payment of $750 from workers’ compensation will be subtracted from the federal settlement.

According to Feinberg’s formula, any funds received from charitable organizations are not deducted from the federal settlement. Life insurance, however, is subtracted. Marchetti will not disclose the value of Gricelda James’ policy, saying only that after the offset, the claim he submitted on behalf of her family came to “somewhere between $1 million and $1.5 million.”

For months, Marchetti and Michael James often spoke daily. They drove to visit Gricelda’s sons in Boston, where they also consulted two forensic psychiatrists as well as an economist.

The cause of death for every World Trade Center victim is listed as “homicide,” and Marchetti’s plan was to follow the same strategy that would apply to any wrongful-death case.

Using calculations devised by Richard Weckstein, professor emeritus of economics from Brandeis University, Marchetti included more than $500,000 in “replacement services” in the Gricelda James claim. This encompassed her cooking, cleaning, bill paying, household chores, “all the things that she contributed that had financial value to her family,” Marchetti explained.

Marchetti maintained that Gricelda was about to make career changes that would have brought a big salary increase. She was taking classes, he said, and working to improve her skills and educational qualifications.

Weckstein said that Feinberg determined income loss by taking an average of the last three years’ earnings and projecting that figure with “reasonable estimates of growth.” In the case of Gricelda James, he said, “that would not really be appropriate.”

Weckstein prepared two parts to his presentation. In one, he followed the special master’s rules “to the letter.” In the second, he argued that Gricelda James would probably have increased her salary so much that “the ultimate number would be 20% or 30% higher.”

But Feinberg dismissed such computations as speculative. His mandate from Congress was straightforward: Start with “the economic loss of the victim;” then add noneconomic loss such as pain and suffering; then deduct “collateral” income sources, such as life insurance, pensions and workers’ compensation.

“And that is the number you get, tax-free,” Feinberg said.

Some of the deceased probably were contemplating career changes, said Feinberg, “but life is unfair. In order to compute economic loss, we need not to speculate but to look at the track record of the deceased. The guy who was the busboy who was 25 years old and who died leaving two children and a wife who now says he was about to go to medical school--she can complain that he was going to be a neurosurgeon. But we can’t compensate for hypotheticals and speculation.”

Another Boston economist, Evan Schouten, worked as a volunteer to help Feinberg craft his formula. She said the evaluation was based strongly in the law’s tradition of awarding payments for wrongful death.

“This isn’t a novel approach,” said Schouten, who lost a colleague on the first plane to hit the World Trade Center. “But it is an approach we’re not used to seeing for 3,300 people. It is only astonishing because ... we have to put a busboy up against a CEO, or a 63-year-old up against a 22-year-old.”

One technique the special master adopted, Schouten said, was to eliminate race and gender from salary projections--basing all calculations on earning levels of white males, the most highly paid group of workers.

Feinberg described the application process as rigorous--and cumbersome--because so much documentation is required. Congress placed no cap on the fund, which could run between $4 billion and $7 billion, Feinberg noted. By some estimates, private charities may add another $1 billion to the amount doled out.

“You’re talking about giving away billions of dollars, tax-free,” he said, “so fill out the 30-page form.”

The compensation system, said Michael James, is just that: a complicated process that ultimately ascribes a dollar figure to a loved one’s life.

“I discussed it sometimes with her sons. I told them, the only way that we can get compensated is through money,” James said. “We just have to go through with it.”

Some days that is harder than other days. Some days, his energy evaporates and he cannot fill out one more form. He still has not returned to work. Maybe in January, he said.

“Before, Gricelda and I were so happy. We were so happy with our house. I was so happy, just cutting the grass,” he said. “All of that is gone. You lose a lot of motivation. You want to understand that people have organized to help, but it is just too much. Dealing with compensation and so forth, it gets to you, and you don’t want to deal with it anymore.”

Still, on June 28, James’ lawyer was able to submit to the special master a 2-inch binder filled with papers about the life of Gricelda James. On the cover was a photograph of the wife whom James first met more than 35 years ago when both were children in Honduras.

Then, on July 8, Marchetti met with Feinberg. “He was gracious, he was more than patient with us,” the lawyer said. “But we had a time slot.”

To keep his perspective--and perhaps his sanity--Michael James thinks of the award as “just a gift from Gricelda.”

He said, “We need to move on. We need to get this step over with so we can move on. I don’t want to drag it on, I really don’t.”