Holding the Checkbook

By Josh Tyrangiel

Ken Feinberg has a big personality, and he is hit or miss on first impression. He missed with Steve Campbell, a New York City police officer whose wife was killed in the World Trade Center collapse. "Your offer spits on my wife, spits on my son and spits on my father-in-law," Campbell told him during one of Feinberg's first Manhattan meetings with the families of Sept. 11 victims. The Campbell meeting was not rock bottom. "Staten Island," says Feinberg. "Staten Island was the worst. Very, very heated. Just awful. It's on CNN; I've got the tape if you want it."

As special master of the Federal Government's September 11th Victim Compensation Fund, Feinberg has to put a price on lost life. It may be a heartrending calculus, but it is, in the end, just calculus. Lawyers and actuaries worked out payment structures for catastrophic death decades ago, and--with a few modifications for cost of living, income and dependents--anyone can discover his or her approximate postmortem value with a 10- second glance at a statistical chart. Feinberg's challenge is to convince the 9/11 families that even though the country has valorized their husbands, sisters, sons and mothers because of their ghastly death, the dollars Feinberg will pay them will be a reflection of who their loved ones were--and what they earned--in life.

"In some respects this case is one of the easiest I've ever done," says Feinberg, 56. "There's a relatively finite number of claimants: 3,000, maybe 3,200. There's no causation problem here, not really. These people were injured or killed by traumatic injury--instantaneous. It's the emotion. The emotional proximity between this program and the event makes this an unprecedented, difficult assignment because people, understandably, see no reason to be reasonable. Why should they be? What happened to them was not reasonable."

Feinberg is not the first person you would pick to comfort the aggrieved. He has a jagged intellect that does not easily abide dissent; he is a leading candidate for the title of World's Most Competitive Human; he is completely unfamiliar with hushed, conciliatory tones (even in intimate moments, his thick Boston accent and habit of applying verbal italics to every third word make Feinberg sound as if he is in the midst of a perpetual rant). He is, not surprisingly, a very successful lawyer.

Raised by a bookkeeper mother and tire-salesman father in Brockton, Mass., Feinberg was the family ham. He went to the University of Massachusetts with thoughts of becoming an actor until he considered the merits of a weekly paycheck and enrolled at New York University Law School. After clerking for New York Court of Appeals Judge Stanley Fuld in 1970, Feinberg landed a job in the office of Senator Edward Kennedy, and then took a job with a big firm. Feinberg was on his way to becoming "just another Washington lawyer," as he puts it, until a bit of acting changed his legal career.

"I saw him do a satire of Judge Fuld that had the entire room--40 clerks and Judge Fuld--in hysterical tears," says U.S. District Judge Jack Weinstein. "That marked him in my mind. Years later, when the Agent Orange case was in front of me and I needed somebody to try and settle it, I reached back in my mind to Ken because he was not only brilliant, but he had a particular sense of humor that would make people want to work with him."

With no previous mediation experience, Feinberg settled Agent Orange--a decade-long case pitting veterans against Dow Chemical, Monsanto and the U.S. government over the use of a toxic defoliant in Vietnam--in six weeks. Soon other judges and lawyers were asking him to step between warring parties, and in cases ranging from the faulty birth-control device Dalkon Shield to asbestos exposure, Feinberg got the job done, more or less inventing the field of mass tort mediation as he went along. "The secret to Ken's success," says a judge who has worked with Feinberg on a number of occasions, "is that he knows when to listen and when not to. He'll hear proposals from both sides, then ignore everybody and find a middle ground he thinks is fair. Then he devotes himself to lobbying the claimants toward his proposal. And let me tell you, he could make a mint as a lobbyist."

The mint has been made. The Feinberg Group, with offices in New York City and Washington, is one of the top mediation practices in the country, and Feinberg has been known to receive seven-figure fees for his expertise. When Attorney General John Ashcroft asked him to be the special master of the compensation fund in December, Feinberg accepted pro bono.

Congress was moving quickly when it created the fund as part of the airline-bailout package on Sept. 21. The idea was not just to avoid the political nightmare of victims' families' getting eviction notices but also to keep the economy from buckling under the weight of potential litigation. Thus anyone who receives money from the fund must waive the right to sue the airlines or the government. For the sake of the claimants and the economy, it was resolved that the fund would move quickly, with an application deadline of December 2003.

Feinberg moved quickly too. As his first order of business, he scheduled large introductory meetings with the families. The meetings did not go well. In most settlements, the moment of injury or death and the discussion of a settlement take place years apart, giving the aggrieved time to cope with their loss. The Victim Compensation Fund did not have that luxury. "These people lost family members just weeks before in the most horrific circumstances," says Jeanne Marks, a psychologist and friend of Feinberg's who has met with several of the families. "They lost total control of their lives, and then Ken comes in and presents them with a plan that [Congress] has already drawn up. That just increased how powerless they felt, and they really vented on him."

Poor timing was not the only problem, though. In meeting after meeting Feinberg came across as arrogant. "The guy walks in," says one Pentagon widow, "and he's obviously smart, but the way he spoke seemed like he was treating this as just another case. I wanted to scream, 'This is not just another case! This is Sept. 11!'" Months later Feinberg says, "I would have done some things differently," though he doesn't elaborate on exactly what. Dede Feinberg, Ken's wife of 27 years, believes her husband's demeanor was misunderstood. "He tries to give off this attitude of strength because he wants to be somebody you can believe in to pull this whole thing together," she says. "Unfortunately, people don't know him, and this gets perceived as cynical or flippant. It's not. It's just a survival technique he's developed over the years from listening to one trauma after another."

Whether Feinberg's hard shell is personality or professional affectation, it was cracked soon enough. During a Jan. 16 session with families from Cantor Fitzgerald, which lost 658 employees in the World Trade Center collapse, Feinberg turned pale and had to be helped to a seat by Cantor Fitzgerald CEO Howard Lutnick. At a meeting shortly thereafter, a man asked Feinberg if he should fill out one or two applications for the fund because his wife was eight months pregnant when she died. Feinberg, who has three grown children, was near tears.

The news that Feinberg was human spread quickly via e-mail among the families, and, coincidence or not, the relationship between the special master and those he serves has been smoother since. "The families still ask the same demanding questions," says Stephen Push, whose wife died on Flight 77 when it crashed into the Pentagon. "But he's getting better at fielding them. It takes a lot of sensitivity to deal with people who are grieving as much as we are, and he's improving."

Feinberg, who spends hours on the phone talking to victims and their lawyers, has not sought counseling as a result of hearing horror story after horror story, and he is skeptical of any attempt to depict him as transformed by Sept. 11. "I honestly do not believe that I've been surprised by any of it," he says matter-of-factly. "I went through Agent Orange, which was pretty rough, and I anticipated on this assignment that it would be rough emotionally, and it has been. But I'm not surprised." What Feinberg will admit is that the experience has caused him to recalibrate his job description. "In dealing with these claims," he says, "you're only 10% lawyer. You're 40% rabbi and 50% shrink."

From a practical point of view, Feinberg's ability to help claimants is limited. A few of the fund's more controversial regulations--the litigation waiver; life insurance must be deducted from any potential payout--were designed by Congress. But how much each family receives is at Feinberg's discretion. Claimants can appeal Feinberg's decision--to Feinberg or to one of 30 specially appointed hearing examiners--or they can reject it and sue, although Congress has stacked the deck against any lawsuit's succeeding. Congress also neglected to put a cap on how much Feinberg can give the families. (Feinberg expects to award a total of $4 billion to $6 billion.) "The absence of a cap," Feinberg says, "means that I've got to be aware of what is fair not only from the claimants' point of view but from the taxpayers' point of view. I take both responsibilities very seriously."

In an attempt at fairness to all constituencies, Feinberg decided that everyone would receive the same amount for pain and suffering: $250,000. He says, "Some people said, 'I want more; my husband was a hero.' Others said, 'My husband called me four times from the 103rd floor to say goodbye.' Some were heroes; some saved others; some tried to save themselves. I'm not in a position to make distinctions amongst those people."

Where he can and must make distinctions is in the personal circumstances of the deceased. Feinberg's actuarial tables show that a 30-year-old decedent with a wife, a child and a stockbroker's $80,000 annual salary will suffer $2,521,248 in economic losses. But life isn't a statistical table. The stockbroker's death meant more lost income than a window washer's, but what if the window washer cared for a mentally retarded child? How much should his family be compensated for lost services?

Applications to the fund have been slow to come in, but the roughly 650 that have arrived show a dizzying array of exceptional details, such as complicated medical conditions, psychological problems, dependent parents and spouses who are now the lone child-care provider and have yet to return to work. In the days before the first awards were handed out, Feinberg, who usually sleeps four hours a night, was down to just three, fretting over the fact that the families will receive his judgments not just as a payout but as an epitaph for their loved ones. "It's very, very important that I be fair," he says. "If I am--and I think I will be--I think 90% will come to the fund."

On Aug. 7, Feinberg issued his first award, $1.04 million to the family of an unmarried recent college graduate who earned $60,000 a year and died at the World Trade Center. The family's attorney, Roberta Gordon, said that her clients were not happy. They could never be happy. But they thought that Feinberg's award was "eminently fair." One down, 3,199 cases to go.