Con Ed, Insurers Sue Port Authority

Consolidated Edison Co. of New York and a group of its insurers sued the Port Authority of New York and New Jersey Sept. 10 in search of more than $314.5 million for damages to a substation that was demolished in the Sept. 11th attacks on the World Trade Center, according to a Reuters report.

Filed in Manhattan federal court, the suit alleges that the Port Authority did not properly and adequately enforce city and state fire safety codes and rules. It also alleges that the Port Authority failed to apply safe engineering practices and standards oftentimes used in New York City high-rise office buildings.

The Port Authority is the owner of the World Trade Center, while Silverstein Properties is the leaseholder. The substation, which included nine transformers and provided service to lower Manhattan, was destroyed when 7 World Trade Center fell to the ground late in the afternoon on Sept. 11.

The plaintiff insurers in the suit are: underwriters at Lloyd’s of London (LOL.UL), Aegis Insurance Services, Liberty International Underwriters, National Union Insurance Co. of Pittsburgh, and Nuclear Electric Insurance Ltd.

According to the suit, in 1983, 7 World Trade Center was created on top of and alongside the Con Ed substation. In 1999, New York City added a command bunker on the 23rd floor of the 7 WTC and multiple diesel fuels tanks were placed there along with electricity generators in the event of power failure.

The suit alleges that the Port Authority was negligent in permitting the diesel fuel tanks to be situated in the building and that the tanks and other combustibles were factors in its collapse.