LOS ANGELES, Feb. 4, 2005 (PRIMEZONE) -- Los Angeles World Airports (LAWA) will receive $5.9 million from an insurance company for business interruption damages incurred as a result of the terrorist attacks of September 11, 2001. It is believed to be the largest payout by an insurance carrier to a U.S. airport for business losses relating to 9/11.
"We are pleased to recover a significant portion of our business interruption losses relating to the airport closures caused by the terrorist attacks," said Cheryl Petersen, president of the Los Angeles Board of Airport Commissioners. "Our airports were shut down for several days and did not return to their previous levels of activity for a considerable period. The compromise settlement validates LAWA's contention that we were entitled to a payout under our insurance policy."
LAWA submitted a claim for its losses to its insurance carrier and its representative, Westport Insurance and Industrial Risk Insurers, for financial losses sustained at Los Angeles International and Ontario International airports when the Federal Aviation Administration closed all U.S. airports in the wake of the terrorist attacks. The insurance companies denied the claim and LAWA filed a lawsuit that was scheduled for a jury trial later this year.
A mediator proposed the settlement of $5.9 million in favor of LAWA. The parties agreed to accept the mediator's proposal subject to approval by the Los Angeles Board of Referred Powers, LAWA's governing legislative body in this case. The matter was referred to the Board of Referred Powers, consisting of five Los Angeles city councilmembers, because a member of the Board of Airport Commissioners is a partner in one of the law firms representing LAWA in the matter.
In recommending the settlement to the Board of Referred Powers, Managing Senior Assistant City Attorney Eduardo Angeles said, "This compromise is the approximate mid-point, or average, of LAWA's best and worst case scenarios as projected by its experts."
Los Angeles World Airports is a Los Angeles City department that owns and operates four airports: Los Angeles International (LAX), Ontario International (ONT), Palmdale Regional (PMD), and Van Nuys (VNY).