Cantor Fitzgerald has agreed to settle a lawsuit against American Airlines Group Inc. and its insurers over business and property losses stemming from the Sept. 11, 2001, attacks on the World Trade Center, in which the Wall Street company lost 658 employees.
The settlement in principle averts a trial that had been slated to begin next month, and was disclosed by lawyers for both companies at a hearing on Thursday in the U.S. District Court in Manhattan. Terms were not disclosed.
U.S. District Judge Alvin Hellerstein will consider approval at a hearing on Jan. 13, 2014, court records show.
Hellerstein oversees much of the litigation stemming from the Sept. 11 attacks, including cases involving the World Trade Center’s developer, victims, property owners and Ground Zero workers. The attacks caused close to 3,000 deaths.
Cantor lost nearly two-thirds of its roughly 1,000 local employees after American Airlines Flight 11 struck the World Trade Center’s north tower, where the financial services company had occupied the top floors.
The company had at one time sought $1.1 billion of damages in its lawsuit against American, but that sum was later reduced to between $464 million and $489 million.
John Stoviak, a partner at Saul Ewing representing Cantor, told Hellerstein that “we have reached an agreement on the terms of a settlement,” according to a hearing transcript.
Desmond Barry, a partner at Condon & Forsyth representing the airline, said the settlement requires dozens of signatures and approval from insurers around the world, but that the money has been collected and is being held in escrow.
Cantor had accused American of negligence for failing to prevent hijackers, including ringleader Mohamed Atta, from boarding Flight 11 at Logan International Airport in Boston and eventually crashing the plane.
The lawsuit was originally filed in 2004, and focused on business interruption and property losses.
In seeking to dismiss the case, American had contended that it had no way to predict the attack.
American also said the hijackers’ intervening criminal acts, “let alone the actions of fanatical terrorists engaged in a holy war against the United States,” broke any link between its alleged negligence and Cantor’s business losses.
Cantor confirmed the settlement on Friday. A spokesman, Robert Hubbell, declined to elaborate.
The former AMR Corp, the parent of American Airlines, merged this week with US Airways Group Inc.
The cases are Cantor Fitzgerald & Co et al v. American Airlines Inc. et al, U.S. District Court, Southern District of New York, No. 04-07318; and In re: Sept. 11 Property Damages and Business Loss Litigation in the same court, No. 21-mc-00101.