Silverstein Files Suit Against IRI

NEW YORK CITY- The legal woes associated with the rebuilding of Ground Zero continue. Silverstein Properties Inc. filed suit Tuesday against Industrial Risk Insurers, the Connecticut-based insurance unit of General Electric, to compel IRI to fully satisfy its obligation to pay for the reconstruction of 7 World Trade Center, which was destroyed on September 11.

IRI has already paid Silverstein approximately $440 million to fund the construction of the new building and compensate Silverstein for business interruption losses and the suit relates to funding issues likely to arise at the end of 2004. The suit was filed as a claim in a suit that is already pending in the United States District Court for the Southern District of New York brought by a former tenant of 7 World Trade Center against IRI.

IRI was the sole insurer of 7 World Trade Center, which was covered by an $860 million insurance policy. IRI maintains that the policy covers five buildings, not just 7 WTC. Representatives claim Silverstein supplied them with that figure as the cost of replacing all of the buildings including the rental stream.