Opinion ID: 2512475
Heading Depth: 2
Heading Rank: 3

Heading: Whether the Proposed Settlement Payments Count Towards the Aviation Defendants' Liability Limits

Text: The WTCP Plaintiffs finally argue that the district court erred in crediting the settlement payments against the contributing Aviation Defendants' respective liability limits. They contend that ATSSSA's limitation only applies to payments for liability, and that the settlement payments here should not count because they were not determined on the basis of the Aviation Defendants' liability. We are not persuaded. When interpreting a statute, we must give terms their ordinary, common meaning and read them in their appropriate context. See Bilski v. Kappos, ___ U.S. ___, 130 S.Ct. 3218, 3226, 177 L.Ed.2d 792 (2010) ([I]n all statutory construction, unless otherwise defined, words will be interpreted as taking their ordinary, contemporary, common meaning. (internal quotation marks and alteration omitted)); see also Torraco v. Port Auth. of N.Y. & N.J., 615 F.3d 129, 142 (2d Cir.2010) (In the usual case, if the words of a statute are unambiguous, judicial inquiry should end, and the law is interpreted according to the plain meaning of its words. (internal quotation marks omitted)). The meaning of a word [or phrase] cannot be determined in isolation, but must be drawn from the context in which it is used. Strom v. Goldman, Sachs & Co., 202 F.3d 138, 146 (2d Cir.1999) (quoting Deal v. United States, 508 U.S. 129, 132, 113 S.Ct. 1993, 124 L.Ed.2d 44 (1993)). ATSSSA states in relevant part, liability for all claims ... shall not be in an amount greater than the limits of liability insurance coverage maintained by [an Aviation Defendant]. ATSSSA § 408(a)(1) (emphasis added). Liability, meanwhile, is defined as either: 1) [t]he quality or state of being legally obligated or accountable; or 2) [a] financial or pecuniary obligation. Black's Law Dictionary 997 (9th ed. 2009). Here, reading the term in context, it is clear that liability refers to a financial or pecuniary obligation that can arise through the settlement of claims. This reading of liability in § 408(a)(1) accords with the common understanding of liability insurance, which commonly provides for an insured's claim to arise once the insured's [legal obligation] to a third party has been asserted. Black's Law Dictionary 873 (9th ed. 2009) (emphasis added); see also 15 Holmes' Appleman on Insurance § 111.1 (2d ed. 2000) ([L]iability insurance protects the insured against damages which he may be liable to pay to third parties arising out of the insured's conduct. (emphasis added)). Settlements, in turn, reduc[e] the liability remaining under the policy. Duprey, 256 N.Y.S.2d at 989 (emphasis added). This reading also coheres with other provisions of ATSSSA Title IVnamely § 408(a)(4), which uses similar language to limit the liability of certain defendants for debris removal claims. While paragraph (4) specifies the limits of liability for such entities, paragraph (5) specifies a priority of payments for plaintiffs who obtain a settlement or judgment with respect to a claim or action to which paragraph (4) applies. ATSSSA § 408(a)(5) (emphasis added). If liability, as used in § 408(a)(4), referred only to payments for legally adjudicated obligations, paragraph (5) would be rendered meaningless, and the word settlement reduced to surplusage, since there could be no settlement... to which paragraph (4) applies under the WTCP Plaintiffs' reading. It thus makes better sense to read liability to include the settlement payments made here. The district court therefore did not abuse its discretion or commit an error of law in crediting the settlement payments against the contributing Aviation Defendants' limits of liability.