Less than 14 months after a devastating
apartment building fire in Conshohocken, Pa., left scores of
residents homeless, lawyers unveiled a global settlement worth more
than $36 million that will resolve all property damage and
About $27 million will go toward rebuilding the two Riverwalk
towers, a project now nearing completion and set to reopen in
November. The remaining $9 million must be approved by a Montgomery
County judge and will reimburse a class of tenants for their lost
property as well as satisfying insurers' subrogation claims for
payments already made to tenants who had insurance.
Attorney Robert J. Mongeluzzi of Saltz Mongeluzzi Barrett &
Bendesky, the lead lawyer for the class of tenants, hailed the
settlement as "an amazing result" and credited the work of mediator
James Melinson, a former federal magistrate judge now with
"This was one of the most challenging puzzles I have ever seen
and Melinson was everywhere, working tirelessly on this settlement
since July," Mongeluzzi said.
Early on in the litigation, Mongeluzzi said, the lawyers for all
of the major players agreed that it made more sense to work toward
settlement because the accidental cause of the fire was clear.
Workers on a building project across the street from Riverwalk
had been using acetylene torches to remove aluminum balconies,
Mongeluzzi said, and fire investigators later determined that
molten metal found its way into wood and sparked a fire after the
Mongeluzzi's associate, Patrick Howard, said the class
settlement will ultimately be handled by an independent claims
administrator and that members of the tenant class will be required
to participate in a claims process that will be designed to
reimburse subrogating insurers at the same time.
Under the terms of the settlement, Cavan Construction Co., whose
workers were determined to have accidentally started the fire, will
pay $16 million; Merion Construction, the general contractor, will
pay $11 million; Lynch 2 Inc., a construction management firm, will
pay $6 million; and O'Neill Properties Group, the owner of the site
where the fire originated, will pay $3 million.
Three additional defendants will pay sums ranging from $50,000
to $150,000, for a total settlement of $36.25 million.
Mongeluzzi said the three top-settling defendants had
contributed the entirety of their insurance coverage and that the
settlement is therefore likely to be deemed as good of a result as
the plaintiffs could have achieved.
The settlement also resolves subrogation claims brought by
attorney Robert A. Stutman of Fort Washington, Pa., who served as
liaison counsel on behalf of the subrogated insurance company
"This is an example of an excellent outcome as a result of the
pooled resources of our respective attorneys and experts," Stutman
Christopher Konzelmann of White & Williams represented
Riverwalk Realty Co., a unit of J.P. Morgan Chase Bank, which will
be paid $27 million in the settlement to reimburse it for the cost
Cavan Construction was represented by attorneys Marc B.
Zingarini of Weber Gallagher Simpson Stapleton Fires & Newby,
along with Donald M. Grimes of Kelly Grimes Pietrangelo & Vakil
in Media, Pa.
Merion Construction was represented by Philip D. Priore of
McCormick & Priore in Philadelphia; Lynch 2 was represented by
Elizabeth Horneff of Margolis Edelstein; and O'Neill Properties
Group was represented by F. Warren Jacoby, Julie Negovan, Mark E.
Opalisky and Elliott R. Feldman of Cozen O'Connor.