WPBN: A federal judge on Tuesday overturned a federal rule that only provided economic losses as compensation for the Hermits Peak-Calf Canyon disaster, allowing victims to receive several hundred million dollars for the psychological suffering caused by the 2022 disaster.
In late August 2023, the Federal Emergency Management Agency released final regulations announcing that it would not be providing victims of the federally caused wildfire with so-called “noneconomic damages.”
This implied that the almost $4 billion that Congress had allotted for victims could only be used for tangible items, such as a destroyed home, lost revenue from businesses, smoke damage, and animals that were lost.
However, a number of legal companies sued FEMA, claiming that it was disregarding the law established by Congress to establish a compensation scheme as well as the law in New Mexico.
They contended that in addition to monetary damages, state law allows victims of trespass and nuisance, which they claimed the fire amounted to.
A legal struggle over what the government owed to families who lost property, livelihoods, or more in the largest wildfire in New Mexico history began in October when attorneys for thousands of clients filed a complaint.
Judge James O. Browning’s 99-page decision was anticipated. In mid-October, he indicated that he did not agree with the Federal Emergency Management Agency’s explanation for the payout cap.
However, his decision on Tuesday granted plaintiffs all of their requests and went one step further, stating that FEMA “unlawfully withheld” money owed to victims and requiring FEMA to find a means of compensating people who claimed these losses.
He had the option to just scrap the regulation and return it to FEMA for revision, which might have started a lengthy rule-making process.
“The Court sees no sound reason to remand the Plaintiffs’ claims to FEMA for further determination after concluding that the Hermit’s Peak Act allows recovery of noneconomic damages,” he stated. “and that FEMA’s Hermit’s Peak Regulation precluding recovery of noneconomic damages is unlawful.”
According to plaintiffs’ lawyer Antonia Roybal-Mack, the strong decision was “a little surprising.”
“It’s very telling, a little surprising. It really shows that the federal court was aware that FEMA has been stalling, is not as efficient as it needs to be,” she stated.
Another attorney for fire victims, Gerald Singleton, had calculated that the noneconomic losses incurred by thousands of people in the burn scar were worth $400 million.
In anticipation of the decision, he and other firms have submitted narratives detailing the frustration, inconvenience, and emotional suffering that clients experienced during the fire, in addition to their other losses.
What comes next is unclear. The United States Attorney’s Office and FEMA have two options: either follow the order or appeal the decision to the 10th Circuit Court of Appeals.
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Additionally, Congress is considering an additional $1.5 billion for victims, and the decision comes only three days before the deadline for filing notifications of loss.
Even though FEMA has already disbursed slightly more than $1.6 billion, that would raise the total compensation to $5.45 billion. The application deadline for compensation is this Friday.
