New Orleans Files $77 Billion Lawsuit for Failed Levees

New Orleans, LAThe city of New Orleans has filed a $77 billion claim against the United States Army Corps of Engineers seeking compensation for losses incurred after failed levees resulted in flooding of the city.

In addition to the city's lawsuit, at least 34,500 other claims had also arrived in the New Orleans district office. In many cases, people are claiming that their homes survived Hurricane Katrina but were damaged in the flooding that followed the hurricane.

According to an article in the Los Angeles Times, the New Orleans electrical utility, Entergy New Orleans, which went bankrupt after Hurricane Katrina, has claimed $655 million, while New Orleans Sewerage and Water is seeking $460 million.

The New Orleans claim was filed on March 1st, which under the Federal Tort Act was the last day claims could be filed against the Army Corps. Claims must be filed before any lawsuits can be brought. The Corps now has six months in which do decide whether to accept, settle, or reject claims brought against it. After that point claimants will be able to sue in order to recover damages.

Claimants who filed against the Corps include the Orleans Parish School Board, which filed a claim for $455 million, and St. John the Baptist Parish School Board, which filed a claim for $119 million. According to an article in the Times-Picayune, the school board recently signed a one-year contract for property insurance at a rate almost seven times what it paid prior to Hurricane Katrina. Furthermore, the board will only have insurance coverage for $15.5 million of $122 million in property during some stormy weather conditions.

One lawsuit, which is seeking class-action status, has already been filed against the Corps. Victims whose homes were damaged by the failure of the 17th Street Canal allege that the Corps allowed dredging of the canal despite receiving warnings that dredging would make the walls less stable. They argue that the Corps was negligent in the construction and maintenance of the 17th Street Canal's floodwalls.

Hurricane Katrina hit New Orleans on August 29, 2005. In the aftermath many floodwalls collapsed, allowing flooding over most of New Orleans and causing death and massive destruction. Those people who did survive have had their lives uprooted over the past year-and-a-half. An editorial at usatoday.com reports that almost half of New Orleans' population prior to Katrina, which was around 455,000, has not returned to the city, and more are thinking of leaving.