The leaseholder of the World Trade Centre (WTC), Larry Silverstein, has suffered a setback in his legal battle with insurers over how much should be paid out for the terrorist attacks.

A US federal judge has ruled that conversations between Silverstein's attorneys and insurance brokers are not protected by attorney-client privilege.

The insurance companies' lawyers have been wanting to question insurance brokers at Willis Group Holdings about the conversations they had after September 11 to see if the brokers were pressured to change their minds and back up Silverstein's account of how coverage was agreed upon.

This is important because their account supports Silverstein's argument that the attacks count for two events, not one, so he should receive two insurance payouts amounting to around $7bn (£4.6bn).

Silverstein's lawyers denied applying any pressure and argued that the confidentiality of their discussions with Willis was protected.

However, Judge John Martin rule against this, ordering Willis chiefs to disclose most of their discussions with the lawyers at Wachtell Lipton.

His ruling stated: "The privilege belongs solely to the client. The Willis employees who conferred with the Wachtell firm had no reason to believe they were talking to lawyers who were representing their interest."

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