NBC News and news services
updated 11/29/2006 9:11:59 PM ET 2006-11-30T02:11:59

A federal judge on Wednesday ordered the Federal Emergency Management Agency to immediately resume making housing benefits available to the thousands of evacuees of Hurricanes Katrina and Rita.

U.S. District Judge Richard Leon said FEMA failed to adequately explain why it ended the 18-month housing assistance program for people who lost their homes in the 2005 storm.

Judge Leon has ordered FEMA to immediately restore short-term housing assistance benefits to all evacuees who as of August were found ineligible for benefits. Also, the judge has ordered FEMA to pay each of these evacuees the short-term assistance benefits they would have otherwise received from September to November 2006.  The request for a preliminary injunction was brought by the Association of Community Organizations for Reform Now (ACORN ) on behalf of several thousand evacuees of Katrina and Rita.

The judge wrote in a 19-page opinion that FEMA violated the due process rights of those hurricane evacuees who were denied long-term housing benefits "by failing to provide them explanations that were sufficiently detailed to enable them to file a meaningful appeal."

Judge: Agency relief efforts 'Kafkaesque'
Leon added, "It is unfortunate, if not incredible, that FEMA and its counsel could not devise a sufficient notice system to spare these beleaguered evacuees the added burden of federal litigation to vindicate the constitutional rights."

The judge called FEMA's bureaucratic process for evacuees to apply for relief "Kafkaesque."

It is the second court victory for Katrina victims this week. A federal judge in Louisiana said Monday that many homeowners might be entitled to more insurance money for flood damage.

"It is unfortunate, if not incredible, that FEMA and its counsel could not devise a sufficient notice system to spare these beleaguered evacuees the added burden of federal litigation to vindicate their constitutional rights," Leon wrote.

Survivor stories
In his ruling, Leon cited statements submitted by evacuees describing the ordeal.

"The reasons I have been given for the termination are not what is in the documents and/or the reasons change each time I call," said Carmen Handy, an evacuee whose statement was cited. "Every time I call back, the person answering the call knows nothing about what the previous person told me."

Leon's ruling came in a case brought in August by the Association of Community Organizations for Reform Now, which said more than 11,000 families would be affected. FEMA did not immediately have data on how much the ruling would cost and said it was considering its legal
options.

Getting the word out
ACORN spokesman Charles D. Jackson said the agency was trying to spread word about the ruling through the scattered communities of evacuees, some of whom were left homeless by FEMA's decisions.

In Louisiana, U.S. District Judge Stanwood Duval Jr. sided with New Orleans homeowners who argued that the language in some insurance policies that excluded water damage was ambiguous. He said a suit against The Allstate Corp., The St. Paul Travelers Companies Inc. and other insurers could go forward.

Duval said the policies did not distinguish between floods caused by an act of God -- such as excessive rainfall — and floods caused by an act of man, which would include the levee breaches following Katrina's landfall on Aug. 29, 2005.

For some, a glimmer of hope
If successful, this suit could cost insurers $1 billion in Louisiana alone, industry officials said, and could lead to similar suits elsewhere. Insurers pledged to appeal.

The ruling was hailed by Xavier University, a historically black college in New Orleans that was inundated by six feet of water when nearby levees gave way. Xavier sued Travelers after the company only paid for a fraction of more than $50 million in damage to the school.

"When you pay for as much insurance as you can, you never dream that this kind of a catastrophe wouldn't be covered," said school President Norman Francis. "This ruling gives us a glimmer of hope."

NBC News' Joel Seidman and The Associated Press contributed to this report.

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