WASHINGTON – Corporations could avoid costly tort litigation by creating voluntary compensation funds similar to the one for the victims of the September 11 terrorist attacks, said the special master of the fund, Kenneth Feinberg.

Lawmakers and industry officials should study the September 11 Victim Compensation Fund as they attempt to rein in costly tort litigation, which President Bush has called a “lawsuit abuse crisis,” said Mr. Feinberg, who was appointed by the White House to distribute $7 billion to families of victims.

Many potential plaintiffs would be willing to forego costly and lengthy court battles in exchange for swift settlements of their claims, he said. The costs of such a system would be more predictable for defendants than jury awards, he said.

“American industry ought to take a look at creating a voluntary compensation scheme,” Mr. Feinberg told a conference devoted to examining the lessons learned from the fund and applying them toward tort reform. The conference was organized by the Manhattan Institute’s Center for Legal Policy.

The fund could also be a model for dealing with the growing number of claims from victims of asbestos poisoning, he said. The Senate Judiciary Committee is attempting to create a trust fund to deal with the growing number of asbestos claims, whose costs are predicted to be more than $100 billion.

“It is a scandal that they haven’t passed an asbestos bill,” Mr. Feinberg said.

The September 11 Victim Compensation Fund was established by Congress in the wake of the terrorist attacks. To participate in the fund, families of victims had to sign away their rights to sue defendants such as airlines and buildings and agree to receive fixed compensation, as determined by Mr. Feinberg.

The fund, which finished processing claims in June, handled 7,300 claims from 97% of affected families. The average award was $2 million tax free. Fewer than 50 families chose to bypass the system and launch independent lawsuits, Mr. Feinberg said.

Conference participants said there were numerous lessons from the fund that could provide alternatives to litigation in areas such as pharmaceutical side effects or medical malpractice.

“I think the 9/11 model may be a model for tort reform,” said a former general counsel to the Food and Drug Administration, Daniel Troy.

Mr. Troy said a similar fund could be created to give swift compensation to victims of adverse drug effects, while sheltering drug makers from unpredictable jury awards in cases where drugs were approved by federal regulators.

Several conference participants said that, using the September 11 Fund as a guide, compensation funds should have: a single administrator with broad discretion to set awards, a clear timeline for decisions, and a transparent system for setting compensation that allowed victims to be heard.

The compensation amounts should be consistent, or preferably identical, fixed amounts, Mr. Feinberg added.

But there are some aspects of the fund’s success that would be difficult to copy in other areas of tort law.

The biggest obstacle may be replicating the sheer generosity of the taxpayer-paid compensation, which was motivated by a unique tragedy and a united nation.

“In one sense, there is no lesson here,” said Mr. Feinberg. “I could solve almost every tort in the United States if you gave everyone two million dollars tax free,” he said.

Moreover, the money came from federal Treasury funds, without an appropriations battle in Congress.

“I didn’t have the problem of taking from Peter to pay Paul,” Mr. Feinberg said.

Families of terrorism victims also faced other incentives to participate in the fund: lawsuits related to the attacks would have to take place in federal court in New York, and there were various caps on the liability of the defendants, such as airlines and security companies.

“The 9/11 model is instructive, but obviously not a template you can use for all tort reform issues,” said the director of the center, James Copland.

For example, set compensation funds could reduce the financial incentives for medical practitioners and manufacturers to take precautions to protect patient and consumer safety, several participants cautioned.

Trial lawyer Richard Bieder, who headed a group of layers that provided free legal services to more than half the victims’ families, called the fund “highly successful” and said he would not quarrel with creating similar funds for other purposes, as long as victims were free to accept compensation or launch lawsuits.

“I am against taking away rights that have been part of the American scene for years,” he said.