Business

November 30, 2012

War contractor: Feds should pay lawsuit damages

An Iraq war contractor that lost an $85 million verdict to a group of sickened U.S. soldiers has filed a lawsuit seeking to force the federal government to pay the soldiers’ damages.

In early November, 12 Oregon National Guard soldiers won the verdict against Kellogg Brown and Root, an engineering and construction firm that helped lead the reconstruction work in post-war Iraq. The soldiers were exposed to a toxin while guarding an Iraqi water plant.

In the new lawsuit, KBR also demands that the government pay more than $15 million in its attorneys’ fees.

At the heart of the suit is a so-called indemnification clause that KBR alleges it agreed to with the U.S. Army Corps of Engineers in March 2003. The clause was designed to protect KBR against “unusually hazardous risks” in its work in Iraq.

In a Nov. 16 filing in the U.S. Court of Federal Claims, KBR argues the clause makes the government responsible for the results of its actions in Iraq, including the Oregon verdict.

“Based upon an erroneous legal and factual analysis of the terms of the indemnification agreement, (the Army Corps) has refused to indemnify (KBR) for the costs of defending against the various third-party lawsuits,” KBR attorneys wrote, “and has refused to participate or assume direct responsibility in defending (KBR) in the underlying tort litigations.”

KBR said in the suit that it had no insurance to cover its wartime work, and the government’s refusal to involve itself in lawsuits constitutes a breach of the indemnification agreement.

A U.S. Army Corps of Engineers spokesman declined to comment Nov. 27, citing the ongoing litigation. Emails and messages to KBR were not immediately returned, and KBR’s attorneys declined to comment.

At least another 130 lawsuits are pending from soldiers in England, Texas, Indiana and West Virginia, as well as other Oregon soldiers who were present at the Iraqi water plant, called Qarmat Ali.

A jury found the company guilty of negligence for illnesses the soldiers who guarded Qarmat Ali, an oilfield water plant.

The three-week trial ended after just two days of deliberation by the jury. The suit was the first concerning soldiers’ exposure to a toxin the plant.

The soldiers said they suffer from respiratory ailments after their exposure to sodium dichromate, and they fear that a carcinogen the toxin contains, hexavalent chromium, could cause cancer later in life.

 




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