If a Congressman from Oregon has his way, then American taxpayers would not be expected to foot the legal bills for private military contractors like the former Halliburton subsidiary that allegedly allowed dozens of National Guard troops to be poisoned by a dangerous chemical in Iraq.
Legislation introduced to Congress by Rep. Earl Blumenauer (D-Oregon) on Wednesday would require the military to notify Congress before accepting substantial legal liability on behalf of its contractors and prevent contractors guilty of gross negligence from winning new contracts.
The legislation could spell trouble for Kellogg, Brown and Root (KBR), the massive contractor that was secretly granted liability immunity as part of at least one wartime contract since 2001.
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KBR has since split from Halliburton, its former parent company, and faces a list of lawsuits based on serious allegations, including poisoning soldiers with fumes from open burn pits in Iraq, allowing soldiers to be electrocuted in showers with faulty wiring, failing to protect female soldiers from sexual assault, participating in human trafficking, and the list goes on.
“KBR’s repeated negligence has endangered our troops and cost lives,” Blumenauer said. “Such a long record of alleged misconduct indicates to me that KBR did not fear being held responsible by anyone. Our war contracting process does too little to ensure that contractors act with the best interests of our troops and taxpayers in mind, and we’re going to change that.”
Last year, 26 National Guard troops in Oregon filed a lawsuit against KBR claiming they got sick after KBR managers failed to properly alert them to the presence of a rust remover containing hexavalent chromium, the same cancer-causing chemical famously fought by Erin Brokovich, at a water treatment facility in Iraq where the guardsmen were providing security for the contractor.
The legal proceedings revealed that KBR had secretly secured a clause that could make the government and its taxpayers responsible for the court costs and damages awarded to the sick soldiers. National Guard members in Indiana and West Virginia have filed similar lawsuits against KBR.
In a correspondence with the Department of Defense (DoD), Representative Blumenauer discovered that the Bush administration had provided KBR with a secret indemnity agreement making the government liable for damages arising from a no-bid, multibillion dollar contract given to KBR to restore Iraq’s oil production infrastructure soon after the initial US invasion.
The DoD told Blumenauer that the details of the indemnity agreement would remain classified.
Blumenauer responded last week with another letter requesting the DoD declassify the secret indemnity agreement made at a time when US interests were poised to take control of Iraq’s lucrative oil fields.
In his original August 31 response to the Congressman, Army Secretary John McHugh wrote that secret indemnity provision provided in KBR’s lucrative Restore Iraq Oil (RIO) contract was the only of its kind issued by the Army, and that KBR had not filed any claims under the provision.
Blumenauer’s latest response demands information about indemnity agreements provided to contractors hired by any military department, not just the Army. He also asked for a list of lawsuits and instances in which the government has bailed out private contractors for their own negligence.
The Congressman also asked for information on any government payouts associated with an annual defense bill, suggesting that KBR may not be the only contractor eligible for indemnity:
It has come to my attention that contractors may have been granted indemnification using a second type of authority, granted annually since 2003 as part of the Defense Appropriations bill, whereby “contracts entered into under the authority of this section may provide for such indemnification as the Secretary determines to be necessary.”
The results of Blumenauer’s probe and the response to his legislation remain to be seen, but the lawsuit alleging KBR is responsible for the illnesses suffered by 26 soldiers carries on in an federal district court in Portland.
David Sugerman, the independent attorney representing the sick soldiers, wrote in his blog that the government’s classified indemnity agreement with KBR does not excuse the contractor from defending itself in court.
KBR has tried to have the case dismissed twice, and most recently a federal judge ruled against a KBR attempt to dismiss the case on August 30, finding that KBR personnel knew about the hexavalent chromium at the Qarmat Ali plant and even brought more material containing the chemical to work with and store at the facility.
On September 14, The Oregonian’s Julie Sullivan reported, in a surprise move, KBR’s defense team tried a unique legal maneuver and attempted to appeal the case before the trial. If the appeals court accepts, the case could be delayed for years as the court decides whether a contractor can be sued at home for acts committed while serving the military overseas.