Uncle Sam could soon be writing another big check to a U.S. company, this time not for recession-related troubles but for civilian casualties five years ago in Iraq.
KBR may ask the U.S. government to reimburse it for legal bills if a jury decides the company failed to protect KBR truck drivers during a deadly April 2004 roadside attack, a lawyer for the Houston-based government contractor said.
Though no final decision has been made, lawyer Robert Meadows said, if the cases go to trial and result in a jury award, “it’s conceivable that KBR would look to the government to accept responsibility under its contract” with the company.
Such a prospect does not sit well with plaintiffs’ attorneys, who argue the government contractor should pay its own bills if held liable in the cases.
“It would be extremely rare for anybody to be able to turn the cost of their own negligence over to any other individual, much less the U.S. government,” said Tobias Cole, a Houston attorney representing Kevin Smith-Idol, a KBR contractor shot in the knee and hip during the attack.
But the idea is only hypothetical at the moment. KBR lawyers are preparing to file motions that will ask U.S. District Court Judge Gray Miller in Houston to dismiss the cases before they go to trial, Meadows said.
That could set up a key decision this summer, which could determine the fate of three cases that have been winding through the courts since 2005 and that could be precedent-setting for other civilian contractors pursuing claims against KBR.
The suits accuse KBR and its former parent company, Halliburton, of knowingly sending a convoy into a dangerous area where it was attacked on April 9, 2004. Six truck drivers died in what has been called the Good Friday massacre, a seventh is missing and presumed dead, and 15 were wounded.
The truck drivers caught in the ambush were delivering fuel under a multibillion-dollar 2001 contract — called the Logistics Civil Augmentation Program, or LogcapIII — in which KBR provided a host of logistical support services for U.S. troops in the Middle East, from building bases to serving meals.
In 2006, Miller dismissed the cases, agreeing with KBR that the court lacked authority to second-guess the military, which helped design routes for KBR truck convoys. But in May 2008, the 5th U.S. Circuit Court of Appeals sent the cases back to Miller, saying the lower court may be able to resolve the lawsuits without making a “constitutionally impermissible review of wartime decision-making.”
Since then, attorneys for the plaintiffs have deposed KBR officials, gathered company e-mails and searched for other documents to bolster claims that KBR knowingly put its workers in harm’s way.
They need to prove that point in order to refute KBR’s contention that the casualties are covered by the Defense Base Act, which offers the equivalent of workers’ compensation insurance to workers serving the U.S. military and caps payouts at certain levels.
The plaintiffs have “probably as strong a case as you can imagine” in challenging the Defense Base Act defense but still face a high hurdle in proving KBR intended to hurt workers, said Aaron Walter, an attorney with Herbert Chestnut & Associates, an Atlanta law firm that specializes in Defense Base Act cases.
Meadows, the KBR lawyer, said, “nothing supports the allegation that anyone at KBR did anything to intentionally harm fellow workers.”
Under KBR’s massive LogcapIII military-support contract, “all reasonable, allocable and allowable contracts costs relating to contract performance, including legal services, can be reimbursed to a contractor,” Linda Theis, a spokeswoman for the Army Sustainment Command, said in an e-mail. “This may also include settlement and judgment costs.”
But David Gunn, a Houston attorney who argued on behalf of the plaintiffs at the 5th Circuit last year, chides KBR for being intentionally vague on whether it will seek reimbursement from the government if the cases result in jury awards.
“I’d like them to be upfront about it and tell the world they plan to bill the taxpayer for their mistakes,” he said.
Heather Browne, a KBR spokeswoman, said it would be inappropriate to comment on the reimbursement question until there is a final decision in the convoy cases.
http://www.chron.com/disp/story.mpl/business/6510878.html
***Note: Ha! Apparently, I was able to sneak this past the Internet Police***
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