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Declassified KBR Contract Shows How It Gets a Free Pass for Willful Misconduct

A KBR government contract protected the company from liability for injuries or deaths caused by willful misconduct, according to recently declassified Army documents.

Although the existence of the clause was revealed as a part of a lawsuit filed in 2009, the actual document remained classified until this week. The contract is a key point in the federal suit, filed in Texas by Houston attorney Mike Doyle on behalf of 136 Indiana, South Carolina and West Virginia National Guardsmen (and British Royal Air Force officers) who were allegedly exposed to cancer-causing chemicals while providing security at an Iraqi water treatment plant in 2003.

Two Guardsmen have died, seven have developed respiratory system tumors and others are experiencing serious respiratory issues as a result of the exposure, according to the suit. (Doyle is also involved in a sister suit in Oregon, involving 34 Oregon National Guard soldiers.)

The indemnity clause requires the government to cover the cost of litigation against KBR, even if the company (then still a part of Halliburton) was at fault. In the water treatment plant suit, the guardsmen claim they were exposed to a highly toxic chemical called hexavalent chromium, and that KBR lied to the soldiers about the chemical's presence and any associated health risks.

KBR has denied any wrongdoing.

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Approximately 1,000 Army soldiers and civilian employees were exposed to the chemical while working at the Qarmat Ali facility in 2003, "and many remained unaware of their exposure until 2008," according to a September 2011 report by the Department of Defense's Office of Inspector General.

"Contractor recognition of, and response to, the health hazard represented by [the chemical] contamination, once identified at the Qarmat Ali facility, was delayed," the report states. "The delay occurred because KBR did not fully comply with occupational safety and health standards required by the contract...."

However, the indemnity clause appears to absolve KBR of any financial liability. This prompted Oregon Representative Earl Blumenauer to co-author an amendment in the National Defense Authorization Act of 2011 calling for the Pentagon to notify Congress of future indemnity clauses.

"We already know from what happened at KBR's Qarmat Ali project that these secret bailout deals are bad for our soldiers and a bad deal for taxpayers, and anything that puts more protections in place is a good step," Doyle said of the act's amendment.

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