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KBR sues US Army after losing case to Oregon National Guardsmen

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The US Army resists KBR’s attempt to “gobble” up more taxpayer dollars as KBR cries “fowl” and sues the US Army Corp of Engineers (USACE) after they refuse to indemnify the “turkey’s” [KBR's] legal fees from exposure of Oregon National Guard troops and others to sodium dichromate at Qarmat Ali, Iraq. If I were the Army, I would be saying “Stick a fork in ‘em [KBR], they’re DONE!” (OK….that’s all the Thanksgiving cliche’s for now.)

On November 2, 2012, an Oregon federal jury ruled that KBR must pay $85 million to 12 Oregon National Guard members who allegedly suffered emotional distress after the company exposed them to sodium dichromate at Qarmat Ali.

Each guardsman was awarded $6.25 million in punitive damages after the jury determined that KBR “acted with reckless and outrageous indifference to a highly unreasonable risk of harm and conscious indifference to the health, safety and welfare of others,” as well as $850,000 in non-economic damages.

KBR quickly responded:

This is a jury verdict, and not a final judgment in the case. The potential KBR financial impact is unknown until a final judgment is entered by the U.S. District Court for the District of Oregon, which may differ from the jury verdict. Following the final judgment, KBR’s actions may include appealing the decision, seeking to enforce KBR’s indemnity rights under the Restore Iraqi Oil contract with the U.S. Army, and seeking reimbursement for all incurred costs for which KBR is entitled pursuant to the contract under the Federal Acquisition Regulations. The timing of the final judgment and ensuing KBR actions are unknown at this time.

The Project on Government Oversight (POGO) reported in July 2012 that KBR was informed as early as November 18, 2011 the US Army would not indemnify KBR for litigation cost resulting from chemical exposure at Qarmat Ali:

Excerpt from letter (pdf) signed by John H. Rogers-Army Contracting Officer dated November 18, 2011

KBR, as the subject matter expert in oil field issues, was responsible for assessing conditions at each site to which it was sent and taking appropriate action to prevent exposure of any personnel at the site to industrial and environmental hazards. Although the general remediation of pre-existing environmental hazards was beyond the scope of the work contemplated by the contract, it was fully within the authority of KBR to take any actions necessary to protect personnel at the site from exposure to such hazards. KBR obviously understood this, as they moved out with corrective action without receiving prior consent from the contracting officer once they identified the hazards presented by sodium dichromate at Qarmat Ali.

For all these reasons, I continue to believe that any litigation costs that KBR incurs as a result of this litigation are not covered by the classified indemnification agreement. Furthermore, as you know, the Army has taken the position that it will remain neutral in these lawsuits. Accordingly, I must again decline your request that the USACE acknowledge that any recovery will be covered by the classified indemnity agreement and request the Department of Justice to assume responsibility for defense of these suits.

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4 Comments

  1. Comment by KBR Watch:

    KBR should know, that the indemnity was as illegal as if they were paying a bribe to DCMA contracting officers. Once again, this shows the U.S. Army is operating far outside the law and making their own rules. Bottom line, just because a contracting officers put it in the contract – doesn’t mean it is legal. KBR is just finding that out that some of their ” arrangments ” and behind the scenes schemes just are not legal. This is as irresponsible of KBR as not having fully armored cabs on their tractor trailer rigs and expecting that the Defense Base Act Insurance IS their management planning. Killem’ Baggem and Replacem’

    • Comment by KBR WATCH:

      How many other KBR Qui Tams are hidden under seal you have to wonder.

      DOJ ( Erik Holder ) – why are you holding up trials that will recoup taxpayer money for overcharging ? Where is the First Kuwaiti money that should have been recovered. Do you really only depend on the Agency coming to you. The report clearly states that to repair the shoddy workmanship where the Army Corp of Engineers and the State Department colluded to have First Kuwaiti build this unnecessary embassy, the United States taxpayer is owed $ 120+ Mil and yet Holder sits on his hands once again – why Holder. Time to go Holder.

  2. Comment by leo:

    Let’s me get this right kbr was giving a contact that there where the subject expects. There a contacter it was there call not to do the right thing working for Kbr not hard just do the right thing and stand by it. You will not make friends but are you there to make friends.

  3. Comment by ssg (ret/u.s. army)jericho n beauchamp:

    Ok,what about the rest of us.I got a stage 4 cancer to my throat that wasn’t suppose to be in me for another 30 years.guess I won’t be seeing that much cash.how do we start our litigation case?I was active duty for 14 years army and this ruined my career and changed me drastically.for 4 years I have been in a state of shock over this,40lbs less still.when the hell am I and the rest of us going to get our piece.I have to live with more than a quarter of my neck gone because of the shortcuts others take burning debri.that’s bs!they took me from what I loved,working with soldiers and took a damn good leader from them.I lost my juggler vein,95 lymph nodes,longmuscle along neck,all on right side.wth am I gonna get,prob less than others on emot5ional stress.yep I’m pissed.I have suffered long enough.I have nuerological damage in my neck called radiation damage which will last for several years.I have a statement from my oncologist stating I’m not suppose to have this cancer.I nearly dies from chemo and radiation to survive and get screwed by our govt and getting cut on my % for disability,not combat related,but “service connected from iraq”u don’t get crap for service connected.that’s crazy service connected and iraq r in the same sentence!I have been patient for too long.19136025218 is my cell.I need what they have taken from me back.I have lost a crapload of money because I don’t make as much as I did and the govt deducted(va) 10% off of my disability already.how is that when the ppl doing this are 100% wrong?how?bs!like I wrote I could really use this towards my kids future,the debt of making less and cutting me 6 years short of my pay and retirement while serving my country in iraq.I got the irs on my butt and never had issue like that until I retired.this cancer crap has caused a chain reaction of events that has bee a emotional,mental,physical and financial hell for me.when I call congressmen,they never calll back.that’s total crap how we r treated and america needs to know.so where do I start,so I can get some doggone justice??-ssg(ret)jericho n beauchamp/u.s. army retired.

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