By Mike Francis, The Oregonian The Oregonian

KBR Inc. enjoyed government-guaranteed immunity from claims that might be brought by anyone claiming the contractor’s actions in Iraq caused injury or death, according to a newly declassified 2003 military contract. 

But under the terms of the $662 billion defense appropriations bill Congress sent to the president Thursday, the military will be required in the future to inform the House and Senate Armed Services Committees when it grants immunity in such cases. If such language had been in effect when the KBR contract was signed, it wouldn’t have remained classified for 8-1/2 years.

“By forcing the Pentagon to conduct business with contractors out in the open, we are restoring a sense of public accountability for companies whose operations may endanger our troops,” said Rep. Earl Blumenauer, D-Ore., who along with Rep. Kurt Schrader, D-Ore., and Sens. Ron Wyden, D-Ore., and Jeff Merkley, D-Ore., have called for greater transparency in such contracts.

Army lawyers on Wednesday released terms of the amended contract under which the Army hired KBR to perform work to restore Iraq’s oil production in the early years of the Iraq war. Instead of standard language that excludes government liability for cases of “willful misconduct and lack of good faith,” the amended contract contains no such exclusion. Instead it says the government shall shield KBR from liability for claims by third persons “for death, personal injury, or loss of, damage to, or loss of use of property.”

The contract had been classified, but was released to lawyers whose clients include Oregon National Guard soldiers suing KBR after being exposed to potentially dangerous levels of a carcinogen at Qarmat Ali.

“By shining a light on these secret agreements,” Wyden said in a statement, “we are making sure that there will be no repeats of what happened to National Guard troops from Oregon and other states at Qarmat Ali in Iraq or anywhere else that troops are sent to protect private contractors.”

-Mike Francis

Houston Press| by Craig Malisow

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.

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.