I came accross this July 11, 2008 story from the Washington Business Journal.

It tells the sad tale of 12 men from Nepal hired by KBR subcontractor, Daoud & Partners to work in a luxury hotel in Jordan. Unfortunately, these men were forcibily re-directed, if not kidnapped, by the subcontractor and sent to Iraq to serve as cheap labor at US military bases. In an even more unfortunate turn of events, the men were kidnapped by insurgents and eventually killed.

The case is a good example of how wide the reach of the Defense Base Act really.  It does not merely provide coverage for workers ON military bases. It covers all employees of contractors working for/with the US government, including both US Citizens and foreign nationals.

One thing to note though is that whether you are from Nepal, Germany, Russia, or Houston, Texas, the DBA provides that your weekly benefits will be paid in US dollars. Given the state of the US Dollar, that isn’t always a good thing.

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View the entire article in context at: http://washington.bizjournals.com/washington/stories/2008/07/14/story3.html?b=1216008000%5E1666656

Last month, in a somewhat surprising decision, U.S. 5th Circuit Court of Appeals reversed a District Court ruling that employees of KBR could not sue their employer in tort.  The opinion involved the so-called “Good Friday Massacre” where several truck drivers employed by KBR lost their lives when attacked by insurgents.  The plaintiffs sued KBR alleging, among other things, that KBR had falsely and fraudulently induced them to come to work in Iraq with the assurances of KBR that they would be completely safe.  The U.S. military was responsible for the protection of the contractors and KBR’s defense contractors used this fact to convince the lower court to dismiss the suit.

The theory behind the dismissal was the trial judge’s opinion that the plaintiff’s could not prove their case without necessarily bringing into question the Bush Administation’s policies and strategies for protection of civilians in Iraq.  This being the case, the claims of the plaintiff’s necesarily involved “political questions” regarding the Executive branch and the Judicial branch, the courts, are prohibited from interfering in the function of the Executive branch. 

While the theory of the defense was creative, it was a very harsh result due to the the facts of the case .  The plaintiffs in the suits (four suits were consolidated and decided together) alleged that KBR had assured potential employees that they would have “[f]ull 24 hour a day U.S. military protection…” to insure safety and that employees would be “…100% safe.”  On April 8, 2004, plaintiff Kevin Smith-Idol was injured when his convoy was attacked by insurgernts.  The next day, several more trucks were sent on the same route resulting in more injuries and deaths to KBR employees.  There were allegations that the route had been closed by the military and the Army had been engaged in a 48 hour battle with over 300 insurgents.  In summary, KBR sent unarmed civilians into not only a “war zone” but an active battle.

In its decision, the 5th Circuit disagreed that there was no plausible set of facts whereby the plaintiffs could prove their case that also did not involve an inproper intrusion into the Executive Branch.  Interestingly, the Court gave several factual scenarios which would allow the plaintiffs to succeed, at least at to the political question doctrine.  However, the court also specifically did not rule on whether KBR had valid defenses under the “exclusive remedy” provision or other defenses it raised.

The good news is that the case is alive - the bad is that the plaintiffs are not out of the woods yet.  If the attorneys for the plaintiffs can avoid the several pitfalls which most always arise when suing a government contractor in a war zone, it would open up KBR and its associated companies to many other suits outside of the Defense Base Act.

It is difficult enough to hire an attorney when you are familiar with the legal issue and the lawyers you deal with.  When an individual has been injured and needs a workers’ compensation or personal injury attorney for the first time, it is almost impossible to know if you are selecting the right attorney.  Ironically, in most cases, whether you have selected a good attorney will only be determined when the case is over.  The five questions below will not insure that your attorney is competent or the best lawyer for your case.  It will give you some insight into the type of attorney you are hiring.

The decision that you make in hiring an attorney will have more to do with the eventual result than any other decision you make on the claim.  Most people make this decision on the type of ad someone has in the phone book or what commercial they see or hear on television or radio.  Just because an attorney appears in these mediums is no reason to either hire or reject them.  Hire someone you feel comfortable with and confident in.  Hopefully, the suggestions above will be helpful.

Herbert J. Chestnut, Esq.

June 19, 2008

1.  How many years of experience do you have?  This seems to be an obvious question but it is amazing how infrequently it gets asked.  Experience is the key to the practice of law.  The old adage is that, with a lawyer, you pay for the grey hair.  The more experience an attorney has, the more likely that he or she has had a case similar to yours.  However, every professional must start somewhere.  If your case is assigned to a young associate, make sure that someone with experience supervises the case.

2.  What percentage of your practice is in this area of the law?  The practice of law is becoming more and more specialized.  It stands to reason that an attorney who chooses to concentrate his or her practice in a single area know that area better than one who tries to do a little of everything.  It is very difficult in this day and time to be a “jack of all trades.”  Also, relationships between opposing attorneys does play a part in the successful resolution of a case.  The more specialized an attorney is, the more likely he or she is to know the opponent if the case goes to litigation.

3.  Do you have malpractice insurance?  This question is almost never asked but should be.  However, if you have work done on your house, one of the first question you would probably ask is “Do you have insurance?”.   If the worst happens and your attorney commits malpractice, you do not want to try to collect from an uninsured individual.  Also, if he or she has no insurance, there may be a reason such as previous successful malpractice claims.

4.  When I call your office, will I talk to your or one of your staff?   While paralegals and secretaries are important to any successful practice, they are not lawyers and are not a fair substitute for speaking directly with your attorney regarding important issues in your case.  This is not to say that you should always expect to talk to your lawyer when you call.  However, some firms rely solely on paralegals after the case begins.  The client sees the lawyer when the firm is retained and maybe when the case settles.  You entrusted the attorney with your case, not his or her staff.

5.  Will you try my case yourself?  Often, high volume lawyers never see the inside of a courtroom.  If the case needs to be tried, they will either withdraw from your case or refer it to someone else.  In a “volume” practice, it takes too much time to try a case as opposed to settling it.  What they sacrifce as far as the recovery on a single case, they make up in sheer numbers.  These practices are referred to as “mills”, grinding out settlement after settlement.  However, when your opponent knows that your lawyer is not willing to take your case to court, the chances of you receiving maximum value for your case is far less.

I have been reading a lot of comments throughout the internet cheering the recent tort suits against KBR regarding the Good Friday Massacre and also potential sodium dichromate exposures.

See  - “Hoist by their own petard” and “Suing the crap out of KBR.”

Part of their argument is that KBR should not be able to “hide behind” what has been described by many bloggers as the “archaic World War II-era law” protecting KBR from liability for injuries to their employees in Iraq. That law, of course, is the Defense Base Act (as an extension to the Longshore and Harbor Workers’ Compensation Act).

It has recently come to light that KBR was running a bit a tax scam on the United States. Some surmise that this means KBR is admitting they are not a US Corporation and are therefore not entitled to “hide behind” the Defense Base Act. Several bloggers appear to figuratively point their fingers and laugh at KBR for their arrogance in trying to both benefit from US law and foreign tax benefits.

I have no love for KBR. I have already been critical of their unique tax accounting. Additionally, I have been critical of AIG, the insurer in 90% of DBA cases. They overcharged contractors for DBA insurance, at least for the first couple years of the war. Those bills were passed directly to US taxpayers, who essentially pay these premiums for every contractor over in Iraq/Afghanistan. 

But, back to the topic at hand -  lets say KBR, now a foreign corporation, should be found unable to claim refuge from negligence based personal injury actions by its employees. (NOTE: Even under the DBA, KBR could be sued in a personal injury/tort action if the injury were due to intentional actions by KBR). This would mean that the Defense Base Act does not protect KBR. Yeah! Lets all cheer and rejoice!

But wait, lets consider what this means. KBR is the largest US Contractor in Iraq. 1,000+ US Contractors have been killed in action in Iraq and over 10,000 have been injured. Over 11,000 claims have been filed under the Defense Base Act, and a large portion of these have been involving KBR. If The DBA does not apply to KBR the thousands of injured or deceased employees and their families would no longer receive income benefits or medical treatment under the laws of the Defense Base Act. Compared with similar state systems of Workers’ Compensation, the Defense Base Act is quite favorable. This would be a catastrophic loss for thousands of people.

What would be gained? Tens, maybe hundreds of contractors could sue KBR directly alleging specific negligence on KBR’s part which caused their injuries. However, most injuries occuring overseas to contractors are not due to anyone’s negligence. They range from the kind of back injury you could get lifting something in your own backyard to a bullet wound from enemy fire. Thousands of common injuries would no longer be covered so that KBR could be opened up to personal liability in the few situations in which their actions were truly negligent.

In case some readers (possibly international readers) did not know, every state in the US has a Workers’ Compensation system. It is the exclusive remedy for injured employees to recieve compensation (cash or medical). In other words, except in RARE circumstances, you can’t sue your employer because you are hurt. Whether this is a good system for employees/employers I will leave for another day. The fact is - it is there.

If KBR was as reckless and possibly intentional in some of its actions, as media reports indicate, I hope and pray that those contractors and their families are capable of sueing KBR directly for damages in those cases. However, for those who simply cheer bad news for KBR, think about who the Defense Base Act and its Workers’ Compensation system helps before you root for its demise as some archaic WWII systems magically used to insulate KBR from suit. The DBA is as much there for the the individual contractors as it is for KBR.