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KBR Hails Court Ruling as Wartime Suit Protection


SAN FRANCISCO - KBR Inc (KBR.N) said a U.S. appeals court ruling would help protect the company from civil lawsuits stemming from its work done under U.S. military logistics contracts.

The Eleventh Circuit Court of Appeals ruled last Tuesday that KBR could not be found negligent in the case of a U.S. Army sergeant severely brain-damaged when a KBR fuel tanker he was escorting in a military convoy crashed in Iraq in 2004.

"Contractors facing these types of suits now have a useful appellate court precedent which affirms that significant tort protections exist where the contractors are executing military directed missions," Andrew Farley, KBR's general counsel, said in a statement on Monday.

Citing the political question doctrine, the appeals court found that adjudicating the plaintiff's claims in the case would require "extensive reexamination and second-guessing of many sensitive judgments surrounding the conduct of a military convoy in war time."

Apart from civil lawsuits by soldiers, KBR's conduct as a military contractor has been called into question by U.S. lawmakers as well as some investors.

In May, Houston-based KBR and Halliburton Co (HAL.N), KBR's parent company until two years ago, were sued by a pension fund accusing them of lack of oversight after a bout of scandals that the fund says destroyed value. [ID:nN14500012]

Lawyers in other civil suits against KBR said the Eleventh Circuit court's decision had more to do with the facts in that particular case.

Tommy Fibich, who represents the families of convoy-truck drivers killed or injured in Iraq, said decisions made by military commanders were different from the decision to allow drivers to leave the base in the first place.

"That is not a political decision, that is KBR's alone," Fibich said in a phone interview.

The Fifth Circuit Court of Appeals last year had ruled that the cases of the convoy-truck drivers' cases must be heard.

Mike Doyle, a Houston lawyer representing National Guard soldiers who are suing KBR over exposure to a toxic form of chromium in Iraq, agreed with Fibich that the two appellate court decisions appeared to run in contrast to each other, but also believed this was due to the facts involved.

(Reporting by Braden Reddall; Editing by Tim Dobbyn)

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