December 04, 2012

Wyden Amendment to NDAA Forces Pentagon to Disclose Contractor Indemnification Agreements

Washington, D.C. – The U.S. Senate today passed the National Defense Authorization Act of 2012 that contains an amendment written by U.S. Senator Ron Wyden (D-Ore.) that will require the Pentagon to disclose and justify to Congress any contracts that contain indemnification clauses that hold military contractors harmless of acts of negligence.

Last month, a jury ordered defense contractor Kellogg, Brown and Root (KBR) to pay $85 million in damages to troops negligently exposed to toxic levels of sodium dichromate in Iraq. Under a previously-classified indemnity clause in their contract KBR was allowed to sue the Federal government to recoup those damages and pay their court costs. Wyden’s amendment ensures that Congress is not left in the dark about clauses that leave the taxpayer holding the bill for a contractor’s malfeasance.

“What KBR received -- and Oregon soldiers and the American taxpayers may be stuck paying for -- is a get out of jail free card that no one outside of the Pentagon had any say in giving them,” Wyden said. “Thanks to that plum deal, KBR could be let off the hook after negligently exposing Oregon servicemembers to toxic chemicals. Some indemnification agreements are justified, but many are not, and the Pentagon should have to justify these agreements to Congress.”

In the run up to the Iraq war, the engineering firm KBR secured a contract with the Department of Defense containing a classified clause freeing the contractors from all financial liability for misconduct on the job and allowing KBR to pass on all of their legal costs to the U.S. government. The firm was found liable last month in Portland for negligently exposing Oregon guard troops to toxic levels of sodium dichromate at the Qarmat Ali water treatment facility in Iraq.

Wyden secured other amendments to the NDAA including one requiring a study on “soft landing” reintegration proposals. Soft landing is a term for programs that make it easier for National Guard and Reserve members serving in war zones and their families to better adjust to civilian lives. Wyden has advanced soft landing proposal in the past including efforts to give those returning servicemembers the same access to mental health services offered to active-duty soldiers, job search aide and pay as they transition from guard service to civilian employment.