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Injured workers sue contracting, insurance firms over injuries in Iraq, Afghanistan

In a 200-page complaint filed in federal court Monday, dozens of former government contractors injured in Iraq and Afghanistan accuse their old employers and insurance carriers of blocking or withholding their health benefits.

As ProPublica reported Tuesday, the $2 billion class-action claims security firms, support companies like KBR Inc., and their insurance providers “routinely lied, cheated and threatened injured workers,” while flouting the World War II-era law guaranteeing coverage for private workers supporting the U.S. military.

Reporter T. Christian Miller investigated how the wars in Iraq and Afghanistan have strained the system over the last few years, but the latest complaint may be the most far-reaching yet:

The lawsuit, believed to be the first of its kind, charges that major insurance corporations such as AIG and large federal contractors such as Houston-based KBR deliberately flouted the law, thereby defrauding taxpayers and boosting their profits. In interviews and at Congressional hearings, AIG and KBR have denied such allegations and said they fully complied with the law. They blamed problems in the delivery of care and benefits on the chaos of the war zones.

The suit names Houston-based KBR, Xe Services — the security firm formerly known as Blackwater — and Dyncorp International among the defendants, along with insurance giants AIG and CNA Global Insurance, the two major insurance providers for private workers under U.S. Department of Defense contracts.

Four Texas men are included as plaintiffs, along with others around the U.S. and South Africa. Their injuries include blast wounds from explosives, infected sandfly bites, post-traumatic stress disorder and traumatic brain injury.

Washington lawyer Scott Bloch, a former U.S. Special Counsel under George W. Bush, told the Texas Independent that he first heard about contractors’ troubles with their medical claims shortly after he started his private practice. Bloch represents former Blackwater employees in a separate case filed in June, also over medical benefits.

“My experience tells me it’ll require hundreds of millions of dollarsin damages for them to wake up,” Bloch said. He hopes this class action will eventually result in criminal and internal investigations, not only into the private companies named in the suit, but the government agencies that handle their contracts.

Contractors across the country continue fighting drawn-out cases over individual claims, and a 2009 House subcommittee hearing on health benefits for war contractors has brought little change in the law.

“This is a massive scandal, this is a bigger scandal than Walter Reed — much more wide-ranging,” Bloch said. “The light isn’t shining on it. The news outlets are like, ‘Well, we want the soldier’s stories. We want the guys carrying the guns with the sunglasses.’”

Houston attorney Gary Pitts has spent years on individual Defense Base Act cases involving some of the same companies and health issues — and testified before that House subcommittee hearing two years ago. While the types of injuries are different today than they were in 2004 — fewer truckers are injured by IEDs today — Pitts said the claims system remains just as difficult to navigate.

“We’re just sloggin’ away,” Pitts said. “Who knows how long this’ll go on?”

But grouping defendants together into class-action suit is a long shot for some claims in Bloch’s complaint, Pitts said, like allegations that workers were fired in retaliation.

“The trend of the courts over 10 to 20 years has been to make it harder and harder to bring a class action,” Pitts said. “I would say the odds are very very hard.”

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