Full Court Review Requested In KBR Contracting Case

Whistleblower Seeks Release of Documents that Demonstrated Contracting Fraud during the War in Iraq

Washington, D.C. July 28, 2014. Today, Mr. Harry Barko, a whistleblower who alleged that defense contractor KBR had engaged in widespread fraud during the War in Iraq, requested the full U.S. Court of Appeals for the District of Columbia Circuit to review a major court ruling that impacts the integrity of corporate compliance programs nation-wide.

In the case, In re: Kellogg Brown & Root, Inc., et al, a three-judge panel of the Court ruled that corporations could keep internal corporate compliance records secret under the attorney-client privilege, even though the documents demonstrated widespread defense contracting fraud. The documents in question contained direct evidence of bid-rigging, conflicts of interest, and overcharging the U.S. Government by KBR during the Iraq War.

A federal district court judge had ordered the release of the documents finding that the compliance documents were business records and they were not created to obtain legal advice, but the three-judge panel of the appeals court reversed, significantly expanding the ability of corporations to conceal internal compliance documents.

“If the Court’s initial ruling is sustained, companies will be able to use compliance investigations to hide fraud and discredit whistleblowers,” stated Stephen M. Kohn, the KKC Partner and one of the attorneys for the whistleblower who had requested that the documents be released.