Blackwater suit to stay in arbitration, court rules

NORFOLK

A federal court has ordered a hearing on the deaths of four Blackwater Worldwide guards in Iraq back to private arbitration, likely shielding the contractor from a public investigation into the bloody 2004 ambush.

The 4th U.S. Circuit Court of Appeals on Friday dismissed a petition by the families of the Blackwater guards to move the case into public courts.

Blackwater lawyers have argued that the men signed contracts that required disputes to be resolved by confidential arbitration. The dispute will be settled by a three-person panel.

Company spokeswoman Anne Tyrrell said the ruling reaffirms the company's decision to handle the dispute privately, as called for in the contracts. "The federal courts have now honored those written agreements," she said.

Scott Horton, a visiting professor at the Hofstra University School of Law, said the ruling will be beneficial to Blackwater and other contractors. The confidential hearings protect the company's reputation and the settlements are generally smaller, he said.

Horton has testified before Congress about the issue of private contractors' liability for employee injuries and deaths in war zones. Employees' limited access to courts "clearly raised a lot of concern," he said.

Four Blackwater guards - Stephen Helvenston, Mike Teague, Jerko Zovko and Wesley Batalona - were ambushed and killed in Fallujah, west of Baghdad, in March 2004. The images of their mutilated bodies hanging from a bridge sparked a massive offensive by U.S. troops in the city.

A representative for the families of the four men sued the company in January 2005, claiming Blackwater broke its contract by failing to provide proper equipment and security while the men were in hostile territory.

The case was ordered into arbitration in April 2007. Lawyers for the families appealed a month later.

A three-judge panel from the Court of Appeals ruled the court did not have jurisdiction over the appeal of the case. Unless the lawyers for the families choose to appeal further, the confidential arbitration panel will resume work on the case.

Lawyers for the families did not respond to requests for comment.

The three-person arbitration panel includes William Webster, who was a director of the FBI and CIA under President Ronald Reagan; Edward Dreyfus, a New Jersey patent lawyer; and Jean Kalicki, an attorney specializing in international arbitration based in Washington, D.C.

Louis Hansen, (757) 446-2322, louis.hansen@pilotonline.com