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DOJ says Iraq CPA contractors can be sued for profiteering in US

[JURIST] The US Department of Justice [official website] claimed Friday in court papers that contractors for the former Coalition Provisional Authority [official website] in Iraq can be sued for profiteering under the Federal False Claims Act [text]. Lawyers for the US government contend that the Act, enacted to curb war-profiteering, applies to contracts issued by the CPA from its inception shortly after the invasion until it handed over power to the interim government last June. The brief followed a hearing involving a fraud lawsuit against the security firm Custer Battles LLC [Official website] brought by two former employees who claim that the firm scammed CPA out of nearly $50 million. The Justice Department lawyers argued that because US government and military officials distributed the funds, fraud against the CPA is tantamount to fraud against the US government. Lawyers for Custer Battles maintained that they could not be sued in the US over seized Iraqi funds. The company and the former employees have until April 15 to file briefs when a US District judge will decide whether to dismiss the case. AP has more.

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Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

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