On September 16, 2007, employees of contractor Blackwater USA opened fire in a crowded Baghdad traffic circle at Nisoor Square. They killed 17 unarmed Iraqi civilians, including a 9-year-old boy who was riding with his father. Many more were injured.
The company, which derives much of its profits from government contracts, asserts that its guards did nothing wrong that September day. But an FBI inquiry determined that Blackwater employees engaged in the firefight unprovoked, and no witnesses have disputed that. Furthermore, investigations revealed a pattern of lawless behavior by Blackwater and no clear process of accountability. The contractors had immunity from Iraqi law, and it was unclear which American laws applied to their behavior. In response to the shooting, the Iraqi government demanded an end to immunity for private contractors.
Blackwater, which changed its name to Xe (pronounced "zee"), has not been charged in the case. The company has more than $1 billion worth of federal contracts and task orders, according to a May 2008 estimate by the US Department of State. In 2009, Xe lost its security contract at the US Embassy in Baghdad, but the company still has CIA contracts, including one to load bombs and rockets on Predator drones at secret bases in Pakistan and Afghanistan.
A month after the shooting, the estates of three deceased victims and one survivor filed a lawsuit against the company in US federal court, under the Alien Tort Claims Act. The Plaintiffs' complaint (Complaint in Abtan, et al. v. Blackwater Security Consulting) makes several claims, including that Blackwater murdered and severely injured many innocent civilians on September 16, 2007, that the company used excessive and unnecessary deadly force, and that Blackwater destroyed important evidence after the shooting occurred.
Additional charges were filed under the Racketeer Influenced and Corrupt Organizations Act (RICO) in July 2009 by Iraqi survivors of Nisoor Square. They accuse Blackwater and chairman Erik Prince of encouraging employees to engage in a series of illegal acts "in the company's financial interests," including murder, destruction of audio and videotaped evidence, distribution of controlled substances, tax evasion, child prostitution, and weapons smuggling. The Virginia federal court consolidated this case with five similar lawsuits against Blackwater from other victims of the Nisoor Square shooting. The case is pending and updates are available on the website of the Center for Constitutional Rights, an organization representing the plaintiffs: http://www.justice.gov/opa/pr/2008/December/08-nsd-1068.html.
In December 2008, following an investigation by the FBI, the US Department of Justice filed criminal charges against five of the guards. The guards were subsequently indicted by a federal jury. A sixth guard pleaded guilty to voluntary manslaughter. The criminal trial is set to begin in February 2010, and is expected to address important questions about the role of private military contractors in war zone environments.
In November 2009, reports surfaced that shortly after the shooting, Blackwater sent bribes to government officials in Iraq to protect the company's license to operate in the country. Although it is unknown whether the bribes reached Iraqi officials, Iraq revoked Blackwater's license in Spring 2008. As of this writing, the company still works on temporary projects in Iraq. The company or its executives could face charges of obstruction of justice and violating the Foreign Corrupt Practices Act, which bans bribes to foreign officials. An investigation by the US Attorney's Office is pending.