## Facts

- Five Nepali men worked on a U.S. military base in Iraq for KBR, Inc., a U.S. defense contractor providing logistical support to the U.S. Army in Iraq under the LOGCAP III contract.
- The workers alleged they were promised jobs in Jordan but were instead trafficked to Iraq in 2004 and subjected to forced-labor conditions.
- The workers alleged a Jordanian subcontractor, Daoud & Partners, recruited and supplied laborers for KBR’s Iraq operations.
- The complaint alleged that KBR personnel in the United States:
  - analyzed staffing needs in Iraq,
  - controlled recruitment and the supply of workers through the Jordanian subcontractor,
  - supervised medical clearances,
  - set pay rates,
  - set policies for equipment used by the workers,
  - paid the Jordanian subcontractor,
  - received reports from multiple sources about trafficking,
  - developed responses to trafficking allegations, and
  - directed how those allegations should be handled.
- The workers alleged KBR’s U.S.-based personnel did not stop the trafficking and profited from it.
- The workers sued KBR in federal court in Texas, asserting claims including:
  - civil claims under the Trafficking Victims Protection Reauthorization Act (TVPRA),
  - claims under the Alien Tort Statute (ATS),
  - Iraqi-law claims, and
  - Texas tort claims (including negligence-based theories and intentional infliction of emotional distress (IIED)),
  - and sought injunctive relief.
- KBR moved to dismiss under Rule 12(b)(6), arguing (among other defenses) that the TVPRA and ATS could not reach the alleged foreign conduct and injuries.

## Issues

1. Whether the TVPRA provisions invoked by plaintiffs (based on 2004 conduct, before the 2008 amendments) applied to alleged trafficking and forced labor occurring abroad, or were barred by the presumption against extraterritorial application and non-retroactivity.
2. Whether plaintiffs plausibly stated an ATS claim that “touch[es] and concern[s]” the United States based on alleged U.S.-based planning, direction, payments, and responses to trafficking reports, including under aiding-and-abetting and corporate-liability theories.
3. Whether the TVPRA displaced or otherwise barred an ATS remedy for the same alleged trafficking-related misconduct.
4. Whether plaintiffs stated a basis for forward-looking injunctive relief where the alleged trafficking injuries were past events abroad.
5. Whether, at the pleading stage, limitations defenses and contractor-immunity arguments (including reliance on CPA Order 17) required dismissal of the remaining Texas and Iraqi-law claims.

## Decision

- The court **granted in part and denied in part** KBR’s Rule 12(b)(6) motion.
- The court **dismissed plaintiffs’ TVPRA claims**, holding that the TVPRA provisions at issue, as they existed before the 2008 amendments, did not apply to the alleged extraterritorial conduct and injuries, and the later amendments did not apply retroactively.
- The court **denied dismissal of the ATS claim**, concluding the complaint plausibly alleged sufficient U.S.-based conduct connected to the alleged law-of-nations violations to proceed past the pleadings, and rejecting KBR’s arguments against corporate and aiding-and-abetting ATS liability at this stage.
- The court **declined to hold that the TVPRA barred the ATS claim**, allowing the ATS theory to move forward despite dismissal of the TVPRA counts.
- The court **dismissed the IIED claim**.
- The court **rejected the request for injunctive relief**, finding no present or imminent injury supporting forward-looking relief based on completed harms.
- The court **left other claims in place at the pleading stage**, including various Iraqi-law and negligence-based claims, declining to dismiss them on limitations, tolling, or CPA Order 17 grounds based solely on the face of the complaint.

## Legal Principles

- A Rule 12(b)(6) motion tests plausibility; the court accepts well-pleaded factual allegations as true and draws reasonable inferences for the plaintiff.
- Under the presumption against extraterritoriality, courts ask (1) whether Congress clearly authorized extraterritorial application, and if not, (2) whether the case is a domestic application based on the statute’s focus.
- The pre-2008 TVPRA provisions relied on by plaintiffs lacked a clear statement authorizing extraterritorial reach for the alleged 2004 trafficking injuries; later statutory expansions of reach are not applied to earlier conduct absent congressional direction.
- ATS claims based on foreign harms may proceed only when the allegations sufficiently connect the claims to U.S. territory; allegations of U.S.-based direction and support can satisfy that requirement at the pleading stage.
- At this stage, the court accepted that ATS liability may extend to corporate defendants and may be based on aiding-and-abetting theories where the complaint plausibly alleges knowing assistance tied to the violation.
- Claims for injunctive relief require a live case or controversy; completed past injuries, without ongoing or imminent harm, do not support forward-looking relief.
- Limitations and related defenses (including tolling contentions and certain contractor-immunity theories) often turn on facts not resolvable on the pleadings and may be inappropriate grounds for dismissal when not established by the complaint itself.

## Conclusion

In *Adhikari v. KBR, Inc.*, the Southern District of Texas ruled on a Rule 12(b)(6) motion that plaintiffs’ TVPRA claims based on 2004 trafficking allegations could not proceed because the pre-2008 TVPRA did not reach the alleged foreign conduct and injuries and the 2008 amendments did not apply retroactively, but it allowed the ATS claim to continue based on allegations that KBR’s U.S.-based personnel directed and supported key aspects of the labor-supply arrangement and responses to trafficking reports; the court also dismissed IIED, denied injunctive relief for lack of a current or threatened injury, and declined to dismiss related Iraqi-law and negligence-based claims at the pleading stage on limitations or CPA Order 17 theories.


Adhikari v. KBR, Inc., 2017 WL 4237923 (2017)