Judge orders Iraq to pay millions to slain contractor’s firm

FALLS CHURCH, Va. — A military contractor whose top executive was killed in Iraq under mysterious circumstances 15 years ago has won a judgment of roughly $140 million against Iraq to reimburse the contractor for funds it never received.

The judgment of nearly $89 million plus interest and attorneys’ fees issued Tuesday by a federal judge in Washington caps a decade-long legal battle between Pennsylvania-based Wye Oak Technology and the Republic of Iraq.

Wye Oak says its president, Dale Stoffel, was slain in Iraq in December 2004 after complaining that his company wasn’t paid more than $20 million it was owed for refurbishing tanks to help the Iraqi military get back on its feet after the 2003 war.

A terrorist group claimed responsibility for Stoffel’s death, but witnesses testified at trial that Stoffel was really killed to avoid paying his company.

Allen Foster, a lawyer for Wye Oak, said the case was difficult because “Iraq did everything they could do for 10 years to delay having to explain their actions.”

Iraq offered up a number of defenses, all of which were rejected in a 107-page ruling from U.S. District Judge Royce Lamberth.

In his ruling, Lamberth writes that money that was supposed to go to Wye Oak was never paid. Stoffel sought U.S. assistance, and in a December 2004 meeting, U.S. military officials received commitments from Iraq’s Ministry of Defense that Stoffel and Wye Oak would be paid.

Three days later, Stoffel and an associate were killed en route to Baghdad to make payment arrangements.

In a footnote, Lamberth wrote that he was unable to make a definitive assessment of who killed Stoffel and Joe Wemple, a construction manager who was working with Stoffel. But Lamberth wrote that regardless, Stoffel wouldn’t have been on the road to Baghdad if the payments had been properly made.

“Dale Stoffel may very well still be alive today if not for MoD’s (Iraqi Ministry of Defense) breach” of contract, Lamberth wrote.

Lamberth awarded nearly $89 million plus interest and attorneys’ fees to Wye Oak, which is now headed by Stoffel’s brother David, though it is no longer active in the arms business. Foster estimated that the true judgment will total roughly $140 million.

He acknowledged it can be difficult to collect judgments from foreign nations but noted that “Iraq has assets all over the world” and he would be pursuing them.

Neither the lawyers who represented Iraq in court nor the Iraqi embassy in Washington returned phone calls and emails Tuesday seeking comment.

Dale Stoffel had built up expertise in arms dealing and particularly in Soviet-bloc arms like those used by Iraq when at the time he led Wye Oak, a contractor based in Monongahela, Pennsylvania. He received an early contract after the war to salvage and refurbish Iraqi tanks.

Former Army Gen. David Petraeus, one of the leaders in the Iraq rebuilding effort, testified in a deposition last year that Stoffel was a key part of efforts to help the Iraqi military stand up on its own. Petraeus said Stoffel accompanied him multiple times on helicopter flights in Iraq.

He said that the “performance of Wye Oak was quite good and appeared quite competent. I mean, the problem was that the Iraqis hadn’t paid him. And that was a fairly big deal, as you might imagine, and something that I took up repeatedly with the Ministry of Defense.”