No. 14-13-00824-CV

IN THE

FOURTEENTH COURT OF APPEALS

HOUSTON, TEXAS

TAMIMI GLOBAL COMPANY, LTD.

Appellant/Cross Appellee,

v.

KELLOGG BROWN & ROOT, L.L.C., KELLOGG

BROWN & ROOT INTERNATIONAL, INC., AND

KELLOGG BROWN & ROOT SERVICES, INC.,

Appellees/CrossAppellants.

MOTION FOR REHEARING

Lauren B. Harris

Texas Bar No. 02009470

lharris@porterhedges.com

Nicholas A. Simms

Kerry M. McMahon

David W. Salton

Porter Hedges LLP

1000 Main Street, 36th Floor

Houston, Texas 77002

Telephone: (713) 226-6624

Facsimile: (713) 226-6224

Attorneys for Appellees and CrossAppellants Kellogg Brown & Root,

L.L.C., Kellogg Brown & Root

International, Inc., and Kellogg Brown &

Root Services, Inc.

ACCEPTED

14-13-00824-CV

FOURTEENTH COURT OF APPEALS

HOUSTON, TEXAS

11/23/2015 4:29:17 PM

CHRISTOPHER PRINE

CLERK

 FILED IN 14th COURT OF APPEALS HOUSTON, TEXAS 11/23/2015 4:29:17 PM CHRISTOPHER A. PRINE Clerk
1

TO THE HONORABLE FOURTEENTH COURT OF APPEALS:

Pursuant to the Texas Rules of Appellate Procedure, Appellees and CrossAppellants Kellogg Brown & Root, L.L.C., Kellogg Brown & Root International,

Inc., and Kellogg Brown & Root Services, Inc. (collectively “KBR”) file this

Motion for Rehearing, and would respectfully show the Court as follows:

Argument

KBR files this motion for rehearing to address a single issue: whether this

Court properly affirmed the district court’s denial of KBR’s breach of contract

counterclaim seeking recovery of $930,000 in attorneys’ fees and costs it incurred

in third-party litigation arising from Tamimi’s payment of illegal kickbacks. This

Court affirmed the trial court’s findings that the collateral litigation against KBR

was not caused by Tamimi’s breach of the contract by offering kickbacks, but the

acceptance of those kickbacks by two KBR employees (Terry Hall and Luther

Holmes). Op. at 43-47. KBR respectfully urges this Court to reconsider its

decision because the Court’s analysis is contrary to controlling standards of

causation the Texas Supreme Court has carefully established.

I. Tamimi’s Offers of Kickbacks and Their Acceptance By Hall and

Holmes Were Concurring Causes of KBR’s Damages.

The Court’s causation analysis demonstrates that it failed to properly adhere

to controlling standards for evaluating causation, and in particular, for applying the

“substantial factor” test. Rather than properly considering Tamimi’s conduct in
2

paying kickbacks, the Court incorrectly determined that causation was not proven

because of Hall and Holmes’ acceptance of the illicit offer. The breakdown in the

Court’s reasoning, however, is that Tamimi not only initiated the entire chain of

events by offering kickbacks, but it paid them over an extended time period and

allegedly benefitted from those payments—the very reason the United States

government deemed its contract “tainted” and KBR was sued. The acceptance of

kickbacks was, at the very least, a concurring cause of KBR’s damages.

The Court’s analysis further demonstrates that it improperly treated the

acceptance of kickbacks as a superseding cause that absolved Tamimi from any

liability. That theory, however, has no application under these facts where the

acceptance of kickbacks was within the scope of the risk created by Tamimi’s

conduct and foreseeable. The Court then compounded its error by erroneously

concluding that the federal counterclaim attributed any misconduct only to the

acceptance of kickbacks, when that interpretation is refuted by its plain language.

Tamimi’s breach of the contractual anti-kickback provision was a “substantial

factor” in causing the government’s federal counterclaim as a matter of law.

A. The “Substantial Factor” Standard Does Not Require Tamimi’s

Conduct To Be The Sole Cause of Harm.

The trial court misconstrued the “substantial factor” test to require that

Tamimi’s conduct be the only cause of KBR’s damages. The trial court criticized

KBR for failing to offer proof that the United States would have “filed its
3

counterclaim had there been an offer of kickback from Mr. Khan but no acceptance

by KBR employees.” CR2592-93¶12. In other words, the trial court incorrectly

construed the “substantial factor” standard to essentially require KBR to eliminate

Hall and Holmes’ conduct as a basis for the counterclaim—disregarding that, at the

very least, Tamimi’s conduct was a concurrent cause of KBR’s damages.

The “substantial factor” test permits a finding of causation-in-fact

notwithstanding concurrent causation by other intervening events. See

Transcontinental Ins. Co. v. Crump, 330 S.W.3d 211, 222-23 (Tex. 2010). The

proximate cause standard has been defined to include the substantial factor

requirement (cause-in-fact) as well as a foreseeability component:

“Proximate cause” means a cause that was a substantial factor in

bringing about an event, and without which cause such an event

would not have occurred. In order to be a proximate cause, the act or

omission complained of must be such that a person using the degree

of care required of him would have foreseen that the event, or some

similar event, might reasonably result therefrom. There may be more

than one proximate cause of an event.

See State Bar of Tex., Texas Pattern Jury Charges: Business, Consumer, Insurance

& Employment PJC §100.14 (2012 ed.); Crump, 330 S.W.3d at 223. The trial

court’s analysis fails to recognize that there can be more than one cause of an

event, and that a concurrent act that cooperates with the original act will not cut off

the liability of the original wrongdoer. See Travis v. City of Mesquite, 830 S.W.2d

94, 98 (Tex. 1992); Bell v. Campbell, 434 S.W.2d 117, 122 (Tex. 1968); 2RR41.
4

The foreseeable conduct of another does not break the chain of causation.1See

Mewhinney v. London Wineman, Inc., 339 S.W.3d 177, 182 (Tex. App.—Dallas

2011, pet. denied).

The trial court mistakenly believed that the “substantial factor” standard

imposed a higher burden on KBR that its plain language implies. CR2592¶11. In

Crump, the Texas Supreme Court rejected the view that the “substantial factor”

requirement imposes a higher threshold, stating:

The word “substantial” is used to denote the fact that the defendant’s

conduct has such an effect in producing the harm as to lead reasonable

men to regard it as a cause, using that word in the popular sense, in

which there always lurks the idea of responsibility, rather than in the

so-called “philosophic sense,” which includes every one of the great

number of events without which any happening would not have

occurred. Each of these events is a cause in the so-called “philosophic

sense,” yet the effect of many of them is so insignificant that no

ordinary mind would think of them as causes.

Crump, 330 S.W.3d at 224 (citing Lear Siegler, Inc. v. Perez, 819 S.W.2d 470, 472

& n.1 (Tex. 1991)). Despite the supreme court’s guidance, the trial court declined

to find that Tamimi could be “responsible for whatever happens next.”

CR2592¶14.

1

These Texas cases discuss the proximate cause standard in the context of tort

claims, such as general negligence. However, to the extent the trial court and court of

appeals applied the proximate cause standard here, these cases are applicable.
5

The trial court and Court of Appeals erroneously failed to recognize that

Tamimi initiated the chain of events causing the ultimate harm, i.e. paying the

kickbacks that “ensured that Tamimi would obtain lucrative dining facility

(“DFAC”) subcontracts from KBR,” and that the government alleged resulted in

inflated claims. KBR Ex. 23, ¶108; App. Tab A. This is not a situation (as the

Court here appears to have accepted) where a mere offer and attenuated acceptance

occurred. The scheme between Tamimi, Hall and Holmes took place over an

extended period, as Tamimi continued to pay them over the course of more than a

year. Id. at ¶115. Throughout this period, Hall and Holmes were allegedly

involved in making decisions that continued to benefit Tamimi as it received

lucrative contracts from KBR. Id. at ¶116. Tamimi’s conduct was a substantial

factor in sparking the government’s counterclaim as a matter of law, and, at least, a

concurring cause of KBR’s damages. The trial court’s contrary decision is also

against the great weight and preponderance of the evidence.

The trial court never properly focused on the conduct of Tamimi and its

contractual breaches, or considered the foreseeability component of the proximate

cause test. The possibility that a lower level KBR employee might accept

kickbacks was certainly foreseeable to Tamimi. See, e.g. County of El Paso, Tex.

v. Jones, No. EP-09-CV-000119-KC, 2009 WL 4730303 *11 (W.D. Tex. 2009)

(not designated for publication) (“Because it is also foreseeable that Defendants’
6

conduct in offering bribes to Flores would lead to acceptance of the offer, the

County has established proximate cause.”). In fact, the prohibition on kickbacks

was expressly stated in the parties’ subcontracts. These subcontracts were

reviewed by Shabbir Kahn (“Kahn”), who ran Tamimi as its chief of operations.

2RR75, 3RR26, 31. And it was Khan who was responsible for initiating the

kickbacks. 3RR23, 27-28, 32, 39. Also see El Chico Corp. v. Poole, 732 S.W.2d

306, 314 (Tex. 1987) (recognizing that it is foreseeable that the sale of alcohol to a

minor will result in the minor driving while intoxicated and causing injury to

himself or others).

Mark Lowes, in-house counsel for KBR, was the only expert witness to

testify as to KBR’s attorneys’ fees and the reason why they were incurred:

Q: (Mr. Simms): And how did the offer of bribes to Terry Hall

cause damages to KBR?

A: (Mr. Lowes): Well, but for that, we would haven’t had the

counterclaim and we wouldn’t have had to defend. We would have

only had the contract action.

3RR24.

Q: (Mr. Klasing): ....isn’t it true that the trigger for every single

one of these causes of action,....is the fact that KBR employees

actually took kickbacks from someone?

A: (Mr. Lowes): You and I have and I have had this semantic

discussion before and I respectfully disagree. Our contract says

you’re not going to make the offer, but for the offer, it’s impossible

for anyone to accept it....
7

3RR80-81. Tamimi did not offer any witness to contradict this testimony. Also

see 3RR53 (“...but for the bribe, which the government claimed tainted the

contract, I wouldn’t have had to defend these actions.”). Because the court

misinterpreted the “substantial factor” test to require KBR to disprove that Hall

and Holmes’ conduct was also a reason for the government’s counterclaim, the

judgment should be reversed.

B. Hall and Holmes’ Acceptance of Kickbacks Was Not An

Intervening Cause That Vitiated Tamimi’s Liability.

Without expressly using the term “new and independent” (or superseding)

cause, this Court and the trial court effectively decided that Hall and Holmes’

acceptance of the kickbacks absolved Tamimi of liability for the consequences of

its breach. However, this inferential rebuttal theory has no applicability where the

intervening forces are foreseeable and within the scope of the risk created by the

defendant’s conduct.

A “new and independent cause” is one that intervenes between the original

wrong and the final injury such that the injury is attributed to the new cause rather

than the first and more remote cause. See Dew v. Crown Derrick Erectors, Inc.,

208 S.W.3d 448, 450 (Tex. 2006). An intervening cause supersedes the

defendant’s conduct and destroys the causal connection between that conduct and

the plaintiff’s injury. Id. However, this Court and the trial court failed to

recognize that if the intervening force was foreseeable, it is “considered to be a
8

concurring cause of the plaintiffs’ injuries and the defendant remains liable.” Id. at

451.

As the Texas Supreme Court noted in Dew, intervening forces are within the

scope of the original risk created by the defendant’s misconduct:

Obviously the defendant cannot be relieved from liability by the fact

that the risk, or a substantial and important part of the risk, to which

the defendant has subjected the plaintiff has indeed come to pass.

Foreseeable and intervening forces are within the scope of the original

risk, and hence of the defendant’s negligence. The courts are quite

generally agreed that intervening causes which fall fairly in this

category will not supersede the defendant’s responsibility.

Id. at 453. “Where the intervening act’s risk is the very same risk that renders the

original actor negligent, the intervening act cannot serve as a superseding cause.”

Id.

Similarly, it is no defense to Tamimi’s liability that the acceptance of the

kickbacks was a criminal act. Intentional criminal conduct is also not a

superseding cause of injury where the criminal conduct is foreseeable. See Phan

Son Van v. Peňa, 990 S.W.2d 751, 753 (Tex. 1999). As stated in the Restatement

of Torts,

[t]he act of a third person in committing an intentional tort or crime is

a superseding cause of harm to another resulting therefrom, although

the actor’s negligent conduct created a situation which afforded an

opportunity to the third person to commit such a tort or crime, unless

the actor at the time of his negligent conduct realized or should have

realized the likelihood that such a situation might be created, and that

a third person might avail himself of the opportunity to commit such a

tort or crime.
9

Id. at 753, citing RESTATEMENT (SECOND) OF TORTS §448 (1965). Here, Tamimi’s

conduct went well beyond being merely negligent—Tamimi intentionally

committed a crime by offering a kickback and created a situation where that offer

was accepted.

The Court effectively (but incorrectly) decided that Hall and Holmes’

acceptance of kickbacks relieved Tamimi of any responsibility for its breach,

allowing Tamimi to breach its contracts with impunity. Although the trial court

acknowledged the federal court of claims’ finding that knowledge of the kickbacks

had not been imputed to KBR in the federal court proceeding (CR2591¶6, KBR

Ex. 25; 3RR58), the court improperly decided that it was KBR’s acceptance of the

kickbacks that caused the collateral litigation against KBR. The trial court,

however, never made any finding that KBR was responsible for the illegal actions

of Hall and Holmes, or that their conduct was authorized. See J & C Drilling Co.

v. Salaiz, 866 S.W.2d 632, 636 (Tex. App.—San Antonio 1993, no pet.) (finding

that claim of respondeat superior was waived where no evidence of course and

scope of employment was presented). The trial court’s determination that KBR’s

conduct, and not Tamimi’s, was the cause of KBR’s damages is in error.

C. The Court Improperly Construed The Federal Pleadings To State

That The Counterclaim Was A Result of KBR’s Conduct Alone.

The Court’s affirmance of the trial court’s judgment is also in error because

the lower court solely relied on the federal court counterclaim to decide that the
10

lawsuit was caused by “KBR’s acceptance of the offer which triggered the

litigation.” CR2592. However, the trial court disregarded the allegations

throughout the petition that Tamimi’s repeated illicit payments to Hall and Holmes

also served as a basis for the counterclaim.

The allegations in the counterclaim describe a course of payments Tamimi

made over several years, after Hall initially declined the offer “but reported it to

nobody.” See KBR Ex. 23, ¶114-116; App. Tab A. The pleadings further describe

decisions for the “benefit of Tamimi as a KBR subcontractor” during the time the

payments were made. Id. at ¶116. The government also alleged that these

kickbacks resulted in “inflated contract prices from Tamimi for which KBR sought

reimbursement.” Id. at ¶118. Any conclusion that the government filed its

counterclaim purely based on Hall and Holmes’ acceptance of the kickbacks,

belies the plain language of the pleadings.2

If the focus of the counterclaim was on KBR, it was because Tamimi, as a

subcontractor, was not a party to that litigation. It is undisputed that Tamimi and

2 At the hearing on the motion for entry of judgment, the trial court stated that the

basis for his judgment was that “the only actual evidence I had was the federal

government saying that it was the acceptance of the offer and not the making of the offer

that caused their lawsuit.” 1RR7. To the contrary, the pleadings state that the

“counterclaims generally arise from the receipt of kickbacks by KBR employees from

Tamimi Global Company.” KBR Ex. 23, ¶108 (emphasis added); 3RR 23. Nowhere do

the pleadings state that Tamimi’s payments played no role in the litigation.
11

Khan were, in fact, separately prosecuted for their roles in the scheme. Tamimi

was charged with conspiracy to pay kickbacks and conspiracy to pay gratuities.

4BRR at DX 11, ¶1. Tamimi entered into a Deferred Prosecution Agreement with

the government (4BRR at DX 11) (App. Tab B), and Khan went to prison (4B RR

at DX 16). As part of the Deferred Agreement, Tamimi expressly admitted that it

was responsible for the “past crimes” and “unlawful conduct” of Khan in paying

kickbacks to Hall and Holmes (described therein as “Person A”). 4BRR at DX 11,

¶4, 22, Attachment A, ¶1, 41-43; 3RR31, 35. Tamimi also agreed to pay a

monetary penalty of $5.6 million. 4BRR at DX 11, ¶8. According to the

agreement, Khan made the payments to Hall and Holmes “in order to ensure that

[Tamimi] kept the DFAC subcontracts that it had, and to ensure that [Tamimi]

would continue to get additional subcontracts as they became available.” Id. at

¶43.

The government’s counterclaim against KBR, as well as Tamimi’s plea

agreement, unequivocally describe Tamimi’s pervasive role in paying illegal

kickbacks to obtain subcontracts at inflated prices. The trial court and court of

appeals’ decisions that the federal court litigation was only attributable to conduct

of KBR is simply wrong.
12

II. Texas Law Allows for The Recovery of Attorneys’ Fees Incurred In

Defending Foreseeable Litigation Caused By A Breach of Contract.

Although the trial court and this Court applied the “proximate cause”

standard in this case, that test is not typically applied in a breach of contract

dispute. See Abraxas Pet. Corp. v. Hornburg, 20 S.W.3d 741, 758 n.12 (Tex.

App.—El Paso 2000, no pet.); Winograd v. Clear Lake City Water Auth., 811

S.W.2d 147, 156 (Tex. App.—Houston [1st Dist.] 1991, writ denied) (“While

proximate cause must be proven in a tort action, it is not the causal standard

applied in a suit for damages for breach of contract.”); see Michol O’Connor,

O’CONNOR’S TEXAS CAUSES OF ACTION, ch. 5-B, §2.1 (2015 ed.). The Texas

Supreme Court has indicated that the proper test for breach of contract is whether

the damages “result from” the alleged breach. See McKnight v. Hill & Hill

Exterminators, Inc., 689 S.W.2d 206, 209 (Tex. 1985). Even if this higher

standard is applied,3however, KBR was still entitled to recover its attorneys’ fees

as a matter of law.

3

The requirement of foreseeability is a more severe limitation of liability than is

the requirement of substantial or “proximate” cause in the case of an action in tort or for

breach of warranty. See RESTATEMENT (SECOND) OF CONTRACTS §351 cmt. a (1981).

Even so, KBR should also prevail under the foreseeability test.
13

The Restatement (First) of Contracts §334 contemplates that attorneys’ fees

incurred in the defense of collateral litigation caused by a defendant’s breach of

contract are recoverable. The Restatement provides:

If a breach of contract is the cause of litigation between the plaintiff

and third parties that the defendant has reason to foresee when the

contract was made, the plaintiff’s reasonable expenditures in such

litigation are included in estimating damages.

See RESTATEMENT (FIRST) OF CONTRACTS §334 (1932) (emphasis added). As the

Restatement recognizes, the key inquiry is the foreseeability of third party

litigation expenses resulting from any breach. See Mead v. Johnson Group, Inc.,

615 S.W.2d 685, 687 (Tex. 1981) (“In an action for breach of contract, actual

damages may be recovered when loss is the natural, probable, and foreseeable

consequence of the defendant’s conduct.”). A contracting party is expected to

account for those risks that are foreseeable at the time the contract is made. See

RESTATEMENT (SECOND) OF CONTRACTS §351 cmt. a, c.

Foreseeability is a fundamental prerequisite to the recovery of consequential

damages for breach of contract. Basic Capital Management, Inc. v. Dynex

Commercial, Inc., 348 S.W.3d 894, 901 (Tex. 2011). As the Texas Supreme Court

has recognized:

Consequential damages are those damages that result naturally, but

not necessarily, from the defendant’s wrongful acts. They are not

recoverable unless the parties contemplated at the time they made the

contract that such damages would be a probable result of the breach.
14

Thus, to be recoverable, consequential damages must be foreseeable

and directly traceable to the wrongful act and result from it.

Stuart v. Bayless, 964 S.W.2d 920, 921 (Tex. 1998) (per curiam) (internal citations

omitted). Texas jurisprudence regarding the foreseeability requirement has been

derived in part from Hadley v. Baxendale, in which the court recognized that:

Where two parties have made a contract which one of them has

broken, the damages which the other party ought to receive in respect

of such breach of contract should be such as may fairly and

reasonably be considered either arising naturally, i.e. according to the

usual course of things, from such breach of contract itself, or such as

may reasonably be supposed to have been in the contemplation of

both parties at the time they made the contract as the probable result

of the breach of it.

Basic Capital, 348 S.W.3d at 901, citing Hadley v. Baxendale, 9 Exch. 341, 156

Eng. Rep. 145, 151 (1854).

The Texas Supreme Court has specifically acknowledged the applicability of

section 351 of the Restatement (Second) of Contracts in which the parameters for

determining whether a loss is a foreseeable result of any breach is defined. See

Basic Capital, 348 S.W.3d at 901-02. The Restatement provides:

(1) Damages are not recoverable for loss that the party in breach did

not have reason to foresee as a probable result of the breach when

the contract was made.

(2) Loss may be foreseeable as a probable result of a breach because

it follows from the breach

a. in the ordinary course of events, or
15

b. as a result of special circumstances, beyond the ordinary

course of events, that the party in breach had reason to

know.

See RESTATEMENT (SECOND) OF CONTRACTS §351. If the contract is silent as to

risks the defendant has assumed, courts will determine what risks were foreseen or

foreseeable when the contract was made by viewing the matter in the light of

common sense, considering the nature and purpose of the contract, the surrounding

circumstances, and what liability the breaching party may reasonably have

assumed. See 24 SAMUEL WILLISTON & RICHARD A. LORD, A TREATISE ON THE

LAW OF CONTRACTS §64:13 (4th ed.).

In Basic Capital, the Texas Supreme Court, applying this test, reversed the

court of appeals’ determination that lost profits a borrower claimed as

consequential damages for breach of a commitment to provide financing were not

foreseeable. Basic Capital, 348 S.W.3d at 902-03. The lender agreed to loan the

borrower $37 million to acquire and rehabilitate three commercial buildings, if its

other entities would borrow $160 million over a two year period. After loaning

$37 million to acquire the buildings, however, the lender refused to provide further

financing once interest rates rose. Id. at 897. The borrower claimed damages for

lost profits, which the court of appeals disallowed. The Texas Supreme Court

reversed the court of appeals’ determination that the borrower’s lost profits were

not foreseeable. Id. at 901-02. The Court reasoned that the lender “cannot profess
16

blindness to foreseeability that its breach would also cost [the borrower] business.”

Id. at 903.

Applying these principles here, there is no question that Tamimi’s breach of

the contract precluding the offer of kickbacks was a cause of collateral litigation

initiated by the government. As in Basic Capital, Tamimi cannot claim that it was

unaware that if it breached the contract by offering kickbacks, those offers might

be accepted (unbeknown to KBR). And it is certainly foreseeable that this illegal

conduct might be discovered, and the perpetrators prosecuted. It is axiomatic that

when a person commits a crime, the actor contemplates the possibility of getting

caught. Tamimi, through Khan, knew it would breach the subcontracts and

commit a crime by offering kickbacks, yet chose to do so anyway.

The context and purpose of the contract between Tamimi and KBR must

also be considered in deciding whether KBR’s attorneys’ fees incurred in the

collateral litigation are foreseeable. KBR retained Tamimi as a subcontractor to

provide food services to the American troops during wartime in the Middle East.

3RR10-16. The parties certainly contemplated through the inclusion of the “antikickback” provision in the contract that such offers were a possibility—especially

where the work was to be performed in a country experiencing lawlessness and

political unrest. The subcontracts specifically prohibit “kickbacks” not only

because they are illegal, but also to avoid the exact course of events that unfolded
17

here—that the government could decline to reimburse KBR for its payments to

Tamimi, and the parties could face criminal prosecution.

KBR included an anti-kickback notice in each of its subcontracts in

connection with the war effort in Iraq. 3RR17, 20. Certainly, KBR expected its

subcontractors to adhere to this agreement, and expressly contracted for

compliance. 3RR17. KBR maintains an active compliance program that is “part

of its corporate culture.” 3RR35. KBR has written policies and procedures

prohibiting kickbacks, and each employee participates in annual training to

reinforce them. 3RR35. Similarly, KBR provides hotlines to allow employees to

report potential violations of its corporate policies. 3RR36. The decisions of both

the trial court and this Court render KBR’s compliance program and the parties’

anti-kickback provision—which expressly prohibits Tamimi from offering

kickbacks—meaningless.

KBR was entitled to the recovery of attorneys’ fees because it was forced to

defend itself in collateral litigation that arose from Tamimi’s breach of the contract

and illegal conduct. The acceptance of any kickback offer was clearly foreseeable

to Tamimi because it occurred “in the ordinary course of events,” or at the very

least, occurred “as a result of special circumstances, beyond the ordinary course of

events, that [Tamimi] had reason to know.” See RESTATEMENT (SECOND) OF

CONTRACTS §351. The reasonably foreseeable consequences of a breach of
18

contract are compensable, “even if the criminal act of a third person intervened.”

See 24 SAMUEL WILLISTON & RICHARD A. LORD, A TREATISE ON THE LAW OF

CONTRACTS §64:13 at n.44. This Court incorrectly determined that the acceptance

of the kickback offers by KBR employees precluded KBR’s recovery of its

attorneys’ fees. KBR respectfully urges the Court to reconsider that decision.

WHEREFORE, Appellees and Cross-Appellants Kellogg Brown & Root,

L.L.C., Kellogg Brown & Root International, Inc., and Kellogg Brown & Root

Services, Inc. respectfully requests that the Court grant this Motion for Rehearing,

and for such other and further relief to which they may show themselves to be

justly entitled to receive.

Respectfully submitted,

PORTER HEDGES LLP

By: /s/ Lauren Beck Harris

Lauren Beck Harris

State Bar No. 02009470

Nicholas A. Simms

Kerry M. McMahon

David W. Salton

1000 Main Street, 36th Floor

Houston, Texas 77002

Telephone: (713) 226-6624

Facsimile: (713) 226-6224

Attorneys for Appellees and CrossAppellants Kellogg Brown & Root,

L.L.C., Kellogg Brown & Root

International, Inc., and Kellogg Brown

& Root Services, Inc.
19

CERTIFICATE OF SERVICE

Pursuant to Rules 6.3 and 9.5(b), (d), and (e) of the Texas Rules of Appellate

Procedure, this is to certify that on this 23rd day of November 2015, a true and

correct copy of the foregoing was served on the following counsel of record by

U.S. first class mail and by electronic delivery as follows:

Murphy S. Klasing

Weycer, Kaplan, Pulaski & Zuber, P.C.

11 Greenway Plaza, Suite 1400

Houston, TX 77046

Attorneys for Appellant Tamimi Global Company Ltd.

/s/ Lauren B. Harris

Lauren B. Harris

CERTIFICATE OF COMPLIANCE

1. This brief complies with the type-volume limitation of Texas Rule of

Appellate Procedure 9.4(i)(2)(D) because this brief contains 4,274 words,

excluding the parts of the brief exempted by Texas Rule of Appellate Procedure

9.4(i)(1).

2. This brief complies with the typeface requirements of Texas Rule of

Appellate Procedure 9.4(e) and the type style requirements of Texas Rule of

Appellate Procedure 9.4(e) because this brief has been prepared in a proportionally

spaced typeface using Microsoft Word in 14-point Times New Roman font or

larger.

/s/ Lauren B. Harris

Lauren B. Harris
APPENDIX A
?laintiff, )v. ) No. 09-351C ) (Judge Christine Miller) THE UNITED STATES, )) Defendant )

DEFENDANT’S AMENDED ANSWER AND COUNTERCLAIMSt

For its amended answer to plaintiff’s complaint, defendant admits, denies, and alleges as

follows:

The allegations contained in the first sentence ofthe first paragraph ofplaintiffs

“Introduction” are plaintiffs characterization, of its case, to which no response is required; to theextent that they may be deemed allegations offact, they are denied. Admits the allegationscontained in the second sentence ofthe first paragraph ofplaintiffs “Introduction” to the

extent supported by the referenced contract, which is the best evidence of its contents; otherwise

denies the allegations. Admits the allegations contained in the third sentence of the first

paragraph ofplaintiffs “Introduction.”

Denies the allegations contained in the first sentence of the second paragraph of

plaintiff’s “Introduction” for lack ofknowledge or information sufficient to form a belief as to

their tmth. The remainder ofthe allegations contained in the second paragraph ofplaintiffs

Although we made earlier filings in this case related to the potential affirmative

defenses and fraud counterclaims under seal because ofthe pendency ofMr. Terry Hall’s

testimony in a criminal case, this filing is not made under seal because Mr. Hall’s testimony in

that case has been completed and there is no longer any need to keep the information contained

herein confidential.

KBRPRODOO58839
denied.

The allegations contained in the third paragraph ofplaintiffs “Introduction” constitute

plaintiffs characterization ofits case and conclusions of law, to which no response is required; to

the extent that they may be deemed allegations offact, they are denied.

1. Denies the allegations contained in paragraph 1 for lack ofknowledge or information

sufficient to form a belief as to their truth.

2. The allegations contained in paragraph 2 are plaintiff’s characterization ofits case, to

which no response is required; to the extent that they may be deemed allegations offact, they are

denied.

3. The allegations contained in paragraph 3 are conclusions oflaw to which no response

is required; to the extent that they may be deemed allegations offact, they are denied.

4. Admits the allegations contained in paragraph 4 that, on July 17,2008, plaintifffiled a

claim with Ms. Mendoza to the extent supported by the referenced claim document, which is the

best evidence ofits contents; otherwise denies the allegations.

5. The allegations contained in paragraph 5 are conclusions oflaw to which no response

is required; to the extent that they may be deemed allegations offact, they are denied.

6. Admits the allegations contained in paragraph 6 to the extent supported by the

referenced notification document, which is the best evidence of its contents; otherwise denies the

allegations.

2

KBRPRODOO5884O
supported by the referenced letter, which is the best evidence ofits contents; otherwise denies the

allegations.

8. Admits the allegations contained in paragraph 8 to the extent supported by the

referenced notification document, which is the best evidence ofits contents; otherwise denies the

allegations.

9. Admits the allegations contained in paragraph 9 to the extent supported by the

referenced notification document, which is the best evidence ofits contents; otherwise denies the

allegations.

10. The allegations contained in paragraph 10 are conclusions oflaw to which no

response is required; to the extent that they maybe deemed allegations offact, they are denied.

11. Admits the allegations contained in paragraph 11 to the extent supported by the

referenced contract, which is the best evidence ofits contents; otherwise denies the allegations.

12. Admits the allegations contained in paragraph 12 to the extent supported by the

referenced novafion document, which is the best evidence ofits contents; otherwise denies the

allegations.

13. Admits the allegations contained in paragraph 13 to the extent supported by the

referenced contract, which is the best evidence ofits contents; otherwise denies the allegations.

14. Admits the allegations contained in paragraph 14 to the extent supported by the

referenced contract, which is the best evidence ofits contents; otherwise denies the allegations.

3

KBRPRODOO5884I
16. Admits the allegations contained in paragraph 16 to the extent supported by the

referenced task order, which is the best evidence ofits contents; otherwise denies the allegations.

17. Admits the allegations contained in paragraph 17 to the extent supported by the

referenced task order, which is the best evidence ofits contents; otherwise denies the allegations.

18. Admits,19. Admits,

20. Admits the allegations contained in paragraph 20 that, on occasion during the

performance ofTask Order 59, some roads in Iraq were closed due to hostilities and contractors

in Iraq were sometimes the targets ofinsurgent activities. The allegations in this paragraphrelating to the means of performing the contract are admitted to the extent supported by the

contract task order, which is the best evidence ofits contents; otherwise denies the allegations.

Denies all other allegations contained in this paragraph.

21. The allegations contained in paragraph 21 are plaintiffs characterization ofits case,

to which no response is required and are so vague that they are not susceptible to responsive

pleading; to the extent that they may be deemed allegations offact, they are denIed.

22. Admits the allegations contained in paragraph 22 to the extent supported by the

referenced task order, which is the best evidence ofits contents; otherwise denies the allegations.

23. The allegations contained in paragraph 23 are conclusions oflaw to which no

response is required; to the extent that they may be deemed allegations offact, they are denied.

4

KBRPRODOO58$42
25. Admits the allegations contained in paragraph 25 to the extent supported by the

referenced task order, which is the best evidence ofits contents; otherwise denies the allegations.

26. Admits.

27. Admits the allegations contained in paragraph 27 to the extent supported by the

referenced task order modification, which is the best evidence of its contents; otherwise denies

the allegations.

28. Admits the allegations contained in the first sentence ofparagraph 28 to the extent

supported by the referenced statement ofwork, which is the best evidence ofits contents;

otherwise denies the allegations. Admits the allegations contained in the second sentence of

paragraph 28.

29. Admits the allegations contained in paragraph 29 to the extent supported by the

referenced statement ofwork, which is the best evidence ofits contents; otherwise denies the

aliegations.

30. Admits.

31. Denies the allegations contained in paragraph 31 for lack of knowledge or

information sufficient to form a belief as to their truth.

32. The allegations contained in paragraph 32 are ambiguous and plaintiffs

characterization ofits case, to which no response is requfred to the extent that they may be

deemed allegations offact, they are denied.

5

KBRPRODOO58843
34. Admits.35. Admits.

36. Admits the allegations contained in paragraph 36 to the extent supported by the

referenced agreement, which is the best evidence of its contents; otherwise denies the allegations.

37. Admits the allegations contained in paragraph 37 to the extent supported by the

referenced “work release,” which is the best evidence ofits contents; otherwise denies the

allegations.

38. Admits the allegations contained in paragraph 38 to the extent supported by the

referenced “revised work release,” which is the best evidence of its contents; otherwise denies

the allegations.

39. The allegations contained in paragraph 39 are conclusions oflaw to which no

response is required; to the extent that they may be deemed allegations offact, they are denied.

40. Admits the allegations contained in paragraph 40 to the extent supported by the

referenced “Tamimi Subcontract” which is the best evidence ofits contents; otherwise denies the

allegations.

41. Admits the allegations contained in paragraph 41 to the extent supported by the

referenced modification to ‘MA3, which is the best evidence of its contents; otherwise denies

the allegations.

42. AdmitS the allegations contained in paragraph 42 to the extent supported by the

referenced “Tamimi Subcontract” which is the beet evidence ofits contents; otherwise denies the

6

KBRPRODOO58844
Camp Anaconda at sites A-I and A4 by Prime Projects International. Denies the remainder of

the allegations contained in paragraph 43 for lack of knowledge or information sufficient to form

a belief as to their truth.

44. The allegations contained in paragraph 44 are ambiguous and plaintiffs

characterization ofits case, to which no response is required; to the extent that they may be

deemed allegations offact, they are denied.

45. Denies the allegations contained in paragraph 45 for lack ofknowledge or

information sufficient to form a belief as to their truth.

46. Denies the ailegations contained in paragraph 46 for lack ofknowledge or

information sufficient to form a belief as to their truth.

47. Admits the allegations contained in paragraph 47 to the extent supported by the

referenced change order which is the best evidence of its contents; otherwise denies the

allegations.

48. Denies the allegations contained in paragraph 48 for lack ofknowledge or

information sufficient to form a belief as to their truth.

49. Admits the allegations contained in the first sentence ofparagraph 49 to the extent

supported by the referenced change order which is the best evidence ofits contents; otherwisedenies the allegations. Denies the allegations contained in the seconds sentence ofparagraph 49for lack of knowledge or information sufficient to form a belief as to their truth.

7

KBRPR0D0058845
Case 1:09-cv-00351-CCM Document 47 Filed 03/15/11 Page 8 of 26 

50. Denies. 

51. Admits the allegations contained in paragraph 51, regarding the contents of plaintiff's 

"RFP" to the extent supported by the referenced document, which is the best evidence of its 

contents; otherwise denies the allegations. Denies the remainder of the allegations contained in 

paragraph 51 for lack of knowledge or information sufficient to forra a belief as to their truth. 

52. Admits the allegation contained in paragraph 52, that Tamimi and others responded 

to the "RFP." Denies the remainder of the allegation contained in paragraph 52. 

53. Admits the allegations contained in the first sentence of paragraph 53 to the extent 

supported by the referenced change order which is the best evidence of its contents; otherwise 

denies the allegations. 

54. Admits the allegations contained in paragraph 54 to the extent supported by the 

referenced change order which is the best evidence of its contents; otherwise denies the 

allegations. 

55. Admits the allegations contained in paragraph 55 to the extent supported by the 

referenced change order which is the best evidence of its contents; otherwise denies the 

allegations. 

56. Admits the allegations contained in paragraph 56 to the extent supported by the 

referenced change order which is the best evidence of its contents; otherwise denies the 

allegations. 

57. Admits the allegations contained in paragraph 57 to the extent supported by the 

referenced change order which is the best evidence of its contents; otherwise denies the 

allegations. 

Case I :09-cv-00351-CCM Document 47 Filed 03115/11 Page $ of 26

50. Denies.

51. Admits the allegations contained in paragraph 51, regarding the contents of plaintiff’s

“RPP” to the extent supported by the referenced document, which is the best evidence ofits

contents; otherwise denies the allegations. Denies the remainder ofthe allegations contained in

paragraph 51 for lack ofknowledge or information sufficient to form a belief as to their truth.

52. Admits the aUegation contained in paragraph 52, that Tamimi and others responded

to the “RFP.” Denies the remainder ofthe allegation contained in paragraph 52.

53. Admits the allegations containedin the first sentence ofparagraph 53 to the extent

supported by the referenced change order which is the best evidence ofits contents; otherwise

denies the allegations.

54. Admits the allegations contained in paragraph 54 to the extent supported by the

referenced change order which is the best evidence ofits contents; otherwise denies the

allegations.

55. Admits the allegations contained in paragraph 55 to the extent supported by the

referenced change order which is the best evidence ofits contents; otherwise denies the

allegations.

56, Admits the allegations contained in paragraph 56 to the extent supported by the

referenced change order which is the best evidence ofits contents; otherwise denies the

allegations.

57. Admits the allegations contained in paragraph 57 to the extent supported by the

referenced change order which is the best evidence of its contents; otherwise denies the

allegations.
59. Admits the allegations contained in paragraph 59 that plaintiffsolicited and received

proposals from vendors for the recruitment and transportation oflaborers to Camp Anaconda.

Denies the remainder ofthe allegations contained in paragraph 59 for lack of knowledge or

information sufficient to form a belief as to their truth.

60. Admits the allegation contained in paragraph 60 that plaintiff awarded a subcontract

to “ESS” in August 2004 to provide labor. Denies the remainder ofthe allegations contained in

paragraph 60 for lack of knowledge or information sufficient to form a belief as to their truth.

61. Denies the allegations contained in paragraph 61 for lack ofknowledge or

information sufficient to form a belief as to their truth.

62. Admits the allegations contained in paragraph 62 to the extent supported by the

referenced change order which is the best evidence ofits contents; otherwise denies theallegations.

63. Denies the allegations contained in paragraph 63 for lack ofknowledge or

information sufficient to form a belief as to their truth.

64. Admits the allegation contained in paragraph 64 that plaintiffterminated its

subcontract with ESS. Denies the remainder ofthe allegations contained in paragraph 64 for lack

of knowledge or information sufficient to form a belief as to their truth.

65. Denies the allegations contained in paragraph 65 for lack of knowledge or

information sufficient to form a belief as to their truth.

9

.Vc.

KBRPRODOO5$847
67. Denies the allegations contained in paragraph 67 for lack of knowledge or

information sufficient to form a belief as to their truth.

68. Admits the allegations contained in the second sentence of paragraph 68 that Tamimi

continued to perform its contract with plainti during negotiations. Denies the allegationscontained in paragraph 68 for lack ofknowledge or information sufficient to form a belief as to

their truth.

69. Denies the allegations contained in paragraph 69 for lack of knowledge or

information sufficient to form a belief as to their truth.

70. Admits the allegations contained in paragraph 70 to the extent supported by the

referenced contract modification which is the best evidence ofits contents; otherwise denies the

allegations for lack ofknowledge or information sufficient to form a belief as to their truth.

71. Admits the allegations contained in paragraph 71 to the extent supported by the

referenced change orders which are the best evidence of their contents; otherwise denies the

allegations.

72. Denies the allegations contained in paragraph 72 because the phrase, “substantially

based upon” is ambiguous and for lack of knowledge or information sufficient to form a belief asto their truth.

73. Admits the allegations contained in paragraph 73 to the extent supported by the

referenced change order which is the best evidence of its contents; otherwise denies the

allegations.

10•

KBRPRODOO58848
are denied.

76. The allegations contained in paragraph 76 are ambiguous and plaintiffs

characterization ofits case, to which no response is required; to the extent that they may bedeemed allegations of fact, they are denied.

77. The allegations contained in paragraph 77 are ambiguous and plaintiff’s

characterization ofits case, to which no response is required to the extent that they may be

4eemed allegations offact, they are denied.

78. The allegations contained in paragraph 78 are ambiguous and plaintiffs

characterization ofits case, to which no response is required to the extent that they may be

deemed allegations offact, they arc denied.

79. Denies the allegations contained in paragraph 79-for lack of knowledge or

information sufficient to form a belief as to their truth.

20. Admits the allegations, contained in paragraph 80, that plaintiffprovided vouchers to

the Government, that included statements of amounts paid to Tamimi pursuant to Task Order 59.Denies the remainder ofthe allegations contained in paragraph 80 for lack of knowledge or

information sufficient to form a belief as to their truth.

81. Admits. - 82. Admits.

83. Admits the allegations contained in paragraph 83 to the extent supported by the

11

KBRPRODOO58849
84. Admits.

85. Admits the allegations contained in paragraph 85 to the extent supported by the

referenced DCAA form lwhich is the best evidence ofits contents; otherwise denies theallegations.

86, Admits the allegations contained in paragraph 86 to the extent supported by the

referenced DCAA form lwhich is the best evidence ofits contents; otherwise denies the

allegations.

87. The allegations contained in paragraph $7 are plaintiffs characterization ofits case,

to which no response is required; to the extent that they may be deemed allegations of fact, they

are denied.

88. Admits the allegations contained in paragraph 88 to the extent supported by the

referenced DCAA Form lwhich is the best evIdence ofits contents; otherwise denies the

allegations.

89. Admits the allegation contained in paragraph 89, that the “PCO” has withheld

$41,070,624 from plaintifl The remainder ofthe allegations contained in paragraph 89 are

plaintiff’s characterization ofits case, to which no response is required; to the extent that they

may be deemed allegations offact, they are denied.

90. Defendant incorporates by reference its responses to the allegations ofparagraphs 1

through 89 ofthe complaint.

12

KBRPR00005B85O
g

, 

y 

92. The allegations contained in paragraph 92 are conclusions oflaw and plaintiffs

characterization of its case, to which no response is required; to the extent that they may bedeemed allegations offact, they are denied.

93. Admits the allegations contained in paragraph 93 to the extent supported by the

referenced regulation, which is the best evidence of its contents; otherwise denies the allegations.

94. The allegations contained in paragraph 94 are conclusions of law and plaintiff’s

characterization ofits case, to which no response is required; to the extent that they may bedeemed allegations offact, they are denied,

95. The al]egations contained in paragraph 95 are conclusions oflaw and plaintiff’s

characterization ofits case, to which no response is required; to the extent that they may be

deemed allegations offact, they are denied.

96. Denies.97. The allegations contained in paragraph 97 are conclusions oflaw and plaintiffs

characterization of its case, to which no response is required; to the extent that they may be

deemed allegations offact, they are denied.

98. The allegations contained in paragraph 98 are conclusions oflaw and plaintiffs

characterization ofits case, to which no response is required; to the extent that they may be

deemed allegations of fact, they are denied.

‘3

KBRPRODOO58B5I
Case 1:09-cv-00351-CCM Document 47 Filed 03/15/11 Page 14 of 26 

99. The allegations contained in paragraph 99 are conclusions of law and plaintiff's 

characterization of its case, to which no response is required; to the extent that they may be 

deemed allegations of fact, they are denied. 

100. The allegations contained in paragraph 10 are conclusions of law and plaintiff's 

characterization of its case, to which no response is required; to the extent that they may be 

deemed allegations of fact, they are denied. 

101. Denies that plaintiff is entitled to the relief set forth in the prayer for relief 

immediately following paragraph 100, or to any relief whatsoever. 

102. Denies each and every allegation not previously admitted or otherwise qualified. 

Case 1 :09-cv-00351-CCM Document 47 Filed 03/15111 Page 14 of 26

99. The allegations contabed in paragraph 99 are conclusions of law and plaintiff’s

characterization ofits case, to which no response is required; to the extent that they may be

deemed allegations offact, they are denied.

100. The allegations contained in paragraph 10 are conclusions of law and plaintiff’s

characterization ofits case, to which no response is required; to the extent that they may be

deemed allegations offact, they are denied.

101. Denies that plaintiffis entitled to the relief set forth in the prayer for relief

immediately following paragraph 100, or to any reliefwhatsoever.

102. Denies each and every allegation not previously admitted or otherwise qualified.
DEFENDANT

S COUNTERCLAIMS

104. These counterclaims arise pursuant to the Special Plea in fraud, 28 U.S.C. § 2514,

the Anti-Kickback Act, 41 U.S.C. § 53, 55, the False Claims Act, 31 U.S.C. S 3729, and under

common law fraud.

105. The Court possesses jurisdiction pursuant to 28 U.S.C. § 1503 and 2508.106. Defendant and counterclaim plaintiffis the United $tate.

107. Plaintiff and counterclaim defendant is Kellogg Brown & Root Services, Inc.

(“KBR”). V

108. These counterclaims generally arise from the receipt ofkickbacks by KBR

employees from Tamimi Global Company (“Tamimi”). The two KBR employees most directly

implicated in this case are Mr. Terry Hall, who was KBR’s head offood services for Kuwait andfracj from late 2002 through early 2004, and Mr. Luther Holmes, his deputy. Mr. Hall and Mr.

Holmes were both receiving kickbacks from a high-level Tamimi employee at the same time that

they were making decisions and recommendations that ensured that Tarnimi would obtainlucrative dining facility (9)FAC”) subcontracts from KBR pursuant tthe LOGCAP Ut contact

for which KBR would be reimbursed by United States taxpayer dollars along with a fee

determined by the subcontract costs. These actions resulted in, among other things, thesubmission offalsely inflated and fraudulent claims to the contracting officer for payment from

the United States Treasury.

15 V

KBRPRODOO5$853
Case 1:09-cv-00351-CCM Document 47 Filed 03/15/11 Page 16 of 26 

109. In October 2002, Mr. Hall was assigned to Kuwait by KBR. Mr. Hall's 

responsibilities included being the Regional Food Services Manager for Kuwait (and Iraq, 

subsequent to its invasion by Coalition forces) under the LOGCAP III contract. The Regional 

Food Services Manager and his staff were responsible for, among other things, ensuring that 

subcontractors providing DFAC services for KBR, as required by task orders upon the LOGCAP 

La contract, were technically competent to perform such services; were responsible for helping 

craft statements of work for subcontractors providing DFAC services; were responsible for 

formally requisitioning DFAC services (including estimnting the costs of such services) from the 

KBR subcontracting staff; and were responsible for overseeing performance of DFAC 

subcontracts. 

110. In early 2003, Mr. Hall was joined in Kuwait by his newly-hired deputy, Mr. Luther 

Holmes. 

111. One of the DFAC subcontractors supervised by Mr. Hall was Tarnimi At the time 

that Mr. Hall arrived in Kuwait, Tamimi was already providing DFAC services related to the 

LOGCAP III contract as a KBR subcontractor at Camp Arian, Kuwait. 

112. Due to an electrical fire at the Camp Arian DFAC, caused through the fault of 

Tamimi, Mr. Hall and his superiors at KBR contemplated terminating KBR's subcontract with 

Tamimi in November 2002. They ultimately chose to continue to subcontract with Tamimi. 

113. Through the performance of his duties and his dealings with Tamimi, Mr. Hall 

came to know and socialize with Tamimi's chief of operations and vice president, Mr. 

Mohammad Shabbir Khan. 

Case I :09-cv-00351-CCM Document 47 Filed 03/15111 Page 16 of 26

109. In October 2002, Mr. Hail was assiied to Kuwait by KBR. Mr. Hall’s

respcnsibiities included being the Regional Food Services Manager for Kuwait (and Iraq,

subsequent to its invasion by Coalition forces) under the LOGCAP m contract. The Regional

food Services Manager and his staff were responsible for, among other things, ensuring that

subcontractors providing DFAC services for KBR, as required by task orders upon the LOGCAP

Ill contract, were technically competent to perform such services; were responsible for helping

craft statements ofwork for subcontractors providing OFAC services; were responsible for

formally requisitioning DFAC services (including estimating the costs ofsuch services) from the

KER subcontracting staff; and were responsible for overseeing performance of OFAC

subcontracts.

110. In early 2003, Mr. Hall wasjoined in Kuwait by his newly-hired deputy, Mr. Luther

Holmes.

111. One ofthe DFAC subcontractors supervised by Mr. Hail was Tamimi. At the lime

that Mr. Hall arrived in Kuwait, Tamimi was already providing DFAC services related to the

LOGCAP Ill contract as a KBR subcontractor at Camp Arian, Kuwait

112. Due to an electrical fire at the Camp Ariau OFAC, caused through the fault of

Tamimi, Mr. Hail and his superiors at KBR contemplated terminating KBR’s subcontract with

Tamimi in November 2002. They ultimately chose to continue to subcontract with TamimL

113. Through the performance of his duties and his dealings with Tamimi, Mr. Hall

came to know and socialize with Tamimi’s chief of operations and vice president, Mr.

Mohammad Shabbir Khan,
this conversation, but reported it to nobody.

115. At some point in late 2002 or early 2003, Mr. Hall began taking money from Mr.

Kiaan. Mr. Hall understood that the money was being provided so that Tamimi would remain in

KBR’s good graces and continue to get DPAC contracts from KBR. The money provided to Mr.

Hall first took the form of $5,000 in cash that Mr. Khan had delivered to him at the airport in

Kuwait prior to ins departure on a vacation in 2003. Mr. Khan. caused $5,000 in cash to be

delivered to Mi. Holmes at the airport at the same time. Mr. Klan also gave Mr. Hall an

automated teller machine (“ATM”) card that could be used to access a bank account into which

Mr. Klan had placed $5,000. Mr. Hall used the ATM card to withdraw approximately $3,500 in

cash from the bank account Mr. Holmes was also given access to the account by Mr. Khan, and

withdrew the remaining $1,500 from the account Mr. Holmes was also given $10,000 or morein cash by Mr. Klan, which he gave to his secretary. Near the end of2003, Mr. Klan gave Mr.

Hall $20,000 which was ostensibly to be used as an investment in a “Golden Corral” restaurant,

although Mr. Hail did not, in fact, make such an investment with Mr. Klan’s money, nor did Mr.

IChan ever request that it be paid back.

116. During the time that Mr. Holmes and Mr. Hall were receiving money from Mr.

Klan, they were involved in decisions that were made to the benefit ofTamimi as a KBR

subcontractor. In Yune 2003, KBR convened a board to determine which local contractors would

be awarded “master agreement” suboontacts to perform DFAC services for KBR pursuant to the

LOOCAP UI contact. Once KBR awarded a “master agreement” to a contractor, it intended to

17

KBRPRODOO58855
Case 1:09-cv-00351-CCM Document 47 Filed 03/15/11 Page 18 of 26 

issue "work releases" upon the master agreement as means to order DFAC services at particular 

locations. Contractors not awarded master agreements would not be eligible for subcontracts to 

operate DFACs for KBR. 

117. Mr. Holmes and Mr. Hall were amongst the KBR employees who sat upon the 

board to determine which contractors would be awarded master agreements. As Regional Food 

Services Manager for KBR, had Mr. Hall objected to the award of a master agreement to a 

contractor, it would have been highly unlikely that such an award would be made. Tamimi and 

five other contractors were awarded master agreements; the board decided not to award master 

agreements to several other contractors that sought them. The master agreement awarded to 

Tamimi was known as "Master Agreement 3." 

118. KBR issued multiple work releases upon Master Agreement 3 to obtain DFAC 

services in response to task orders issued upon the LOGCAP M contract. The relevant LOGCAP 

L._ M task orders were Task Order 59, which was issued in August 2003, but effective from June 

2003 through April 2005, and Task Order 89, which covered services from May 2005 through 

August 2006. All told, Tamimi billed and KBR paid approximately $466,290,328 upon all of the 

work releases for Master Agreement 3. KBR regularly submitted vouchers to the United States 

seeking reimbursement for these amounts as direct costs, plus a base fee of 1 percent of direct 

costs (also referred to as "definitized costs"), and an award fee of up to two percent of direct 

costs, plus a fee for indirect costs. Mr. Hall and Mr. Holmes knew, when they accepted their 

kickbacks from Mr. Khan, that KBR would file vouchers with the United States seeking 

reimbursement for any Tamimi subcontracts as set forth above. Mr. Hall and Mr. Holmes also 

knew or had reason to know that the kickbacks that they received would lead to inflated contract 

Case 1:09-cv-00351-CCM Document 47 Filed 03115/11 Page 18 of 26

issue “work releases” upon the master agreement as means to order DFAC services at particular

locations. Contractors not awarded master agreements would not be eligible for subcontracts to

operate OFACs for KBR

117, Mr. Holmes and Mr. Hall were amongst the KBR employees who sat upon the

board to determine which contractors would be awarded master agreements. As Regional Food

Services Manager for KER, had Mr. Hail objected to the award of a master agreement to a

contractor, it would have been highly unlikely that such an award would be made. Tamimi and

five other contractors were awarded master agreements; the board decided not to award master

agreements to several other contractors that sought them. The master agreement awarded to

Tamimi was known as “Master Agreement 3.”

118. KBR issued multiple work releases upon Master Agreement 3 to obtain DFAC

services in response to task orders issued upon the LOGCAP UI contract. The relevant LOGCAP

UI task orders were Task Order 59, which was issued in August 2003, but effective from June

2003 through April 2005, and Task Order 89, which covered services from May 2005 through

August 2006. Ml told1 Tamimi blUed and KBR paid approximately $466,290,328 upon all ofthe

work releases for Master Agreement 3. KBR regularly submitted vouchers to the United States

seeking reimbursement for these amounts as direct costs, plus a base fee of 1 percent of direct

costs (also referred to as “definitized costs”), and an award fee of up to two percent of direct

costs, plus a fee for indirect costs. Mr. Hail and Mr. Holmes knew, when they accepted their

kickbacks from Mr. Khan, that KBR would file vouchers with the United States seeking

reimbursement for any Tamimi subcontracts as set forth above. Mr. Hall and Mr. Holmes also

knew or had reason to know that the kickbacks that they received would lead to inflated contract
Camp Anaconda, Iraq, KBR decided to continue to utilize Tainimi, which was the incumbent

contractor for the Army at Camp Anaconda. This decision was, in the initial instance, made, at

the urging ofMr. Hall and Mr. Gatlin, by Mr. Daniel Petsche, who was a LOGCAP msubcontracts administrator for KBR, responsible for LOGCAP Ill subcontracting in Iraq. Mr.

Petsche did not possess the authority from KBR to commit the company to more than a certain

amount ofspending on a particular subcontract, but he could make provisional decisions to agree

to certain subcontracts and then seek ratification from superiors at KBR wIth the proper authority

to commit the company to the larger contractual amounts. Mr. Petsche did not possess the

authority to commit KBR to the contractual amounts that would be necessary for the Camp

Anaconda OFAC contract.

120. Mr. Petsche made the decision to acquiesce to the award ofthe Camp Anaconda

subcontract to Tamlini based in large part upon the pressure supporting the award that he

received from Mr. aafl. Indeed, Mr. ?etsche had contemplated having the Camp Anaconda

DFAC subcontract be awarded to a different subcontractor than Tamimi, but changed his mind

based upon the advocacy for Tamimi that he received from Mr. Hail,

121. Mr. Hall’s strong advocacy on behalf ofTamimi, and the support given to Mr.

Hail’s positions by Mr. Hall’s direct supervisor, Mr. Robert “Butch” Gatlin, influenced Mr.

Petsche’s decision-maldng relating to TamimI at Camp Anaconda and elsewhere. Additionally,

Mr. Hall ‘rote and signed the memorandum for the KBR procurement file justifying the solesource award to Tamimi ofthe DFAC subcontract at Camp Anaconda.

19

KBRPRODOO5885Z
Case 1:09-cv-00351-CCM Document 47 Filed 03/15/11 Page 20 of 26 

122. Work Release 3 of Master Agreement 3 was the contractual vehicle by which KBR 

obtained DFAC services from Tamimi at Camp Anaconda, Iraq from August 2003 through 

December 2005. Tamimi billed and KBR paid approximately $307,630,344 upon Work Release 

3 of Master Agreement 3. KBR then sought and obtained payment of the $307,630,344, plus 

base and award fees and fees for indirect costs, from the United States. 

123. In late December 2003 Mr. Petsche was fired by KBR for receiving a gift from a 

subcontractor not Tamimi In February 2004, shortly after his termination, Mr. Petsche was 

contacted by KBR employee David Hadcock. Mr. Hadcock had been reviewing KBR's Camp 

Anaconda DFAC procurement files and was searching for both an authorization and justification 

for the cost of Master Agreement 3, Work Release 3. 

124. Mr. Petsche discussed the matter briefly with Mr. Hadcock on the telephone and 

sent a follow-up e-mail to Mr. Hadcock at his request. In the e-mail, Mr. Petsche stated that he 

had previously referred to the Anaconda DFAC as, "the mother of all DFAC drug deals" because 

of all of the irregularities surrounding it. In Mr: Petsche's words, the Anaconda DFAC was 

"predestined and out of control from the start." Mr. Petsche wrote that Tamimi's pricing for the 

Anaconda DFAC was "very close to the [amount in. the internal KBR] requisition," which Mr. 

Petsche had thought indicated that the deal had been previously agreed to by others from KBR 

and Tamimi, but that he had chosen not to question it. Mr. Petsche further wrote that he had 

drafted a work release to effect this agreement, but had not signed it because he felt that he 

needed more data to justify its expense. Mr. Petsche explained the lack of a signed work release 

and price justification memorandum by writing, "I did not execute the Work Release. I did not 

do a Price Reasonableness write-up on it. I could not present it with the data and support I had." 

Case I :09-cv-00351-CCM Document 47 Filed 03115/11 Page 20 of 26

122. Work Release 3 ofMaster Agreement 3 was the contractual vehicle by which KBR

obtained DFAC services from Tamimi at Camp Anaconda, Iraq from August 2003 through

December 2005. Tamimi billed and KBR paid approximately $307,630,344 upon Work Release

3 ofMaster Agreement 3. KBR then sought and obtained payment ofthe $307,630,344, plus

base and award fees and fees for indirect costs, from the United States.

123. In late December 2003 Mr. Petsche was flred by KBR for receiving a gift from a

subcontractor not Tarnimi. In february 2004, shortly after his termination, Mr. Petsche was

contacted by KBR employee David Hadcock. Mr. Hadcock had been reviewing KBR’s Camp

Anaconda DFAC procurement files and was searching for both an authorization and justification

for the cost ofMaster Agreement 3, Work Release 3.

124. Mr. Petsohe discussed the matter briefly with Mr. Hadoock on the telephone and

sent a follow-up e-mail to Mr. Hadoock at his request In the e-mail, Mr. Petsohe stated that he

had previously referred to the Anaconda DFAC as, “the mother of all DEAC drug deals” because

of all ofthe irregularities surrounding it. In Mr. Petsche’s words, the Anaconda OFAC was

“predestined and out of control from the start.” Mr. Petache wrote that Tamimi’s pricing for the

Anaconda DFAC was “very close to the amount in the internal KBR requisition,1’ which Mr.

Petsohe had thought indicated that the deal had been previously agreed to by others from KBR

and Tamimi, but that he bad chosen not to question it Mr. Petsche further wrote that he had

drafted a work release to effect this agreement, but had not signed it because he felt that he

needed more data to justify its expense. Mr. Petsche explained the lack of a signed work release

and price justification memorandum by writing, “I did not execute the Work Release. I did not

do a Price Reasonableness write-up on it I could not present it with the data and support I had.”
125. Upon receipt of Mr. Petsehe

s e-mail, Mr. Hadoock forwarded it to Mr. William

Jonas, head ofprocurement for KBR, and Mr. Charlie Carr, the head ofKBR’s ‘DEAC team,”

which, by that time, had oversight of all DFACS in Kuwait and Iraq. Neither Mr. Hadoock, Mr.Jonas, Mr. Carr, nor any other KBR employee took any action based upon Mr. Petsche’s e-mail

or the allegations contained therein. No KBR employee ever conveyed Mr. Petsohe’s concerns(or any oftheir own) regarding the Camp Anaconda and other Tamimi contacts to any

representative ofthe United States Government. In March 2004, after Ms receipt ofMr.

Petsche’s e-mail and after his forwarding ofthe e-mail to Mr. Jonas and Mr. Carr, Mr. Hadcock

wrote a memorandum purporting to justify the costs for Master Agreement 3, Work Release 3.

Only after Mr. Hadoock’s memorandum was Master Agreement 3, Work Release 3 officially

ratified by KBR officials with the authority to do so.

126. The original period ofperformance for Master.Agreement 3, Work Release 3

concluded in March 2004. Through the issuance of change orders, KBR extended the period of

performance ofMaster Agreement 3, Work Release 3 through December 31, 2005.

Count I

Special Plea In fraud—28 U.S.C. 2514

127. The United States incorporates by reference the allegations set forth in paragraphs

104 through 126 above.

12$. Pursuant to 28 U.S.C. § 2514, defendant’s special plea in fraud seeks the forfeiture

ofthe plaintiff’s claim in this action.

21

K5RPR0D0058859
aga

st t

e Gove

e

t in 

duc

g the Government to enter the contract, during performance of

the contract, or in the proof or statement of a claim against the Government.

130. Performance ofthe LOGCAP Ill contract, in particular Task Orders 59 and 89.

under which KBR was compensated for the costs ofwork performed under the various work

releases ofMaster Agreement 3, was tainted by the fraud ofthe kickbacks received by KBR’s

employees, Mr. Hall and Mr. Holmes, when they sat upon the board that awarded Master

Agreement 3 and when they took actions to encourage the issuance of Work Release 3 to MasterAgreement 3 to Tamimi for work at Camp Anaconda.

131. Accordingly, pursuant to 28 U.S.C. § 2514, plaintiff’s claim in this action is subject

to forfeiture in its entirety.

Count U

Anti-Kickback Act—41 U.S.C. § 53,55

132. The United States incorporates by reference the allegations set forth in paragraphs

104 through 131 above.

133. The Anti-Kickback Act, 41 U.S.C. § 53, 55, prohibits employees of Government

contractors from accepting “kickbacks” from subcontractors and establishes penalties for personswho iciowingly violate the Act and for companies that violate the Act. A “kickback’ is payment

of money or a thing of value for the purpose of obtaining or rewarding favorable treatment of thesubcontractor by the prime contractor.

22

KBRPRODOO5886O
Kickback Act.

135. The violations ofthe Anti-Kickback Act by Mr. Hall and Mr. Holmes are

attributable to KBR because the two were acting as KBR’s agents at the time that they accepted

the kickbacks.

Count UI

False Claims Act—31 U.S.C. § 3729(a)(1)

136. The United States incorporates by reference the allegations set forth in paragraphs

104 through 135 above.

137. KBR knowingly presented and caused to be presented to officers and employees of

the United States Government false or fraudulent claims for payment or approval by submitting

vouchers for payment for costs associated with Master Agreement 3 and all ofthe work releasesupon it, The claims were false or fraudulent because KBR knew that the award ofMaster

Agreement 3 and the work releases upon it, including but not limited to Work Release 3, weretainted by kickbacks given by Mr Khañ to Mr. Hall and Mr. Holmes.

Count IV

Rescission And Disgorgement (Master Agreement 3)

138. The United States incorporates by reference the allegations set forth in paragraphs

104 through 137 above.

23

KBRPRODOO5B86I
Case 1:09-cv-00351-CCM Document 47 Filed 03/16/11 Page 24 of 26 

139. Because of the kickbacks to Mr. Hall and Mr. Holmes, the portion of the LOGCAP 

III contract tainted by such kickbacks is void or voidable. Accordingly, the Government is 

entitled to be restored to its pre-contract position relating to these portions of the LOGCAP III 

contract 

140. Based upon the facts described above, the Government is entitled to the rescission 

of the portion of the LOGCAP M contract involving all work performed by KBR through its 

Master Agreement 3 subcontract with Tsmimi, inasmuch as that subcontract was tainted by 

kickbacks and it would be contrary to public policy for the Government to pay for such 

unlawfully awarded work. The Government is also entitled to disgorgement of all sums paid to 

KBR as compensation related to the tainted subcontract. 

Count V 

Disgorgement (Task Order 59) 

141. The United States incorporates by reference the allegations set forth in paragraphs 

104 through 140 above. 

142. Task Order 59 to the LOGCAP DI contract was issued to KBR. shortly after the 

kickback-tainted award by KBR of Master Agreement 3 to Taminai. All work releases upon 

Master Agreement 3 were issued under the authority of Task Order 59. Because the kickbacks to 

Mr. Hall and Mr. Holmes necessarily tainted Task Order 59 at or about the time of award by 

establishing a relationship that influenced the pricing and cost of that task order, Task Order 59 

unjustly enriched KBR. 

143. Based upon the facts described the Government is entitled to disgorgement of all 

fees paid to KBR pursuant to Task Order 59. 

Case I :09-cv-00351 -CCM Document 47 Filed 03/15/11 Page 24 of 26

139. Because ofthe kickbacks to Mr. Hall and Mr. Holmes, the portion ofthe LOGCAP

III contract tainted by such kickbacks is void or voidable. Accordingly, the Government is

entitled to be restored to its pre-contract position relating to these portions ofthe LOOCA? Ill

contract.

140. Based upon the facts described above, the Government is entitled to the rescission

of the portion ofthe LOGCAP DI contract involving all work performed by KBk through its

Master Agreement 3 subcontract with Tarnirni, inasmuch as that subcontract was tainted by

kickbacks and it would be contrary to public policy for the Government to pay for such

unlawMly awarded work. The Government is also entitled to disgorgement of all sums paid to

KBR as compensation related to the tainted subcontract.

Count V

Disgorgement (Task Order 59)

141. The United States incorporates by reference the allegations set forth in paragraphs

104 through 140 above.

142. Task Order 59 to the LOGCAP DI contract was issued to KBR shortly after the

kickback-tainted award by KBR ofMaster Agreement 3 to TamImi. All work releases upon

Master Agreement 3 were issued under the authority ofTask Order 59. Because the kickbacks to

Mr. Hall and Mr. Holmes necessarily tainted Task Order 59 at or about the time of award by

establishing a relationship that influenced the pricing and cost ofthat task order, Task Order 59

unjustly enriched KBR.

143. Based upon the facts described the Government is entitled to disgorgement of all

fees paid to KBRpursuant to Task Order 59.
Case 1:09-ov-00351-CCM Document 47 Flied 03115/11 Page 25 of 26 

PRAYER FOR RELIEF 

WHEREFORE, defendant, the United States, requests that the Court enter judgment in its 

favor, and against KBR as follows: 

a. As to Count I, under the Special Plea in Fraud, 28 U.S.C. § 2514, against plaintiff for 

the forfeiture of KBR's entire claim; 

b. As to Count II, under the Anti-Kickback Act, 41 U.S.C. §§ 53, 55, against plaintiff, for 

damages in the amount of double the amount of the kickbacks given to Mr. Hall and Mr. Holmes, 

plus civil penalties as are allowable by law of $5,500 to $11,000 per violation, post-judgment 

interest, and costs; 

c. As to Count III, under the False Claims Act, 31 U.S.C. § 3729, against the plaintiff, for 

treble the damages sustained by the United States, plus civil penalties as are allowable by law of 

$5,500 to $11,000 per violation, post-judgment interest, and costs; 

d. As to Count N, rescission and disgorgement related to Master Agreement 3, for 

rescission of the portion of the LOGCAP El contract that was effected by KBR through the use 

of Master Agreement 3, and for disgorgement of all moneys paid to KBR for direct costs, indirect 

costs, fixed fees, and award fees related to any work release upon Master Agreement 3, postjudgment interest, and costs; 

e. As to Count V for disgorgement of all moneys paid to KBR for fixed and award fees 

related to Task Order 59, post-judgment interest, and costs. 

f. For the dismissal of KBR's complaint; and 

g. For such other and further relief as the Court may deem appropriate. 

Case I :09-cv-0035-CCM Document 47 Filed 03115/11 Page 25 of 26

PRAYER FOR RELIEF

WHEREFORE, defendant, the United States, requests that the Court eater judgment in its

favor, and against KBR as fo1lows

a. As to Count I, under the Special Plea in Fraud, 28 U.S.C. § 2514, against plaintiff for

the forfeiture ofKBR’s entire claim;

b. As to Count II, under the Anti-Kickback Act, 41 U.S.C. § 53, 55, against plaintiff, for

damages in the amount of double the amount of the kickbacks given to Mr. Hall and Mr. Holmes,

plus civit penalties as are allowable by law of $5,500 to $11,000 per violation, post-judgment.

interest, and costs;

c. As to Count fl], under the False Claims Act, 31 U.S.C. § 3729, against the plaintiff, for

treble the damages sustained by the United States, plus civil penalties as are allowable by law of

$5,500 to $11,000 per violation, post-judgment interest, and costs;

d. As to Count W, rescission and disgorgement related to Master Agreement 3, for

rescission of the portion of the LOGCA? Ill contract that was effected by KBR through the use

ofMaster Agreement 3, and for disgorgement of all moneys paid to KDR for direct costa, indirect

costs, fixed fees, and award fees related to any work release upon Master Agreement 3, postjudgment interest, and costs;

e. As to Count V, for disgorgement of all moneys paid to KBR for fixed and award fees

related to Task Order 59, post-judgment interest, and costs.

f. For the dismissal ofKBR’s complaint, and

g. For such other and further relief as the Court may deem appropriate.
s1Ieanne ‘E ]iisoiJEANNE E. DAVIDSON

Dfrectör

a’J. Reid Prouty’

3. aEID PROUTY

SeniirTiai Counsel

Commercial tAtiatin Branok

‘Civil Division

Depatrnen ofjustice

11OaLs:tree, N.W.,

Atti: Classification Unit

BUi ‘Floor’

Wasbiugton, D.C., 2O3’O

TeIe (2O2)O5-7586

Fax: (2,02)514.7969

Attorneys for Defendant

March15, 20fl

EO

a’

26

KBRPRODOO58864
APPENDIX B
4:11-cr-40083-MMM-JAG # 6 Page 1 of 13 E-FILED 

Monday, 19 September, 2011 10:32:32 AM 

Clerk, U.S. District Court, ILCD 

FILED 

gEP 

FfAmstAtfsiisissoNbishic IAS: DISTROTCOUAT. - 

CENTRAL D.ISTRIcrtnialpfs' 

IN TIiI 17Arrpo STATES DISTRICT COURT 

rattiziet tint:AIWA 

AT, E0 a ISLAND 

'UNITED STATES' OF AMERICA, 

Plaintiff, CaSeNml, I- 4083 

vs. 

TAMIMI oLoBAI., co., LTD;a/k/a fTAFGA," 

Defendant: 

BEFERREBTROSECUTION AGREEMENT . 

Defendant Taminii dobarCii.,:14:18„ also. as,:"1.0.0e(aii,cLiST08ftettOgrreai to 

as "TAFGA"), by its underSighedattorileys,puMuiliitte!atitlitkitY, &anted by TAFGA'a 

Executive Board; and the, United StateSAfterney foro.octiitia)Thistrldt ofIllinoistat times 

referred to herein as the "Goverrimentiventerliiimilihtleterredprosecutiowagreement 

"Agreement"). 

The terms and toriditionstittiieldeferied proSteittibMagretthent are as fO1LowS: 

1. TAFGA acknoWledges40 agreds:tliatthe:GOvetninent NSii.fliesfoteoubt. 

crimifiathit'OrinatiOn,MtaChed, in.theUriited.StatesDistrictCourt 

for the Central :Disti•iet'of IllinoiSyeliargingin:Counil Conspiracy to.PayKickbacksin viOlation 

of Title 18; United States Section 371, and:tharging in :Count2 Conspiracy to-Pay 

Gratuities in violatibridTitle,•13, -.United States,Code Section 311•Irtdoing:so, TAFGA.(a) 

knowingly,waives its righttelndiottrientlin these ehargesi.as well as rights to peedy.Trial: 

pursuant to the.Sbitb Unit44:$t4fOcp#0400piffitLelti;Linitect atatee'Peclei: 

Section 3161andFederal Rule of Criminal Pmcedure 48(1)1and (b) consents to thefiling of the 
4:1 1-cr-40083-MMM-JAG # 6 Page 2 of 13 

A. 

2.. TAPQA *laths that IS responsible for the WS of its officers, employees and 

agents aSSerforthin theittforMatifiii and:the Statement of as Attnehinetit 

A (incorporated by:refer-en:dein thiS.Agreemelit), With the execptiOn ofthe.paragraphs in the 

Statementof Facts beginning with,the:Phrase (Accordingia the gov.ernineties tvidenee;” 

Shotild the Government pursue' theprosecutiontliat is treferredbythis Agreement; TA.FdA 

agrees thabit will neither ethitestrhe adraiSsibilityttnerboritradintrhethateinentbf Factsj.ivith 

theekeeptiontofttie:ptitagrapiiS begititting."Attording td thegtiVeriirneitra2eVidefiee,"-in any 

criniffialiirodeeding; including<duniig aiig gutlty pidafir SentenCingtiOdeeditiga. Subjeettrithe 

provisions of this Agreementrhowever, TAPGAis free fadefend:any criminal,. civil,tm 

administrative action broughtby the 'Government. 

tatimaftheAtreetrient 

3. ThisAgreement is, effectiVeto,raperiocibeginningefitherlate of the Siming:tif 

this Agreement, and ending, eighteew(110itrionths from:that:date (tlieffrterm. 

.12ntevarittansiderations 

4. The- bovenunententerstite ibis Agreement basedon the individirai factsand 

circumstances presented hy..tlits,ease. •Amorigtheladts considered weretheitelleMing: (a): 

tAEdA's:acknOvAdgM0c Opi4!;.011n0S.1.5"-etripipyoes actteSPtiliedin theetP:064 8tatemenr 

of Facts acid (b);TAFQA'sifirglehiefitatitiri and maintenance o f zemedial measures and 

compliance prograin, itielading rilarieVVICticVaitiitiariageriteMteatii andran etltieS 

and compliance, team with oversightoverthS,,governmentcontracts-andSubtontracts, 

strengtheniiig,offistodo-altusitiesstbnduct;modernizationmfats. 'Standard Operating 

Pdffiil d tifti

itittiibflihtlid 
• 4:11-cr-40083-MMM-JAG # 6 Page 3 of 13 

harm to eriaployees and other piers* not. culpable Of the co:hist arising from the prosecution as 

set forth in the Staten-teat of Facts: 

Pittnithit.ofMonetiry Criminal Penalty 

. .............. 

5. The GoterratientandkOaagfee:tlieflippliealIonorIlielIfiltedBtates 

Sentencing QuidelitieartISSG" Of'"Senteneing:Buideliiidel fo deterininethe nfiPlinable 'fine 

range yields the following for Count 2: 

Base offense level: 

More than onogrelnity: 

More than $400,000? 

Total: 

ffS8G §2C1 .2(e)(2) 9 

(?)(). 

(1)(2) 14 

25 

6. The-Government and trAP.dA agree iliateounts and2 constitute "ClUs4 

RelSted Count? under §3D1 .2, 'silk as:sucti,. rity increase.ih'the riffenSelevel results froth those 

counts. 

7. The 'etiVerhriietitdrid TAEGA;tigree leU the terndining ClildUlatiOns of the 

applidable fine range: for TAFGMSerlinirialidondltet ltridniqhe;Senteileing.Gtildelines: 

Base Fine .for Offense Level 115: . §8C2A(u)(1) $I& Million 

Base Culpability adj.*" §$c2.5(a) 

, 

.5 points. 

Mote than 1•,000 employees:in Unit: (b)(2)(B)(i) 4points 

Obstruction•opustice, (0) 3 points 

Adeeptaneelif Respensibility (g)(3) =1:ptiint 

Teta!: Li 0/nit 

Multiplier range §802,6. 2.60 = 4.00 

Fine range' ' §80Z7, $54 to $11:1Millipn 
4:11 -cr-40083-MM M-JAG # 6 Page 4 of 13 

8. 'MEGA agrees: te pay a monetary .criblinalpobaity irx thcomount of.SS.d million. 

TAFGA and the •Government agree' hat.t1S,fine is appropriate nature and'. extent of the 

criminal conduct Of the TAFGA employees deSeribetiiiilthe Statement:of Facts, the degree to 

which TAFGA has instituted programs-by which tmensurefuture compliance, and TAVGA's' 

agreement to comply with the otherterms of this"Agreement. The monetary criminal penalty 'in 

•the amountof S5:6 million shallhe pard.ktliree: equal installinents imactehet 2611, April 2012, 

and Septeinbet 2612. The payments are'Cluthythe 18thdityOf each dithose tricitithS: This 

fibe is 'final and. Shall not bo'sefubdabk initiertinYteitatiMStarioeS. Flistlierniore, nothing 

in this Agteetnent shall be deeineitatorieeSsion by the Government thatS5:6'millicinis the. 

maxiinutn.penalty thatmay be imposed:in any finure.prosecutibn,and tlie, Governmentis:not 

precluded from ;arguing in any ;future prosecution that the CourtSimatil itupose ahiglier fine; 

although the boternitent agrees that-Under those eireuinstancesilt;Will recommend to dtnitt.: 

that any abiount paid under Nils Agfeetheashiiiild Offiet agailistany fine the Court imposes 

paift of a. futiike jUdginent. 

Candi tionalRel cas:criminal Liability as:10.Past Misconduct 

9. fit retired fotTAITQN-SeeitiplianceWiththe.terniS abd c,onditibris.tif this 

Agreeirient,:lhel.Goemment agreeSilleCteAlsetifiy/infoftiratienielitted10-the conduct-described 

lathe attached Statement ofiFacts,..or any information TAFGA-disolosecho •the 'United States 

Attorney lbr the eirWhiehmas othermiisellcriewnhy tlietTrtite&States 

Attorney :for the Central District of Illinois,.prior Waledaft of thiS.Agobitient; agailiStFAEGAi. 

or any Of its tiliollyroWned (a) iii a, 
4:11-cr-40083-MMM-JAG # 6 Page 5 of 13 

or (ci) any oriole related to national spPtattytna,tters dteliniteci State. in addition, the 

Govarnthentagrees, excOptrie;piti3lidedliereitythatit Will, nothrjng. anY'etiniinal in:dee410On 

•againatTAFGA, or any of its viholly-:ciyined Ot'cotittdlledinb'sidt4riess.related fo the conduct: 6f. 

presentanatbriner officers; directors, managers,:employess„agerit:s:,:constiltantsj.contraetors and 

subcontractors, as tesoribedilittlie.attachectrStatomefit-of Pieta; Orreihtins to inforrnation 

tik.E.GA diselOsed to the lifilithStates:Attbrneitortdie dentratbistriattilliiindis, bt.ixta 

otherwise knoivn. ipy thclInited'atat&Atteitaytbrtite Central'Diattiet Of 

dat&ofthis Agreement: ThiSParagiiiiiikdOeSitiOtinrOidet nytitOilOtiiiii.agailiaf the 6;01 it 

'erithinaharosectition for. any crimes .orvidlations, if any, comniittedlittlit fliturehrtAfThei, 

any.of its wholly-owned or controlled stibsidiaries,or any.iTAPGA.riwtret; director, .officer, 

manaser,employee, or agent: TriadaitiOnptliiSI'mtagraphdoStiouvrovideanyliroteetitaingainSt 

civil or criiii ilia' 'proseention of attypreSent COnript employee, shareholder,, 

agent,' abhatiltant, eantraetor, Or. Snlieolgr.aetotietTAFakethhet.:Or ViOlatiO4 iflny„ 

,cOlninitted:by: the& 

Cornoratei.Conintianea Program 

10. TAFGA.reproSentS thatitihaSiniNeinentadatid*J:oontititreteiniplenaenta 

compliance and othicsprogrant designeilto,d*ctand preyent.thetypeatoffenses describedin 

the attached.tatement-of Facts, and.anyttither crimes undetiholaWs of the united States, 

throughout itstperatious; includingthoSeoiitsaffillates. linplethentation:otthesspolibles anti 

procedures:shalltnatbe Construed hiarlyfuttireerifoteetitentpiocteditigas.proVidifigimiriniiity 

or amnesty far•taPY 'cranes, POPCIis0910(1:$0111* Pciv04400t 6016.thtil#W1061410Wilt0- thP 

4 
4:1 1-or-40083-MMM-JAG # 6 Page 6 of 13 

11. In. order to address any;deficiencies in its internaleontrols, policies, and 

procedures, TAFGArepresents thatithasiundertaken, and willeontinue toundettakeinthe. 

future, in a manner consiStentWith ail elks ohligaiionsunderthiS Agreement, a review of Its. 

existing internattontrolt;.liolioies„"wid:plo66dureidit compliance WitliVerlerat Aegiiisitidii 

Regulation TAFGA will adept new or modify existing internal 

proc'edures„ deSighed to(enstne chinpliatteWith The compliance 

standards, and procedures Will Maude; lintriatbeliniitedte,themiliiriluntelementssetiorthin 

Attachment 3, wilithisiiworporaleaby reference into thisAgreement 

Cot•porate'CornpliaiiceRepoi1ing 

TAFGA agrees thatl,vithinahrmonthstilsigning this:Agreeinent it will StIbmita. 

wriften repo:rt to the Government regarding remediatiorrand implementkitomol the compliance 

Measures Clescrihedin Attachinentlt, therepo'rusliall betratismittetito the DaitedState 

;Mtornef &Office ter the teqtrattSPIri$:OitiAtidis,..310path.Slx-th:Street; Springfield, 

62701: TAMA:May ektelid.the'tittienededfabistif4heOf itibi0.0ifikitAtp*6e Written 

-apprayal.ofthe Governineut basednoM,good.::.eauge.she*ntherefOre.: TAFGAahalidcsigilateitS 

Corporate Ethics. Director as the-persortresponsiblehr overseeing,TAVGAts corporate 

compliance reporting obligafions• Duringthe Term of be 

reaSonablegrotindSte'hefieVethat aviblatitin Of UnitetbStatestaWfias odeurred:or that 

queStiOnable or ebriuptpaythents tittlhesliOnallle'dti:601MPttransterai0 piopetty or interests 

MaY:liaYe been offeted,.PrentiSed,P0dc.nf authorized by,:aily- TAPCK 

minty orperson working directly for TAFGA,:.or that:related:false hook&and recordslayeeen 
4:1 1-cr-40083-MMM-JAG # 6 Page 7 of 13 

Deferred Prosecution. 

3. Inconsideration O1'.:(1)'TA.PGA. aeknOWlectaiiient of iiaSt,.CririeS -6y "employees 

described a401.141Stateriferit'OfPuett,(b)IAPC. -ayinent'ef a monetary ciimiiial 

penalt5i of $5...6 Million; and (e)',TAP9A'.0tebtitiiiiied.deitipliiMeetiiariagemerifgha.GOVeinment 

agrees that any prosecution of TAPOA forTheconduct set forth in theInfOrmation antrthe 

attaehed'Statement.ofPacts,endfor the conductrthat TAFGA Governinentoris 

otherwise known:by the'doVerninemprior tolhesigninrefthiSagreernerityte and liereby:ie 

deferred'foiiiie.terintf 0;4 Agreement.:Coucittetyia,vonircoriSidered diselOed‘tellie: 

Coverrundrit if TAFGApidindeal.vtittehriiitifieatibri tellie1.1.SiAtteriiey''anffiee fok,the 

CentralDiatrict of Illinois, 318 3..:60 Street, Spiingfielklli, Prior to tlie:signing of this 

Agreement. 

14: The eovenimtent furtheragteesiliatifTAPOktilitytcoinpflesWitlialt.ot. 

'obligations under this Agreementsthe:GMferinethWilituittoritinuelitettliiiinat prosecution 

against:TAFGA,described. it. Paragraph 1 and, at tlie:ebneltisiUttuftheTerMithieAgreetnenf. 

shall ekpire. Within thirty (30) ilaYkof thiliAgeeetrienfiSieiPitittion, tlieq0einnionthall sbelc 

dismissal with prejudice of the, cringneitiformatiOnliled against TAF.GAdescribedin 

Paragraph 1. 

lircaeitof the Mreetheritmid.6trittite.oftiniitittibtisMitliteri 

15, If, during:the Term of this:Agreement die:Gov.erturienteoncludes,anitthe Court 

determines thatTAFOA.hat'(a) eomthitted.anylaloriymn'der.federallaWsubsequentto the, 

signing:Of-this .Agreementiand thatsubstantiatuutbo.tiitypersotmeITas:defiiied in the 
4:11-cr-40083-MMM-JAG # 6 Page 8 of 13 

PerSandell? of TAFGA :partiCipatedia,:gonciOneti, directed, that crime, or (b) Substantial 

AuthorityFOrsonnel of TAFQA:otlierWiSelOn5WifiglY beintiiitteritia directed a material, 

substantial breath of this Agre.einent, TAFGA shall thereafter:be subtect.to,prosecution, for any 

federal criminal: violation -ofWhich the6-ovelnintiithas. kuowledge,.hicluding the. diarges'in the: 

Information, which may be pursuedbythe'6overnmentintheru,S; District Court for the Central 

District of Illihois or in any'other federi:distriet. TAFSkagretathatii:Wiii einiSent t&U.3, 

personal Jurisdiction foi any'SnefitiiiinitnifproSedutidoihtici.TAFGA -ai)pciihtelte: 

legal CO1.iiisel, eutrentlythelaW f±hii f Schiff Hardin LLB, afar:the:designee:10 acceptservice of 

legal process,. toinclude numinous, forsuckaction.. Inthe .eventofabreach of this Agreement 

any count of prosecution'thatis nottiniebarrecthyllie.applinalth statute of limitations: as ofilie 

date' of the signing of ihis'Agreehtentreay'beconiinetided: eg4hist TAFGA nOtsiiitlistandlitigthe 

expiration of the. statute of liMitatiOnShetweetrthe d4O Agreerneric.and the • 

4piiation-ef.lho Tenn:. In additirirriby•:signing:this::Agreenient; TAFGA fiiiiher.agreesthaftbe 

Statute of limitation's Witlfrelpectito:the offenses ehargeclinille Infermattottwere.notttithe-barred 

as ofthe date of the signing oftlicsAgreement.andishallbetoiledifromihat,date through-die 

expiration of the Term.. 

1.6. the':'eventtli at the.Goveitirierit. conoludes.lhat TAFGA liam6reaplied 

Agfeement;,the Government Eigreea-taProiiiide,TAF.Pii.ipi:WrittoilAgfideccifits, intent:to file 

with the COUtt arecitieSt thatllie Conti findthat TOGA has:Weacheci Ageetnetit and that 

The commentary provides:that “Substantial.authority personnel" Means individuals who. 

within 4be...kei;e of their aiittiOr4 exercise a substantial measure etdiscretion in actingon behalf 

of an organation. The termAncludealligli-leVel:persorinel4ik*elorgaifization, 

exercise substantial supervisory authority ;(e

g-a plant managera sales manager); and any other 
4:11-cr-40083-MMM-JAG # 6 Page 9 of 13 

the ,Geverrinient is seeking to continue or initiate a ct niinal prosecution resulting from 

TAFGA shall, within tliirlyadYtiliyS.6.freeeiptcifslienmoilee, have:the opportunity to 

respond. to the Governmentin uature,and Circumstances of the alleged. 

breach, as-well as the-actionsTADGAlliastakento-address mid reinediatetlie sittration, which. 

explanation the Government shall consider in determining whether to seek to 'continue or 

institute &prosecution. 

17; eVehttlitit the GOVeriuneritieinialtdeSilirid thelConft deterrinneS that 

TAFQAlia breathed:this Agreethepr:'!(a) all sib:tern:mils made, by or:mite:half:of TAFGA to :the 

Government or to the tourt;:ineltdinwthe tacliediStatement of Pacts; exceptionelthe 

paragraphs begintiing,"According to thezgov.ernmentla evidence;" and:anyleacis'derivedifrom 

siicli stateinents,'shalljhendmissibleirr eVidenoeikarry and all trinitind:prciceedingsliatiught by 

to GriVentMentagOiSt'll.F9A;:arid(b) TAFGA shall not 'attOtCa#Y.:Olaith1a1cter'tlie United 

Stat6S CcitiSritution, Ritlett(f) of tlileFederalliti.ileiOf CrithirlarProeedtire, Ittile 410 elate 

Federal Rules ofEviderice, or anyother federal rulecthatsliteinentsmade hy Or on behalf:of' 

TAFGA prior or subsequent talliis Agreement, and anyleads.derive4Therefrom; should be 

suppressed. The deciSibillVlietlier.tild Condubt.br statements 011aiay'entraiitdilleCterler employee, 

or any per SOil ,acting onbehalfof, or: at will tt,.T.4FP-Afar. 

the purpose of doterixiiiiingmlielberTAFGA has vielatednaY:lifevision Of thikAgreOnient,Sh011: 

be,made:by'the Cowl. 

1$. TAFGA acknowledgesthaVthe Governmentbasmademo 'representations, 

assurances; or promises concerning Vilia&serifencemay be Unposed by the-Court if TAFGA 
4:11-cr-40083-MMM-JAG # 6 Page 10 of 13 

that any such sentence is, solely within the discretioluottlitCypit and thatucithing in this 

Agreenienthindi of reattibta 'the Gouttan.the.exer.Olsofatieltdiscretion. 

Sale or Merger of TAFGA 

19.. TAFGAagteeat114:th die:evOdlitSellkiiiditei;YE:VansfetS all or substantially all 

of its buSineas OeratiOns as illey't date :of this-Agreement, 'whether such 

structured as astock or assetsale,therger:yritansfer,lit shallineludeth anycontract forsale, 

merger; or tranSferia proviSienthinclingkiliepurchaser, orany successor. in interestthereto; to the 

obligations deScribed inttnikAgteetrierit, 

Piiblie:StateinetitsvbttAFGA 

20. TAFGA expressly'agreesttbat it shantititilitugh ptesentor fthure .attottieyS„ 

of-fiders; directots,employees; agents Yrany Othei'PeraotitintilofiEetith speak thr TAFGA,Inake 

any finnliC;StatenlentrOccept iri eiVil,:atipithiStratiye„j:ofetultitiffy:Pitieegiogoym s-otfArth 

ber6x); eohti*dibtingiike accept urce of esponsibility by TAFGA...s4 forth above:or the:Tots 

described in-the attached Statement ofEacts,Mith:the.exeepiion'ofitatementsthade in,a criminal 

'proceeding as to paragraph's in,the.81afement of Facts heginningnAecording.th"the government's' 

evidence:" Anyauch contintliettity.atatetnentsliall; sithleotte*fliteureilebtStifTAFGA 

desbribedhelb*;:and (h),a,deteiirthitideri;hr.the Cenrt, etinSfltnte4bteach of thiiAgteoletit 

and TAFGA.thereaftef:sliallthe'.ObjeettyprOSeenliOnSafgiithilaiiraglapl*1.$.11itongh 1815€ 

this.Agreement. If the Oovenunenteoncludes.:that.a.publiestatemeithbrany such person 

contradicts in whole Yr-impart:a statement-contained iinheStatementofFactaa's described. 

,above,:the.Govemnientahall, ptior to seekingloinitiate.aprosecutloivresetilting from such 
4:11-cr-40083-MIVIM-JAG # 6 Page 11 of 13 

assert affirmative claims in ciyil,adridnistratil:,..0, or regulitorY:proccedings,relating to the alSte.r.S: 

set forth in the Stafethent of Fact& Orin etiniiiiatplOCeedi4lrelating:toteParagiralibaofthe. 

Statement of Factabeginning "According to The government's:el/Mance This Paragraph does 

not apply to any statement maddby any present or fanue.remp.toyee'of TAFGkin the course-Of 

any:criminal, civil, admilifsfratrve, prxegulatory ease initiatetagaihst suchindfi4dbaLuilless 

Stich individual is apealtirigoii behalf oftAFGA. 

TAPQA EigiteS.that ifitetniiybfits ,dii-eatti-ifidireCtaffiliate SubSidiafies 

issues a PressreleaSe OreSS conterenee Agreerneit TAFGA 

shall first consult the Government to determine (a)ANThether thelextolthexeleasc or-proposed 

statementratthe presaconference arertrue and aceuratemithrespecflomatterstetween the 

Government and TAFOA; and (b) vilfetherthe -Government has any,Olijeetiona to: die release: 

22, The Government agrees Idki'ng to atteritfop Of odieripi/ernitenvatithorities, .

hicitiding debarinefit offidialai thdfaCt..1:40atiretunatanSiclathritO.thiS.Agreetrient; 

The :natureof the underlying conductitidTAFQAks aceePtairce.of tesiionSib.ility. for thourilawfiii 

conduct ;described io. theStatementxifFacts.. By :agreeing to provide:Ws heonnation: to 

debarment autborifies,..the dovernmentis TIC& agre.eing-toaditocate'ortifelialf oftAVGA; but 

ratlicrproAildingfacts to be:evaluated:independent& lay ddbarmentauthoriiles, 

LitiiitatiOnOidBiirdingEffeet-of Akteeiritiff 

11 This Agreement :is liiirdfrig:ontAFGA, andtheadslettithentlitt apecihbally does 

not bind any other tedeial.agencics,:or any state,, focal OrlfOrei.kfiltil'etribreenient Or regulatory 

agericic, or ony'otrief:atitliontiesiig41.1081:01i0;a0VOrPti:WV4:Wir.ig:TAFPa'SOOPP#de of 

responsibility audits compliance witli4tts,ptherobligatici3s:iundpriliia;Agreompato The attend:01r 

of sneh:agencieaand.authoriiies if Tequestealo do :so by TAFOA. 

it 

KBRPROD0057711 

4:11-cr-40083-MIVIM-JAG # 6 Page 11 of 13 

assert affirmative claims in civil,„arlininistratiVe, or regulitOxY:proceedings,relating to the aVtte.t.S: 

sot forth in tlie Starethent of Fact& Orin CtirtiiiiatpfOCC,O4iOgS4elating:tote,PaMgfalibS4ftlie. 

Statement of Factabeginning "According to The government's. 014ence." this Paragraph does 

not apply to any statement made by. any present or fOrme.remp.toyee'of TAFGkin flie course-Of 

any; criminal, civil, admilifsfrative, prxegulatory case initiatetagaihst such'indiv dual; unless 

such individual is Ispealtirigoii behalf ofTAFGA. 

TAPQA Eigitestha ifittittiiyofits ,diteetbt ifidireCtaffiliate SubSidithes 

issues a PressreleaSe OreSS conterenee Aiieemojit TAFGA 

shall :first consult the Government to determine (a)ANThether theleittorthexeleast or-proposed 

statementratthe presaconference are true and: accuratemitlitespecflomaatterstetween the 

Government and TAFGA; and (b) Whothetthe -Government basnnyiblijections.to: die release: 

22, The Government agrees lo:imi'ng to the atteritfop Of otbergoVernitenvatitlictities, .

offidialai the:faCt$:anatireuMStanSfelatinitO.thiS4greerrient; 

The nature of the underlying colidtieritidTAFQMs aceelitithee.of responsibility. for the unlawfill 

canduCtdescribed theStatementsifFacts.. By :agreeing to provide:ibis ileonnation: to 

debarment authorifiesithe Govenunentis That agre.eing-to:adVocate'ombelialf of:TAVGA; but 

ratlicrproVidingfacts to be:evaluated:independent& by debarment:authorities, 

Liiiiitationit Binding' Effect--of Akteeiffeiff. 

11 This Agreement is binditig:onTAFGA, anti theariVetrithentlititspecihbally does 

not bind: any other tedeial.agencies, ''any state,, local pi,f0yellafilatitillbrOn*4 or regulatory 

agericic, !*Ony'ottief:atithontiesiig41.1081:01i0;a0VOrPti:WV4:WirAg:TAF.Pa'SOOPP#de of 

responsibility audits compliance witli4tts,ptherobligatici3s:iundprilii4;Agreompato attan.00a. 

of sueh:agencies.and.authoriiies if. Tequestealo xlia'SQ by TAFOA. 

it 

KBRPROD0057711 
4:11-cr-40083-MMM-JAG # 6 Page 12 of 13 

Notice 

24. Any notice to the Government under thiS,Agitementsiialt lie given by personal 

delivery, overnight by a-rpcogi:Oad46fiy-Oy service; or reiiStereti or certified mail; AO" 

the United •StateS Atterireyfor the Celt& DietiictofElinoia,13 Sonth 

IL 62701. Any notice to TAFGA Under this Agreement:shall:be given by personal delivery, 

overnight delivery by arecognized defiVery services:or registered or ce.rii8edlnail, kilts 'current • 

counsel, which is, as ofthe date of this Agreement, Schiff Hardin LLYs- Suite 6600, 231-South 

Wacker Drive, Chicago, IL'60666: 

174E :REST. OF 17.14814GE18•INIENTIONALLI4tEkt BLA1UC 
s/Major General Perry V Dalby 

JOY V- alb),(Rd.) 

General M9. ager;TA ,a 

4:11-or-40083-MMM-JAG # 6 Page 13 of 13 

Complete Aereement 

25. ThigAideemeats0sdbrifialltlielerms:oltheagreement: betweeirTAFGAand,the 

Government. No ainpndinemsonodiii6ationtekinidaitioavithigAtrboaeiitt.liAll be '1/2.114 

unless they are in NWifing•iiiiid.eist*. by the. ptivOilWrit, th attorneys foi TAP0A, !and a dilly. 

authorized representative of TAF:QA, 

AGREED: 

FOR TAMMT GLOBAL CO,, LTD,: 

Date: September 7 ,2011 By: 

Date: September 61 ,2011 fly: 

.FOR THE Uicl'PEDSTATES GFAMERTGA: 

Date: September , 2011 

r in fl 

s/Matthew C Crowl 

IthriaS 

Matt*/!C: 

Schiffliardin LLP 

Counsel for TAMA 

'AMEBA. LEWIS 

United States Attorney 

...41111tr

"'WA amen_ 

TT Or-CANNON 

Supervisory'Assistant Attorney 

31a South STN-tb.Pftect 

SprileOriM OAT 

(217} 492-400 
4:11-cr-40083-MMM-JAG # 6-2 Page 1 of 13 E-FILED • 

Monday, 19 September, 2011 10:32:32 AM 

Clerk, U.S. District Court, ILCD 

ATTACHMENT A 

STATEMENT OF FACTS 

1. The following Statement of Facts is incorporated by reference as part of the Deferred 

Prosecution Agreement (the "Agreement") between the U.S. Attorney's Office for the Central District 

of Illinois (the "Government"), and Tamimi Global Co., Ltd., a/k/a "TAFGA," which is hereinafter 

referred to as "TAFGA". With the exception of the paragraphs below beginning, "According to the 

government's evidence," TAFGA admits, agrees, and stipulates to the following: (a) TAFGA is 

responsible for the acts of its officers, employees, and agents as set forth below; (b) the facts set forth 

below are true and accurate; (c) should the government pursue the prosecution deferred by this 

Agreement, TAFGA will neither contest the admissibility of, nor contradict, this Statement of Facts in 

any such proceeding; and (d) if this matter was to proceed to trial, the Government would prove 

beyond a reasonable doubt, by admissible evidence, the facts alleged below and set forth in the 

criminal Information attached to the Agreement as Exhibit 1. Should this matter proceed to trial, 

TAFGA reserves the right to contest the facts set forth in paragraphs below that begin with the 

phrase, "According to the government's evidence." The evidence would establish the following: 

TAFGA and TAFGA Managers 

2. Defendant TAMIMI GLOBAL COMPANY, LTD., also known as "TAFGA," and 

hereinafter referred to as "TAFGA," was a Saudi Arabian-based company that provided dining 

facility and other services to U.S. military personnel in the Middle East. TAFGA operated dining 

facilities ("DFACS") at U.S. military bases in Kuwait and Iraq as a prime contractor to the U.S. 

Army, as a subcontractor to a prime contractor to the U.S. Army, and as a contractor to the Kuwait 

government. During the period from 2002 through the date of this Information, TAFGA has received 

hundreds of millions of U.S. dollars as the result of contracts and subcontracts to provide services to 
4:11-cr-40083-MMM-JAG # 6-2 Page 2 of 13 

naturalized U.S. citizen. 

4. Zubair Khan Ahmed Khan ("Zubair Khan") was TAFGA's Operations Manager for 

Iraq, whose duties included supervising DFAC operations. 

5. An individual herein identified as "MSK" was a Project Manager for TAFGA whose 

duties included managing food service operations at DFACS operated by TAFGA in Kuwait. 

6. An individual herein identified as "M14" was an employee of TAFGA in Bahrain 

whose responsibilities included renewing employee visa and identification cards. 

Other Persons 

7. Stephen Lowell Seamans ("Seaman?) was employed by the company now known as 

Kellogg Brown & Root Services, Inc. ("KBR") from approximately March 1999 through 

approximately May 2003. From approximately October 2002 through November 2002 and from 

approximately March 2003 through May 2003, Seamans worked for KBR in Kuwait as a 

Procurement Materials and Property Manager. His duties as a Procurement Materials and Property 

Manager included the negotiation and awarding of subcontracts under the U.S. Army's prime contract 

called the Logistics and Civil Augmentation Program III ( "LOGCAP III"). As such, Seamans was a 

public official. 

8. Ray Scott Chase ("Chase") served as a Sergeant First Class in the United States 

Army. From approximately January 2002 through December 2003, Chase was deployed to Kuwait in 

connection with Operation Iraqi Freedom, As part of his official duties in 2002 and 2003, Chase 

served as the Contracting Officer's Representative ("COR") and the Non-commissioned Officer in 

Charge ("NCOIC") for the military dining facility located at the United States Central Command at 

Camp Doha, Kuwait and U.S. Army contracts related thereto. As the COR and NCOIC, Chase 

supervised the food procurement, preparation and service operations at Camp Doha. In 2003, Chase 
4:11-cr-40083-MMM-JAG # 6-2 Page 3 of 13 

LOGCAP III Contract 

9. In December 2001, a United States Army contracting command located at the Rock 

Island Arsenal in Rock Island, Illinois, which is within the Central District of Illinois, awarded the 

LOGCAP III prime contract to KBR. The Army Field Support Command, also located at the Rock 

Island Arsenal, was the procurement command for LOGCAP III. As the procurement command for 

LOGCAP III, the Army Field Support Command obligated and committed the funding for this prime 

contract. 

10. Under LOGCAP III, KBR provided goods and services to the Army in Kuwait, Iraq, 

and other locations around the world, including DFACS at U.S. military bases in Kuwait and Iraq. 

The specific requirements under LOGCAP III were set forth in "Task Order? that the Army Field 

Support Command issued to KBR. Under LOGCAP III, the United States Government paid KBR for 

the costs KBR incurred, plus an award fee. KBR commonly used subcontractors that invoiced KBR 

for their work. KBR thereafter invoiced the government which included the costs of subcontracts. 

KBR engaged TAFGA as a subcontractor to fulfill some of its DFAC obligations under the prime 

contract. The Resource Management Unit of the Army Field Support Command at the Rock Island 

Arsenal managed the money for the LOGCAP III prime contract, including the obligating of funding 

for the payment of Task Orders for DFAC operations. 

11. The LOGCAP HI prime contract incorporated the Anti-Kickback Procedures set forth 

in Title 48, Code of Federal Regulations, Section 52.203-7. KBR's subcontracts with TAFGA 

likewise incorporated those same Anti-Kickback Procedures set forth in that section. 

12. KBR's subcontracts with TAFGA also contained a specific Anti-Kickback Notice: 

Subcontractors and suppliers are prohibited from offering any money, fee, commission, credit, 

gift, gratuity, thing of value or compensation of any kind directly or indirectly to [KBR] 

employees for the purpose of improperly obtaining or rewarding favorable treatment in 

connection with a prime contract or in connection with a subcontract relating to a prime contract. 
4:11-cr-40083-MMM-JAG # 6-2 Page 4 of 13 

13. In or about October 2002, a LOGCAP HI task order required KBR to establish a 

DFAC at Camp Arifjan in Kuwait, known as the Camp Arifjan Zone 2 DFAC. On or about October 

14, 2002, KBR awarded the Camp Arifjan DFAC subcontract to TAFGA. 

14. In or about April 2003, a LOGCAP III task order required KBR to establish a DFAC 

at a palace in Baghdad, Iraq. On or about April 14, 2003, KBR awarded the Baghdad Palace DFAC 

subcontract to TAFGA. 

Criminal Conduct -Count I of the Information 

15. On or about October 9, 2002, Shabbir Khan hosted a birthday party for Seamans in 

Kuwait. At the party, Shabbir Khan provided Seamans with the services of a prostitute. When 

Shabbir Khan drove Seamans back to his quarters following the party, he offered to pay Seamans a 

kickback in connection with the Camp Arifjan Zone 2 DFAC. 

16. On or about October 14, 2002, Seamans awarded the Camp Arifjan Zone 2 DFAC to 

TAFGA in the not-to-exceed amount of US $14,398,505 for a One-year period. Seamans executed 

the subcontract on behalf of KBR, and Shabbir Khan executed the subcontract on behalf of TAFGA. 

17. According to the government's evidence, in or about April 2003, Seamans provided 

Shabbir Khan with bid information pertaining to the Baghdad Palace Subcontract. Seamans, knowing 

the amount of the bid submitted by another bidder, provided Shabbir Khan with the price TAFGA 

needed to bid to secure the award of the subcontract. 

18. On or about April 14, 2003, Seamans awarded the Baghdad Palace subcontract to 

TAFGA in the not-to-exceed amount of US $2,000,000. Seamans awarded the subcontract by way of 

a document entitled "Letter Subcontract Anticipating a Fixed Price Type of Subcontract," which 

provided for the parties to enter into negotiations for a cum-fixed-price subcontract by April 24, 2003. 

Seamans executed the letter subcontract on behalf of KBR, and Sbabbir Khan executed the letter 
4:11-cr-40083-MMM-JAG #6-2 Page 5 of 13 

$7,381,725.90 and specified the period of performance as six months from April 14, 2003, or through 

October 13, 2003. Seamans executed the change order on behalf of KBR, and Shabbir Khan executed 

the change order on behalf of TAFGA. 

20. From in or about October 2002 through in or about October 2003, on or about the 

below-listed dates, in connection with the Camp Arifjan Zone 2 DFAC and Baghdad Palace DFAC 

subcontracts, Shabbir Khan paid and caused to be paid kickbacks to Seamans in the total amount of 

approximately US $133,000 in the form of U.S. currency, and wire transfers from bank accounts in 

the Middle East to accounts in the United States, including the following: 

a. 10/29/02 Wire transfer of US $2,965 from Kuwait; 

b. 11/25/02 Wire transfer of US $20,965 from Kuwait; 

c. 4/17/03 Wire transfer of US $8,000 from Bahrain; 

d. 4/18/03 Wire transfer of US $9,465 from Kuwait; 

e. 4/23/03 Wire transfer of US $9,000 from Bahrain; 

f. 4/28/03 Wire transfer of US $8,500 from Bahrain; 

g. 5/12/03 Wire transfer of US $9,500 from Bahrain; 

h. 5/15/03 Wire transfer of US $8,500 from Bahrain; 

i. 5/16/03 Wire transfer of US $7,500 from Bahrain; 

j. 5/19/03 Wire transfer of US $6,500 from Bahrain; 

k. 5/21/03 Wire transfer of US $3,000 from Saudi Arabia; and 

1. 10/2/03 Wire transfer of US $9,965 from Kuwait. 

21. In or about April 2005, Shabbir Khan spoke with and otherwise communicated with 

Seamans, who was in the United States at the time, informing Seamans that an attache from the 

embassy or consulate in Bahrain had recently inquired into the source of wire transfers that TAFGA 

f ihd id Skikbkihif 2003Shbbi
4:11-cr-40083-MMM-JAG # 6-2 Page 6 of 13 

Middle East, this would make the wire transfers the authorities inquired about appear to be a 

legitimate business investment by Zubair Khan, 

22. On or about August 27, 2005, federal law enforcement personnel from the Central 

District of Illinois interviewed Zubair Khan in Kuwait. During the interview, Zubair Khan: 

a. Falsely stated, in sum and substance, that he and Seamans agreed in February or 

March 2003 to enter into a business venture to purchase armor plated, United States-made vehicles for 

sale in Iraq; 

b. Falsely stated, in sum and substance, that he directed TAFGA employee "MM" 

to wire transfer more than US $60,000 to Seamans as his investment in the business venture; and 

c. Falsely stated, in sum and substance, that the armored vehicle deal with Seamans 

fell through, and, thereafter, he tried to get Seamans to purchase a recreational vehicle ("RV") in the 

United States to sell in the Middle East, but the RV deal also fell through. 

23. On or about August 26 and 28, 2005, federal law enforcement personnel from the 

Central District of Illinois interviewed Shabbir Khan in Kuwait. During the interview, Shabbir Khan; 

a. Falsely stated, in sum and substance, that he thought certain wire transfers of 

money that persons affiliated with TAFGA made to Seamans were for a business venture between Zubair 

Khan and Seamans for the purchase of armored cars in the United States for sale in the Middle East for 

profit; and 

b. Falsely stated, in sum and substance, that he was unaware of any kickbacks and 

gratuities paid to Seamans by TAFGA personnel. 

24. According to the government's evidence, by at least August 26, 2005, when 

interviews of Zubair Khan, Shabbir Khan, and others commenced in Kuwait by federal law 

enforcement personnel front the Central District of Illinois, TAFGA was told of the kickback 
4:11-cr-40083-MMM-JAG # 6-2 Page 7 of 13 

25. On or about August 28, 2005, during the interview in Kuwait with federal law 

enforcement personnel from the Central District of Illinois, Shabbir Khan provided the law 

enforcement personnel with false and misleading documents to support his and Zubair Khan's 

fictitious story about a business venture between Zubair Khan and Seamans. These documents 

included a document Shabbir Khan represented as an April 10, 2003, memorandum from Zubair 

Khan to Shabbir Khan in which Zubair Khan requested that Shabbir Khan advise the TAFGA finance 

department to give US $67,000 of Zubair Khan's year 2002 bonus to TAFGA employee "MM." 

These documents also included a document Shabbir Khan represented as an April 13, 2003, 

memorandum between TAFGA finance department employees stating that the Operations Manager of 

TAFGA had approved Zubair Khan's April 10, 2003, request 

26. On or about the dates below, defendant TAFGA caused the Rock Island Division of 

the United States Attorney's Office, Central District of Illinois, to receive the following false and 

misleading documents from TAFGA's then legal counsel: 

a. September 12, 2005: documents relating to wire transfers made to Seamans by 

one or more TAFGA employees in the Spring of 2003; 

b. September 16, 2005: e-mails between Zubair Khan and Seamans concerning the 

fictitious business venture; and 

c. September 26, 2005: a memorandum repeating and crediting the fictitious 

business venture story. 

27. On or about October 28, 2005, Shabbir Khan and Zubair Khan met with Seamans in 

London, England. During the meeting, the three discussed the following, in sum and substance, 

among other things: 

a. Zubair Khan explained to Seamans the fictitious story he had told to the federal 
4:11-cr-40083-MMM-JAG # 6-2 Page 8 of 13 

c. Shabbir Khan and Zubair Khan told Seamans that they needed documentation 

showing that Seamans had wired approximately US $65,000 back to Zubair Khan's bank account in order 

to support the fictitious story they had told federal law enforcement personnel; and 

d. Shabbir Khan and Zubair Khan further instructed Seamans to wire transfer a sum 

of money to Zubair Khan's bank account, that they would then transfer the same sum of money back to 

Seamans, and that this process was to continue until Seamans had sent a total of US $65,000 to Zubair 

Khan's bank account, and had received a total of US $65,000 in return, in order to support the fictitious 

story they had told federal law enforcement personnel. 

28. On March 22, 2006, federal law enforcement personnel interviewed Shabbir Khan at 

the United States Attorney's Office in Rock Island, Illinois, in the Central District of Illinois. During 

the interview, Shabbir Khan: 

a. Falsely stated, in sum and substance, that in 2003, Zubair Khan had a private side 

business deal with Seamans for the purchase of an armored vehicle in the United States for resale in the 

Middle East; 

b. Falsely stated, in sum and substance, that to obtain money for Zubair Khan's 

investment in the armored car deal with Seamans, Zubair Khan asked TAFGA to give US $67,000 of his 

year 2002 bonus to TAFGA employee "MM;" 

c. Falsely stated, in sum and substance, that none of the money provided to 

Seamans by TAFGA employee "MM" had anything to do with TAFGA's business with KBR; 

d. Falsely stated, in sum and substance, that the armored vehicle deal with Seamans 

fell through; 

e. Falsely stated, in sum and substance, that neither Shabbir Khan, Zubair Khan nor 

TAFGA intended to pay kickbacks to Seamans through the payments made to Seamans; and 
4:11-cr-40083-MMM-JAG # 6-2 Page 9 of 13 

Criminal Conduct -Count 2 of the Information 

29. Tn 2002 and 2003, defendant TAFGA provided dining facility services to the United 

States military at Camp Doha in Kuwait through a contract with the Kuwait government. TAFGA 

likewise provided the dining facility services at one of the Camp Arifjan DFACS, known as the Camp 

Arifjan Zone 1 DFAC, after that facility was set up in 2003. 

30. Ray Scott Chase was responsible for supervising all food procurement, preparation, 

and service at the Camp Doha DFAC and the Camp Arifjan Zone 1 DFAC. Chase was responsible 

for ordering food, supplies, and services for those DFACS from private contractors that held Blanket 

Purchase Agreements with the U.S. Army. 

31. According to the government's evidence, in approximately mid-2002, "MSK" met 

with Chase and solicited Chase to use Chase's position to order food for the Camp Doha DFAC, and 

according to government evidence was done to reduce TAFGA's obligation to provide food under its 

contract with the Kuwait government, thereby reducing TAFGA's costs and increasing its profits. 

32. According to the government's evidence, in approximately mid-2002, "MSK" gave 

Chase an envelope containing approximately US $10,000. 

33. According to the government's evidence, between approximately mid-2002 and 

December 2003, at monthly or bi-monthly intervals, "MSK" paid Chase cash amounts between 

approximately US $8,000 and US $20,000 because of official acts Chase performed and was going to 

perform in relation to the Camp Doha DFAC and the Camp Arifjan Zone 1 DFAC. According to the 

government's evidence, this included Chase's ordering of food in a manner that reduced TAFGA's 

obligation to provide food under its contract with the Kuwait government, thereby reducing Tamimi' s 

costs and increasing its profits. 

34. According to the government's evidence, between approximately mid-2002 and 
4:11-cr-40083-MMM-JAG # 6-2 Page 10 of 13 

free of charge. 

36. In sum, TAFGA admits that it is responsible for the misconduct of its employees, 

who (a) agreed to provide Chase illegal gratuities; (b) in furtherance of that conspiracy gave Chase 

things of value, that is, United Statei currency and the use of an apartment, because of official acts 

performed, and that were to be performed, by Chase during the year 2002 through the end of the year 

2003 in connection with contracts for dining facility services at Camp Doha in Kuwait and the Camp 

Arifjan Zone I DFAC; and (c) paid these gratuities unlawfully to Chase, that is, the gratuities were 

not provided to him as part of the proper discharge of his official duties. 

Other Relevant Conduct and Illicit Payments 

37. An individual herein identified as "TA" was TAFGA's Area Manager for the Balad 

Area in Iraq whose duties included managing the DFACS operated by TAFGA in that area. 

38. John Rivard (Rivard) served as a Major in the United States Army. From 

approximately March 2004 through February 2005, Rivard served as the Army's Chief of Contracting 

for Camp Anaconda which was located north of Baghdad in Iraq. His duties included supervising the 

process of awarding contracts for obtaining goods and services needed at and near Camp Anaconda. 

39. Theresa Russell (Russell) served as a Sergeant in the United States Army and 

worked and associated with Rivard at Camp Anaconda. 

40. According to the government's evidence, in or about 2004, Rivard participated in the 

awarding of a contract to TAFGA for DFAC operations at several forward operating bases in the 

vicinity of Camp Anaconda in Iraq. Approximately a month and a half after the contract was 

awarded, "TA" provided Rivard with US $10,000 in cash on account of Rivard's efforts in awarding 

the contract to TAFGA, and another US $10,000 in cash that "TA" directed be given to Russell. 

41. Terry Hall was employed by KBR in Kuwait as a Food Service Manager from 
4:11-cr-40083-MMM-JAG # 6-2 Page 11 of 13 

42. An individual herein identified as "Person A" was employed by KBR in Kuwait 

during the time beginning in approximately February 2003 as a Food Service Technician, Food 

Service Supervisor, and ultimately the Deputy Regional Food Service Manager of LOGCAP III for 

Kuwait and Iraq. 

43. According to the governments evidence, between the end of 2002 and the beginning 

of 2004, Shabbir Khan paid Hall and "Person A" a combined total of approximately US $40,000 in 

connection with DFAC subcontracts that TAFGA had been awarded under LOGCAP III. Khan did 

so in order to ensure that TAFGA kept the DFAC subcontracts that it had, and to ensure that TAFGA 

would continue to get additional subcontracts as they became available. 

44. From approximately March 2003 through early 2005, an individual herein identified 

as "Person B" was employed by KBR. He served primarily as a Subcontracts Administrator in Iraq. 

45. According to the government's evidence, in early 2005, Zubair Khan paid "Person B" 

approximately US $40,000 as a gratuity for the renewal of a KBR subcontract awarded to TAFGA for 

a DFAC in Iraq. 

46. In 2005, Peleti "Pete" Peleti, Jr., was serving in Kuwait as a U.S. Army Chief 

Warrant Officer and the Army's Chief Food Service Advisor for the Middle East Region. He was the 

advisor to the Commander on all facets of the Army's food service program. Among his duties-was 

the monitoring of food service contracts in Kuwait, Iraq and Afghanistan, including the acquisition 

and distribution of food and related food service supplies at Army bases and camps. 

47. According to the government's evidence, during Peleti's time as Food Service 

Advisor, Shabbir Khan provided him with airline tickets, food, drinks, several thousands of U.S. 

dollars, and the use of a "Party House" maintained by a TAFGA executive and other TAFGA 

representatives. Khan provided these gratuities to Peleti in light of Peleti's prominent position with 
4:11-cr-40083-MMM-JAG # 6-2 Page 12 of 13 

TAFGA employed and transported into Kuwait and Iraq several thousand food service workers from 

Bangladesh, Nepal, Sri Lanka, and elsewhere, 

49. One provision of the LOGCAP III task orders relating to DFACS required that food 

service personnel shall receive appropriate medical screening prior to employment. Screening was to 

include testing for infectious diseases, such as tuberculosis, typhoid fever, and hepatitis A. Food 

service workers' medical records were required to be maintained, and could be located at the 

respective DFACS. 

50. In March 2004, the Defense Contract Management Agency (DCMA), an agency 

responsible for oversight of the LOGCAP III prime contract, initiated a routine inspection of some of 

the DFACS operated by TAFGA, including one at Camp Arifjan in Kuwait. During the inspection, 

DCMA reviewed what was purported to be the medical records of TAFGA food service workers. 

DCMA questioned the legitimacy of some of the records, and requested additional medical 

information on TAFGA food service workers through the prime contractor, KBR. 

51. In response to a KBR demand for TAFGA's employees' medical screening records, 

TAFGA delivered to KBR in Kuwait City sets of photocopied documents purported to be the medical 

records of TAFGA's food service workers. Many of the records raised suspicion because they 

contained identical lab test results for multiple different food service workers. DCMA then 

conducted inspections at three other TAFGA operated DFACS in Kuwait and determined that all the 

purported medical records for TAFGA employees at each of those DFACS were forgeries. As a 

result, a federal investigation was initiated in the Central District of Illinois at Rock Island. 

52. In February 2005, a federal grand jury in the Central District of Illinois issued a 

subpoena to TAFGA requiring production of all of the company's food service workers' medical 

screening records. In response to the grand jury subpoena, from in or about May 2005 through in or 
4:11-cr-40083-MMM-JAG # 6-2 Page 13 of 13 

contained in those personnel files were different from, and much more elaborate than, the medical 

records that TAFGA had provided to DCMA and KBR in Kuwait in March 2004. It was 

subsequently determined that many of the purported medical records contained within the personnel 

files produced by TAFGA in 2005 to the grand jury were not legitimate and had been fabricated. The 

personnel files were produced as follows: 

a. On or about May 6, 2005, via hand delivery in Chicago, Illinois; 

b. On or about May 19, 2005, via commercial interstate carrier, from Chicago, 

Illinois to Rock Island, Illinois; 

c. On or about June 22, 2005, via commercial interstate carrier, from Chicago, 

Illinois to Rock Island, Illinois; 

d. On or about July 7, 2005, via commercial interstate carrier, from Chicago, 

Illinois to Rock Island, Illinois; 

e. On or about July 28, 2005, via commercial interstate carrier, front Chicago, 

Illinois to Rock Island, Illinois; and 

f. On or about August 18, 2005, via commercial interstate carrier, from Chicago, 

Illinois to Rock Island, Illinois. 
4:11-cr-40083-MMM-JAG # 6-3 Page 1 of 2 E-FILED 

Monday, 19 September, 2011 10:32:32 AM 

Clerk, U.S. District Court, ILCD 

ATTACHMENT B 

CORPORATE COMPLIANCE PROGRAM 

In order to address past deficiencies in its internal controls, policies, and procedures 

regarding compliance with the applicable United States anti-corruption laws, TAFGA agrees to 

continue to conduct, in a manner consistent with all of its obligations under this Agreement, 

appropriate reviews of its existing internal controls, policies, and procedures. 

Where necessary and appropriate, TAFGA agrees to adopt new or to modify existing 

internal controls, policies, and procedures in order to ensure that it maintains: (a) a system of 

internal accounting controls designed to ensure that TAFGA makes and keeps fair and accurate 

books, records, and accounts; and (b) a rigorous anti-corruption compliance code, standards, and 

procedures, in compliance with Federal Acquisition Regulation 52 203-13. At a minimum, this 

should include, but not be limited to, the following elements: 

1. Retention of a government contract compliance specialist to monitor 

TAFGA's compliance program and report to TAFGA's Legal Department. 

2. A clearly articulated corporate policy against violations of the anti-corruption laws of 

the United States. 

3. Promulgation of compliance standards and procedures designed to reduce the 

prospect of violations of the anti-corruption laws and TAFGA's compliance code. These standards 

and procedures shall apply to all directors, officers, and employees and, where necessary and 

appropriate, outside parties acting on behalf of TAFGA in a foreign jurisdiction, including but not 

limited to, agents, consultants, representatives, and distributors (collectively, "agents"); 
4:11-cr-40083-MMM-JAG # 6-3 Page 2 of 2 

procedures regarding the anti-corruption laws. Such corporate officials shall have the authority to 

report matters directly to TAFGA's Executive Board or any appropriate committee thereof; 

5. Mechanisms designed to ensure that the policies, standards, and procedures of 

TAFGA regarding the anti-corruption laws are effectively communicated to all directors, officers, 

employees, and, where appropriate, agents. These mechanisms shall include: (a) periodic training 

for all directors, officers, and employees, and, where necessary and appropriate, agents; and (b) 

annual certifications by all such directors, officers, and employees, and, where necessary and 

appropriate, agents, certifying compliance with the training requirements; 

6. An effective system for reporting suspected criminal conduct and/or violations of 

the compliance policies, standards, and procedures regarding the anti-corruption laws for directors, 

officers, employees, and, where necessary and appropriate, agents; 

7. Appropriate disciplinary procedures to address, among other things, violations of 

the anti-corruption laws and TAFGA's compliance code by TAFGA's directors, officers, and 

employees; 

8. Appropriate due diligence requirements pertaining to the retention and oversight of 

agents; 

9. Standard provisions in agreements, contracts, and renewals thereof with all agents 

that are reasonably calculated to prevent violations of the anti-corruption laws, which may, 

depending upon the circumstances, include anti-corruption representations and undertakings 

relating to compliance with the anti-corruption laws; and 

10. Periodic testing of the compliance code, standards, and procedures designed to