Contractors and contractor employees perform countless tasks on the government's behalf, which include playing an integral role in U.S. military operations. Though combat operations in Iraq have ceased and the government plans a drawdown of U.S. forces in Afghanistan in 2014, commentators have noted that contractors will continue to be vital to future military efforts. Given the apparent tension between contractor accountability and ensuring that contractors' monetary liability does not get passed, directly or indirectly, to the government or otherwise undermine federal policy, the potential tort liabilities that contractors might face in the course of meeting contractual obligations are of perennial interest to Congress. In recent years, U.S. civilian personnel, military personnel, and other parties have sued federal contractors under state tort law, alleging that contractors intentionally or accidentally injured them during the course of performing a federal contract. Contractors have responded to these tort suits by raising the Federal Tort Claims Act (FTCA), the political question doctrine, and derivative immunities in seeking to avoid liability. Some have also alleged that the government is obligated to indemnify them for any liability they may incur to third parties. This report provides background on, and analysis of, key legal issues that such suits present. It begins by providing a broad overview of tort claims generally. Then, it discusses the primary mechanisms through which contractors have attempted to defend against tort liability. Finally, it examines indemnification agreements between the government and contractors. Such agreements do not permit contractors to escape tort liability, but can allow them to shift the monetary losses resulting from tort liability to the government. This report supersedes an earlier report on this topic, CRS Report R41755, Tort Suits Against Federal Contractors: An Overview of the Legal Issues , by [author name scrubbed] and [author name scrubbed]. A tort is a civil wrong for which an injured party may obtain remedy, typically in the form of damages. Torts arise from breaches of duties imposed by law. In contrast, contractual remedies typically result from breaches of duties imposed by oral or written agreements between the parties to a contract. A tort suit against a contractor therefore generally results from the contractor's breach of duties imposed by law rather than its breach of contractual obligations. With some exceptions, tort duties are typically imposed by state law, and every state has its own tort laws. Tort law encompasses a number of civil wrongs, including intentional interference with the person of another by assault, battery, and false imprisonment; various types of interference with property; and negligence. Negligence indicates culpable carelessness or unintentional injury. To successfully establish a claim for negligence, a plaintiff must generally prove, by a preponderance of the evidence, that (1) the defendant owed the plaintiff a legal duty; (2) the defendant breached this duty, which generally requires the plaintiff to show that the defendant failed to exercise the care that a reasonably prudent person would have exercised in a similar situation; (3) the defendant's action or failure to act actually or proximately caused the plaintiff's injuries; and (4) the plaintiff suffered harm as a result of the defendant's action or inaction. Many tort claims against contractors allege negligence on the part of contractor employees in either performing their obligations under a service contract or producing goods pursuant to a contract for goods, though some also allege intentional torts. Furthermore, under the theory of respondeat superior, contractors may be held liable for the wrongful acts of their employees that are committed within the scope of employment. Contractors often raise the FTCA, the political question doctrine, and/or derivative immunities when defending against tort claims, particularly claims arising from their involvement in military operations. These defenses often implicate fundamental legal issues, such as the interaction of federal and state law, separation of powers and which branches of government are best equipped to consider particular types of questions, and protection of the federal government's monetary interests. The federal government is a sovereign, and thus enjoys sovereign immunity. The Supreme Court has long held that "[i]t is elementary that the United States, as sovereign, is immune from suit" unless it unequivocally and expressly consents to suit. The FTCA is one such unequivocal and express consent to suit, and it specifies that the federal government is liable for tort claims "in the same manner and to the same extent as a private individual under like circumstances, but shall not be liable for interest prior to judgment or punitive damages." However, though the FTCA generally waives the federal government's immunity from tort liability, it contains a number of exceptions through which the government retains its sovereign immunity in specified circumstances. Under these exceptions, for example, the government retains sovereign immunity from suit for any claim arising in a foreign country and any damages claim caused by regulation of the monetary system. Contractors have argued that the protections of some of the FTCA's exceptions should be extended to them under the doctrine of preemption. Under the Supremacy Clause of the U.S. Constitution, federal law is "the supreme Law of the Land" and applies instead of, or preempts, state law to the degree that the two are incompatible. The FTCA is not directly applicable to contractors, but courts have occasionally used its exceptions to craft rules that protect contractors from tort suit. Where courts have done so, they have rationalized that the FTCA and its underlying policies, as federal law, preempt tort claims, which are frequently rooted in state law. The two FTCA-based preemption defenses that contractors appear to invoke most frequently when defending against tort liability are the government contractor defense and the combatant activities exception. One FTCA exception permits the government to retain its sovereign immunity against any claim based on its or its employees' "exercise or performance or the failure to exercise or perform a discretionary function or duty … whether or not the discretion involved be abused." It is the tension between this FTCA exception, known as the discretionary function exception, and imposing tort liability on government contractors for harms caused by defects in some government-approved designs that spurred the Supreme Court to create the government contractor defense in its 1988 decision in Boyle v. United Technologies Corporation . After the Boyle decision, lower courts were left to determine whether the Supreme Court's rationale applies only to design defect claims, or whether it also supports immunizing contractors from manufacturing defect claims and claims originating in the performance of service contracts. In Boyle , a Marine pilot died when his helicopter crashed off the coast of Virginia Beach, VA. The Marine survived the initial crash, but subsequently drowned when water pressure apparently prevented him from opening the submerged helicopter's outward-opening escape hatch. His estate sued the contractor that built the helicopter to government specifications, arguing, among other things, that the escape hatch's design was defective because it opened outward rather than inward and equipment obscured the hatch handle. In response, the defendant contractor argued that the Court should recognize contractor immunity from liability for harms caused by defects in government-selected designs through a judicially created tort immunity based on the FTCA's discretionary exception. The plaintiff countered that courts could not create rules preempting state law by immunizing contractors from tort suit in the absence of express legislative authorization. However, the Court disagreed, holding that judicially created rules can preempt and replace state law in a few areas implicating "uniquely federal interests," meaning committed to federal control by the Constitution and U.S. laws. Having thus found that preemption by a judicially created rule is possible, the Court then fashioned and applied a two-part test for determining when preemption of state law by a judicially created rule is appropriate. This test focuses upon (1) whether the claim involves "uniquely federal interests," and (2) whether the state law "significantly conflicts" with an identifiable federal policy or interest, or impedes specific objectives of federal legislation. Based on this test, the Court found state law preemption by judicially created rule appropriate in this instance. The Court did so by first noting that contractors' civil liabilities arising under equipment contracts involve "uniquely federal interests" because imposing tort liability on contractors would directly affect government contracts by causing contractors to either decline to make equipment for the government or raise prices. The Court then concluded that a significant conflict exists between the discretionary function exception to the FTCA and holding contractors liable under state tort law for design defects in military equipment when the government selected the equipment's design. The discretionary function exception removes the government's own tort liability arising from its discretionary acts, and the Court determined that selecting the appropriate design for military equipment is plainly a discretionary act within the meaning of the discretionary function exception. The Court further concluded that contractors would "substantially if not totally" pass through to the government the costs of any tort liability derived from the government's discretionary selection of equipment design by increasing prices to "cover," or insure against, potential liability. In effect, this would make the government bear liability costs resulting from its discretionary acts, which the discretionary function exception sought to prevent. Thus, the Court found a conflict between the discretionary function exception and holding contractors liable under state tort law for defects in government-selected designs and preempted state tort law with a judicially created rule. After applying its two-part test and determining state law preempted by the discretionary function exception, the Boyle Court then created a rule for contractor immunity from tort liability. In doing so, the Court considered the extent to which state law should be displaced, and thereby the degree to which contractors should be immune from tort liability, necessary to protect the federal interest underlying the discretionary function exception. Specifically, in determining the scope of preemption, the Court sought to avoid frustration of the discretionary function exception's underlying policy of preventing the government from bearing the costs of liability caused by its discretionary acts, while simultaneously preventing contractors from perversely altering their behavior because of overly broad immunity from tort liability.