Washington (IraqiNews.com) — The US Supreme Court has rejected a bid to fine the Iraqi government $121 million in a long-running dispute with American defense firm Wye Oak Technology over a failed military contract.
The ruling confirmed that Iraq remains protected under the US Foreign Sovereign Immunities Act (FSIA).
The case stemmed from Wye Oak’s lawsuit alleging breach of contract during efforts to rehabilitate Iraq’s military equipment after 2003. However, the court reaffirmed that Iraq enjoys exceptional legal immunity in the United States, shielding it from such claims.
This immunity traces back to the aftermath of the US-led invasion in 2003, when Congress passed the “Iraq Freedom from Judicial Attachment Act,” signed into law by President George W. Bush. The legislation granted Iraq protection from lawsuits and asset seizures, a safeguard renewed by successive administrations for two decades.
At the time, Iraq faced billions of dollars in debts accumulated under Saddam Hussein’s regime. To manage those liabilities, Washington created the Iraq Development Fund, channeling the country’s oil revenues and foreign reserves into an account held by the US Federal Reserve. The arrangement was intended to protect Iraq’s assets from creditors and ensure financial stability during its reconstruction phase.
