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Army Corps not liable for Katrina damage, appeals panel finds

New Orleans residents were dealt a setback Monday when a federal appeals panel, upending its own earlier decision, ruled that the US Army Corps of Engineers cannot be sued for damages stemming from losses sustained after hurricane Katrina.

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In this May 2012 photo, the new levee wall constructed with reinforced concrete, is shown at one of the breach sites from Hurricane Katrina, in the Lower 9th Ward in New Orleans. The Army Corps of Engineers was given about $14 billion to improve flood defenses after Katrina.

Gerald Herbert/AP

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Five hurricane Katrina survivors seeking government compensation for lost property and livelihoods were dealt a setback this week, as a federal appeals panel absolved the US Army Corps of Engineers from liability for damages stemming from failure of the flood-control system that protects New Orleans.

The panel's decision Monday came as a surprise, in effect upending its previous finding in March that the Army Corps was liable for some damages. The Army Corps has primary responsibility for building and maintaining the network of levees and flood-control mechanisms surrounding New Orleans, and plaintiffs claim that the floodwaters that inundated most of New Orleans in August 2005 – killing nearly 2,000 people, displacing half the population, and causing more than $81 billion in damage – were not the result of a natural disaster but rather of failure by the corps to supply adequate protection.

Previously, a lower court had blasted the Army Corps for failing to maintain the flood-protection system. The five residents suing the corps – and about 500,000 other claimants in line behind them – say they are owed damages because of systemic engineering, design, and mechanical failures over a 40-year period.

But the three-judge panel of the US FIfth Circuit Court of Appeals said Monday that the corps cannot be subject to liability claims due to a provision in federal tort law called the discretionary function exception. The exception states that the US government cannot be sued for actions that an agency or agency employee makes or fails to make. In its ruling, the panel said the exception “completely insulates the government from liability” and is intended to keep courts from reversing government decisions when they are “grounded in social, economic, and political policy.”

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