Update: The State Department Also Doesn't Know Blackwater's Status.

From Yahoo News:

The workings of security contractors in Iraq are so unclear that the State Department, whom Blackwater protects in Iraq, was still unable to say more than 48 hours after Sunday's incident whether the company holds a legitimate license.

The U.S. embassy also could not answer questions about the legal status of security contractors, and whether any possible proceedings would be prosecuted under Iraqi or U.S. law