Iran Air Flight 655 (IR655), a commercial flight, that flew from Bandar Abbas, Iran to Dubai, UAE, was shot down on Sunday July 3, 1988, towards the end of the Iran Iraq War, by the U.S. Navy guided missile cruiser USS Vincennes somewhere between Bandar Abbas and Dubai, killing all 290 passengers and crew aboard, including 38 non-Iranians, 66 children and one pregnant woman. The USS Vincennes was inside Iranian territorial waters at the time.
Iran Air Flight 655 continuously squawked Mode III (Civilian Airliner) IFF in duration of flight however the crew on the new Aegis cruiser USS Vincennes identified flight 655 as squawking Mode II (Iranian F-14 Tomcat) IFF momentarily, personnel proceeded to label the target from "Unknown Assumed Enemy" to "F-14".
Investigations found that the crew bent the information into a scenario they have trained for, a single plane coming for an attack run, the captain also was known for his aggressive standoff.
The US government never expressed responsibility or liability for what happened. The men of the USS Vincennes were all awarded combat-action ribbons.http://en.wikipedia.org/wiki/Iran_Air_Flight_655