The US Marine Corps said in a statement on Thursday that 16 Americans and three Iraqi contractors were held for three days late last month after they fired on Iraqis and marines from their cars in Falluja.
No charges have yet been laid in the 28 May shootings.
There were no casualties and the circumstances surrounding the shootings remain unclear.
Many Iraqis resent high-profile security details, who speed along Iraqi highways in four-wheel drive vehicles bristling with automatic weapons.
But senior government officials, who are prime targets of fighters wreaking havoc across Iraq, use private security firms for their own protection.