Northrop to settle two lawsuits for $80 million

Northrop Grumman Corp. has agreed to pay $80 million to settle two whistle-blower lawsuits stemming from allegations that the defense contractor overcharged the government on a commercial tanker program and sold the Navy defective military equipment, the Justice Department said yesterday.

The settlements, which were expected, involved payments that were far less than the initial claims levied against the Los Angeles-based defense contractor.


In the case against Northrop's Newport News Shipbuilding subsidiary, government officials accused the company of overcharging the Pentagon $72 million for work on a commercial tanker program. Under the settlement, Northrop will pay the Justice Department $60 million.

In the second case, Northrop agreed to pay $20 million to settle allegations that in the late 1980s and early 1990s it knowingly sold the Navy target drones that contained defective parts. The government had sought $210 million.


Northrop at one point faced four whistle-blower lawsuits stemming from allegations - some more than a decade old - that it violated accounting rules to defraud the government.

But the company has now settled three whistle-blower cases, including a $111 million payment in June to settle federal allegations that TRW Inc., a defense contractor Northrop acquired last year, overcharged the government for various space projects.

The fourth lawsuit, which claims that Northrop inflated costs for electronics used in bombers and fighter jets, is pending. The amount sought in that case is $113 million.

The Los Angeles Times is a Tribune Publishing newspaper.