5.15.2006
Boeing to Settle with Justice
(As SLP risks slowly morphing into Boeing Blog....) Here's more news from the world's #1 aerospace company, and a nice office-warming gift for Judge Luttig, the newly named GC of Boeing: After three years of federal investigations and recent rumors of settlement, the Wall Street Journal reports the company has reached a deal with the feds: Boeing will pay $615 million to settle civil and criminal claims in connection with the defense procurement scandals, the details of which you've read ad nauseum, no need to review. (By the way, the above link is to Reuters, for folks without Journal subscriptions.)
Suffice to note, the hefty settlement amount (which may be a record in the wild world of procurement misconduct) gets Boeing off without having to "admit wrongdoing."
These scandals already cost the company estimated revenue of $1 billion in suspensions and canceled launch contracts, as well as jail sentences for two executives and the resignation of one CEO (Phil Condit). (And I do not know if outgoing GC Doug Bain counts himself as a casualty of all this.) Not to mention a crashed and burned reputation. (And there were plenty other misdeeds and missteps along the way.) (Some people even remember the Raytheon debacle.)
Meanwhile, what about Lockheed's civil suit against Boeing for trade secret theft still pending in district court in Florida? Under the terms of the proposed ULA joint venture between the two rivals, if the deal wins approval (holding your breath?), Lockheed will drop its action. (The WSJ suggests DOJ's not making Boeing admit wrongdoing hurts the Florida case, but I'm not so sure. Agreeing to pay $615 million to the feds is not exactly a ringing declaration of innocence.)
Boeing has also settled some shareholder suits in connection with the procurement malfeasance.
So, is the company finally turning the corner? How interesting to watch Boeing navigate its "new frontier" of ethics and good corporate governance, eh?
Suffice to note, the hefty settlement amount (which may be a record in the wild world of procurement misconduct) gets Boeing off without having to "admit wrongdoing."
These scandals already cost the company estimated revenue of $1 billion in suspensions and canceled launch contracts, as well as jail sentences for two executives and the resignation of one CEO (Phil Condit). (And I do not know if outgoing GC Doug Bain counts himself as a casualty of all this.) Not to mention a crashed and burned reputation. (And there were plenty other misdeeds and missteps along the way.) (Some people even remember the Raytheon debacle.)
Meanwhile, what about Lockheed's civil suit against Boeing for trade secret theft still pending in district court in Florida? Under the terms of the proposed ULA joint venture between the two rivals, if the deal wins approval (holding your breath?), Lockheed will drop its action. (The WSJ suggests DOJ's not making Boeing admit wrongdoing hurts the Florida case, but I'm not so sure. Agreeing to pay $615 million to the feds is not exactly a ringing declaration of innocence.)
Boeing has also settled some shareholder suits in connection with the procurement malfeasance.
So, is the company finally turning the corner? How interesting to watch Boeing navigate its "new frontier" of ethics and good corporate governance, eh?
