Northrop Grumman settles False Claims Act suit involving reconnaissance satellites

Northrop Grumman Corp. and its subsidiary Northrop Grumman Space and Mission Systems Corp. (“Northrop”) have reached a quite sizable settlement with the Department of Justice to end a False Claims Act suit. The government charged that Northrop had billed the National Reconnaissance Office (NRO) for defective parts used in reconnaissance satellites. The lawsuit alleged that from 1992 to 2002, Northrop manufactured certain microelectronic parts, called Heterojunction Bipolar Transistors (HBTs),.that had not been properly tested. These defective HBTs were integrated by Northrop into NRO satellite equipment. Northrop then made misrepresentations to the NRO about the defective parts and concealed information about the reliability of the HBTs. The allegations against Northrop were first brought to light by Robert Ferro, Ph. D., with The Aerospace Corporation. In 2002, Dr. Ferro filed a False Claims Act suit against Northrop in federal court in California. As part of the government’s settlement, Dr. Ferro will receive a substantial share of the monetary settlement, as authorized in the Qui Tam provisions of the False Claims Act.

For the full story, go to Department of Justice’s Press Release.