The Northrop Grumman Corporation has agreed to pay the United States government $80 million to resolve allegations of overcharging and selling the Navy defective military equipment.
The government alleged that from 1994 to 1999, Northrop Grumman?s subsidiary Newport News Shipbuilding (NNS), charged costs to the state for Independent Research and Development (IR&D) that it used for the design and development of double hulled tankers that the shipbuilder had contracts to build for commercial customers. Newport News will pay $60 million to settle the allegations. Since November 2001, NNS has been a wholly owned subsidiary of Northrop Grumman.
In a second action, Northrop Grumman agreed to pay $20 million to resolve allegations that the company knowingly sold the Navy unmanned aerial vehicles, known as Target drones, that contained defective parts. Northrop knowingly provided the Navy with a deficient quality assurance program that failed to meet military specifications, knowingly delivered drones that contained various defective parts, and that the drones failed to meet contractual reliability requirements.
