GRAHAM WARWICK / WASHINGTON DC Manufacturers ask federal judge to delay US Navy's debt collection attempts as attack aircraft saga enters new phase

Boeing and General Dynamics (GD) are moving to delay an attempt by the US Department of Defense (DoD) to recover $2.3 billion from the failed A-12 attack aircraft programme. Last week, the DoD told the companies it will begin collecting the debt by deducting money from payments on various existing contracts, including Boeing's F/A-18E/F Super Hornet and C-17 transport, and GD's Seawolf-class attack submarines.

A federal judge has been asked to block the collection effort, arguing the DoD should wait for a court hearing due to start on 9 January. The manufacturers' move is the latest in the long-running legal battle over the A-12 cancellation in 1991. In August last year, the US Court of Federal Claims ruled that the US Navy, which had ordered the stealthy A-12 as a replacement for its Grumman A-6 Intruder attack aircraft, was justified in cancelling the $4.4 billion development programme because of delays and cost overruns, and could proceed to recover $1.3 billion paid to the contractors, plus $1 billion in interest accumulated since the cancellation.

In August, after losing patience with protracted negotiations, the government gave the contractors until 30 September to repay $1.15 billion each, but both refused. Collection efforts, although postponed while negotiations continued, are now to begin "since it appears an equitable settlement will not be reached in the near term", says the DoD. The Pentagon is understood to have rejected an offer by the companies to repay the debt by providing free engineering improvements and extra aircraft and weapon systems under existing contracts.

In terminating the GD/ McDonnell Douglas (now Boeing) programme "for default", before the first A-12 had flown, the USN cited the contractors' inability to develop the aircraft to the requirements and schedule.

Northrop Grumman and TRW are continuing discussions with the US Department of Justice on the consent decree that will be required to win government anti-trust approval for the companies' planned merger, which they hope to close by year-end. The decree is expected to contain provisions designed to preserve competition in certain satellite technologies, but Northrop Grumman does not expect that any divestitures will be required.





Source: Flight International