Former TRW Accountant Wins Judgment

A former TRW Inc. accountant won a $700,000 judgment against the company after convincing a jury that his superiors ordered him to defraud the government.

A jury deliberated less than four hours Monday in Cuyahoga County Common Pleas Court before returning a verdict in favor of Alan J. Russ, a former manager of accounting for TRW.

Russ was awarded $600,000 in compensatory damages and $100,000 in punitive damages.

A spokesman for Cleveland-based TRW said the company, the nation’s 21st-largest defense contractor, would appeal.

Russ testified during the trial that he was fired in 1984 as a part of an internal managerial shake-up designed to convince the federal government that TRW had dismissed employees who fraudulently inflated prices on government contracts, even though the scheme was being directed by managers higher up in the company.

Countered Charges

TRW’s contracting policies are the subject of a probe by the House Energy and Commerce subcommittee on oversight and investigations.

TRW said in a statement that “during the trial, Mr. Russ freely admitted performing these illegal and unethical acts that led to his dismissal.”

Russ countered that the pricing scheme was already in place and widespread when he came to work for the company in 1967, and that his supervisors taught it to him.

But David Parham, TRW’s lawyer, argued that Russ knew the consequences of his actions.

“TRW is not saying to you that this was not a serious problem, because it was. Forty-seven people were dismissed,” Parham told the jury during closing arguments. “But Al Russ knew exactly what he was doing. He back-dated records and destroyed the originals.”

, Russ and two other former TRW employees also have filed a $3-billion false claims suit against the company in federal court. All actions in that suit are under stay until completion of a federal investigation into alleged fraudulent practices by the company.