Teledyne Unit Barred From U.S. Pacts : Pentagon Suspends Electronics Division, 4 Men Indefinitely
In another response to last week’s military bribery scandal indictments, the Pentagon on Wednesday indefinitely suspended a division of Los Angeles-based Teledyne from bidding on or receiving any government contracts.
The suspension, levied by the Defense Logistics Agency, also effectively bars three current employees and one former employee of the Teledyne Electronics division in Newbury Park from working on government contracts. Other Teledyne divisions and employees are not affected by the ban.
Neither Teledyne nor the defense agency disclosed how much Pentagon business Teledyne Electronics is currently bidding for. But a Pentagon spokesman said the division currently has active military contracts won in past years totaling $223.2 million. Those contracts will not be affected by the suspension.
Berkley Baker, a spokesman for Teledyne, said the firm does not anticipate any immediate impact from Wednesday’s action and reasserted the firm’s belief that it and its employees will be found innocent.
He said the electronics division has annual revenue of $75 million, virtually all of which is defense-related. The electronics unit accounted for about 2% of the company’s total annual revenue last year of $4.6 billion. The electronics division employs 500 of Teledyne’s 44,000 workers.
Wednesday’s suspension bars Teledyne Electronics from receiving any government contracts--defense or otherwise--and also bars the unit from performing “government-approved subcontracting.”
3 Employees Assert Innocence
Three Teledyne employees indicted last week for their alleged involvement in the defense fraud probe known as “Operation Ill Wind” are also affected by the ban. They are: George H. Kaub, vice president for contracts at the Newbury Park unit; Dale Schnittjer, vice president for finance at the same unit, and Eugene R. Sullivan, former comptroller of the unit and now assistant controller at the Teledyne Ryan Electronics unit in San Diego. All three, through the company spokesman, have asserted their innocence.
Teledyne placed the three men on paid administrative leave Friday after the indictments were handed up by a federal grand jury in Virginia, Baker said, and it is paying for their defense attorneys. Michael Savaides, Teledyne’s former marketing director in Washington, who pleaded guilty to one count of conspiracy to commit bribery, is also banned from participating in government contracts. Savaides was fired by Teledyne several months ago, Baker said.
Federal prosecutors have said their investigation focuses on allegations that private consultants bribed government employees for information that gave client companies an edge in winning contracts.
Specifically, the indictment charges that Teledyne Electronics and three of its officers agreed to pay defense consultant William E. Parkin $160,000 to assist them in obtaining Navy contracts. To win the contracts, the indictment contends, Parkin paid Fred H. Lackner, a Woodland Hills consultant, who “in turn paid (Navy electronics engineer and procurement specialist) Stuart E. Berlin . . . for his assistance in manipulating the procurement process to insure that the . . . contract was awarded to Teledyne.” Attorneys for Parkin, Lackner and Berlin have each said their clients intend to fight the charges.
Berlin, the first government employee to be indicted, was suspended from his job without pay Tuesday.
