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Pentagon Lifts Ban on Teledyne Electronics

Times Staff Writer

The ban on new government contracts slapped on Teledyne Electronics six months ago for its role in the massive Pentagon procurement fraud “Ill Wind” was lifted Friday.

A Teledyne spokesman said the ban, imposed by the Defense Logistics Agency and in effect since Jan. 11, had caused “a serious disruption” in business at the Newbury Park subsidiary. However, he said the company had not attempted to quantify its lost business opportunities.

An estimated $223.2 million worth of military work under way at the subsidiary when the ban was imposed was unaffected. Other Teledyne divisions were also not affected. The electronics division, which employs 500 of Teledyne’s 44,000 workers, has annual revenue of $75 million, virtually all of which is defense-related. The entire company last year had total revenue of $4.6 billion.

On March 23, Teledyne pleaded guilty to two charges stemming from the government’s investigation into massive fraud surrounding the bidding on and awarding of Pentagon contracts. The company was fined a total of $4.36 million.

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Federal prosecutors said private consultants, retained by defense contractors such as Teledyne Electronics, bribed government employees for information that gave their clients an edge in winning contracts.

In the case of Teledyne, prosecutors said the company and three of its managers agreed to pay defense consultant William E. Parkin $160,000 to assist them in obtaining Navy contracts handled by Navy electronics engineer and procurement specialist Stuart E. Berlin.

Parkin, Berlin and Woodland Hills consultant Fred H. Lackner, who also was involved in steering contracts to Teledyne, have already pleaded guilty to charges stemming from the investigation. Parkin and Berlin were sentenced to 26 months in prison and fined $25,000. Lackner is awaiting sentencing.

The three Teledyne Electronics employees went to trial. Two, George H. Kaub, vice president for contracts at the Newbury Park unit, and Eugene R. Sullivan, former comptroller of the unit and now assistant controller at the Teledyne Ryan Electronics unit in San Diego, were found guilty of wire fraud and conspiracy. Dale Schnittjer, vice president for finance at the Newbury Park unit, was acquitted.

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