Lockheed Sued on Disclosure of P-7A Overruns

Lockheed was sued Monday by a Pennsylvania corporation that claims to have lost money on the aerospace firm’s stock because it failed to disclose cost overruns on its Navy P-7A program sooner.

The class-action suit was filed by Peter Stuyvesant Ltd., which claims that it purchased 200 shares of Calabasas-based Lockheed on Sept. 20 for $48.50 per share. The suit also names as defendants a number of Lockheed executives and directors.

Lockheed shares lost $3.625 on Monday and closed at $35.875 in New York Stock Exchange trading. That followed a decline of $2.125 on Friday, after the firm announced that it expects to take a $300-million writeoff against fourth-quarter profits on development of the Navy anti-submarine patrol aircraft.

The suit alleges that the problems on the P-7A program “were known to Lockheed and to the individual defendants well before being revealed to the public.” The suit notes that six weeks prior to the public announcement, Lockheed reassigned a vice president to take over the P-7A program from the previous program manager.

Stuyvesant is represented by Greenfield & Chimicles, a law firm that has filed a number of such shareholder suits in the past. The suit, filed in U.S. District Court in Los Angeles, alleges fraud, securities violations and negligent misrepresentation, and seeks unspecified compensatory and punitive damages. A Lockheed spokesman said the company had no comment.