Ex-Official at Hughes in O.C. Indicted : Courts: The Justice Department alleges the former executive and the aerospace firm failed to follow government test procedures.

Hughes Aircraft and a former Hughes supervisor in Newport Beach were indicted in U.S. District Court Thursday on charges that they failed to properly test electronic components used in jet fighters, missiles and other weapons and falsified documentation to show that the defective parts passed rigorous tests.

The Los Angeles-based aerospace firm, a subsidiary of General Motors, strongly denied that it was culpable for the former supervisor’s actions and said the Justice Department would “end up with egg on its face” with respect to some of its assertions in the suit.

A 21-page indictment returned by a federal grand jury charges Donald Anthony LaRue, a former supervisor at Hughes’ Microelectronic Circuits Division in Newport Beach, with ordering his employees to not follow government test procedures, falsify documentation to show that electronic components passed tests they had failed and conduct unauthorized repairs.

The indictment alleges Hughes participated in a conspiracy and made false statements.

But a Hughes attorney said the government has virtually no evidence that Hughes or its executives were involved in a conspiracy with LaRue.

He described the case as a “real stretch of legal attribution,” the theory that links a corporation to the actions of its management. In most cases, a senior executive must be implicated for the corporation to be held liable, but LaRue was on the lowest rung of the company’s supervisory structure, the attorney said.

Neither LaRue nor his attorney could be reached for comment.

The electronic components at issue are hybrid circuits, which contain integrated circuits and other components packed inside a sealed metal container the size of a matchbox. The circuits were supposed to be subjected to tests to insure they would operate properly in the field.

But starting in 1986, LaRue began ordering the employees to forgo conducting some of the tests or to pass failed parts, the indictment charges.

In December, 1986, the indictment alleges, LaRue altered test documentation to show that two defective hybrids were good and allowed them to be shipped to the Hughes Missile Systems Group in Canoga Park for installation in an AMRAAM missile. The two hybrids were intercepted by federal agents and apparently will be used as evidence against Hughes.

The indictment asserts that LaRue’s supervisors, who were not named, participated in the conspiracy by threatening employees who complained about LaRue.

The federal investigation began in 1987, when a grand jury subpoenaed documents from Hughes. LaRue transferred from his job a short time later and retired from the firm in 1989 at the age of 61, a Hughes attorney said.

According to the indictment, when Hughes employee Margaret Goodearl attempted to file harassment charges regarding LaRue and his two supervisors, an unnamed manager of manufacturing “tore up the handwritten complaint and warned Goodearl: ‘If you ever do anything like that again, I will fire your ass.’ He then struck Goodearl on the shoulder with his glasses.”

In addition, the indictment claims that Hughes management ignored reports by Goodearl and Ruth Ibarra, a supervisor at the division’s quality assurance department, of improper testing.