NASA Lifts Rockwell Division’s Suspension in Overbilling Case

Rockwell International Corp. said Wednesday that NASA has lifted a two-month suspension of the corporation’s Collins Avionics & Communications Division, which was indicted last year on charges of overbilling the space agency.

A federal grand jury in Cedar Rapids, Iowa, indicted Rockwell in October on 15 counts of conspiracy, wire fraud and mail fraud in connection with production and repair work for the space shuttle in 1987 and in prior years. NASA suspended the division in November.

The company, which moved its headquarters to Seal Beach last month, has entered not guilty pleas to all the counts.

The indictment also named Richard Priddy, a former manager of Rockwell’s Collins Government Avionics division in Cedar Rapids, Iowa, and Sandra Simoens, a current manager there, on six counts. Both have pleaded not guilty.

The division produces electronic systems used on the shuttle. The alleged scheme involved billing the government for inflated amounts of time worked.

Priddy, a former manager of material and manufacturing operations, allegedly told employees to “soak the shuttle,” “hose NASA” and “fix the numbers,” according to the indictment.

Simoens allegedly told employees to charge time to the National Aeronautics and Space Agency when they had actually worked on other jobs, the indictment alleged.

Rockwell said Wednesday that NASA’s action means that the Collins division has been found to be at present a responsible contractor that may bid on and be awarded contracts with the federal government.

“We are very pleased with NASA’s action,” said J.D. Cosgrove, president of the Collins unit. “We believe NASA’s action reflects confidence in our integrity, and we remain committed to maintaining that confidence.”

Rockwell’s Space Systems Division, citing cuts in government funding, said Tuesday that it will eliminate about 1,000 jobs in Southern California by this spring. The Rockwell unit, builder of the shuttle orbiters and their main engines for NASA, said significant layoffs are likely at its plants in Downey and Seal Beach.