Hughes Division Conspired to Falsify Military Equipment Tests, U.S. Says

A prosecutor told a federal jury Wednesday that Hughes Aircraft Co.’s Newport Beach division and a company supervisor conspired to falsify tests on military electronics components, an allegation the company denies.

Assistant U.S. Atty. George B. Newhouse Jr. charged that Hughes’ Microelectronic Circuits division and Donald Anthony Larue, a supervisor at the test facility, routinely ordered test operators to falsify test results on components known as hybrids from 1985 to 1987.

The federal indictment, filed in December, alleges that when two test operators filed complaints with managers about the irregularities, they were threatened and harassed and their complaints ignored.

“This is a case of cheating, lies and fraud,” Newhouse said. “Hughes cheated on testing requirements, made false statements and tried to fool the Department of Defense.

“The government was not getting what it paid for,” the prosecutor said.

Hughes’ attorney, James Sanders, conceded that some mistakes were made in the testing process but said the criminal charges were unfounded.

“There was no conspiracy by Hughes or anyone affiliated with Hughes to defraud the United States or to make false statements,” Sanders said.

Sanders said the company had no motivation to cheat on the tests, especially since many of the hybrids it produced were to be used in a prototype weapons system--the Advanced Medium Range Air-to-Air Missile--it wanted to sell to the Air Force.

Hybrids are a series of circuits and tiny electronic components that are enclosed in a metal package and sealed with a cap. They are then plugged into other larger electronic devices or assemblies.

The hybrids produced by Hughes were used in a number of weapons systems, including the F-14, F-15, F-16 and F-18 aircraft, and the Phoenix and prototype missile systems.

Newhouse alleged that Larue, 63, of El Toro, speeded up production of “hot parts,” those most urgently needed, by causing improperly tested hybrids to be shipped.

Two employees will be key prosecution witnesses, Newhouse said.