Firm Sues Over Failed Stealth Jet Program : Defense: H. R. Textron seeks at least $23 million from the government and McDonnell Douglas after the Pentagon canceled the Navy project.
The A-12 stealth plane never got to fly off a carrier deck. But the Pentagon’s cancellation of the Navy jet program has landed the government and prime contractor McDonnell Douglas in federal court, where Valencia-based H. R. Textron is suing them to recover the millions it allegedly lost when the project was terminated.
In a lawsuit filed last month, Textron is seeking at least $23 million from McDonnell Douglas and the U. S. government. The lawsuit, filed in U. S. District Court in Los Angeles, alleges that McDonnell Douglas, one of two prime contractors on the project, tricked Textron into continuing to work as a subcontractor even after McDonnell Douglas knew that it was technically impossible to build the aircraft under guidelines set down by the Defense Department.
Textron began discussions with McDonnell Douglas in 1986 to build flight control equipment and fuel systems components for the A-12, which was going to be the Navy’s first stealth jet. Former Defense Secretary Dick Cheney canceled the contract in January, 1991, on grounds that McDonnell Douglas and General Dynamics, the two prime contractors, defaulted.
According to a Defense Department report, the A-12 program was between $2 billion to $9 billion over budget when it was scrapped. Both prime contractors had agreed in 1984 to develop the A-12 under a cost ceiling of $4.78 billion. The cancellation led to a lawsuit filed in 1991 against the government by McDonnell Douglas and General Dynamics, which are demanding $1.5 billion.
In turn, the Pentagon is demanding a refund of $1.4 billion from the two contractors. The lawsuit filed by McDonnell Douglas and General Dynamics is being tried in Los Angeles federal court.
Rod Hanks, a Textron spokesman, said cancellation of the A-12 project “triggered a slide for us in employment” at the Valencia plant. According to Hanks, employment dropped from 1,250 workers in 1990, the last year of the A-12 contract, to the present level of about 740.
“We spent a lot of 1992 and 1993 trying to deal with this and manage our way out of the problem,” he said.
The company specializes in building flight control and electronics equipment for both military and commercial aircraft.
H. R. Textron is a subsidiary of Rhode Island-based Textron Inc., a diversified company that also owns Avco Financial Services, Bell Helicopter and Cessna Aircraft, among others. Textron Inc. last week reported nine-month profits of $276.6 million on revenue of $6.6 billion.
Textron’s lawsuit also charged that the government was partly to blame for cancellation of the A-12 contract because it failed to audit the program properly. General Dynamics is not listed as a defendant in the 180-page lawsuit filed by H. R. Textron.
The A-12 was designed to replace the Navy A-6 Intruder, a 30-year-old attack aircraft. The A-12 would have been the first stealth jet capable of being launched from an aircraft carrier and was designed primarily to attack ground targets. The stealth plane now in use by the Air Force can be used both as a fighter in air-to-air combat and as a bomber to strike ground targets.
When the Pentagon signed a contract with McDonnell Douglas and General Dynamics for the new airplane, more than a third of the subcontractors hired for the project were in California.
In the lawsuit, Textron alleged that when the company entered into the A-12 contract, McDonnell Douglas withheld information about “the technical impossibilities, severe cost overruns, schedule delays . . . as well as the fact that McDonnell had abandoned its own performance on the prime contract.”
McDonnell Douglas spokesman Jim Reed, at the company’s headquarters in St. Louis, declined to comment on the Textron lawsuit.
The subcontractors lost millions, much of it their own money, when the contract was canceled. Some companies that had tied their financial future to the project were forced out of business, while others managed to survive.
Dick Pierson, sales manager at Electro Film Manufacturing in Valencia, said his company recovered $70,000 from McDonnell Douglas that it had spent on developing a cockpit heater for the A-12. However, Pierson said, the company was paid only after he spent weeks filling out a stack of forms that measured eight inches high.
“We only recovered about three-quarters of the money we put into it. It (the A-12 project) just didn’t come off,” Pierson said.
He said the company had signed an agreement with McDonnell Douglas to build 750 heaters at $3,000 each. Cancellation of the contract did not lead to any layoffs at Electro Film, which has annual sales of about $3.5 million and 65 employees, Pierson added.
Other subcontractors who worked on the A-12 fiasco still refuse to discuss the project, citing strict orders from the Navy not to reveal any information about the aircraft that turned out to be a Pentagon white elephant.
Pilkington Aerospace Inc, a British-owned company in Garden Grove, built the A-12 canopy, which is the glass bubble that encloses the cockpit.
A Pilkington employee said several technicians from the company were flown to the McDonnell Douglas plant in St. Louis to view a mock-up of the A-12 and the design for the canopy that the company was hired to build.
But company officials will still not acknowledge that the program even existed.
Pilkington security officer Joyce Taylor refused to say whether the company was ever paid by McDonnell Douglas.
“I can’t comment, even though it’s a dead program,” Taylor said.
For a while, Pilkington stored an A-12 canopy in a top-secret area of its plant, where it could be viewed only by a handful of workers with clearance to see it. The company, which was called Swedlow Inc. before it was sold, employs about 500 workers.
