Teledyne Will Reportedly Plead Guilty in Iraq Bomb Case

Teledyne Inc. reportedly is ready to plead guilty to federal charges that it illegally exported 130 tons of zirconium that was used to make cluster bombs for Iraq in the 1980s.

The Los Angeles-based defense contractor plans to enter the plea rather than face trial next month in Miami, a source close to the case told Associated Press on condition of anonymity.

Teledyne said late Tuesday that it has “been exploring its alternatives” with respect to the case but that “no resolution has been reached” and that “whether resolution is possible at this time is conjecture.”

Teledyne spokeswoman Rosanne O’Brien declined to elaborate.

In an indictment handed up by a federal grand jury in Miami in May, 1993, Teledyne was charged with violating the U.S. Arms Export Control Act and with conspiracy by illegally exporting enough zirconium to Chile to make 24,000 cluster bombs.

Teledyne’s customer, Chilean arms maker Carlos Cardoen, allegedly sold at least 10,000 cluster bombs to Iraq in the 1980s during the Iran-Iraq war.

If Teledyne does plead guilty, it would mark the company’s latest effort to dispose of a variety of ethics-related litigation that has entangled the contractor for several years.

Last year, Teledyne settled two major civil suits brought by the Justice Department and four whistle-blowers for more than $112 million. Those suits included charges of padding contracts and improperly testing electronic components.

In the Miami case, Teledyne contended that U.S. government officials knew the zirconium would be used to make bombs overseas but that they approved the sale as part of a secret plan to help Iraq in its eight-year war with Iran.

But U.S. District Judge Shelby Highsmith ruled in May that Teledyne could not use as a defense its assertion that the U.S. government quietly approved of the exports.

Teledyne has not signed a formal plea agreement, said Assistant U.S. Atty. Frank Tamen. But prosecutors requested a hearing for a “change of plea” by the company, said William Heede, Highsmith’s deputy clerk. It is scheduled for Jan. 26.

“We are preparing for trial,” Tamen said. “If a plea agreement is actually signed and worked out prior to trial, we will certainly advise all concerned.”

Teledyne would face a fine of $3 million to $4 million--or twice the gross profit estimated by prosecutors on zirconium sales to Cardoen--if the company pleaded to the two counts, Tamen said.