Garden Grove Company Must Pay $3 Million

A federal judge ordered a Garden Grove company Friday to pay more than $3 million in penalties for shipping defective bolts to aerospace customers such as Boeing Co.

Air Industries Corp. was fined $1.25 million and directed to make restitution to Boeing, Vought Aircraft, Northrop Grumman and Burbank Aircraft.

U.S. District Judge John Coughenour also sentenced Daniel Arredondo, Air Industries’ vice president of sales, to six months of home confinement. Arredondo, 54, of Dana Point, also must perform 150 hours of community service and pay a $2,500 fine.

The case against Air Industries began with a complaint from a former employee who filed a lawsuit in Los Angeles accusing the company of fraud. The U.S. attorney’s office then filed a lawsuit in Seattle because Boeing is based there.

Arredondo and the company pleaded guilty in September to mail fraud and admitted shipping bolts that did not meet quality-control specifications, Assistant U.S. Atty. Bruce Carter said. No accidents have been traced to the bolts.

A security officer at Air Industries said no one from the company was available for comment Friday night.

Air Industries was ordered to pay Boeing $549,888; Vought, $572,693; Northrop Grumman, $123,279; and Burbank Aircraft, $5,360, for the expense of testing and scrapping the parts. The company also must pay nearly $654,000 in prosecution costs.