Litton Industries Inc – ‘8-K’ for 1/14/94

As of:  Tuesday, 1/18/94   ·   For:  1/14/94   ·   Accession #:  950148-94-26   ·   File #:  1-03998

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Current Report   —   Form 8-K
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Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         6     22K 

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 

Date of Report (Date of earliest event reported): January 14, 1994

LITTON INDUSTRIES, INC. 
(Exact name of registrant as specified in its charter)

                                                                [Download Table]
                                                                        
        Delaware                  1-3998                 95-1775499     
     (State or other            (Commission             (IRS Employer   
     jurisdiction of           File Number)          Identification No.)
     incorporation)                                                     

360 North Crescent Drive, Beverly Hills, California 90210 
    (Address of principal executive offices)        (Zip Code)

Registrant's telephone number, including area code: (310) 859-5000

                        Exhibit Index appears on Page 2              Page 1 of 6

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Item 5.  Other Events                                                           

   As previously reported in the Registrant's Annual Report on Form 10-K for
the fiscal year ended July 31, 1993, as a result of the "Operation Ill Wind"    
investigation of defense contractor marketing practices, two employees of the   
Data Systems Division of Litton Systems, Inc. ("LSI"), a wholly-owned subsidiary
of the Registrant, were convicted in March, 1991, on charges of unlawful        
conveyance of governmental property (i.e., certain Government procurement-      
related information), conspiracy to perform such acts, and the use              
of the U.S. mails in these alleged activities. Following affirmation of such    
convictions by the United States Court of Appeals for the Fourth Circuit in     
August, 1992, the Registrant was informed by the Government that it intended to 
proceed against LSI under the legal doctrine of respondeat superior, i.e., that 
the employer is responsible for the acts of its employees.                      

 On January 14, 1994, LSI agreed to settle all charges and claims of the
Government in connection with this matter by paying $1.5 million in fines, $1.1 
million as reimbursement of costs of the Government's investigation, and $1.3   
million in settlement of the Government's civil claims. In an agreement filed in
the United States District Court for the Eastern District of Virginia and       
approved by the Court, LSI agreed to plead guilty to the three-count information
previously filed by the Government with the Court, which was based upon the     
evidence presented by the Government at the trial of the two employees of LSI's 
division who were convicted. The fine referred to above represents the maximum  
penalty of $500,000 for each of such three violations.                          

LSI received no contracts as a result of the alleged wrongdoing and no
allegations were made by the Government that bribes or improper gratuities were 
offered or taken. The Registrant believes that the suspension or debarment of   
any of its operating units from receiving further Government contracts as a     
result of the plea agreement is unlikely.                                       

    The agreement approved by the Court terminates both the civil and criminal
aspects of the legal proceeding previously reported.                            

Item 7.  Exhibits                                                               

Exhibit 99: Plea Agreement entered into in the matter of United States of       
            America v. Litton Systems, Inc., dated January 14, 1994.......page 4

                                                                   Page 2 of 6

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SIGNATURE 

Pursuant to the requirements of the Securities Exchange Act of 1934, the        
registrant has duly caused this report to be signed on its behalf by the        
undersigned hereunto duly authorized.                                           

                           LITTON INDUSTRIES, INC.

                              By: /s/  Norman L. Roberts
                                   -----------------------
                             Norman L. Roberts
                                 Senior Vice President

January 14, 1994                                                                

                                                                 Page 3 of 6

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                                                                      EXHIBIT 99

IN THE UNITED STATES DISTRICT COURT 
EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION 

UNITED STATES OF AMERICA                  )                                     
     )
V.                              )  CRIMINAL NO.             
     )
LITTON SYSTEMS, INC.                      )                                     

PLEA AGREEMENT

     The United States of America, by its counsel, Helen F. Fahey, United States
Attorney, and Joseph J. Aronica and Jack I. Hanly, Assistant United States      
Attorneys for the Eastern District of Virginia, and the Defendant, LITTON       
SYSTEMS, INC., by its attorneys, state the following Plea Agreement reached     
after negotiations pursuant to Rule 11, Federal Rules of Criminal Procedure:    

1. LITTON SYSTEMS, INC. agrees to plead guilty to the three Count     
Information previously filed with the Court, which is based upon the evidence   
presented by the Government at the trial of United States v. Pafort and         
McAusland. The information charges LITTON SYSTEMS, INC., in Count One with      
violating Title 18, United States Code, Section 371, conspiracy to defraud the  
United States and to commit conversion of government property and wire fraud.   
Count Two charges LITTON SYSTEMS, INC. with violating Title 18, United States   
Code, Section 641, conversion of government property. Count Three charges LITTON
SYSTEMS, INC. with violating Title 18, United States Code, Section 1343, wire   
fraud. Each violation carries a maximum penalty of $500,000.                    

  2.  LITTON SYSTEMS, INC. hereby waives the presentence investigation and
report pursuant to Rule 32(c)(1) of the Federal Rules of Criminal Procedure. The
United States does not oppose such waiver.                                      

    3.  The United States and LITTON SYSTEMS, INC. have agreed, subject to the
Court's approval, that LITTON SYSTEMS, INC. will pay a total criminal fine of   
$1.5 million, i.e. $500,000 on each Count. LITTON SYSTEMS, INC. also agrees to  
pay the assessment of $200.00 on each count as required by 18 U.S.C. sec. 3013. 

   4.  Within fifteen days of the entry of the judgment of conviction LITTON
SYSTEMS, INC. agrees to pay, by wire transfer to the United States, civil claims
in the amount of $1.3 million and the sum of $1.1 million as reimbursement of   
costs of investigation incurred by the FBI, DCIS, NIS, and the United States    
Attorney's Office for the Eastern District of Virginia. Such payments, together 
with the criminal fines referred to in paragraph 3 above (excluding assessments 
under Title 18 U.S.C. sec. 3013), shall constitute a complete release and       
satisfaction of all criminal restitution pursuant to Title 18 of the United     
States Code, and all costs of investigation and prosecution for the conduct set 
forth in the Information or any similar matter of which the United States       
Attorney for the Eastern District of Virginia has knowledge at the time of the  
execution of this Agreement and encompassed in the Illwind investigation.       

5.  The United States will close its criminal investigation of LITTON 
SYSTEMS, INC., its divisions, subsidiaries, successors, assigns, affiliates or  
parent thereof, for any violation of the United States Code relating to the     
matters set forth in the Information or any similar matter of which the United  
States Attorney for the Eastern District of Virginia has knowledge at the time  
of the execution of this Agreement and is encompassed in the Illwind            
investigation.                                                                  

6. It is agreed that all costs (as defined in the Federal Acquisition 
Regulations ("FAR") 31.205-47) incurred by or on behalf of LITTON SYSTEMS, INC. 
and its subsidiaries, and their officers, directors, agents and employees in    
connection with (1) the matters covered by this Plea Agreement, (2) the         

                                                                 Page 4 of 6

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government's audit and investigation of the matters covered by this Plea        
Agreement, (3) LITTON SYSTEMS, INC.'s investigation, defense of the matters, and
corrective actions, (4) the negotiation of this Plea Agreement, and (5) the     
payment made to the United States pursuant to this Plea Agreement shall be      
unallowable costs for government contract accounting purposes. These amounts    
shall be separately accounted for by LITTON SYSTEMS, INC.. The matters covered  
by this Plea Agreement include both civil and criminal matters relating to the  
Illwind investigation of Litton Systems, Inc., and its subsidiaries, and their  
officers, directors, agents and employees.                                      

   7. Subject to the entry of judgment and payment of the sums stipulated in
this Agreement, the United States releases and discharges LITTON SYSTEMS, INC., 
its divisions, subsidiaries, successors, assigns, affiliates or parent thereof, 
from any civil claim or cause of action the United States has or may have under 
the False Claims Act, 31 U.S.C. sections 3729-3733; the Program Fraud Civil     
Remedies Act, 31 U.S.C. sections 3801-3812; the common law; or, for costs       
incurred from 1982 through June 14, 1988, for any liability, damages, civil     
penalties, or assessments in lieu of damages, or for any claim that contracts   
are void or voidable; arising from the conduct set forth in the Information     
identified in this Agreement, or for any other matter of which the United States
Attorney for the Eastern District of Virginia has knowledge at the time of the  
execution of this Agreement, and encompassed in the Illwind investigation,      
provided however, that this paragraph shall not preclude any action arising     
under Title 26, United States Code (Internal Revenue Code), or which may be     
brought by the U.S. Securities and Exchange Commission for any violation of the 
federal securities laws or rules and regulations thereunder, provided further   
that this paragraph does not constitute a release from any liability under the  
contracts at issue in this Agreement for delivery of any deficient or defective 
products, or from liability under any express or implied warranties pertinent to
these contracts; and provided further that this release does not constitute a   
defense to, or release from, any liability or the amount of damages or civil    
penalties in United States v. Litton Systems, Inc., CV-99-02276 MRP (C.D. Cal.).

8. The United States Attorney recognizes that before the Illwind      
investigation became public, officers of LITTON SYSTEMS, INC. met with officials
of the Departments of Defense and Justice, and sought to clarify and change the 
rules regarding the non-disclosure of certain types of government procurement   
information, but not the information which the two Litton officials, knowing    
that they were not authorized to receive it, were convicted of obtaining and    
attempting to obtain.                                                           

     9. The United States Attorney agrees to advise the Department of Defense of
this Agreement as well as the nature and extent of LITTON SYSTEMS, INC.'s,      
activities with respect to this case. By this Agreement, the United States makes
no representation regarding suspension and debarment which are within the sole  
authority of the Department of Defense.                                         

    10. It is agreed that if the Court refuses to accept any provision of this
Plea Agreement neither party is bound by any of the provisions of the Plea      
Agreement, and no statement in this Plea Agreement or its attachments will be   
admissible against either party in any proceeding.                              

11. No additional promises, agreements, or conditions other than those
referenced in this Plea Agreement have been entered into and none will be       
entered unless in writing and signed by all parties.                            

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                           Respectfully submitted,

                  HELEN F. FAHEY
                          UNITED STATES ATTORNEY

                             By: /s/ Joseph J. Aronica
                                          ________________________________
                           Joseph J. Aronica
                                     Virginia State Bar No. 2548
                       Jack I. Hanly
                                      Virginia State Bar No. 23969
                                           Assistant United States Attorneys

/s/ Judith Rabinowitz                                                           
____________________________________                                            
JUDITH RABINOWITZ                                                               
Civil Division                                                                  
U.S. Department of Justice                                                      

LITTON SYSTEMS, INC.                                                            

                                                                [Download Table]
                                                                             
By: /s/ Richard A. Sauber                       Dated: January 14, 1994      
    ______________________________________            _______________________
    Richard A. Sauber, Esquire                                               
    Fried, Frank, Harris, Shriver                                            
      & Jacobson                                                             

                                                               Page 6 of 6

Dates Referenced Herein   and   Documents Incorporated by Reference

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This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on:		1/18/94							None on these Dates
For Period End:		1/14/94		1		6
		7/31/93		2
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