The largest settlement ever paid by a defense contractor took place April 2, in which TRW Inc., now owned by Northrop Grumman, paid the U.S. government $325 million in a qui tam lawsuit.

The lawsuit alleged that TRW sold components known as “heterojunction bipolar transistors, “ used in intelligence-gathering satellites, which had known defects and contributed to a “critical failure” in a government satellite in orbit in 2001.  The whistle blower, Robert Ferro, found the defect in 1995 and tried to include the finding in a research report. However, it was found that TRW “sanitized” the report, removing any mention of Ferro’s findings while also editing out references to other warnings.

Northrop Grumman acquired TRW Inc. in 2002. Grumman stated that they believed they, “acted properly under its contracts, “ but also believe the settlement was in the best interest of all parties and the relationship between the company and the U.S. government.