Accepts 'Obstruction' Charge Instead Of 'Conspiracy'

Former Boeing Engineer Kenneth Branch plea bargained a deal with prosecutors to avoid jail time in a case involving a rivalry between Boeing and Lockheed for the USAF's Evolved Expendable Vehicle Launch (EELV) program.

The two companies were competing for a government satellite launching contract when Branch and another ex-Boeing engineer William Erskine were accused of stealing trade information from Lockheed.

Branch had left Lockheed for a position with Boeing -- Erskine hired him. Erskine allegedly told another Boeing employee he'd hired Branch because Branch had offered to bring Lockheed's entire EELV bid proposal with him.

Charges against another Boeing employee implicated in the case, Larry Satchell, have been dismissed on procedural grounds

Boeing won 19 of 28 contracts it bid on for the satellite project in 1998.

Erskine still faces conspiracy charges, but Branch pleaded guilty to the lesser charge of obstruction of justice last Thursday. US district court Judge Ronald Lew fined Branch $6000 and sentenced him to six months of home detention.

Boeing fired the two and agreed to pay a $615 million settlement to end a justice department investigation into its practices surrounding the bid process, and its relationship with a former Air Force procurement officer involved with the EELV program.

As a result of the settlement and admission by Boeing, the Air Force summarily awarded Lockheed the seven remaining launch contracts worth around $1 billion and suspended Boeing from launching rockets for 20 months.

Just this past week the two companies formed a new joint venture called the United Launch Alliance to administer all future launches for the US government.

FMI: www.boeing.com, www.lockheed.com