Company Reinstated To EELV Program After 20-Month Suspension

Boeing is back.

At least, that's what they're saying at the launch pad in Cape Canaveral, FL, after the company's 20-month suspension ended Friday.

Boeing's reinstatement means it will compete again with arch-rival Lockheed-Martin for launch contracts that ensure Washington has not one, but two sources of space vehicles upon which its spy satellites and other government payloads can rocket into orbit.

Boeing is once again "a full partner on our national security space team," acting Air Force Secretary Peter Teets said at the Pentagon, quoted by Bloomberg News. "This has been the longest suspension of a major defense contractor."

As ANN reported, the suspension began in July, 2003, when, after a year-long investigation, the Pentagon busted Boeing for illegally obtaining Lockheed documents pertaining to bids on launch contracts.

"We have worked hard over the past 20 months to restore the trust and confidence of our customer, and we are grateful that we have reached this point," Boeing spokesman Dan Beck, also quoted by Bloomberg.

But Boeing's reinstatement came with a price. The company has to repay the USAF $1.9 million for the cost of the investigation that led to its suspension. And if Boeing is indicted in any criminal or civil investigations -- many of which are still underway -- it could once again be slapped with suspension.

That's a real possibility. Boeing is reportedly cooperating with federal investigators precisely in hopes of avoiding criminal prosecution. In the meantime, the feds are investigating eight other Boeing contracts at the Pentagon, trying to see if they were unduly influenced by former USAF official Darleen Druyun. She's the former Air Force negotiator doing seven months' in prison for illegally favoring Boeing in its negotiations to provide a new tanker platform. Druyun ended up in an executive vp position at Boeing -- before she and CFO Michael Sears were busted. Sears is now serving a four-month prison sentence. On top of all that, CEO Phil Condit abruptly resigned last year, leaving Boeing with a very new look at the top.

"Boeing has taken serious corrective actions," Teets told Bloomberg. "Management, from the CEO down, took responsibility for the company's ethical breaches."

FMI: www.boeing.com