By Dow Jones Business News,
December 09, 2013, 05:54:00 PM EDT
By Michael Calia
Northrop Grumman Corp. ( NOC ) has paid $11.4 million to the U.S. to settle a claim that the aerospace and defense
company made improper charges to its federal contracts, the Justice Department said Monday.
Northrop charged certain costs for deferred employee compensation to the contracts, and, in doing so, failed to abide
by the terms of a settlement in 2002, the department said.
"Federal contractors must abide by the obligations they accept when contracting with the government, including
compliance with federal regulations restricting the types and amount of costs they can charge to their federal
contracts," said Stuart F. Delery, assistant attorney general for the Justice Department's civil division.
A representative for Northrop Grumman wasn't immediately available for comment.
Under the 2002 agreement with the Defense Contract Management Agency, the company had agreed to limit the amount of
deferred compensation it would include in proposals for government contracts, the Justice Department said. However, the
department added, the government's contracting officer found the company had failed to honor the terms, and the
government claimed that it was induced to pay more than $1.9 million in unallowable costs.
Shares of Northrop Grumman were down 11 cents after hours at $109.83. Through the close, the stock was up 63% so far
Write to Michael Calia at email@example.com
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