8-KOther Events

BOEING CO 8-K Report (Jun 13, 2003)

Filed June 13, 2003For Securities:BABA-PA

Summary

This 8-K filing from The Boeing Company (BA) on June 13, 2003, provides an update on a significant ongoing legal and governmental matter. The U.S. Air Force is reviewing Boeing's responsibility as a government contractor due to an incident in 1999 where employees possessed proprietary information belonging to competitor Lockheed Martin Corporation concerning the Evolved Expendable Launch Vehicle (EELV) program. This incident also involves an investigation by the U.S. Attorney in Los Angeles. Further complicating the situation, Lockheed Martin filed a lawsuit on June 10, 2003, alleging violations of federal and Florida law related to the solicitation, acquisition, and alleged concealment of their information during EELV contract competitions. Lockheed is seeking substantial damages and injunctive relief. Boeing states it is cooperating with investigations and will defend itself vigorously against the lawsuit, but the potential financial impact remains uncertain at this time.

Key Highlights

  • 1Boeing is under review by the U.S. Air Force regarding its contractor responsibility due to a 1999 incident involving competitor information.
  • 2The incident pertains to proprietary information of Lockheed Martin Corporation related to the Evolved Expendable Launch Vehicle (EELV) program.
  • 3Two Boeing employees were terminated, and a third was reprimanded and retired in connection with the incident.
  • 4The U.S. Attorney in Los Angeles is also investigating the matter.
  • 5Lockheed Martin filed a lawsuit on June 10, 2003, seeking significant damages and injunctive relief against Boeing and its former employees.
  • 6Boeing is cooperating with government investigations and plans to vigorously defend against the lawsuit.
  • 7The potential material adverse financial impact of these matters is currently unpredictable.

Frequently Asked Questions

The U.S. Air Force is reviewing Boeing's contractor responsibility due to an incident in 1999 where two Boeing employees were found to possess proprietary information belonging to competitor Lockheed Martin Corporation. This occurred in the context of the Evolved Expendable Launch Vehicle (EELV) program.

Lockheed Martin filed a lawsuit on June 10, 2003, in the U.S. District Court for the Middle District of Florida. The suit alleges that Boeing and its employees violated federal and Florida laws by soliciting, acquiring, and using Lockheed's proprietary information during EELV contract competitions and by allegedly concealing this conduct. Lockheed is seeking compensatory damages (including treble and punitive damages), consequential damages, return of proprietary information, and injunctive relief.

Boeing states that it is cooperating with the government investigations (U.S. Air Force review and U.S. Attorney investigation) and intends to defend the lawsuit filed by Lockheed Martin vigorously. The company has not yet been able to predict the outcome or any potential material adverse financial impact.

No, this filing does not report any immediate financial implications. Boeing explicitly states that 'It is not possible at this time to predict the outcome of these matters or whether an adverse outcome would or could have a material adverse financial impact on the Company.'