Federal prosecutors charge former Boeing managers with stealing trade secrets

Thursday, June 26th 2003, 12:00 am
By: News On 6

LOS ANGELES (AP) _ Federal prosecutors charged two former Boeing managers with conspiring to steal trade secrets from competitor Lockheed Martin to help their company win an Air Force rocket contract.

Kenneth Branch, 64, and William Erskine, 43, were charged with conspiracy, theft of trade secrets and violating federal procurement integrity laws, according to documents filed late Wednesday in U.S. District Court in Los Angeles.

The action follows a federal lawsuit Lockheed Martin filed earlier this month against Boeing, the two managers and another former employee.

Both complaints charge that Branch, a former Lockheed employee, gave Boeing thousands of pages of documents that included financial details on Lockheed's planned bid for the $1.88 billion contract.

The deal, part of the Air Force's Evolved Expendable Launch Vehicle Program, was divided between the two companies in 1999. But Boeing was eventually awarded 21 rocket launches, while Bethesda, Md.-based Lockheed, the nation's largest defense contractor, received seven.

The affidavit alleges Erskine hired Branch because he made an ``'under the table' offer to hand over the entire Lockheed Martin EELV proposal presentation ... in exchange for a position at Boeing'' if the Chicago-based company won the contract.

Boeing fired both in 1999 after an internal investigation. Larry Satchell, whose job was to ensure Boeing's bid came in under Lockheed's, was suspended and has since retired. He was not named in the criminal complaint. Boeing also was not named in the criminal complaint.

Branch's lawyer, Richard Steingard, called it unfortunate that the government is prosecuting his client instead of ``corporate officials that created and implemented this plan.''

A message left at the offices of Erskine's lawyer, Steve Madison, was not immediately returned.

A federal court last year dismissed a wrongful termination suit Erskine and Branch filed against Boeing.

Prosecutors said Branch and Erskine, who are both from Cape Canaveral, Fla., will likely be arraigned in federal court next month. Both face a penalty of up to 15 years in federal prison and fines of up to $850,000 if convicted.