Federal Agents Search Orbital Sciences Offices

Rocket-Maker Unclear on Subject of Probe

Rocket-maker Orbital Sciences Corp. said yesterday that federal government agents executed search warrants Thursday at its Dulles headquarters and at a design and manufacturing facility near Phoenix.

Orbital said an investigation led by the U.S. attorney's office in Phoenix appears to be focusing on "contracting procedures" related to "certain U.S. government launch vehicle programs."

The company's products -- sold to government and commercial customers -- include launch vehicles that send satellites into orbit, rockets used to test missile defense systems and interceptor booster vehicles designed to protect against missile attacks.

Despite some failed launches in recent months, Orbital Sciences has been involved in dozens of successful launches over the past decade, and it has attracted some high-profile talent: NASA Administrator Michael D. Griffin is a former employee and on Wednesday the company named former Air Force secretary James G. Roche to its board of directors. Orbital has about 2,100 employees at its Dulles and Chandler, Ariz., facilities.

"We're not aware that we've done anything wrong or that we have any violations," said Barron Beneski, Orbital's spokesman. "We're going to be fully cooperative with the authorities . . . and we're working with the authorities to learn more about the nature of the investigation."

Sandy Raynor, spokeswoman for the U.S. attorney in Phoenix, confirmed that Orbital is the subject of an "ongoing investigation" but she declined further comment. "Nothing about this is public," she said.

Orbital, a major Washington area defense contractor, reported $200 million in profit on $676 million in revenue last year. The company said 54 percent of that revenue came from work it did for the Defense Department and government intelligence agencies.

The raid surprised top officials at the Pentagon's Missile Defense Agency, a principal Orbital customer, according to a senior military officer at the agency. "That's nothing we initiated," said the officer, who spoke on condition of anonymity because he is not an official spokesman for the agency. "We're still waiting to learn the details of what triggered the raids and what it's about."

Founded in 1982 by three friends not long out of Harvard business school, Orbital in its first 20 years found a niche in the aerospace industry, supplying target missiles to the Pentagon but also making small rockets and lightweight satellites for NASA and other government agencies. Its business was concentrated on research and development programs, not major weapons systems.

That began to change in 2001 when Orbital was selected to supply some of the booster rockets for the Bush administration's ambitious new system for defending the United States against ballistic missile attack. As the government's other booster supplier -- Lockheed Martin Corp. -- floundered with its version, Orbital emerged as the lead producer.

Under a contract with Boeing Co., Orbital produces the booster rocket for the interceptor, which is designed to carry a "kill vehicle" into space that then separates from the booster and homes in on enemy warheads. Since last summer, eight such interceptors have been installed at launch sites in Alaska and California. Another six are scheduled to be installed by the end of this year.

The Pentagon has had difficulty carrying out recent tests to demonstrate that the program can work. Two attempts to launch interceptors at mock warheads have been aborted at the last minute for what defense officials blamed on minor glitches -- flawed software code in December and a faulty silo retracting arm in February.