A federal judge has ordered the Justice Department to turn over additional information to a Senate panel that is trying to determine why a criminal investigation of cost overruns by Newport News Shipbuilding and Dry Dock Co. was dropped last year.
U.S. District Court Judge Albert V. Bryan Jr. of Alexandria ruled in an opinion released this week that Justice officials acted improperly in October when they withheld certain materials relating to the investigation into whether the company charged the Navy more than it should have for ships it was building.
Hearings are scheduled to begin today in the Senate Governmental Affairs Committee on charges that the Navy overpaid the company, Virginia's largest private employer, by about $700 million.
Another congressional committee, the Senate subcommittee on administrative practice and procedure, has been looking into whether federal investigators botched their examination of charges that Newport News Shipbuilding, Lockheed Corp. and the electric boat division of General Dynamics Corp. overcharged the government more than $1.8 billion in the late 1970s.
Bryan's order requires that the Justice Department turn over material deleted from documents released to the committee in October. Justice officials had said the material was confidential because it related to grand jury investigations.
Bryan's ruling affects only material involving Newport News Shipbuilding. The information is expected to show why Justice officials closed an investigation alleging false claims by the company despite strong urgings by some federal investigators to seek criminal indictments.
Documents released earlier this year showed that some investigators considered the company's claims of $894 million "the greatest assault on the U.S. Treasury in American history." The claims, for construction of nuclear submarines, cruisers and aircraft carriers, were settled in 1979 for about 25 percent of the shipyard's original request.
Michael Davidson, the Senate's legal counsel, said yesterday that most of the deleted material was turned over to the Senate Monday.
The hearing scheduled today before the Governmental Affairs Committee is expected to focus on Newport News Shipbuilding claims, amid charges that the Navy may have spent $700 million more than necessary for three carriers and four submarines.
A spokesman for the committee said yesterday that the panel has conducted a six-month investigation into 1980 contracts with Newport News Shipbuilding that included contracts for the construction of the aircraft carrier Theodore Roosevelt.
The investigation and hearings are part of a series the committee is holding on defense contracting, sparked by reports of grossly inflated prices for small parts used in government contracted jobs, according to the spokesman.