In 1919, Leslie L. Irvin bailed out the Army Air Corps by making the first free-fall parachute jump in U.S. military history.

"Basically," said one person familiar with the story, "if the 'chute opened, he was in the parachute business. If it didn't, he wasn't."

Irvin survived the fall with a broken leg and went on to win the Army's first contract for 300 parachutes.

In the ensuing 65 years, the company he founded, Irvin Industries Inc. of New York, has become a leading manufacturer of commercial and military parachutes.

But recently, the lines of cooperation between Irvin Inc. and the Army have gotten snarled. In January, Irvin filed a lawsuit in U.S. District Court here alleging, in effect, that it may be whom you know, not what you know, that wins Pentagon contracts.

In court papers, Irvin contended that it was unfairly blocked from bidding last year on part of a $50 million parachute contract held by Goodyear Aerospace Corp., despite what Irvin said is evidence that it could take over about a third of the contract and save the Army $3 million a year.

The lawsuit raises questions about what critics contend is the Pentagon's penchant for sidestepping competitive bidding and handing out lucrative contracts to favored defense contractors.

Also at issue, Irvin argues, is the question of who qualifies as a "mobilization base" supplier -- Pentagon jargon for preferential treatment it gives to producers of critical materials to ensure a ready supply in wartime.

The case has caught the eye of Rep. Jack Brooks (D-Tex.), a watchdog on Pentagon spending practices, who wrote to Defense Secretary Caspar W. Weinberger two months ago demanding an explanation. Brooks is still waiting for an answer.

"In this case, the Army could have gotten savings of 14 percent due to competition," Brooks said, "but they turned it down."

Named as defendants are Weinberger, Army Secretary John O. Marsh Jr. and James A. Bronson, an Army procurement officer. Goodyear was not sued.

Lawyers for Irvin refused to discuss the litigation. But Royce C. Lamberth, chief of the U.S. attorney's office's civil division here, said the government has been involved in settlement talks.

"I think [the Army] contracting people were dealing in a way that suggests we ought to settle if we can," Lamberth said.

At issue is not a parachute for people, but the BSU49/B Inflatable Retarder Assembly -- a balloon parachute designed to slow and help guide descent of 500-pound bombs. Slowing the bomb's fall prevents it from blowing up the plane and pilot that dropped it.

Starting in 1982, Irvin manufactured some of the balloon parachutes at its Roxboro, N.C., plant as a subcontractor for Goodyear.

The first year, according to Irvin, Goodyear ordered 7,243 balloon assemblies. In 1983, the order rose to 10,764. But in May 1983, the number dipped back to 7,800.

The reason for the decline, Irvin alleged, was a decision by Goodyear to steer more business to an Irvin competitor, Carolina Parachute Inc. across town in Roxboro, which Goodyear had aided financially in the past.

Faced with layoffs and production slowdowns, Irvin officials decided last July to bid for some of the miltary's business.

On July 24, Irvin officials wrote Bronson, a procurement officer at the Army's Armament, Munitions and Chemical Command at Rock Island, Ill., asking for technical details on the retarder assembly. The command buys the parachutes for the Air Force.

The data package, to which Irvin said it was legally entitled, was not handed over until November, with "crucial pages missing" and with out-of-date technical drawings, according to Irvin's lawsuit.

Meanwhile, on Oct. 31, Bronson informed Irvin that an option to renew Goodyear's contract had been exercised for all "present and projected future requirements," using the mobilization base rationale. Irvin's proposal to bid for the business, Bronson said, had been found "highly optimistic and unrealistic."

But, Irvin said, there is good reason to expand the "mobilization base" to include Irvin.

The result of the contract award, Irvin President Stephen Gordon said in a court affidavit, is a "preposterous monopoly profit for Goodyear."

Brooks agreed.

"In light of the unsophisticated nature of the product and the substantial cost savings available," Brooks wrote Weinberger, "I see little reason why the award of this contract should not have been made competitively."