Boeing Admonishes 8 In Probe Of 1989 Defense Secrets Case

The Boeing Co. has wrapped up its investigation of its role in a black market in Pentagon documents by admonishing eight employees and warning a former company executive that he might have to pay back Boeing $780,056 in legal fees.

Richard Fowler, the former executive convicted in 1989 of trafficking in classified documents, said yesterday there's no way he can pay those fees.

"If Boeing can find a way to get blood out of a turnip, they can quit making airplanes," Fowler said.

Fowler, 68, was the only Boeing employee prosecuted in the three-year federal investigation that also resulted in actions against the company.

Fowler, who spent 27 months in jail and prison, considers himself a scapegoat. A former Air Force budget analyst, he had been hired by Boeing to keep tabs on Pentagon plans.

Fowler was fired in 1986 after 8 1/2 years with Boeing.

In 1989, Boeing pleaded guilty in U.S. District Court in Alexandria, Va., to two felony counts for accepting a number of classified documents from Fowler that were off-limits to defense contractors, including secret reports on the "Star Wars" defense system.

Boeing's request for Fowler to pay back his lawyer fees came in a Jan. 19 letter to his lawyer.

In it, Boeing counsel Nancy McCready Higgins wrote that since Fowler had been convicted, he had reasonable cause to believe his conduct was unlawful and the company, therefore, was entitled to legal fees under an agreement Fowler had signed in 1986.

Fowler said a financial affidavit he submitted last week shows he can't afford it.

He lives in a rental home in Springfield, Va., drives a 12-year-old Oldsmobile, and says he owns no stocks or bonds and has no savings. Fowler receives retirement income from 35 years of federal civil service, at an amount he did not want to disclose, and $231 a month from Boeing.

Fowler's lawyer, Cary Feldman, in Washington, D.C., said Boeing probably is obliged to its shareholders to see if it can recover the legal fees.

"I'm not sure that Boeing wants to press it," Fowler said. "They can't sue me for anything, that's for damn sure. So I'm not really too worried about it."

As part of its plea agreement, Boeing paid $5.2 million in fines and restitution and agreed to report twice yearly to the Air Force Debarment and Suspension Review Board on its business ethics programs and internal investigation into whether other employees were culpable, as Fowler claims, in document trafficking.

The latest report says the internal investigation, which was done mostly by an outside law firm, was concluded sometime last year, and that eight unidentified employees received letters of admonishment.

But the report says the letters weren't considered by Boeing to be a disciplinary action. There was no word on who was admonished and little explanation of why.

Boeing spokesman Paul Binder declined to talk about the case.

A Defense Department contracting official who saw the letters, Stephen Trautwein, said in a memo they "constitute a warning or cautionary note. The tone of the letters ranged from a reminder of management responsibilities to an expression of dismay with one employee's lack of forthrightness during interviews with those conducting the investigation."

Trautwein wrote that he did not know the details of the misconduct which led to Boeing's guilty plea. Boeing itself wrote in a carefully worded section of the Dec. 1 report to the debarment board: "Based upon the completed internal investigation, Defense & Space Group management has determined that no current employees were culpable or responsible in connection with the misconduct which led to Boeing's guilty plea.

"Accordingly, no disciplinary action was taken. However, a number of employees received letters of admonishment."

Boeing's internal investigation of the documents case lasted well over a year. The company's findings apparently will never be known to the public. Boeing has refused to release them, and the government has not required their release in any public report.

The letters of admonishment were revealed in the semiannual Air Force report, which was released to The Seattle Times this week under a request made through the Freedom of Information Act.

Fowler said numerous past and present Boeing workers were involved in directing him to sneak documents out of the Pentagon and set up a secret documents library in Kent. More than 300 Boeing employees had access to documents from the library. The level of secrecy and concern was shown when a library worker started to take documents home to burn them when federal investigators were closing in.

Boeing used the documents to tailor its research and marketing to try to gain a competitive edge in federal work.

Fowler said at least one current Boeing vice president may have been among those receiving letters of admonishment. His former supervisor, Marshall Heard, is now a vice president at Boeing's helicopter operations near Philadelphia.

"He knew what I was doing," Fowler said.

Heard did not return a phone call for comment yesterday.