Neumann v Boeing – Complaint filed
A 2nd former Boeing employee files whistle-blower complaint
By , P-I REPORTER, 12/03/2008
Editor’s note: The reporter who wrote this story is named in the lawsuits as the reporter who talked with both plaintiffs.
Another former Boeing employee has filed a federal whistle-blower complaint against the firm, charging that he was fired in retaliation for reporting ethics violations. It is the second lawsuit of its type in less than two months.
In a complaint filed Tuesday with the U.S. District Court in Seattle, former Boeing internal auditor Matthew Neumann charges that company managers ignored his warnings about violations of auditing standards. Neumann was an internal auditor on the company’s Sarbanes-Oxley compliance team, which was created after the passage of the Sarbanes-Oxley Act of 2002.
Neumann had worked for The Boeing Co. for 10 years until being fired late last year. He lives in Washington state and holds an engineering degree from the Massachusetts Institute of Technology, the complaint says.
In August 2007, after complaining to several managers that Boeing was ignoring audit results, fabricating audit results and harassing auditors, a Boeing human resources director asked Neumann about his working conditions. Neumann says in the lawsuit that he told the director about potential law violations. The director “pointed to a pillow in her office embroidered with the phrase, ‘Get Over It,’ ” the lawsuit says.
Reached by phone after business hours Tuesday, a Boeing spokesman declined to comment.
Chicago-based Boeing has defended itself in a separate federal court filing, in which it denied the serious allegations made in the first whistle-blower lawsuit. The company insisted that it “has been and is compliant” with securities laws.
Boeing’s court filing is in response to a former employee’s lawsuit in October, charging that the company was disingenuous in its efforts to comply with the Sarbanes-Oxley Act. Nicholas Tides, a former information technology auditor, said the company fired him in retaliation after he spoke to managers about problems.
Boeing responded: “His discharge was completely unrelated to any alleged whistle-blower activity. In fact, plaintiff never communicated to his supervisors, investigators or Congress a belief that Boeing violated any of the anti-fraud statutes enumerated in” the Sarbanes-Oxley Act.
Tides was fired, Boeing said, for “violating company policy regarding the release of confidential company information.”
Boeing said it “investigated each and every one of plaintiff’s allegations and determined most were baseless.”
Tides also charged that Boeing hired auditors PricewaterhouseCoopers, who violated government-mandated auditing standards. Boeing denied fault for the more serious parts of those charges, while admitting that employees and contractors “occasionally eat lunch together.”
Boeing also admitted that PricewaterhouseCoopers consultants designed controls for information technology systems and tested those controls. But Boeing said the consultants were separate people.
Boeing concluded that Tides is not “entitled to any relief whatsoever.”
In July 2007, the Seattle P-I reported that Boeing had difficulty complying with the Sarbanes-Oxley Act, enacted after corporate scandals. Tides and Boeing have both admitted that Tides spoke with the P-I regarding that story.
The second plaintiff, Neumann, said in his lawsuit that he confirmed some aspects of the P-I story after two reporters showed up uninvited on his doorstep. However, before speaking with the newspaper, he said, he “continued to report his concerns through all channels at Boeing available to him.”
Boeing told Neumann that he was fired for unauthorized contact with the media. However, a Washington administrative law judge has ruled that Neumann did not violate “reasonable rules” at Boeing and that he did not “willfully disregard Boeing policy,” the lawsuit says.
The lawsuit notes that, in exchange for not being prosecuted for a previous company scandal, Boeing promised the Air Force in 2006 that it would report the status of its investigations involving fraud allegations. Boeing also promised not to retaliate against employees who report real or potential ethics violations.
TThe attorney handling Boeing’s defense in the first whistle-blower suit works for McGuire Woods LLP in Richmond, Va., which is one of the firms that aided Boeing with its nonprosecution agreement in 2006.
Lynnwood attorney John Tollefsen is representing both plaintiffs.
P-I reporter Andrea James can be reached at 206-448-8124 or .