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January 27, 2008 

BIS Imposes $400,000 Penalty on Northrop Grumman

The Commerce Department’s Bureau of Industry and Security (BIS) announced last week that Northrop Grumman Corporation has agreed to pay a $400,000 civil penalty to settle allegations that it committed 131 violations of the Export Administration Regulations, both in its own capacity and as successor to Litton Industries, Inc., which Northrop Grumman acquired in April 2001.

The allegations primarily involved unlicensed exports of specially designed components for navigation equipment and module manufacturing data that were to destinations in the Philippines, Singapore, Malaysia, Italy and the United Kingdom between January 1998 and September 2002.

BIS noted that Northrop Grumman voluntarily self-disclosed the violations and cooperated fully in the investigation.

This case demonstrates the importance of conducting export controls due diligence when buying a company.

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