Kaman Corporation Settles False Claims Matter, But Grand Jury Investigation Appears Ongoing

Kaman Corporation (NASDAQ: KAMN) announced that its subsidiary, Kaman Precision Products, has entered into an agreement with the U.S. government to settle previously disclosed litigation involving the False Claims Act. This matter, which dates back 7 years, pertained to the subsidiary's prior FMU-143 fuze program. The settlement involves a $4.75 million payment to the U.S. government and a $1.45 million inventory write-off. The impact on 4Q11 earnings will be $6.2 million, or $0.15 per share net of tax. The company's Chief Legal Officer, Candace Clark, acknowledged the significance of the legal expenses incurred in connection with this matter as well as the diversion of management time and effort. 

As of the 10-Q filed 2-Nov-11, KAMN continued to disclose its involvement in a grand jury investigation that was disclosed in August 2011. The investigation relates to record keeping associated with the manufacture of certain composite parts.