The problem with friends in high places

Lockheed Martin pays $4.7 million to settle charges it lobbied for federal contract with federal money

Over five years, starting in 2009, a Lockheed Martin subsidiary — which was being paid by the federal government to run Sandia National Laboratories — lobbied members of Congress and senior Obama administration officials for a seven-year extension of the contract, according to the settlement the Justice Department announced Friday.

The case opened a window on the inner workings of power and influence in Washington. It’s not surprising that a big, politically connected defense contractor would lobby hard to keep a lucrative slice of federal business. But this case went further. Taxpayers, not Lockheed’s corporate lobbying arm in Bethesda, Md., were paying for the influence peddling.

Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, alleges that Sandia Corp., the Lockheed subsidiary, used federal money to lobby Congress and other federal officials from 2008 and 2012 “to receive a non-competitive extension” of its contract in violation of federal law. ompany executives, who allegedly hired a former New Mexico congresswoman to help them, didn’t just press people with influence to continue a relationship worth $2.4 billion a year to Lockheed, as Energy Department Inspector General Gregory Friedman concluded in an investigation last fall. They also urged that the contract be closed to competition.

Lockheed has contracted with the Energy Department to run Sandia since 1993. The research lab is part of the government’s nuclear weapons complex, with facilities in Albuquerque and Livermore, Calif. Wilson, who left Congress in 2009 after an unsuccessful run for the Senate, has publicly denied that she took part in any lobbying involving the Sandia contract.

To clinch the contract extension, Sandia labs officials hired high-priced consultants — including Heather A. Wilson, the former New Mexico congresswoman, who allegedly was paid $226,000 — to write up a “contract extension strategy.” Among the tactics allegedly suggested by Wilson was “working key influencers” by targeting then-Energy Secretary Steven Chu’s staff, his relatives and friends, and his former colleagues at another federal lab — all with the goal of keeping Lockheed Martin in charge of Albuquerque-based Sandia.

Wilson, who left Congress in 2009 after an unsuccessful run for the Senate, has publicly denied that she took part in any lobbying involving the Sandia contract.

Energy Department Inspector General Gregory Friedman alleged that Sandia hired Wilson’s consulting firm and two unnamed former employees of Energy’s National Nuclear Security Administration, which oversees the nuclear labs. Wilson’s company, Heather Wilson LLC, gave explicit guidance to the Sandia team on how to influence important people in Washington who would decide whether Lockheed’s contract would be renewed, authorities say. “Lockheed Martin should aggressively lobby Congress, but keep a low profile,” she advised, according to meeting notes authorities say were obtained by the inspector general’s investigation.

The inspector general said that Sandia’s push for a long-term no-bid contract extension under the Obama administration was not the lab’s first lobbying attempt at taxpayers’ expense. “Perhaps [Sandia] felt empowered because it had improperly directed Federal funds to similar activities in the past,” investigators wrote last fall.

Heather Clark, spokeswoman for Sandia National Laboratories, said the lab “has agreed to settle with the Department of Justice to put the matter behind us, take action on what we learned and focus on our important national security mission.” She said Sandia executives “believed our actions for a contract extension fell within allowable cost guidelines,” but now realize that they “acted too early and too independently in planning for a possible contract extension.”

The investigation has “clarified” Sandia’s understanding of “our legal obligations on interacting with public officials,” Clark said.

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