LOUISVILLE, Ky. (AP) – General Electric Co. has agreed to pay $11.5 million to settle a lawsuit brought by GE employees who alleged the company sold defective turbine parts, the U.S. Attorney's office in Louisville said Friday.
The settlement said GE and two of its subcontractors admitted no wrongdoing.
The suit was filed in Oct. 2000, in the Owensboro federal court, by two GE employees at its Madisonville plant. Five more employees joined the suit in January 2002. They alleged that GE covered up defects in turbine blades and vanes during production.
''The blades and vanes manufactured in Madisonville were assembled into jet engines in U.S. military airplanes, helicopters and ships,'' said David Huber, U.S. Attorney for Kentucky's Western District. ''Most blades and vanes were sold as spare parts, while others were assembled into new engine assemblies purchased by the military.''
Under the settlement, the employees will receive about 20% of the amount, or $2.35 million, with the remaining balance going to the government.
''GE settled this case in order to put it behind us,'' the company said in a statement Friday. ''GE strongly disputes the allegations made in the lawsuit and, in agreeing to this settlement, GE denies any fault.''
Howmet Casting, a subsidiary of Pittsburgh-based Alcoa Inc., and Precision Castparts Corp. of Portland, Ore., were named as co-defendants in the suit.