Whistle-Blower Suit Goes on Despite Death : Litigation: The attorney for the late plaintiff won’t drop case against Litton Industries. The defense firm denies that it used stall tactics.

A Reseda woman with a pending $21-million whistle-blower case against Litton Industries Inc. has died, but her attorney vowed to press ahead with the litigation.

Mary Ann E. Rohan sued Litton in 1991, alleging that executives at the Beverly Hills-based defense concern ignored her warnings of a co-workers’ embezzlement, and then harassed her when she reported the wrongdoing to federal authorities.

Rohan, who left Litton in 1989 on disability leave, suffered from emphysema and chronic heart disease and finally succumbed to lung disease a week ago. She was 58.

A federal court dismissed Litton from the lawsuit last year. The case is currently on appeal before the U.S. 9th Circuit Court of Appeals.

“I believe that Litton engaged in delaying tactics with the specific aim of Mary Ann Rohan’s passing away, and that that would result in the end of this action,” said Rohan’s attorney, Louis J. Cohen.

Litton spokesman Bob Knapp denied the company purposely stalled the legal proceedings, calling the allegation “absolutely ridiculous.”

But Cohen said that after consulting with Rohan’s family, “I intend to vigorously prosecute this case.”

The suit seeks $21 million in damages under the False Claims Act, which Congress amended in 1986 to empower citizens to blow the whistle on defense contractors whom they suspect of defrauding the government.

The law entitles a whistle-blower to receive 15% to 20% of the damages if a complaint is successful. The remainder would go to the federal government.

Cohen said the issue of whether a federal whistle-blower lawsuit can continue after the plaintiff dies must be resolved in court.

He intends to argue that the action should continue and that any damages that would have been awarded to Rohan should pass to her estate.

Rohan worked as an accounting clerk at Litton’s Guidance and Control Systems division in Woodland Hills from February to July, 1989.

In her complaint, Rohan alleged that she repeatedly notified her Litton supervisors about an embezzlement scheme by another worker, but her warnings were ignored.

The worker, Robert J. Newbert, a former Litton planning engineer, later pleaded guilty to two federal counts of making false statements and admitted embezzling more than $200,000 from the company.

Newbert was the only Litton employee convicted of crimes connected with the embezzlement scheme. He served 13 months of a 16-month sentence in federal prison and agreed to reimburse Litton $215,000.

In court documents, Rohan said that Newbert would submit generic invoices of the type sold in stationery stores to get cash reimbursements, even though Litton required all receipts to be imprinted with the name of the company requesting payment.

Rohan alleged that her supervisors looked the other way when she told them about the receipts. Litton then charged Newbert’s fake claims to the federal government, Rohan’s suit contends.

In a deposition in a related case, Newbert admitted that he did favors for employees who helped him get cash. Among other things, he said he gave another employee tickets to Laker basketball games.

The government launched an investigation after Rohan called a U.S. Defense Department fraud hot line in 1989.

An audit by the Defense Contract Audit Agency corroborated many of the irregularities that Rohan reported.

In February, 1992, a federal judge in Los Angeles dismissed Litton from the lawsuit, saying not enough evidence was provided to show that Litton knew about the scheme.

Litton has repeatedly denied knowledge of the embezzlement and asserts that it, too, was a victim of Newbert’s scheme.

Company spokesman Knapp contended that Rohan never reported her suspicions to her supervisors at Litton.

“We fully expect that the appeals court is going to uphold the decision of the lower court,” he said.

Rohan’s appeal, filed last August, has been supported by the U.S. Department of Justice.

In a legal brief filed on behalf of Rohan, Justice officials said they were concerned that the dismissal of her case might jeopardize other whistle-blower cases.

A second cause of action in the lawsuit alleges that Litton retaliated against Rohan for exposing the embezzlement by harassing and threatening her, forcing her to leave the company. It seeks double her back wages and unspecified “special” damages.

Cohen said oral arguments were presented before the 9th Circuit Court of Appeals last month.

If the appellate court rules that the lower court erred in dismissing Rohan’s complaint, the lawsuit would be sent back to the district court to be decided on its merits.

Litton had $5.7 billion in revenue in its latest fiscal year. Its Guidance and Control Systems division makes navigation equipment for ships and aircraft.