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systems, such as fighter planes and air-to-air missiles. Manufacturing these chips was a
lucrative business for Hughes Aircraft; the government paid between $300 and $5,000
for each chip.
In return for paying these high prices, the government insisted that the chips pass
stringent quality assurance tests. Hughes Aircraft technicians made two kinds of tests.
First, they ensured the chips functioned correctly. Second, they checked the chips for
resistance to shocks, high temperatures, and moisture. About 10 percent of the chips
failed at least one of these tests. A common problem was that a chip would have a
defective seal, which let moisture in. These chips were called “leakers.”
Margaret Goodearl and Donald LaRue supervised the testing area. The company
hired Ruth Ibarra to be an independent quality control agent.
In August 1986, floor worker Lisa Lightner found a leaker. Donald LaRue ordered
her to pass the chip. Lightner told Goodearl, and Goodearl reported the incident to
upper management. Hughes Aircraft management threatened to fire Goodearl if she
didn't reveal the identity of the worker who had complained.
Two months later LaRue ordered Shirley Reddick, another floor worker, to reseal
lids on some hybrid chips, in violation of the required process for handling leakers. Red-
dick reported the incident to Goodearl, who relayed the report to upper management.
Again, Goodearl was told she might be fired if she kept up this pattern of behavior.
In the same month, LaRue asked tester Rachel Janesch to certify that a defective
hybrid chip had passed the leak test. Goodearl played a role in reporting the incident to
Hughes Aircraft management. In this case the chips were retested.
Goodearl and Ibarra found a box of hybrid chips with blank paperwork, meaning
the necessary tests had not been performed. When Goodearl reported this discovery to
her superiors, they told her she was no longer part of the team. Goodearl filed a formal
harassment complaint. A midlevel manager in personnel called her into his office, tore
up her complaint, threw his glasses at her, and said, “If you ever do anything like that
again, I will fire your ass” [7].
Goodearl's performance evaluations, which had been excellent, dropped sharply as
soon as she began complaining about irregularities in the chip testing facility. In late
1986, Goodearl and Ibarra contacted the Office of the Inspector General, part of the
US Department of Justice. A joint decision was made for Goodearl and Ibarra to find a
clear-cut case of fraud.
One day LaRue put two leaky hybrid chips on his desk, planning to approve them
after Goodearl had gone home. Goodearl and Ibarra made photocopies of the docu-
mentation showing the chips had failed the leak test. After the chips were shipped from
Hughes Aircraft, the Department of Defense tested them and found them to be leakers.
As a result of this incident, the Office of the Inspector General began a formal investiga-
tion of fraud at Hughes Aircraft.
Hughes Aircraft fired Goodearl in 1989. Ibarra had left Hughes Aircraft in 1988
“after being relieved of all meaningful responsibilities and put in a cubicle with nothing
to do” [10]. In 1990 Margaret Goodearl and Ruth Ibarra (now known under her married
name, Ruth Aldred) filed a civil suit against Hughes Aircraft, claiming that Hughes
