EXECUTIVE MEMO
Army, Contractor Pledge to Stay Out of Court
n an effort to avoid costly litigation and lengthy court battles, the Army and the nation's largest defense contractor have signed an agreement that dictates how they will resolve contract disputes.
The agreement between the Army's Industrial Operations Command at Rock Island, Ill., and Lockheed Martin Ordnance Systems applies to a contract for the production of rockets.
"I've been in this industry 24 years and I've never seen such a partnership," says Linda Hudson, president of the Lockheed division. "We're in this together and will succeed or fail together."
Under the alternative dispute resolution agreement, parties will bring grievances before a standing neutral party, in this case the director of the Army's Armament and Chemical Acquisition and Logistics Activity, also at Rock Island. If the dispute is not resolved with the assistance of the neutral party, the dispute goes to nonbinding mediation. Ultimately, either party can go to court if necessary.
Sandra Crisp, chief of the Industrial Operations Command's Ammunition Procurement Division, says this is the first agreement that stipulates in advance how disputes will be handled.
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