Boeing's plans to establish a joint venture with Lockheed Martin to provide rocket-launch services to the U.S. government have provoked a...
Boeing’s plans to establish a joint venture with Lockheed Martin to provide rocket-launch services to the U.S. government have provoked a wide-ranging lawsuit by a potential competitor.
Space Exploration Technologies, a Los Angeles company that has developed a family of launch vehicles, filed a civil suit late Wednesday in the U.S. District Court for the Central District of California that alleges Boeing and Lockheed have engaged in an “illegal and anti-competitive conspiracy to monopolize and prevent competition in the market for the sale to the United States government of a certain class of space-launch vehicles.”
The suit asks the court to block the formation of the United Launch Alliance, as the new venture would be known, and seeks monetary compensation for losses SpaceX allegedly has already incurred due to actions taken by Boeing and Lockheed.
SpaceX was founded by Eton Musk, who was a co-founder of the popular Internet-payment company PayPal. eBay eventually bought PayPal for $1.5 billion.
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Boeing and Lockheed announced plans to merge their heavy-lift Delta and Atlas rocket programs in May due to a downturn in demand for commercial and government launches. The companies said at the time the merger would save the U.S. government up to $150 million annually.
The proposed tie-up is undergoing review by the Department of Defense and the Federal Trade Commission. Boeing and Lockheed revised and re-submitted their merger application last month, in part to respond to questions about the proposed savings. A decision is expected by the end of the year.
Separately, Citizens Against Government Waste, a nonprofit watchdog group, slammed the proposed deal yesterday.
A news release from the group noted that Boeing and Lockheed are already jointly negotiating with the Air Force on a package of 23 launches under the Air Force’s “evolved expendable launch vehicle” program.
“The structure slams the door on any possible competition,” said Tom Schatz, the group’s president. “The (United Launch Alliance) locks up all contracts, ensuring high costs for taxpayers and stifling innovation.”
Before joining forces, Boeing and Lockheed were fierce competitors in the launch business.
Boeing was suspended from bidding on government launches for 18 months after Pentagon investigators discovered the company had illegally obtained more than 65,000 pages of proprietary data on Lockheed’s Atlas rocket program, and Lockheed had brought a racketeering lawsuit against Boeing.
Lockheed dropped the lawsuit when the United Launch Alliance plans were finalized.
David Bowermaster: 206-464-2724 or email@example.com