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SpaceX sues over rivals’ launch venture

An upstart rocket developer says it has gone to court to challenge plans by the Boeing Co. and Lockheed Martin Corp. to launch government satellites jointly.
/ Source: Reuters

An upstart rocket developer said Thursday it had gone to court to challenge plans by the Boeing Co. and Lockheed Martin Corp. to launch government satellites jointly.

Space Exploration Technologies Corp., also known as SpaceX, filed suit Wednesday in federal court, charging that the joint venture by the two largest U.S. military contractors is anticompetitive and violates antitrust law.

SpaceX, based in El Segundo, Calif., asked the U.S. District Court for the Central District of California to block the joint venture and award SpaceX unspecified damages.

The Federal Trade Commission is conducting an antitrust review of the United Launch Alliance, and a SpaceX spokesman said a decision was expected as early as next week. Last month Boeing and Lockheed refiled their application with the FTC.

The plan, which would end nearly a decade of rivalry between the two in the space launch arena, has been supported by the U.S. Air Force as a way to cut the cost of putting military, spy and research satellites into orbit.

The 50-50 joint venture is expected to save the government $100 million to $150 million a year, according to the companies.

The lawsuit charges that Boeing and Lockheed recognized the threat posed by SpaceX’s developing family of low-cost launch vehicles and says the two contractors strong-armed the Air Force into an exclusive launch contract through 2011 or beyond.

Boeing spokesman Dan Beck said Boeing had not yet seen the suit but said the alliance was working through the FTC review process. “We’re confident (the alliance) will ultimately be approved and meet the launch needs of the U.S. government without being a threat to competition,” said Beck.

Lockheed spokesman Tom Jurkowsky said the company does not comment on pending litigation but said the alliance promised the government assured access to space at less cost.

Citizens Against Government Waste, a watchdog group, on Thursday urged against granting sole-source launch contracts to the alliance.

“The structure slams the door on any possible competition,” the group’s president, Tom Schatz, said in a statement.