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Government Requests Court Dismiss SpaceX Lawsuit Over Air Force's 36-Rocket Block-Buy Deal With ULA

A SpaceX Falcon-9 rocket (left) and a ULA Atlas-V (right). SpaceX is filing a lawsuit against the Federal Government for the right to compete for Department of Defense and other government launch contracts, which ULA currently has a monopoly over. Photo Credits: AmericaSpace / Alan Walters / Mike Killian

A SpaceX Falcon-9 rocket (left) and a ULA Atlas-V (right). SpaceX is filing a lawsuit against the Federal Government for the right to compete for Department of Defense and other government launch contracts, which ULA currently has a monopoly over. Photo Credits: AmericaSpace / Alan Walters / Mike Killian

On June 30, 2014, the U.S. government filed a request with the U.S. Court of Federal Claims to dismiss a lawsuit filed by Space Exploration Technologies (SpaceX) last April against the U.S. government and United Launch Services (ULS), a subsidiary of United Launch Alliance (ULA), over a big multi-billion dollar “block buy” deal the Air Force awarded to ULA for supply of 36 rocket cores over five years.

In the request the government claims SpaceX had no jurisdiction, and calls the Hawthorne, Calif.-based company’s complaints “amorphous,” citing numerous reasons why SpaceX has no standing to bring a challenge to any sole-source purchases made between the U.S. Air Force and ULAincluding the fact that SpaceX was never an actual or prospective bidder on the contract to begin with. For that reason, according to the government, SpaceX should not be allowed to challenge the contract, and the government also emphasized the fact that SpaceX failed to object or respond to a public request for proposal issued in March 2012 for that purchase.

A poster recently released by ULA in light of SpaceX's lawsuit. Image Credit: ULA

A poster recently released by ULA in light of SpaceX’s lawsuit. Image Credit: ULA

“SpaceX did not raise any objection to the solicitation at the time it was issued, nor did SpaceX object at any point during the two years while the Air Force negotiated with ULS,” claims the government defendant in paperwork filed requesting the dismissal June 30. “Rather, only now that SpaceX believes it can compete does it raise – for the very first time – an argument that implicates the solicitation’s terms. This tactic is explicitly barred. As the Federal Circuit explained, vendors are not allowed to sit on their rights in the hopes of securing a contract and then, when those hopes are dashed, undo the entire evaluation scheme by challenging the basis upon which the procurement was conducted.”

The request to dismiss SpaceX’s lawsuit continues on:

Simply put, the fact that SpaceX did not find it necessary to challenge the procurement at the time it was issued does not give SpaceX license to now go back and seek to undo two years of planning and work by the agency. To the contrary, SpaceX’s failure to timely object to the Air Force’s chosen contract vehicle bars SpaceX’s standing to challenge that vehicle now. SpaceX should have indicated its desire to compete at the time the Air Force issued the solicitation in 2012—something SpaceX completely failed to do. We respectfully request that the Court dismiss any portion of SpaceX’s complaint.”

The fact of the matter is SpaceX was not allowed to bid against ULA for that big money contract, and the company’s CEO Elon Musk filed suit last April against the U.S. Air Force in hopes of reopening bidding on those contracts so his company can have a piece of the multi-billion dollar pie. However, the company is not certified yet to launch government payloads on their Falcon 9 v1.1 rocket or their still-in-development Falcon Heavy, something Musk blames on Air Force stall tactics (although not in those exact words). Yet the U.S. Air Force has spent over $60 million thus far on getting SpaceX certified to compete against other launch providers for those big money DOD contracts, and officials expect SpaceX to be certified to launch those critical national security assets by the end of 2014.

The SpaceX Falcon 9 v1.1 rocket launching Thaicom-6 last Jan. Photo Credit: AmericaSpace / John Studwell

The SpaceX Falcon 9 v1.1 rocket launching Thaicom-6 last Jan. Photo Credit: AmericaSpace / John Studwell

“Generally, the person you are doing business with you don’t sue,” said U.S. Air Force Space Command General William Shelton in May. “Right now, we’re launching space station resupply missions with SpaceX. We’re launching food, we’re launching clothing… That doesn’t begin to represent the catastrophic loss much like a national security payload failure would, there’s a big difference.”

“At about $1.5 billion — and sometimes higher — national security payloads have to get there. We have to make sure we’ve done due diligence on the part of the government to make sure that that rocket is going to deliver safely and reliably,” added Shelton. “We’re just not going to give up on mission assurance. There’s a lot pressure out there to make us dial back on mission assurance, but I’ll have a pair of treads running all over me before that happens.”

“At the time the solicitation was issued, SpaceX had not completed the necessary certifying flights for its Falcon 9 rocket; it was very far from having a launch vehicle that could meet the agency’s requirements,” explains the defendant. “SpaceX knew about the agency’s intent to award a sole-source contract to ULS, and received a copy of the RFP less than a month after it was issued. Yet SpaceX failed to object—or to indicate that it too could compete for the eventual contract. Although SpaceX may have ongoing concerns regarding the EELV program that it wishes to explore, SpaceX’s own failure to timely object to the RFP means that it does not have standing to bring those complaints to this Court.”

So far in 2014 SpaceX has launched twice, once for a commercial customer and once for NASA on the company’s third Commercial Resupply Services (CRS)-3 mission of the Dragon cargo craft to the International Space Station. Both missions were successful, and SpaceX is scheduled to launch their third flight this year as soon as July 14.

ULA has launched seven times this year, with the most recent having flown just yesterday, for both NASA and the U.S. government. All launches were successful, and on two occasions launches were carried out within a week of each other. Their eighth mission in seven months, AFSPC-4 for the U.S. Air Force, is scheduled to fly as soon as July 23.

The 20-page “Motion to Dismiss” request filed on June 30 can be viewed in its entirety HERE.

SpaceX has until the end of July to respond to the dismissal request.

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6 comments to Government Requests Court Dismiss SpaceX Lawsuit Over Air Force’s 36-Rocket Block-Buy Deal With ULA

  • Joe:

    … U.S. Air Force Space Command General William Shelton in May. “Right now, we’re launching space station resupply missions with SpaceX. We’re launching food, we’re launching clothing… That doesn’t begin to represent the catastrophic loss much like a national security payload failure would, there’s a big difference.”

    This is an interesting statement. I agree with General Shelton that the loss of a “national security payload” is a serious issue, but is it any more serious than the loss of a crew would be?

  • Tracy the Troll

    What difference does it make if we have billion dollar spy satelites….. but the current Administration didn’t have any idea of the current advancements by Terrorists in Benghazi or in Ukraine by Russia or ISIS in Iraq or the southern border being overrun by illegals….Just cancel the launches all together… use the money for..the presidents vacations…

  • srinivasa

    space x and u l a both companey are american company both are working
    american people / nation WHY ” all are happaning ? government not involved any body favour …. left to court ?…… are settled mutuvally….

  • Karol

    “Results over Rhetoric”. Gotta love it! Unfortunately results, performance, and a proven track record are no match for a successful presidential campaign fundraiser in 2008 and a legion of fanatical followers who will gleefully guzzle the Kool-Aid at the whim of the Musksiaah.

  • ken anthony

    Standing? None of us ever has standing. We’re only citizens. It not like govt. decisions have any impact on us. Next thing ya know we’ll be mentioning that pesky constitution thing.

  • Joe:

    This is probably pointless, but I will give it a try.

    I am not a lawyer (maybe you are) but I believe in this case “standing” refers to being legally entitled to challenge an already existing contract when SpaceX had earlier opportunities to make such a challenge and did not avail themselves of those opportunities.

    Whether or not SpaceX has such “standing” is what a court must decide (since SpaceX brought the suit) and that is why the request for dismissal.

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