SpaceX Charges Racketeering – Sues

Boeing and Lockheed Martin!

Part of: Space Program News

Author: Bennett DawsonPublished: Oct 24, 2005 at 3:13 pm 8 comments

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On the eve of becoming the first privately held company to provide satellite launch services, SpaceX has filed suit against Boeing Company and Lockheed Martin Corporation, charging both companies with conspiracy, anti trust, and racketeering.

Their lawsuit charges that “Boeing and Lockheed Martin have engaged in an unlawful conspiracy to eliminate competition in, and ultimately to monopolize, the government space launch business and prevent SpaceX and other potential new entrants from competing in that business.”

Should anyone be surprised that these two companies, long time beneficiaries of lucrative defense contracts, would try to keep competition from cutting into the massively profitable satellite launch services? It will be interesting to watch this battle unfold. For years there have been cries for more private sector involvement in the space program, as a way to reduce the cost to taxpayers through competitive bids for government contracts.

With SpaceX only a week away from launching its inaugural commercial rocket (to place a NGA payload into a stable earth orbit) it appears that Elon Musk and his group have discovered some behind the scenes activity, designed to lock them out of the government space launch business.

The suit charges the following:

1) Violation of Section 1 of the Sherman Act

2) Violation of Section 2 of the Sherman Act

3) Violation of Section 7 of the Clayton Act

4) Violation of Racketeer Influenced and Corrupt Organizations Act

5) RICO Conspiracy

6) Violation of the Cartwright Act (Unreasonable Restraint of Trade)

7) Violation of the Cartwright Act (Conspiracy To Monopolize)

8) Violation of Section 17200 of California’s Business & Professional Code

The Full Summons is well written and worth the time to download (2.9 MB). It goes into great detail about the methods used by Boeing and Lockheed Martin to shut out SpaceX and other potential competition from the EELV market.

Go get ’em, Elon! Our nation needs more than “business as usual” by a few entrenched defense contractors. We need open competition by visionary groups dedicated to pushing the space program forward. We need to bring the cost of accessing space down to a level that encourages other companies to look beyond the horizon, and start thinking about developing the energy and resources available in the space between the Earth and her moon.
Excerpts

“1. This is an action by Space Exploration Technologies Corporation (“SpaceX”) against the Boeing Company and Lockheed Martin Corporation for violations of antitrust, unfair competition and racketeering laws. Boeing and Lockheed Martin have engaged in an unlawful conspiracy to eliminate competition in, and utlimately to monopolize, the government space launch business and prevent SpaceX and other potential new entrants from competing in that business.”

“4. SpaceX poses a significant threat to Boeing and Lockheed Martin’s dominant position. It has developed new technologies and a new business model that will allow it to reduce dramatically the cost of access to space and increase the reliability of launch vehicles. The rockets being developed by SpaceX will perform better, and will be much less expensive, than those offered by Boeing or Lockheed Martin.”

 

Link:  http://blogcritics.org/culture/article/spacex-charges-racketeering-sues-boeing-and/

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