American Satellite Co. v. United States

37 Cont. Cas. Fed. 76,308, 26 Cl. Ct. 146, 1992 U.S. Claims LEXIS 140, 1992 WL 73648
CourtUnited States Court of Claims
DecidedApril 13, 1992
DocketNo. 525-89C
StatusPublished
Cited by9 cases

This text of 37 Cont. Cas. Fed. 76,308 (American Satellite Co. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
American Satellite Co. v. United States, 37 Cont. Cas. Fed. 76,308, 26 Cl. Ct. 146, 1992 U.S. Claims LEXIS 140, 1992 WL 73648 (cc 1992).

Opinion

OPINION

BRUGGINK, Judge.

Plaintiff, American Satellite Company, contends that the National Aeronautics and Space Administration (“NASA”) was contractually bound to launch one of its satellites on the Shuttle, and that the actions of the President in the wake of the loss of the Shuttle Challenger unilaterally abrogated those rights in favor of other Shuttle customers. As a result, it claims that the United States is liable to it, either for breach of contract or for a constitutional taking, for the cost of reprocurement on a private launch vehicle, approximately $70 million. The case is before the court on cross-motions for summary judgment. For the reasons stated below, plaintiff's motion is denied and defendant’s motion is granted.

[148]*148FACTUAL BACKGROUND 1

On August 3, 1984, American Satellite Company (“ASC”)2 and the United States, represented by NASA, executed a Launch Services Agreement No. 1306-002 (“LSA”), under which NASA was to use its “best efforts” to launch two satellites owned by ASC aboard the Shuttle.3 NASA’s obligations under the LSA were to remain in effect until September 19954 or until both satellites were launched, whichever came first. The first satellite, ASC-1, was launched on the Shuttle on August 27, 1985. The second satellite, ASC-2, was scheduled to be launched on January 27, 1987.5 On January 28, 1986, the Shuttle Challenger was destroyed in a fiery explosion shortly after take-off from the Kennedy Space Center at Cape Canaveral, Florida. As a result of the loss of the Challenger, the NASA Shuttle fleet was reduced from four Shuttles to three.

At the time of the Challenger accident, NASA had entered into LSAs obligating it to launch 44 other commercial payloads, including ASC-2. The payloads were listed on the Shuttle manifest in order of their “Planned” or “Firm Launch Date.”6 As of the date of the Challenger accident, ASC-2 was listed seventh on the manifest.

The aftermath of the accident saw a flurry of activity, particularly with regard to the commercial payloads. Rear Admiral Richard H. Truly, then the Associate Administrator of the Office of Space Flight at NASA, via letter dated April 17, 1986, apprised ASC of the status of NASA’s effort to formulate a new manifest. In the letter, Admiral Truly stated that NASA was doing all it could to lessen the impact of the accident on the commercial users. To that end, Admiral Truly promised that the commercial payloads would “primarily be scheduled according to their launch sequence prior to the [Challenger] accident.” NASA then sent another letter to ASC dated June 3, 1986, in which NASA told ASC that ASC-2 had been given a new launch date in December 1989.

But NASA’s intentions were not to be fulfilled. After months of hearings, testimony and debate on the future of the Shuttle program, the President announced on August 15, 1986, that the United States was pulling out of the commercial launch business and that the Shuttle would no longer be used to launch commercial payloads. In the announcement, the President expressed his belief that the private sector would step forward and develop a satellite launch industry to fill the void left by NASA’s departure from the business.7

The President’s announcement left the Government with the problem of what to do with the 44 commercial payloads that [149]*149were manifested as of the date of the Challenger accident. At a press conference also held on August 15, 1986, the President’s press secretary, Larry Speakes, told reporters that a “working group” of the President’s Economic Policy Council (“EPC”)8 would “set priorities among these 44” payloads and advise their owners as to when they might be launched. Press Briefing by Larry Speakes, et al., Aug. 15, 1986, at 2. Mr. Speakes would not be specific as to how the payloads would be prioritized, but he did suggest that special consideration would be given to those payloads that required a manned presence for deployment and those that had national security or foreign policy implications. Id. at 126.

On September 25, 1986, Alfred H. Kingon, the President’s Cabinet Secretary, sent a memorandum to NASA’s Administrator, Dr. James C. Fletcher, announcing the President’s decision as to the future of the 44 commercial payloads. According to the memorandum, the President ordered that:

NASA shall no longer provide launch services for commercial and foreign payloads subject to exceptions for payloads that: (1) are Shuttle-unique; or (2) have national security or foreign policy implications.
... NASA will revise its manifest to include only those payloads that are either Shuttle-unique or have national security and foreign policy implications. The manifest will then be made public, with the expectation that current customers who are not included on the manifest will voluntarily seek launch opportunities elsewhere.

“Shuttle-unique” is a term of art referring to a payload that is designed in such a way that it cannot be launched by any other method, such as aboard an unmanned expendable launch vehicle (“ELV”). Thus, those satellites having either national security or shuttle-unique status (or both) were excepted from the President’s ban on commercial use of the Shuttle.

According to a document entitled “Space Shuttle Contracts, Forty Four Commercial/Foreign Payloads,” prepared by NASA at the urging of the EPC,9 five payloads had national security implications, twelve had foreign policy implications, and three were shuttle-unique.10 Thus, only 20 of the 44 commercial payloads on the pre-Challenger manifest qualified for exceptions from the President’s ban. Apparently, the White House hoped that the remaining 24 commercial payloads would be launched by the infant private ELV industry alluded to in (and essentially created by) the President’s August 15, 1986 announcement. ASC-2 fell into this remaining class of 24 satellites having neither national security or shuttle-unique status.

On October 3, 1986, NASA issued a telegraphic message addressed to the “Commercial and Foreign Customers” of the Shuttle. The message announced the new manifest of commercial payloads for the Shuttle. The new manifest was comprised solely of those 20 payloads that met the criteria set forth in the President’s order. ASC-2, though slated to be launched seventh on the pre-Challenger manifest, was not included on the new manifest. In fact, only two of the twenty payloads on the new manifest had previously held higher positions than ASC-2 on the pre-Challenger manifest. In effect, NASA, at the President’s direction, reshuffled the [150]*150priorities of the 44 commercial payloads, paying very little heed to the pre-Challenger manifest.11 As a result, several payloads originally having no priority over ASC-2 leapfrogged over and bumped ASC-2 off the Shuttle manifest.

By letter dated October 30, 1986, NASA’s General Manager, Philip E. Culbertson, informed ASC that pursuant to current “White House policy,” there was no launch date on the current manifest for ASC-2. The letter explained that the new manifest represented the Shuttle “launch schedule through calendar year 1994,” and was necessary because “launch requirements ...

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Temple-Inland, Inc. v. United States
59 Fed. Cl. 550 (Federal Claims, 2004)
Centex Corp. v. United States
49 Fed. Cl. 691 (Federal Claims, 2001)
New Valley Corp. v. United States
34 Fed. Cl. 703 (Federal Claims, 1996)
American Satellite Co. v. United States
40 Cont. Cas. Fed. 76,869 (Federal Claims, 1995)
Hughes Communications Galaxy, Inc. v. United States
40 Cont. Cas. Fed. 76,906 (Federal Claims, 1995)
American Satellite Company v. The United States
998 F.2d 950 (Federal Circuit, 1993)
American Satellite Co. v. United States
28 Fed. Cl. 950 (Federal Circuit, 1993)
Blaze Construction, Inc. v. United States
27 Fed. Cl. 646 (Federal Claims, 1993)
Hughes Communications Galaxy, Inc. v. United States
37 Cont. Cas. Fed. 76,307 (Court of Claims, 1992)

Cite This Page — Counsel Stack

Bluebook (online)
37 Cont. Cas. Fed. 76,308, 26 Cl. Ct. 146, 1992 U.S. Claims LEXIS 140, 1992 WL 73648, Counsel Stack Legal Research, https://law.counselstack.com/opinion/american-satellite-co-v-united-states-cc-1992.