Tue, May 24, 2011
Case Referred Back Lower Court For Further Review
The U.S. Supreme Court has set aside a ruling by a Federal
Appeals Court what would have forced Boeing and General Dynamics to
repay over a billion dollars to the Pentagon over a
stealth aircraft that was cancelled in 1991.
GD and McDonnell Douglas (now Boeing) were working on the A-12
Avenger, which was to have been a stealth aircraft designed for
carrier operations. After years of delays and cost overruns on the
$4.8 billion contract, the Pentagon terminated the program in
January of 1991, saying the two companies were in default. Defense
News reports that the two companies claimed they had not defaulted,
and a federal claims court ordered the Pentagon to pay them $1.2
billion in expenses. They said that the government had not shared
stealth knowledge it had used to develop the F-117 and B-2. That
decision was overturned by the federal appeals court, which said
the previous technology argument could not be litigated for reasons
of national security.
And the Pentagon wanted its money back, with interest.
That decision was vacated Monday in a unanimous decision by
SCOTUS, which sent the case back to federal circuit court. In the
court's opinion, Justice Antonin Scalia wrote: "Whether the
Government had an obligation to share its superior knowledge about
stealth technology is left for the Federal Circuit to address on
remand."
In a statement following the ruling, J. Michael Luttig, Boeing
Executive Vice President and General Counsel, issued the following
statement:
“We are pleased with today’s win in the Supreme
Court and the Court’s unanimous decision to overturn the
government’s default termination of the A-12 program. It has
always been our view that the default termination was
improper.”
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