"Claims Without Merit"
You're big. You're successful. You're open to lawsuits.
Boeing's potential financial exposure from allegedly building
defective commercial satellites continues to climb, The Wall Street
Journal reported Saturday, with reports of two new negligence and
breach-of-contract claims totaling $610 million against the
These two latest actions were disclosed in a filing with the
Securities and Exchange Commission Friday, demonstrating that
insurance companies are willing to join satellite operators to
pursue arbitration claims against Boeing, reported Xinhua.
In the filing, Boeing said all the claims lack merit and it
intends to fight them.
Telesat Canada, the
satellite unit of Canadian telecommunications company BCE Inc.,
filed an arbitration order against Boeing in November 2006 and an
action in a Canadian superior court in December 2006.
Several early model 702 satellites, including Telesat's Anik F1,
allegedly faltered in orbit in 2004 after having problems with
their solar panel cells.
Telesat contends breach of contract and negligence. Telesat and
its insurers are seeking more than $385 million in damages and $10
million in lost profits. Boeing pronounced the claim without
Insurers for Japanese firm Space Communications Corp. brought a
second suit against Boeing's satellite unit, seeking $215 million
related to a failed 2004 launch of Japan's Superbird-6 satellite,
according to the SEC filing. Space Communications' insurers filed
an arbitration request on Dec. 1, 2006.
The Superbird-6 was allegedly damaged in low orbit after the
launch. Boeing claimed the satellite was launched into
lower-than-intended orbit and needed to expend additional fuel to
get into the correct orbit.
Boeing also said that claim was without merit.
Overall, industry officials have said Boeing could face
significantly more than $1.5 billion dollars in damage claims
resulting from various satellite defects, according to the Wall
Separately on Friday, Boeing announced it will begin selling a
less-powerful, less-expensive version of its biggest satellite
model this year for customers who require lower signal
The new 702B spacecraft will deliver 2 to 18 kilowatts of signal
strength and likely carry a smaller price tag than the 702,
Boeing's most powerful model, which delivers 10 to 16 kilowatts,
spokeswoman Diana Ball said Friday.