SpaceX Lawsuit against U.S. Air Force Encounters Jurisdictional Challenge

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WASHINGTON — The U.S. Justice Department is arguing that a federal court lacks jurisdiction to hear some or all elements of a lawsuit challenging the Air Force’s $11 billion bulk purchase of rockets from United Launch Alliance, according to legal experts and recent court filings.

In April, Space Exploration Technologies Corp., known as SpaceX, asked the U.S. Court of Federal Claims to void a large portion of the sole-source deal, which was signed last year and includes the purchase of 36 rocket cores from ULA.

Hawthorne, California-based SpaceX, whose Falcon 9 rocket is undergoing Air Force certification to launch national security payloads, argues that it should have been given the opportunity to bid on a large number of those missions.

The Justice Department, which is representing the Air Force in the suit, asked the court in June to dismiss the case, claiming SpaceX missed its window to appeal the contract.

The judge presiding over the lawsuit, Susan Braden, apparently declined, and in July put media gag orders on all involved parties. In addition, a majority of new documents in the case have been filed under seal.

However, the electronic court document system known as the Public Access to Court Electronic Records, or PACER, offers hints of the wrangling happening in the court.

On Nov. 25, the record system shows that one party filed a motion known as a Rule 12(b)(1), a designation that according to lawyers who reviewed the case history indicates a challenge to the court’s jurisdiction on the matter. These attorneys, including Steven Schooner, a professor of government procurement law at George Washington University here, said it can be safely assumed that the motion was filed by the Justice Department.

In a Dec. 2 email, Schooner said the government likely “is asking the court to conclude that it would be an inappropriate waste of time and resources to hear evidence, either through paper filing or through some sort of trial or evidentiary hearing, regarding the allegations, because — regardless of what actually happened — the court has no power to decide the matter.”

But another expert, who did not want to be identified, said the government may be asking a narrower question: whether the court has jurisdiction over certain aspects of the case.

Nicole Navas, a spokeswoman for the Justice Department, declined to answer questions about the filing, saying only, “There is nothing in the public record.”

John Taylor, a SpaceX spokesman, said in a Dec. 1 email that the company has been directed by the court not to comment on the matter.

Questions about jurisdiction have come up before in the case. In May, for example, the court temporarily barred the Air Force and ULA from buying additional Russian-made engines for the Atlas 5 rocket, one of two main launchers built and operated by the Denver-based company. The Justice Department questioned whether Braden had the legal authority to issue such a ban, which has since been lifted.

The weeks immediately following SpaceX’s April filing of the lawsuit produced a slew of publicly available documents and transcripts, including a request by Braden that the parties explain the rocket engines using Lego bricks, the venerable children’s toys, according to a transcript.

In July, Braden asked the Air Force and SpaceX to attempt to resolve the lawsuit in mediation. A decision was expected Nov. 1, but given the ongoing filings it is unlikely that a settlement was reached, legal sources said.