— ICO Global Communications expects to find out Oct. 28 whether the same
jury that ruled in its favor in awarding it $370.6 million in damages to be paid by Boeing Satellite Systems International also will order the satellite maker to pay punitive damages.
In an Oct. 22 conference call, Reston, Va.-based ICO said it is weighing whether to appeal the Los Angeles Superior Court jury award, which fell far short of the $2 billion ICO wanted from Boeing.
ICO and Boeing sued each other over a now-scrapped contract under which Boeing was to build and launch 12 ICO satellites to form a global fixed and mobile communications network. The constellation was never deployed.
Chicago-based Boeing said in an Oct. 21 statement that it would appeal the court ruling, a process Boeing said “may well take years to run its course.”
But ICO General Counsel John Flynn said “ICO has its own grounds for appeal, some of them dealing with the higher amount of damages we sought.”
Flynn and Barry W. Lee, an ICO attorney, said during the call that the jury’s award of $370.6 million is likely to be increased when the court decides how much interest Boeing must pay.
Lee said the court had indicated that interest of 7 percent to 10 percent per year would be appropriate, and that the most likely start date would be August 2004, when Boeing first brought the case to court.
Four years of interest at 7 percent would bring the total award to $485.8 million.
The ICO officials did not speculate on the potential size of a punitive damages award, but said the jury is likely to fix the amount the same day it reconvenes, Oct. 28.
ICO has alleged fraud and breach of contract with respect to a large contract it had with Boeing Satellite Systems of
, to build and launch 12 ICO satellites to provide fixed and mobile communications services worldwide.
One of the 12 satellites was lost during a launch vehicle failure. A second was placed into medium Earth orbit and provides some four hours per day of service to a given point in its footprint before it passes beyond line-of-sight view of a ground station.
The remaining 10 satellites are partially built and in storage in
. ICO has said it would like to complete construction of the satellites and deploy the system it originally intended.
Boeing has alleged that ICO, which paid it some $2 billion to build and launch the satellites, decided to attack Boeing in court only after ICO’s business model collapsed, for reasons that have nothing to do with the satellite maker.
In addition to its $370.8 million award, the jury awarded $91.6 million to ICO in a related complaint against Boeing Co., the parent company of Boeing Satellite Systems, for “tortious interference” in the ICO contract dispute with the satellite builder.
Boeing General Counsel J. Michael Luttig, in a statement issued after the jury award was announced, said Boeing would appeal the decision immediately.
“[T]here were fundamental errors in the case as it was submitted to the jury,” Luttig said in his statement. “There were fundamental errors in the conduct of the trial. There were fundamental errors in the instructions to the jury and in the court’s interaction with the jury during the deliberations. We thus have significant grounds for appeal.”