3 claims against Martin blocked Judge dismisses Intelstat claims on failed launch.

May 01, 1991|By Kelly Gilbert | Kelly Gilbert,Evening Sun Staff

A federal judge in Baltimore today threw out three of four counterclaims by the Intelsat telecommunications consortium in a lawsuit initiated by Martin Marietta Corp. last year in an attempt to avoid paying damages for the bungled launch of a $157 million satellite.

Judge Marvin J. Garbis, ruling in U.S. District Court, temporarily left Intelsat's highly technical breach of contract counterclaim intact and ordered both parties to prepare further briefsthat issue later this month.

But Garbis dismissed Intelsat's claims of negligence, gross negligence and negligent misrepresentation, saying they are barred by public policy established by Congress in the Commercial Space Launch Act.

"The public policy of this country . . . requires that those using the service of a licensed space launch provider do so at their own risk," Garbis ruled.

To hold otherwise, the judge said, would "substantially undermine the protections Congress intended for commercial space launchers" by allowing plaintiffs "to sue for damages on every imperfect space launch."

That would force commercial launchers to obtain prohibitively expensive insurance and "bet the farm on every launch," Garbis said.

Intelsat, the International Telecommunications Satellite Organization, filed its counterclaims in response to Martin Marietta's suit for a declaratory judgment. Martin Marietta asked the court to rule that it does not have to pay Intelsat damages for the launch snafu after months of negotiations failed to resolve financial responsibility.

The suit and countersuit stem from the failure of a Martin Marietta Titan III booster rocket to put an Intelsat telecommunications satellite into orbit after a launch in March 1990.

Martin Marietta freely admitted that a wiring error prevented separation of the satellite from the rocket. The satellite eventually was separated from the rocket, but it has been stranded ever since in a "low-Earth orbit" about 300 miles out in space, unable to perform its mission.

Martin Marietta lawyers argued, at a court hearing in January, that the company did not intentionally breach the launch contract and that Intelsat's ability to recover damages is limited by articles in the contract which bar claims for loss of services and damages as a result of the failed separation.

Intelsat's lawyers countered that there are conflicting articles in the contract . They also argued that Martin Marietta is trying to hide behind those contract provisions despite the nature and degree of its fault.

Intelsat claims it lost at least $400 million in the deal, including the $157 million cost of the now-useless satellite; $115.7 million that Intelsat paid Martin Marietta before the launch; and nearly $130 million in lost revenues from international television and telephone services it was to provide customers.

The consortium also is seeking some $90 million in damages to pay the National Aeronautics and Space Administration to boost the satellite into its intended orbit 22,000 miles above the Earth.

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