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Hughes Communications Galaxy, Inc. v. United States

United States Court of Appeals for the Federal Circuit
271 F.3d 1060 (2001)


Facts

Hughes Communications Galaxy, Inc. (Hughes) (plaintiff) entered into an agreement with the National Aeronautics and Space Administration (NASA) under which NASA would use its best efforts to launch Hughes’ HS-393 satellites on NASA space shuttles until either ten HS-393s were launched or until September 30, 1994, whichever was earlier. After the Challenger explosion, NASA stopped launching commercial satellites on shuttles. Hughes launched three HS-393s and six HS-601 satellites on expendable launch vehicles (ELVs) instead of shuttles. Hughes sued the United States Government (defendant) for breach of contract. Hughes provided evidence that the HS-601s were more suitable for ELV launches and would not have been developed absent the government’s breach. A government report concluded that NASA could have launched five HS-393s during the LSA contract period using its best efforts. The court of federal claims granted summary judgment for Hughes and awarded damages to Hughes for its increased costs in launching five satellites, totaling more than $102,000,000. The trial court used the difference in the cost of launching HS-393s on ELVs instead of shuttles to calculate Hughes’ increased costs in launching the two HS-601s on ELVs. Both parties appealed the amount of damages.

Rule of Law

Issue

Holding and Reasoning (Rader, J.)

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