SpaceX Says Air Force Targeting Legal Loophole in RD-180 Injunction

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SpaceX has upped the ante in its bid to compete for national security space launches against incumbent United Launch Alliance (ULA).

After filing a protest against the U.S. Air Force and ULA in the U.S. Court of Federal Claims last week, the Hawthorne, Calif.-based rocket maker won a temporary inunction against new purchases of Russian RD-180 engines used to power ULA's Atlas 5. The ruling, issued April 30 by Judge Susan Braden, asked that the U.S. Commerce, State and Treasury departments certify such spending does not violate U.S. sanctions against Russian Deputy Prime Minister Dmitry Rogozin, who oversees Moscow's defense and space industries.

Although the injunction excludes purchase orders or payments made to RD-180 prime contractor NPO Energomash prior to April 30, the U.S. government sought to clarify whether the ruling applies to Air Force purchases or payments made to ULA or its subsidiary, United Launch Services (ULS). In a May 2 filing with the court, the government argued a broader interpretation prohibiting purchases from or payments to ULA and ULS “would risk substantially affecting current contractual obligations between the Air Force” and its primary launch services provider.

A more reasonable interpretation, the government argued, would be limiting the ruling to purchases from or payments to NPO Energomash, the Russian state-owned company that builds the RD-180, or any entity subject to Rogozin's control.

Later that day, the court issued a response confirming the April 30 injunction does not apply to government purchases from, or payments to, ULA or its subsidiary.

“The United States may continue to make payments to ULS and/or ULA,” Braden said in a proposed order issued May 2.

However, the clarification has yet to be incorporated into a new ruling. In the meantime, SpaceX weighed in, asserting in a May 4 filing with the court that the government is unable to certify that any payments it makes to ULA do not somehow benefit Rogozin – directly or indirectly.

“The effort to eliminate the word “indirectly” from the Court's order is particularly troubling,” SpaceX attorney Richard Vacura wrote in the filing, arguing the government is asking the court to allow it to continue paying ULA even if they cannot certify the funds will not ultimately flow to NPO Energomash or other entities that may be under Rogozin's control.

“Here, the money transfer, while quite clearly going in part to NPO Energomash, is not likely to be direct,” Vacura asserts, noting that ULS purchases RD-180 engines indirectly through RD Amross, a joint venture owned by NPO Energomash and UTC.

Sidestepping the need to certify government funds given to ULA are neither directly nor indirectly violating U.S. sanctions “would undermine the Court's objective to halt the transfer of money to NPO Energomash” pending government clarification on the matter.

“In essence, Defendant seeks to continue business as usual under the [Air Force Evolved Expendable Launch Vehicle] EELV program – including paying monies to ULS – relieved from any obligation to ensure that those monies do not flow in violation of sanctions,” Vacura wrote.

If the court rules in SpaceX's favor, the outcome brings the potential to broaden application of U.S. sanctions aimed at Moscow, with implications for other U.S. space systems that rely on Russian hardware. These include International Launch Services (ILS), which markets commercial missions of the Khrunichev-built Proton M/Briz M; Sea Launch, a company majority owned by RSC Energia that operates Russian-Ukrainian Zenit rockets from an ocean-based platform in international waters; JSC Glavkosmos, a secondary payload launch provider within the Russian Federal Space Program; ISC Kosmotras, which launches small satellites on converted ICBMs from Russian soil; Eurockot, a Russian-German joint venture that markets commercial Rokot launches, and Arianespace, which markets commercial launches of Russia's Soyuz from French Guiana.

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