General Dynamics, Boeing to appeal loss over Navy contract
General Dynamics and Boeing will petition the U.S. Supreme Court for a review of its long-running dispute over the cancellation of a $4 billion Navy contract for a stealth aircraft.
The defense contractor said late Nov. 24 it lost another round when the U.S. Court of Appeals for the Federal Circuit denied a request for a rehearing of the Federal Circuit's decision in June backing the government's termination of the A-12 aircraft contract.
The U.S. Court of Appeals for the Federal Circuit ruled June 2 that General Dynamics and Boeing must pay the government $2.8 billion to settle the dispute. The court said the Navy was justified in 1991 when it terminated the $4 billion contract with McDonnell Douglas and General Dynamics to build a stealth aircraft.
"We are disappointed in today's decision," said J. Michael Luttig, Boeing executive vice president and general counsel. "The Court of Appeals' decision is clearly wrong as a matter of law and it has broad implications for all forms of government contracting nationwide. As a consequence, I have directed that an immediate appeal be taken to the Supreme Court of the United States."
General Dynamics said it disagrees with the most recent decision and "continues to believe that the government's default termination was not justified." The company said the ruling provides significant grounds for appeal.
The A-12 was to have been the Navy's next-generation, carrier-based advanced tactical aircraft utilizing low observable "stealth" technology. AP