By Doug Cameron
Elon Musk's Space Exploration Technologies Corp. on Friday said
it would drop a lawsuit brought against the Pentagon and the two
largest defense contractors that attempted to break up an $11
billion deal to launch military and intelligence satellites.
The proposed settlement paves the way for SpaceX to repair its
uneasy relationship with the Defense Department and bid on future
deals to launch its satellites, subject to its rockets securing
certification from the Pentagon later this year.
The U.S. Air Force and SpaceX said in a joint statement that
they had reached an agreement that would lead the company to
dismiss the claims brought last April against the Pentagon and the
joint venture between Boeing Co. and Lockheed Martin Corp. that
dominates the military market.
Congress had already required the Pentagon to open up more
rocket launches to competition, but most are covered by a multiyear
deal secured by the Boeing-Lockheed venture.
"The Air Force also has expanded the number of competitive
opportunities for launch services under the [launch] program while
honoring existing contractual obligations," the two sides said in a
joint statement Friday, without providing more details.
The U.S. Air Force said earlier this month that it expects to
clear SpaceX to compete for Pentagon satellite launches by
mid-2015, six months later than previously planned.
While the two sides were set to start mediation, relations
recently appeared to deteriorate and the head of the U.S. Air Force
last week chided Mr. Musk over his allegations that the Defense
Department was dragging its feet in certifying his rockets for
military use.
Air Force Secretary Deborah Lee James said Mr. Musk's comments
in a media interview were unfortunate, but wouldn't affect the
certification process.
"Under the agreement, the Air Force will work collaboratively
with SpaceX to complete the certification process in an efficient
and expedient manner" the two sides said in their statement
Friday.
Write to Doug Cameron at doug.cameron@wsj.com
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