Jurisdiction dispute stalls Raytheon legal battle

2013-10-27T00:00:00Z Jurisdiction dispute stalls Raytheon legal battleBy David Wichner Arizona Daily Star Arizona Daily Star

A lawsuit over failed missile motors supplied to Tucson-based Raytheon Missile Systems has turned into a question of state versus federal jurisdiction even before the merits of the case are argued.

The legal fight involves problems with rocket motors that have delayed deliveries of the Advanced Medium-Range Air-to-Air Missile (AMRAAM) — a key air-superiority weapon for the U.S. and its allies.

Failures of rocket motors supplied by Alliant Tech Systems prompted the Air Force to halt deliveries and suspend $419 million in payments to Raytheon in February 2012. After new motors from a Norwegian company were qualified for use, deliveries of AMRAAMs and payments resumed in December.

But the legal dispute over the motor failures has just begun.

In late July, Raytheon filed a $100 million lawsuit in Pima County Superior Court against Alliant Techsystems, accusing the Virginia-based company of breaching contracts to supply rocket motors that met military requirements.

The next day, Alliant — commonly known as ATK — filed a federal lawsuit in Virginia, seeking judgments that Raytheon improperly terminated its motor-purchase orders and asking $30 million in damages. Both companies have declined comment on the suits.

In late September, a federal judge in Virginia dismissed ATK’s suit, ruling that as a civil matter with no federal law involved, the dispute falls under state-court jurisdiction. ATK had argued that the matter was properly in federal court because it involves federal defense subcontracts and matters of national security.

In late August, ATK filed to remove Raytheon’s state-court lawsuit to U.S. District Court in Tucson, arguing that issues in Raytheon’s case are different from its federal suit, that the case involves a “substantial question of federal law,” and that because it is a matter of national security, “federal common law” should rule.

Raytheon has filed to return the suit to state court.

In documents filed in state court Friday, Raytheon argues that ATK is precluded from litigating the matter in federal court because of the earlier dismissal in the Virginia district court, contending there is no substantial question of federal law.

No hearings in the case have been scheduled.


Meanwhile, a lawsuit against Raytheon Missile Systems alleging trade-secrets infringement involving warhead technology for the Tomahawk cruise missile is set for an initial hearing in federal court in Tucson in late November.

Ordnance Technologies North America Inc. sued Raytheon in federal court in May 2012, alleging the missilemaker stole trade secrets involving a proposed new, bunker-busting warhead for the Tomahawk.

Ordnance Technologies, a longtime Raytheon development partner based in La Jolla, Calif., is seeking a court order halting Raytheon’s use of the technology, known as the Lancer Multi-Effects Warhead System, as well as unspecified damages, saying rights to the technology are worth at least $12 million.

Raytheon has denied the charges, arguing that though the companies shared information, no proprietary information from Ordnance has been adapted to the latest version of the Tomahawk, that the disputed design “was independently designed by Raytheon,” and that purchase orders for designs from Ordnance gave Raytheon ownership of any intellectual property developed under the contracts.

Raytheon has filed a motion for partial summary judgment in the case, and oral arguments have been set for Nov. 25 before U.S. District Court Judge Cindy K. Jorgenson.

Contact Assistant Business Editor David Wichner at dwichner@azstarnet.com or 573-4181.

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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