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Jury awards Intuitive Machines $4.1 million in cash and Moon Express equity

Jan. 30, 2018

Category: space business

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SAN MATEO, Calif. — Intuitive Machines LLC has won a $4.1 million verdict from a federal court jury in a dispute regarding work it was doing on software and a return vehicle for Moon Express.

In a Jan. 12 verdict, a U.S. District Court jury in Delaware awarded $4.1 million in cash and equity in Moon Express Inc. to Intuitive Machines LLC, the Houston-based company hired by Moon Express to write flight software and develop a terrestrial return vehicle for its commercial lunar transportation business.

Moon Express, based at Florida’s Cape Canaveral Air Force Station, filed suit in May 2016 against Intuitive Machines alleging the company failed to complete work on flight software for a spacecraft and lunar lander. The suit also claimed Intuitive Machines failed to follow through on contractual obligations to design, develop, test and manufacture its Terrestrial Return Vehicle and transfer intellectual property associated with the vehicle to Moon Express.

Moon Express planned to use the software for its series of commercial lunar lander missions. The company was a finalist in the Google Lunar X Prize competition, which the X Prize Foundation announced Jan. 23 would end in March without a winner. Moon Express will continue development of its spacecraft for other customers.

Intuitive Machines filed a counter-claim, contending it fulfilled its contractual obligations and halted work because Moon Express failed to make agreed-upon payments. Intuitive Machines further claimed that Moon Express’s failure to pay harmed its business.

The jury found in favor of Intuitive Machines and awarded the company $1.125 million in cash and $2.5 million in Moon Express equity related to the flight software claim. The jury also awarded Intuitive Machines $732,000 related to its work on the terrestrial return vehicle.

“It was a victory for us and I feel vindicated,” Steve Altemus, Intuitive Machines president, told SpaceNews. “We are doing world-class, ground-breaking work in terms of reentry systems and software to get to the moon. Moon Express did not appear to appreciate the quality of the work we were producing.”

The jury award includes a combination of cash and Moon Express equity related to Moon Express’s breach of its flight software contract with Intuitive Machines. However, Intuitive Machines does not want to own shares in Moon Express and has filed a legal motion asking to receive its entire award in cash instead of cash and equity. Moon Express, meanwhile, has filed a motion claiming the jury did not have authority to award equity to Intuitive Machines. The two sides are scheduled to appear before a judge in February to resolve the matter.

Moon Express plans to appeal the verdict. “We are very disappointed by the verdict and feel it was a complete injustice,” Moon Express Chief Executive Bob Richards said in a statement to SpaceNews, noting the company had made more than $3 million in payments “for unfulfilled contracts” to Intuitive Machines. “We are the plaintiff in the case and plan to appeal.”

Altemus said he hopes to move on from the case. “We are not a company that likes to litigate,” he said. “We are a company that likes to build spaceflight hardware. That’s what I’d prefer to do.”

Original news: http://spacenews.com/jury-awards-intuitive-machines-4-1-million-in-cash-and-moon-express-equity/