Hughes Says Lockheed Martin Violated Merger Consent Order
In an acidic letter to federal regulators, Hughes Aircraft has charged that Lockheed Martin attempted to restrict competition and threatened Hughes with lawsuits--all in violation of a consent order that permitted last month’s merger of Lockheed and Martin Marietta.
In the letter to the Federal Trade Commission last month, Hughes says Lockheed has “engaged in a campaign to restrict competition” in the Air Force satellite program known as the Space Based Early Warning system.
Lockheed spokesman Chip Manor declined to comment.
Meanwhile, Lockheed officials have charged in a letter to the Air Force that Hughes has withheld a critical infrared sensor needed by Lockheed to compete in the satellite program. Lockheed has claimed it helped develop the sensor.
The unusual war of words reflects the lean future facing the nation’s major military satellite producers, many of which are not expected to survive through the decade. The merger of Lockheed and Martin Marietta has heightened such concerns over competition.
Hughes had long been teamed with Lockheed to pursue Air Force programs to replace the existing system used to detect worldwide missile launches, the Defense Support Program. Hughes’ role was to build the satellite’s critical infrared sensor, a technology its Santa Barbara Research Center pioneered.
But after the Air Force canceled an earlier effort to build a replacement, Hughes left the Lockheed team and joined up with Lockheed’s archrival, TRW, to build the Space Based Early Warning system.
The Hughes letter--signed by two attorneys representing the company, including Kathleen Buck, the former general counsel of the Defense Department--says Lockheed has threatened to sue if Hughes attempts to compete with it on the sensor’s systems engineering work. Terms of the consent order explicitly prohibit Lockheed from attempting to enforce prior agreements with Hughes that would prevent it from competing in the satellite program.
