US court lifts ban on Boeing work on KC-135 tankers

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A US appeals court lifted a lower court’s injunction against a $1.2 billion Air Force maintenance contract with Boeing Co that was protested by Alabama Aircraft Industries.
The US Court of Appeals for the Federal Circuit overturned a federal claims court ruling in favour of Alabama Aircraft after rejecting the main basis for that decision.
It said the Air Force’s price analysis underlying the award was not “arbitrary and capricious,” as the lower court had ruled, and was not within the lower court’s scope of review.
As a result, it said, the Air Force could now proceed with its contract with Boeing for maintenance and support of its aging fleet of KC-135 refuelling tankers.
Boeing welcomed the decision and said it looked forward to beginning maintenance work on KC-135 aircraft under the contract it first won in September 2007.
“The appeals court ruling affirms that the Air Force correctly chose Boeing for this vital sustainment work to keep the KC-135 fleet flying and battle-ready for our nation’s warfighters,” said Boeing spokesman Forrest Gossett.
The Air Force said the decision meant it could proceed with the Boeing contract.
“The decision by the United States Court of Appeals for the Federal Circuit validates the Air Force’s commitment to acquisition excellence and positions us to deliver critical warfighting capability more affordably,” said Brigadier General Wendy Masiello, program executive officer for combat and mission support, under the Air Force acquisition chief.
The KC-135 tankers more than 50 years old on average provide fuel in mid-flight for fighter jets and other military aircraft. The Air Force recently launched its third attempt in eight years to begin replacing the planes, but the existing aircraft will still need to continue flying for many years.
In its decision, the appeals court agreed with the trial court when it rejected Alabama Aircraft’s claims against Boeing for organizational conflicts of interest and the Air Force’s evaluation of Boeing’s past performance.
As a result of the decision, the appeals court said Alabama Aircraft, which was previously known as Pemco Aviation Group Inc, should not be reimbursed for its costs in preparing its original bid for the deal.
Alabama Aircraft twice protested the Air Force award with the Government Accountability Office, and then took the issue to federal claims court, where it prevailed in October 2008.
The Air Force and Boeing then appealed the federal claims court decision to the federal appeals court.
Boeing and Alabama Aircraft worked together as a team on the previous maintenance contract, which the Air Force has extended several times while the legal protests of the Boeing contract were being sorted out.