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Originally published April 9, 2009 at 12:00 AM | Page modified April 9, 2009 at 9:07 AM

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Boeing wins patent fight against NASA over shuttle tank

Boeing (BA) may get hundreds of millions of dollars in compensation after winning a patent-infringement claim against NASA over an aluminum alloy used to build the Space Shuttle.

Boeing may get hundreds of millions of dollars in compensation after winning a patent-infringement claim against NASA over an aluminum alloy used to build the Space Shuttle.

Boeing developed a lighter structure for frames in the 1970s and 1980s to save on jet fuel prices. It claimed the technology was used in the external fuel tank that provides the backbone of the shuttle during launch and sued the government in the U.S. Court of Federal Claims in Washington in 2000.

U.S. Federal Claims Judge Francis M. Allegra, in an opinion made public April 2, said Boeing is entitled to a 1.25 percent royalty on the cost of the tanks. He ordered the two sides to submit a filing by April 17 on exactly how much that would total.

Boeing had said it was entitled to $1.24 billion based on a royalty of 3.5 percent on all the tanks, while the government put the rate at 1.25 percent and said it should be based only on flight hardware, not including overhead or profit, for a total of $334.6 million.

Under either calculation, only a fraction of the money is for actual royalties. The bulk of the total claim will cover the cost of Boeing having to wait to get paid for the use of its invention.

The National Aeronautics and Space Administration needed the lighter weight so it could increase the amount of the payload going into space to become part of the international space station. The tank was designed and built by Lockheed Martin and was used in shuttle missions beginning in 1998.

Boeing complained to Lockheed Martin, which told Boeing to "take up any issue of infringement with NASA," Allegra wrote. "Boeing eventually did just that."

NASA denied infringement and Boeing sued in November 2000. The court sided with Boeing on infringement in 2005, and a trial on how much NASA should pay ended in November 2007. The judge's opinion was filed under seal on March 16 and reissued April 2 after the lawyers on both sides redacted confidential information.

"While we prefer to avoid litigation, Boeing has an obligation to its shareholders and employees to make good business decisions that protect the company's valuable intellectual property — and sometimes litigation is prudent and necessary," said Joseph Tedino, a Boeing spokesman. "Boeing is satisfied with the decision."

Charles Miller, spokesman for the U.S. Justice Department, said the government is reviewing the opinion.

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