What just happened?
SpaceX is the first private company to launch humans into orbit. Bob Behnken and Doug Hurley were the first to fly in the SpaceX Dragon Capsule on top of the Company's Falcon 9 rocket. The delayed launch on May 30th at 3.22 pm has provided the country a 'morale boost' since the past few months of unrest, the financial times reported.[1]
What does this mean?
The last launch of astronauts from NASA was in 2011. The American space agency has been focusing on satellites ever since. This move is a massive step towards commercialisation of space. It opens the door for further plans regarding the launch of private astronauts, private space stations and, private extraterritorial missions.
NASA had been forced to look towards the private sector for such missions since the cancellation of its space shuttle program in 2011. This launch has freed the American Space Programs from their dependence on Russian spacecrafts.[2] The use of a private spacecraft is meant to bring down costs since commercial incentives replace the traditional cost-plus development programs of NASA. Previously each space shuttle flight costed NASA $1.5bn,[3] SpaceX costs $60-67 mn per seat in comparison. Experts predict that the cost of launching shuttles into the SpaceX program would further reduce to less than $10mn in the next few years. It would be a lot cheaper than dishing out $90mn for the Russian spacecraft.
This drop in prices would open up avenues of space tourism and encourage other governments to create their own manned space programs.[4]
How does it impact the legal industry?
The launch can also be attributed to the lobbying done by Big law firms like Squire Patton Boggs. This included matters such as Space Launch issues, Space Budget, and Export-Import Bank financing and agency reauthorization.[5] This has proved fruitful for both parties since the past decade. SpaceX has paid $3m to the firm in lobbying fees and seen a sharp rise in market valuation to $36 mn. This plays a significant role in assessing the favourable impact of big firms lobbying for new initiatives such as this.
Other private enterprises such as Orbital ATK, Blue Origin, and Virgin Orbit have been included in this new commercial space frontier. It must be noted that start-ups in this field have been increasing and partnering with SpaceX to work on initiatives as in the case of Space Adventures for Orbital Tourism by 2022 and Axiom Space to build a Commercial Destination Module for the International Space Station.[6] The increase in funding and innovation anticipated in this area would make it profitable for law firms to grab the opportunity to secure clients in this industry.
While it may not always be rational to run with their over the ambitious timeline, the space industry provides opportunities in various areas of law. In the case of SpaceX, K&L Gates, Boies Schiller Flexner, Drinker Biddle & Reath, and Cooley were employed for multiple legal needs such as breach of contract suits and antitrust litigations.[7] Law firms are further required to fend off challenges that would prevent launches or reduce their funding.
NASA awarded both Boeing and SpaceX nearly $8bn for this mission, SpaceX beat Boeing by $1bn in developing private launch capabilities. Boeing is now developing its Starliner Capsule, expected to fly out next year.[8] This opens up opportunities for law firms specialising in aviation since most aviation industry carriers would like to either diversify to include the space industry or be consulted in its process.
Here at LawMiracle, we predict this event will change history for the legal sector and help it push back from the aftereffects of the events and trends noticed in 2020.
Written by Srinidhi Dhulipala
(This is the first edition of the three-part series called ‘ The Space Exploration Series)
Assessing firms:
#SquirePattonBoggs #K&LGates #BoiesSchillerFlexner #DrinkerBiddle&Reath #Cooley
References:
[1] Richard Waters, “SpaceX becomes first private company to launch humans into orbit”, Financial Times,(San Francisco May 30th 2020)
[2] Jonathan O'Callaghan, “The Last Soyuz - NASA Ends Reliance On Russia With Final Launch Before Crew Dragon”, Forbes, (9th April 2020)
[3] Jeremy Hsu, “Total Cost of NASA's Space Shuttle Program: Nearly $200 Billion”, Space.com (April 11th, 2012)
[4] Richard Waters, “SpaceX becomes first private company to launch humans into orbit”, Financial Times,(San Francisco May 30th 2020)
[5] ProPublica “Squire Patton Boggs lobbying for SpaceX” Google News Initiative <https://projects.propublica.org/represent/lobbying/300947331> accessed 10th June 2020.
[6] Nasa Press Release, “NASA Selects First Commercial Destination Module for International Space Station” (January 27th, 2020)
[7] Patrick Smith, “SpaceX Set To Blast Off From US Soil With Boost From Big Law”, Law.com, (May 27th 2020)
[8] Loren Grush, “BOEING IS SET TO LAUNCH ITS NEW STARLINER SPACECRAFT ON ITS FIRST FLIGHT TO ORBIT”, The Verge, (December 18th 2019)
Disclaimer: This article (and any information accessed through links in this article) is provided for information purposes only and does not constitute legal advice.