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Space Trip: Bon Voyage Jeff!

Summary:
By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans. Now that Jeff Bezos and his friends are getting set to be launched into space, what should we expect to follow? Why, lawsuits of course. The WSJ ran an interesting story yesterday, Jeff Bezos and Other Space Tourists Fly at Their Own Risk in which via its headline, the paper attempted to forestall the very possibility of space tourism lawsuits: When Jeff Bezos climbs into the New Shepard capsule for its first passenger trip to space next month, his safety will be almost entirely in the hands of the spaceflight company he founded two decades ago. Mr. Bezos plans to join the small band of tourists who have flown in space as the emerging industry

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By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans.

Now that Jeff Bezos and his friends are getting set to be launched into space, what should we expect to follow?

Why, lawsuits of course. The WSJ ran an interesting story yesterday, Jeff Bezos and Other Space Tourists Fly at Their Own Risk in which via its headline, the paper attempted to forestall the very possibility of space tourism lawsuits:

When Jeff Bezos climbs into the New Shepard capsule for its first passenger trip to space next month, his safety will be almost entirely in the hands of the spaceflight company he founded two decades ago.

Mr. Bezos plans to join the small band of tourists who have flown in space as the emerging industry prepares to launch hundreds of people aloft. For now, they aren’t protected by the meticulous federal safety regulations that govern commercial air travel.

Passengers planning a ride on the New Shepard must sign a form waiving their right to sue Mr. Bezos’s Blue Origin LLC in the event of an accident. Richard Branson’s Virgin Galactic Holdings Inc., SPCE 0.71% which plans to send paying passengers on its space plane as early as next year, requires a similar step.

Accident law is mostly a matter of state law, and most state courts enforce waivers of liability for negligence. Most however will not enforce waivers that purport to protect the defendant against claims for gross negligence (or for intentional torts, for that matter).

Waiver or no waiver, there will inevitably be lawsuits if something goes wrong. More on that point in a moment. But first, I’d love to get a look at one of these space carriage contracts to see the handiwork of very clever lawyers trying to insulate their space company clients from liability. Many, many billable hours have no doubt gone into specifying choice of law, venue, jurisdiction, and arbitration provisions, to govern disputes. (By the same token, I’d also love to see the contracts people sign to be guided up Everest. If anyone has one, please send.)

How do I know there will be lawsuits? Well, because there will inevitably be serious injuries or deaths at some point. Space travel is no walk in the park; it’s an an inherently dangerous enterprise. I remember vividly visiting my grandparents when Gus Grissom, Ed White and Roger B. Chaffee died during pre-launch testing for the Apollo 1 mission in January 1967. But we don’t have to go back that far to find space-related fatalities . In 2014, as the WSJ tells the story in Virgin Galactic Spacecraft Crashes, Killing One:

A rocket-powered aircraft designed for space tourists broke apart and crashed during a test flight in California’s Mojave Desert on Friday, killing one pilot and injuring the other.

And when there are deaths, the lawsuits will follow – especially given how expensive these flights are. Meaning only the very richest can ever hope to take one. As yesterday’s Journal article noted:

Blue Origin and Virgin Galactic have said they are following rigorous testing and safety standards as they prepare to open ticket sales. Analysts expect flights to cost as much as $500,000 for a brief up-and-down that includes several minutes of weightlessness. Blue Origin’s flights take about 10 minutes. Virgin Galactic’s take more than two hours because the spacecraft is launched from an airplane that must first climb to a high altitude.

Mr. Bezos will be joined on the planned July 20 flight by his brother, Mark Bezos, and the winner of a charity auction due to conclude Saturday.

Blue Origin said more than 6,000 bidders from 143 countries have taken part in the auction so far. The highest bid stood at $4.8 million by Thursday evening. The company, like Virgin Galactic, hasn’t commented on future ticket prices.

That’s a lot of moolah. When people with such gargantuan resources die in an accident, the executors of their estates are more or less required to sue.

The WSJ also discussed another of its pet themes, self-regulation, in yesterday’s piece:

Congress agreed in 2004 to let the space-tourism industry self-regulate to speed its preparations for passenger flights. Years of delays, including an accident that killed a Virgin Galactic test pilot in 2014, have pushed back the start of flights for fare-paying passengers. The policy has been extended several times and now runs until October 2023.

The Federal Aviation Administration’s jurisdiction is limited to protecting public safety and the environment during launches and re-entries, a spokesman for the agency said. “Congress has not allowed the FAA to extend its authority to the safety of crew or space flight participants,” the spokesman said.

Regulators, lawmakers and industry executives are debating whether to introduce tougher rules, such as requiring passengers to be trained for the rigors of reaching the edge of space. The companies already offer some training for their short flights, which include periods of high G-forces and the possible disorientation that can come with weightlessness.

The 2014 Journal article cited above makes it clear that all the parties – including the companies, members of Congress, and transportation regulators – have been kicking this particular can down the road for a while as the issue is also discussed therein.

Self-regulation means the industry will regulate itself. How much training do the companies think is appropriate before they’ll rocket you into space? According to yesterday’s WSJ:

The companies provide training over two or three days. Virgin Galactic’s preparation includes sessions with its pilots, instruction on weightlessness and time in a cabin mock-up. The company offers passengers optional flights in aircraft that simulate zero gravity, as well as time in a centrifuge that replicates some of the forces astronauts experience during flight.

Blue Origin said traveling in its spacecraft requires minimal training. “It’s familiarization of the safety features and preparations to travel to space on the fully autonomous New Shepard rocket,” said a spokeswoman.

The cost of space launches means the rockets and capsules have been tested much less exhaustively in flight than commercial aircraft, which are sent on thousands of hours of test flights before carrying paying customers.

Jerri-Lynn here. Two or three days? When the inevitable cases wind their way through the courts, we’ll get to see just how clever those lawyers were – whether they earned their no doubt handsome fees. It takes more time to study for a driver’s test than to rocket into space.

Bon voyage, Jeff! Have a safe flight.

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