Business & Technology | Dreamlifter operator sues Boeing as contract loss looms | Seattle Times Newspaper
Thursday, April 1, 2010 - Page updated at 11:23 PM
MIKE SIEGEL / THE SEATTLE TIMES
Dreamlifter operator sues Boeing as contract loss looms
By Dominic Gates
Seattle Times aerospace reporter
Evergreen International Airlines is suing Boeing for $175 million because the plane maker switched the contract for operating its four giant Dreamlifter transport aircraft to another company.
The Dreamlifters are modified 747s that ferry large sections of the 787 Dreamliner around the globe. Boeing contracted with Evergreen in December 2005 to operate the aircraft, providing pilots, ground crews and maintenance.
In February, Boeing unexpectedly told Oregon-based Evergreen that the contract would switch in September to New York-based cargo company Atlas Air.
In a lawsuit filed Thursday in federal court in Seattle, Evergreen alleges bad faith and breach of contract, and also claims Boeing violated confidentiality agreements by providing Atlas proprietary Dreamlifter data from Evergreen.
The complaint says Boeing's only reason for switching the contract is to offset "Boeing's nearly billion-dollar liability to Atlas resulting from delays on the Boeing 747-8 program." That figure is attributed to a remark made by an unidentified Boeing employee to an Evergreen employee.
Atlas' pending order for 12 new 747-8 cargo planes is more than a year behind the original delivery schedule, and Boeing was negotiating with Atlas over its liability.
The original contract cited in the complaint said that after an initial five-year term, it "will automatically renew for an additional five years," unless terminated early due to certain specified conditions including breach of contract by Evergreen or "convenience."
Evergreen said Boeing cited only "current business realities" for the switch.
The complaint alleges that in a January meeting, Boeing's 787 global supply-chain vice president, Bob Noble, told Evergreen executives the contract would be switched "as part of a settlement for the lost revenue claim" from another carrier.
"Noble emphasized that the decision 'was not performance-related' and advised Evergreen that 'there's nothing you can do about it,' " the complaint states.
Because of the repeated delays that have left the 787 program more than two years behind schedule, Evergreen said it incurred considerable expense getting the Dreamlifter fleet ready and didn't collect the projected revenue. It had hoped to recoup those lost profits in subsequent years as production of the 787 ramped up.
The shift of contractor does bring some risk for Boeing. Atlas will have to train fresh pilots on the Dreamlifter's flight characteristics and bring ground and maintenance crews up to speed on its unique configuration. Evergreen says it has no contractual obligation to help with that.
"Evergreen is the only company in the world with any experience operating, maintaining, and performing the ground handling for the unique Dreamlifter airplane," states the Evergreen complaint. "Boeing has jettisoned its teammate and placed in jeopardy the operation of the (Dreamlifter) program and success of the Dreamliner program."
Boeing spokesman John Dern said Thursday the company has not yet seen the complaint and declined to comment.
Dominic Gates: 206-464-2963 or
[email protected]
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