A unit of Italy's Finmeccanica SpA has sued the U.S. government to block the Pentagon's proposed award of an $800 million helicopter deal to an arm of Airbus Group EADSY -0.35% NV, alleging that the defense department violated its own rules for opening contracts to competition.
The U.S. Army stirred controversy from rival manufacturers during the summer with its plan to retire two types of training helicopters and replace them with 155 new Airbus UH-72 Lakota helicopters, without holding a competition.
AgustaWestland North America Inc., the Finmeccanica unit, asked a U.S. judge for a temporary restraining order barring the Army from awarding the helicopter contract to Airbus without a competition, according to the complaint filed on Sept. 19 with the U.S. Court of Federal Claims in Washington, D.C.
Representatives of the U.S. Army and the Justice Department, which represents the government in civil cases, didn't immediately respond to requests for comment on Monday.
While defense contractors regularly contest contract awards through the Government Accountability Office, it is unusual for them to go to court. However, the Pentagon has attracted two such suits this year.
Elon Musk's Space Exploration Technologies Corp. in April sued the U.S. government and a joint venture between Boeing Co. and Lockheed Martin Corp. over the award of a military satellite launch contract. That case continues.
Pentagon officials have conceded in recent months that the overall level of competition awards has dropped. Acquisition chief Frank Kendall last month issued new guidance aimed at boosting competition, including guidelines for proposed deals agreed without a contest.
The Army wants to retire its fleet of Bell TH-67 Creek and OH-58 Kiowa training helicopters made by the Bell Helicopters unit of Textron Inc., and replace them with Lakotas transferred from other uses and others bought new from Airbus.
The Army now uses the Lakota—a version of the EC-145 helicopter commonly used to transfer workers and supplies to offshore oil and gas platforms—for noncombat missions such as transport and reconnaissance.
AgustaWestland and Bell have both claimed the twin-engine Lakota will cost more to buy and operate than their own helicopters.
The Army has said it is cheaper to retire whole fleet types. It aims to save money by using the same helicopter for training and operating.
"We are dismayed that the Army is moving toward a sole-source procurement, involving more than $800 million in initial acquisition costs, with no publicly available cost analysis or open consideration of alternative platforms potentially better suited for this important mission," an AgustaWestland spokesman wrote in an emailed response.
The federal judge assigned to the case hasn't ruled on the request for a restraining order. On Monday she granted a request from AgustaWestland to refile part of its motion to correct non-substantive errors, according to a court filing.
AgustaWestland Sues U.S. Government Over Army Helicopter Plan - WSJ