ILNews

Humvee maker, defense giant BAE wrangle over $277M judgment

Back to TopCommentsE-mailPrintBookmark and Share

A dispute over the true cost of Humvee body armor rushed to the battlefield in the deadliest days of the Iraq war has resulted in a court battle that includes suggestions that one of the world’s top defense contractors may have serious business problems as it argues against posting full security for a $277 million judgment.

British defense contractor BAE Systems Inc. has asked the Indiana Court of Appeals to stay execution of the judgment pending appeal. Mishawaka-based Humvee maker AM General LLC argues it’s entitled to the judgment and opposes BAE’s motion.

BAE argues in court filings this month that a ruling in St. Joseph Superior Court in November ordering it to post an appeal bond or irrevocable letter of credit in the amount of $290 million “effectively holds the bond cap statute unconstitutional.”

BAE argued it should only have to provide security in the amount of $25 million under I.C. 34-49-5-3, which BAE argues caps appeal bonds at that amount.

BAE supplied armor kits that could be installed on AM General’s Humvees. St. Joseph Superior Judge Michael Scopelitis in April ordered BAE to pay $277,939,519 to AM General, ruling BAE and predecessor companies were in breach of contract and violated most-favored customer clauses by overcharging for armor kits that troops used in the field to retrofit Humvees.

BAE appealed in October and earlier this month filed a motion to stay execution of judgment pending appeal.

“The trial court erroneously concluded that BAE Systems’ alternate form of security … was not sufficient,” the company’s brief says.

“There is simply no evidence that BAE Systems itself, or its parent company, present any risk of not complying with any final judgment in this case,” the company argues. Its filings say there is “virtually no chance” BAE will not satisfy a final judgment.

AM General argued in reply that BAE misreads the appeals bond statute, which allows discretion on when the cap may not apply, and that in any event, Trial Rule 62(D) governs a request to stay the trial court order.

“AM General received its judgment on April 2, 2013, and BAE has managed to avoid posting full security against the judgment as required by Trial Rule 62(D) for more than 37 weeks,” the Humvee maker argues. “AM General is entitled to protection of its very large judgment without further delay.”

“The trial court considered substantial evidence attached to AM General’s opposition brief about the state of BAE’s finances and serious problems facing its business,” AM General argues in its pleadings.

“No BAE officer or employee with knowledge affirmed the representations about the company’s financial condition,” according to AM General’s filing.

BAE says it recorded international sales of more than $27 billion in 2012, and its parent company, BAE Systems PLC, is rated as the world’s second-largest defense contractor, according to the Stockholm International Peace Research Institute.

No arguments before the Court of Appeals have been scheduled in the case.

 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Bill Satterlee is, indeed, a true jazz aficionado. Part of my legal career was spent as an associate attorney with Hoeppner, Wagner & Evans in Valparaiso. Bill was instrumental (no pun intended) in introducing me to jazz music, thereby fostering my love for this genre. We would, occasionally, travel to Chicago on weekends and sit in on some outstanding jazz sessions at Andy's on Hubbard Street. Had it not been for Bill's love of jazz music, I never would have had the good fortune of hearing it played live at Andy's. And, most likely, I might never have begun listening to it as much as I do. Thanks, Bill.

  2. The child support award is many times what the custodial parent earns, and exceeds the actual costs of providing for the children's needs. My fiance and I have agreed that if we divorce, that the children will be provided for using a shared checking account like this one(http://www.mediate.com/articles/if_they_can_do_parenting_plans.cfm) to avoid the hidden alimony in Indiana's child support guidelines.

  3. Fiat justitia ruat caelum is a Latin legal phrase, meaning "Let justice be done though the heavens fall." The maxim signifies the belief that justice must be realized regardless of consequences.

  4. Indiana up holds this behavior. the state police know they got it made.

  5. Additional Points: -Civility in the profession: Treating others with respect will not only move others to respect you, it will show a shared respect for the legal system we are all sworn to protect. When attorneys engage in unnecessary personal attacks, they lose the respect and favor of judges, jurors, the person being attacked, and others witnessing or reading the communication. It's not always easy to put anger aside, but if you don't, you will lose respect, credibility, cases, clients & jobs or job opportunities. -Read Rule 22 of the Admission & Discipline Rules. Capture that spirit and apply those principles in your daily work. -Strive to represent clients in a manner that communicates the importance you place on the legal matter you're privileged to handle for them. -There are good lawyers of all ages, but no one is perfect. Older lawyers can learn valuable skills from younger lawyers who tend to be more adept with new technologies that can improve work quality and speed. Older lawyers have already tackled more legal issues and worked through more of the problems encountered when representing clients on various types of legal matters. If there's mutual respect and a willingness to learn from each other, it will help make both attorneys better lawyers. -Erosion of the public trust in lawyers wears down public confidence in the rule of law. Always keep your duty to the profession in mind. -You can learn so much by asking questions & actively listening to instructions and advice from more experienced attorneys, regardless of how many years or decades you've each practiced law. Don't miss out on that chance.

ADVERTISEMENT