Boeing hit with $237 mln in damages from ICO trial

NEW YORK, Oct 31 (Reuters) - Boeing Co BA.N and its satellite manufacturing unit have been ordered to pay $236.86 million in punitive damages to ICO Global Communications (Holdings) Ltd ICOG.O as a result of a long-running legal dispute, the company said on Friday.

The award comes on top of the $370.6 million in damages Boeing was ordered to pay ICO in the same case 10 days ago by a California state court jury in Los Angeles.

Boeing said it would seek an appeal that could take several years to run its course. The company said it believed it did not break the law or breach any contract.

The dispute dates back to a $2 billion contract initially awarded in 1995 by ICO to Hughes Electronics, which was acquired by Boeing in 2000.

ICO’s plan was to build and launch a dozen satellites that would form the basis of new global communications network, but according to arguments presented in the case, only one satellite was ever launched into space, another exploded on launch, and 10 more are incomplete and in storage.

ICO, a satellite communications company based in Reston, Virginia, was taken over by wireless pioneer Craig McCaw in 2000.

Chicago-based Boeing initially sued ICO in 2004 after ICO terminated its contract for the satellites. ICO countersued, accusing Boeing of breach of contract and fraud, and sought $2 billion in damages.

Boeing has denied any wrongdoing and said ICO’s problems stemmed from a bad business decision betting on the future of satellite phones. (Reporting by Bill Rigby, editing by Leslie Gevirtz)