Hughes Communications Galaxy, Inc. v. United States
United States Court of Appeals for the Federal Circuit
271 F.3d 1060 (2001)
Hughes Communications Galaxy (Hughes) (plaintiff) contracted with NASA to launch HS-393 satellites aboard space shuttles using best efforts, until NASA stopped launching commercial satellites entirely after the Challenger explosion; Hughes then launched satellites, including newly developed HS-601 models, on expendable launch vehicles (ELVs) instead. Hughes sued the government (defendant) for breach, and the court of federal claims awarded over $102 million based on the increased cost of launching substitute satellites via ELV rather than shuttle. Both parties appealed the damages calculation.
Whether, upon a seller's breach of contract, a buyer of goods may obtain substitute goods from another seller and recover the increased cost of the substitute goods as damages.