Jenner & Block

Firm Achieves Significant Victory for Client Lockheed Martin

Jenner & Block’s Government Contracts Group achieved a significant victory for Lockheed Martin, recovering $107.6 million from the Air Force in a dispute involving the F-22 aircraft program.  The last three annual production lots of the F-22 were lots 7, 8 and 9.  The parties recognized that if Lot 9 were the final lot, then the cost of the Lot 9 aircraft would be higher than prior lots, because of labor and supplier disruptions that occur at the end of a major production run.  Accordingly, the parties estimated what those costs would be and agreed that, if certain conditions were met, the Air Force would pay Lockheed Martin an additional $147 million for last lot costs.  Those conditions were met, however, the Air Force refused to pay. 

The Firm’s team pursued a claim and litigation in an administrative court on behalf of the client.  After months of discovery, the parties agreed to alternative dispute resolution, specifically, a mediation involving the trial judge and a principal from each side. Jenner & Block Partner Jay DeVecchio made the presentation for Lockheed Martin on the morning of June 5.  By late afternoon, the parties had a settlement in principle, which was finalized the next day.  This is an excellent example of how litigation costs can be reduced and very favorable results achieved, through ADR.  The Jenner & Block team, led by Mr. DeVecchio and Associate Sarah A. Maguire, included Partner Daniel E. Chudd and Associates James C. Cox and Kristen M. Rogers, assisted by Law Clerk Anna M. Sturgis, Senior Paralegal Albert K. Peterson, Paralegal Jason Berrus, Project Assistant Brandon S. Baier, and Legal Secretary Lynne T. Colbert.