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NASA Says Blue Origin 'Gambled' Its Chance to Build a Lunar Lander Away

Did Jeff Bezos ask for too much money?

NASA Says Blue Origin 'Gambled' Its Chance to Build a Lunar Lander Away
A NASA logo (left), and Blue Origin owner Jeff Bezos in front of the New Shepard vehicle (right). 1, 2

NASA and Blue Origin are locked in a legal battle.

NASA says Jeff Bezos' Blue Origin "gambled" its moon lander proposal away in 2020 when it hoped the agency would negotiate the firm's initial $5.9 billion price offering for a contract, according to blunt legal findings initially reported in The Verge.

While the end of the legal battle could still be months away, NASA is clear that it considers Blue Origin's lunar lander protest nothing more than a "gamble" that Bezos' company "lost."

NASA responds to Blue Origin's protests with hundreds of pages

NASA has a tight budget from Congress, which is why it declined the opportunity to negotiate with Bezos, and turned Blue Origin down in favor of SpaceX's lunar lander proposal, sparking an ongoing legal battle from the former. NASA hasn't said much about its fight with Blue Origin, since it acknowledged the firm's displeasure at learning it wasn't the one. But it has said the company's protests have held back the agency's ambitions to return humans to the moon by 2024, and in hundreds of legal filing pages that The Verge obtained via a Freedom of Information Act request, it appears attorneys have set up a strong defense for NASA's Artemis Moon program, affirming its earlier decision to choose SpaceX for the contract to execute the first crewed mission to the surface of the moon since 1972.

NASA's primary reply to Blue Origin's May objection involved senior agency attorneys arguing that Bezos' firm leveraged a "door-in-the-face" bidding tactic when it proposed a $5.9 billion proposal for its lunar lander project, called Blue Moon — which is being built in collaboration with Northrop Grumman and Lockheed Martin. Blue Origin claims it was "able and willing" to lower its price for NASA's interest in a lunar lander, but elected not to at first, because it was under the impression that NASA would work to negotiate a lower price before switching to SpaceX, argue Blue Origin's attorneys in a six-page declaration authored by Brent Sherwood, the firm's senior vice president, according to the report.

'Blue Origin made a bet and it lost'

In Sherwood's declaration, he argued that NASA didn't "afford Blue Origin, a well-funded private space company backed by Jeff Bezos, any opportunity to submit a revised business position" when the agency discovered it didn't have the funds from Congress to finance two discrete lander proposals, like it had originally suggested in its call for lander program proposals. Sherwood also said Blue Origin had invested "almost one billion dollars" of corporate money and private investments in its lunar lander offer, and "had the financial potential to increase" its investment, according to The Verge report. The firm said its initial price of $5.9 billion, which is nearly double that of Elon Musk's SpaceX, was predicated upon the expectation that Congress would offer NASA more money for the proposal, despite the legislative branch's indicating a month earlier (and before Bezos' company made its bid) that NASA would not receive the funding it requested.

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NASA, on the other hand, says private aerospace firms were told to submit their best proposal first, referencing seven other examples where the agency had informed bidders of its final decision, in addition to how many companies' contracts it could afford to enter, depending on money from Congress. Ever protesting, Blue Origin fired back that NASA should have changed or canceled its terms for the lunar lander program when it learned that Congress would only provide one-quarter of what the agency wanted. Bezos' space firm also said that fairness was lacking in the reality of NASA choosing to bring only SpaceX in on the action, which the agency rejected in its hundreds of pages of heavy rebuttals. It looks like the legal struggle will continue, for how long we can't say, but in general, NASA's new position seems to be that "Blue Origin made a bet and it lost."

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