The Future of Commercial Space Law and Regulation: State and Local Issues

June 7, 2011 at 10:08 am | Posted in Blogcast, Space Law | Leave a comment

by P.J. Blount with th blog faculty

The next panel addressed State and Local issues of commercial space regulation. It consisted of Leonard David, Space Journalist, Space.com, Space News, AIAA Aerospace America; Milton “Skip” Smith, Sherman & Howard L.L.C.; Rachael Yates, Partner, Holland and Hart LLP; and was moderated by James A. Vedda.

David’s introductory comments focused on the changing face of space commerce activities. He noted the rise of wealthy investors in the area. He said that this changed the atmosphere for commercial space by changing the nature of investments that are being made in space. He also stated that this changed the business by shifting emphasis to media attention and also changing the speed of developments due to competition. He said that regulations should be adopted that would not stifle innovation and development, but that these regulations should still address risk, especially to third parties. He then moved to a discussion of how developments such as Spaceport America positively affects local economies.

Yates’ comments focused on what happens, in light of liability, when a commercial spacecraft crashes. She focused on liability waivers at the state level and who those waivers protect. She stated that state laws that protect a broader group of people will better encourage space commerce. She then gave analysis of the four state liability laws (Virginia, Florida, New Mexico, Texas). She stated that the language that these laws use may leave companies open to litigation by allowing litigants to recover for certain types of damages not covered under the law. She also discussed that the informed consent requirements differ from state to state, as well as the entities bound by the laws. She concluded the analysis, by noting the exception to protection granted to space flight providers. She then addressed the Enomoto v. Space Adventures case. In which a space tourist sued Space Adventures for brach of contract. In the case, Enomoto paid Space Adventures for a trip to the ISS, but was disqualified for health reasons. She stated that the case appeared to have settled. She noted that in this case there was a choice of law provision. This is important when discussing liability laws, and space flight providers should be aware of this when contracting.

Smith started by stating that state regulations were driven by different motivations than federal regulations. Specifically he stated that state laws are concerned with economic considerations. These laws are developed to enhance state economies by giving companies incentives to operate within the borders of that state. He noted that states do this in a variety of ways in addition to the liability waivers. He noted tax laws and government grants as major tools used by states to encourage space companies to do business within their borders. He stated that states were competing with each other for these companies. He comments then moved to the FAA Centers of Excellence and how the program leads to the development of expertise with a state. He also commented on space act agreements, technology transfer opportunities, small business innovation opportunities, and technology facility development as ways to develop the industry.

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