Virgin Galactic Applauds Legal Protection Against Space Tourist Lawsuits

DUBAI, United Arab Emirates ? The president of the most prominent company developing a space tourism business on March 3 applauded legislation signed into law in New Mexico that reduces the risk that space tourism operators will face crippling lawsuits brought by surviving family members of a participant injured or killed during flight.

Virgin Galactic President Will Whitehorn said the legislation, signed into law Feb. 27 by New Mexico Gov. Bill Richardson, will help place the emerging space tourism business on the same footing as tour operators leading expeditions to Mt. Everest.

"This helps give us a really solid insurance foundation" for the business, Whitehorn told the World Space Risk Forum here. "It includes the principle of informed consent. Participants will be required to sign a waiver before flight."

Insurance has long been considered one of the least exciting, but most problematic, hurdles that the space tourism industry faces. Customers at least in the early years are likely to be high-net-worth individuals, many of them still professionally active. The threat that a fatal accident could result in a multimillion-dollar award has been shadowing the space tourism business since the beginning.

Vanessa Leigh, who is with the specialist aerospace law firm Gates and Partners of London, said even the strongest legislation will not immunize the industry against future challenges from courts, as has proved to be the case with civil aviation.

"The [space tourism industry] may dream of something like the 1929 Warsaw Convention, but it isn't going to happen," Leigh told the conference, referring to the pact that sets limits on liability for passenger transport and helped permit the commercial aviation industry to expand.

But the New Mexico law, called the Space Flight Informed Consent Act, is intended to set barriers to future insurance claims that could render the space tourism industry uninsurable and thus, for all practical purposes, stillborn.

The law stipulates that spaceflight operators cannot be held liable for the "death of a participant resulting from the inherent risks of space flight activities" so long as participants sign a waiver before the flight. The waiver reads in part: "I understand and acknowledge that under New Mexico law, there is no liability for injury to or death sustained by a participant in a space flight activity provided by a space flight entity if the injury or death results from the inherent risks of the space flight activity. Injuries caused by the inherent risks of space flight activities may include, among others, death, bodily injury, emotional injury or property damage. I assume all risk of participating in this space flight activity."

The waiver does not hold in the event the space tourism operator is found guilty of gross negligence or willful misconduct.

Steve Landeene, executive director of Las Cruces, N.M.-based Spaceport America, said in a March 1 statement that the law's passage "was critical to the success of Spaceport America and our ability to attract and retain commercial space companies to New Mexico."

Virgin Galactic plans to operate suborbital space tourism flights out of the New Mexico spaceport.

The law covers only New Mexican airspace and will not apply to flights departing from one point and landing at another ? a business Whitehorn said will take many years, and more legislative developments, to develop.

The Commercial Space Launch Amendments Act of 2004 (H.R. 5382) in 2004 established initial guidelines for space tourism operators intended to give them room to develop. The U.S. Federal Aviation Administration's Office of Commercial Space Transportation, which is responsible for licensing space launches, refers to customers as "participants" rather than passengers, reinforcing the idea that they are presumed to understand the risks of the endeavor.

Virgin Galactic, Whitehorn said, will own and operate the SpaceShipTwo vehicle and its mother ship, WhiteKnightTwo, which will carry passengers to the edge of the atmosphere. It remains unclear whether all the program's industrial subcontractors will sign cross-waivers with Virgin Galactic with respect to responsibility for their components.

Nearly 330 people have made deposits totaling $45 million to reserve flights with Virgin Galactic, Whitehorn said. A certain number of them have asked to fly on the demonstration flights, displaying an appetite for risk that was not shared by the insurance underwriters, satellite builders, satellite operators and others attending the space-risk forum here. In a poll, more than 60 percent of the attendees said they would not sign up before at least six successful flights were undertaken.

Whitehorn said the SpaceShipTwo vehicle designed by Scaled Composites LLC of Mojave, Calif., is nearing completion of ground tests and will be put through a series of drop-and-glide tests in the coming months before powered flight tests begin in 2011. The Spaceport America runway is scheduled to be inaugurated in October.

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