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Bill To Curb Liability Introduced in Senate

SANTA FE – A compromise bill that would expand legal liability protections for spacecraft manufacturers and suppliers was introduced in the Senate on Wednesday, and representatives from Virgin Galactic and the state Trial Lawyers Association said they support it.

The two groups previously had been at odds over proposals that would limit passengers who sign a liability waiver before spaceflight from filing some lawsuits against spacecraft manufacturers in case of an accident during flight.

Democratic legislators, including bill Sen. Mary Kay Papen, D-Las Cruces, announced Tuesday that a compromise was reached, but few details of the deal were not known because the legislation had not been introduced.

As introduced Wednesday, the compromise bill – SB 240 – would require commercial aerospace companies, including manufacturers and suppliers, to carry liability insurance of at least $1 million to qualify for the state’s spaceport liability protections.

Although Virgin Galactic had initially requested that the new legal protections to be indefinite, the compromise bill instead extends the protections to expire in 2021, a three-year delay from the current spaceport liability protection, scheduled to expire in 2018.

“We support passage of this,” said Virgin Galactic Senior Vice President Marc Holzapfel, the company’s legal counsel. “It got us to where were comfortable we can protect our manufacturers and suppliers, protect the spaceport.”

New Mexico law already grants spaceflight operators that protection, but Virgin Galactic -Spaceport America’s primary tenant – has said expanded protections matching other states’ liability waivers are necessary to attract aerospace manufacturers to relocate to New Mexico and help share the operational expenses of the state-owned spaceport.

The New Mexico Trial Lawyers Association has opposed past versions of the bill during the past two legislative sessions, saying the partial immunity was a broad rollback of civil protections.

Trial Lawyers Association President Ray Vargas said his group thought the minimum liability insurance would help ensure companies building or supplying spacecraft parts have had their operations reviewed by an independent insurance company.

“If part suppliers can’t come up with $1 million liability coverage, then they’re really not a commercially viable entity,” Vargas said. ” … That insurance provides a layer of consumer protection.”

Holzapfel said that the $1 million liability insurance is considered a reasonable amount for a company and that the requirement shouldn’t deter multimillion-dollar aerospace manufacturers from considering a move to New Mexico with the legal protections in place.

“We’re going to have insurance coverage, or we do already, that’s much more than that,” Holzapfel said. “A roofing company has $1 million (insurance). … It’s a very reasonable amount.”

The proposed legislation would continue to allow residents whose property or homes are affected by a spacecraft accident to file lawsuits. The bill would also allow passengers to sue spacecraft operators or manufacturers in cases of “reckless disregard for the safety of the participant.”

Bill To Curb Liability Introduced in Senate

— This article appeared on page A6 of the Albuquerque Journal