Stephen Harper's new government could face a $1-billion legal penalty after a European aerospace firm filed a claim for damages citing political interference by the Liberals during the 2004 purchase of naval helicopters.
Aerospace giant Agusta-Westland recently filed the $1-billion claim for damages in Federal Court, alleging its EH-101 helicopter didn't win the competition to provide Canada's military with a maritime chopper because of political interference by the Liberal government. The company is also asking for $1-million in punitive damages. Some Conservatives have privately voiced concerns their government will get stuck with the bill if the company wins its case.
Agusta-Westland contends the Liberals designed the $5-billion program to buy 28 maritime helicopters in such a way as to prevent the selection of its EH-101 chopper. The firm lost out to its U.S. rival Sikorsky, which was awarded the contract in 2004 to provide a replacement for the military's ageing Sea Kings.
In its statement of claim, Agusta-Westland contends the Liberal government wanted to ensure the EH-101 didn't win the Sea King replacement contract because it wanted to avoid political embarrassment. The firm alleges the Liberals were worried that if the EH-101 did win, the government would be accused of wasting hundreds of millions of dollars in cancelling the first deal.
The company also claims the government made serious errors in evaluating the bids and knew in advance that Sikorsky would not be able to deliver choppers on time.
Agusta-Westland also alleges the government reduced the performance criteria of the new helicopter in order to allow the Sikorsky aircraft to be selected. Agusta-Westland has complained over the years the helicopter program was rigged to favour any aircraft other than its EH-101.
The Sea Kings have become symbolic of the predecessor government's studied neglect of, if not outright contempt for, its national defence responsibilities. After more than 40 years in service, they have become almost impossible to maintain and keep in the air. Airmen practically expect to crash every time they fly one, and not without reason, as a dozen have crashed, killing ten airmen.
Read more about the bid process and the technical problems with the Sea Kings, the EH-101 and the new Sikorsky H-92 here.
You'll be disgusted to find out the lengths Jean Chretien went to keep this one campaign promise to cancel the EH-101 contract when he blithely broke so many others.