WASHINGTON — Optical and infrared sensor supplier Geost has filed a $17.1 million breach of contract lawsuit against Sierra Space, alleging the company reneged on an agreement to use Geost’s sensor payloads for missile-tracking satellites under a U.S. Space Force program.
Geost, a subsidiary of LightRidge Solutions based in Arizona, filed the complaint on Jan. 4 in the U.S. District Court in Denver. The lawsuit accuses Sierra Space of engaging in subcontracting negotiations and encouraging Geost to pre-purchase materials, only to later abandon the deal in favor of a competing supplier, Leidos, after securing a $740 million contract from the Space Force’s Space Development Agency (SDA).
Background on the contract
Sierra Space, a Colorado-based satellite manufacturer, was selected in January 2024 to produce 18 satellites for the SDA’s Tranche 2 Tracking Layer — a component of a military constellation known as the Proliferated Warfighter Space Architecture (PWSA). The contract covers 16 satellites for missile warning and tracking and two additional satellites with enhanced missile defense capabilities.
The SDA’s solicitation for Tranche 2, issued in September 2023, encouraged participation from new entrants as part of an effort to diversify the defense space industrial base. Alongside Sierra Space, Lockheed Martin and L3Harris were also awarded contracts under the program.
Geost’s allegations
According to Geost’s complaint, Sierra Space sought to partner with Geost shortly after the solicitation was announced, incorporating the company’s payload proposal into its bid. Geost alleges that LightRidge CEO Bill Gattle and then-Sierra Space CEO Tom Vice — who has since left the company — verbally agreed to collaborate and committed to formalizing terms if awarded the SDA contract.
Based on this understanding, Geost claims it spent $2 million in October 2023 to procure focal plane arrays from Teledyne Imaging Sensors, believing the early investment would strengthen Sierra Space’s bid. Sierra Space submitted its proposal on Oct. 9, 2023, highlighting Geost’s contributions and willingness to invest in long-lead materials as a “risk reduction” measure.
Following the contract award in January 2024, Geost asserts that the SDA director emphasized the selection was based on the Sierra Space-Geost partnership, valuing the inclusion of a new commercial supplier.
However, the lawsuit alleges that Sierra Space subsequently delayed finalizing the subcontract with Geost while secretly negotiating with Leidos. In February, Sierra Space issued an interim letter agreement introducing new conditions, including a requirement for Geost to procure up to $35 million in long-lead items. The agreement also stipulated that Geost must transfer these items to Sierra Space even if the subcontract was terminated.
Subcontract terminated
Geost claims that Sierra Space intentionally prolonged negotiations while working behind the scenes to replace Geost with Leidos. The lawsuit states that in June 2024, Sierra Space issued a stop-work order to Geost and terminated the agreement for convenience.
“Geost was shocked when Sierra Space terminated its subcontract and then sought to acquire just the long-lead items that Geost had procured from its vendors,” the complaint reads. Geost further alleges that Sierra Space leveraged Geost’s supplier relationships and standing with SDA to win the contract, only to substitute Leidos for the actual payload work.
After the termination, Geost asserts that Sierra Space pressured the company to hand over its materials and purchase orders to Sierra Space or Leidos. In total, Geost claims it incurred $42.4 million in costs for materials and labor, but Sierra Space reimbursed only $25.3 million.
Legal claims and industry implications
Geost is seeking at least $17.1 million in damages for incurred expenses and has indicated plans to pursue additional claims for lost profits from the $269 million subcontract. The company also intends to seek punitive damages at a later stage.
A Geost executive said the company could not comment for this article.
A Sierra Space spokesperson told SpaceNews via email: “We dispute the allegations in this complaint and will defend ourselves through the legal process.”
