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Amazon Shareholder Reveals Bezos' Decision to Reject SpaceX for Major Satellite Launch Contract

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Amazon Shareholder Lawsuit Alleges Bezos' Snub of SpaceX for Satellite Launch Contract

A shareholder lawsuit filed by the Cleveland Bakers and Teamsters Pension Fund (CB&T) on behalf of Amazon accuses the company of snubbing SpaceX for valuable satellite launch contracts due to Jeff Bezos' personal rivalry with Elon Musk. The lawsuit centers around Amazon's purchase of rocket launches for its Project Kuiper satellite internet system. CB&T alleges that Amazon's leadership breached their fiduciary responsibilities by awarding contracts to rockets that have yet to launch and are behind schedule, while excluding SpaceX, the leading rocket provider, due to Bezos' rivalry with Musk. The lawsuit claims that Amazon failed to conduct a meaningful analysis of the rocket launch market and approved contracts without protecting negotiations from Bezos' conflict of interest. It also alleges that the Amazon audit committee did not consider SpaceX as an option and did not receive updates on the negotiations for nearly 18 months. CB&T argues that the lack of information about Blue Origin's struggles and the potential risks to Amazon's Kuiper program further demonstrate the breach of fiduciary duties. CB&T highlights the stark contrast between Amazon's handling of the satellite launch contracts and its acquisition of Whole Foods, where the company engaged financial advisors. The lawsuit contends that by neglecting its fiduciary duties, the Amazon board has exposed the company to harm and put the entire Kuiper program at risk. The suit suggests that Bezos' personal rivalry with Musk may have influenced the decision-making process. In response to the lawsuit, Amazon rejected the claims, stating that they are without merit. Blue Origin, Bezos' space company, has yet to provide a statement regarding the lawsuit. CB&T, represented by Grant & Eisenhofer, alleges two counts of breach of fiduciary duty against the defendants. The lawsuit seeks to hold Amazon's leadership accountable for their actions and shed light on the decision-making process behind the satellite launch contracts.

Implications for New Businesses

This lawsuit provides a valuable lesson for new businesses about the importance of transparent and objective decision-making, particularly when personal rivalries could potentially influence business decisions.

Transparency in Decision-Making

The allegations against Amazon highlight the need for businesses to conduct thorough market analysis and maintain transparency in their decision-making processes. New businesses should ensure that all decisions, especially those involving significant financial commitments, are made based on sound business principles and not influenced by personal biases or rivalries.
Fiduciary Responsibilities
The lawsuit also underscores the importance of fulfilling fiduciary responsibilities. Company leadership has a duty to act in the best interests of the company and its shareholders. New businesses must understand these responsibilities and ensure that they are upheld in all business decisions.


In conclusion, the lawsuit against Amazon serves as a reminder for new businesses about the potential pitfalls of allowing personal rivalries to influence business decisions. It highlights the importance of transparency, objective decision-making, and fulfilling fiduciary responsibilities. By learning from these allegations, new businesses can avoid similar issues and ensure that their decisions are made in the best interests of the company and its stakeholders.
Story First Published at: https://www.cnbc.com/2023/09/01/bezos-snubbed-musk-spacex-satellite-contract-lawsuit.html
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