A Space Flight Participant is (Mostly) Not a Customer

Little things can trip you up.  Like thinking you know your native language.  Actually, that’s not the problem.

What can trip you up is thinking others use it the way you do.  Take, for example, the term “customer” in the Commercial Space Launch Act (CSLA) and its implementing definition in the FAA’s regulations.  You might think you are a launch company’s customer just because you are boldly paying to go for a ride on its rocket.  Not so.  Or, not necessarily so.  You are a space flight participant because you are a person on a launch or reentry vehicle — unless you are crew or a government astronaut, which, in defiance of your childhood dreams, we are today going to cruelly assume you are not.

These distinctions matter because the CSLA requires some launch participants to waive claims for bodily injury, death, or property against other launch participants.  For space flight participants, these requirements have changed over time and are slated to change again.

Although the CSLA does not define the term, the FAA’s regulations define a “customer” to mean:

(1) Any person:

(i) Who procures launch or reentry services from a licensee or permittee;

(ii) With rights in the payload (or any part of the payload) to be launched or reentered by the licensee or permittee, including a conditional sale, lease, assignment, or transfer of rights;

(iii) Who has placed property on board the payload for launch, reentry, or payload services; or

(iv) To whom the customer has transferred its rights to the launch or reentry services.

(2) A space flight participant, for the purposes of this part, is not a customer.

Please note that under paragraph (2) a space flight participant is not a customer.

That was then.  There is a reason for this oddity.  When Congress passed the CSLA’s 2004 changes — clarifying the FAA’s role in regulating human space flight — it required space flight participants to sign reciprocal waivers of claims with the government, but not with launch operators. “Customers” continued to have to sign with launch operators (and the government, of course).  (There’s more to these agreements than I’m getting into here, but I am trying to stick to one small point so just think of them for now as agreements not to sue.  Lawyers everywhere are cringing because I said it that way.)

For example, SatelliteCo, LaunchCo, and the FAA on behalf of the federal government all had to sign the same agreement saying they waived claims against each other.  In this scenario, SatelliteCo is a customer.  However,  SpaceTouristDude only waived claims against the FAA.

When I was at the FAA working on the rules to incorporate Congress’ changes to our governing statute*, we didn’t want the space flight participant signing the wrong agreement.  We didn’t want SpaceTouristDude accidentally waiving claims against LaunchCo for giving him a ride on its rocket.  Congress only wanted “customers” waiving claims against launch operators; and it only wanted space flight participants waiving claims against the federal government.  Fine.  So the definition in the regulations makes it clear that a space flight participant is not a customer, and when anyone read the cross waivers provided in the FAA’s regulations, they were supposed to find it easier to use the right one.

This is now.  Time passed.  Lobbying happened.

In 2015, Congress modified the law again.  Now Congress does require a space flight participant to waive claims against a launch operator, at least until September 30, 2025.  51 USC 50914(b).  Because the requirement for space flight participants to waive claims against launch operators and other applicable parties expires in 2025, it’s probably best to leave the definition alone.  The FAA has a rulemaking coming up to account for the 2015 amendments, but this looks like one thing not worth changing.

When is a space flight participant a customer?  There are circumstances where we need to recognize that a space flight participant is also a customer.  It’s not because he’s getting on the rocket, but because he might be placing property on board or merely have rights in property placed on board.  In those cases, he needs to waive claims for damage to his property, probably even after 2025.

* For those of you for whom American Civics was a long time ago or who are overseas readers, our Congress is the legislative branch and writes the laws.  The agencies in the executive branch carry out the laws.  So, when an agency such as the FAA is writing regulations, it has to write the regulations and definitions to follow the law Congress passed.  The FAA doesn’t get to make up its own laws but is instead supposed to wait on Congress and only writes regulations where Congress has given it the authority to do so.