(KEY ALLEGATIONS FROM LORAL SHAREHOLDERS CASE:
138. On February 15, 1996, a Chinese Long March 3B Rocket carrying a $200 million commercial communications satellite manufactured by Defendant Loral failed in midflight.
139. According to the Cox Report, the satellite on board the failed rocket was an Intelsat 708 satellite manufactured by Defendant Loral for Intelsat, the world’s largest commercial satellite communications services provider. In October 1988, Intelsat had awarded a contract to Loral to manufacture several satellites under a program known as Intelsat VII. That contract had a total value of nearly $1 billion dollars.
140. On information and belief, the failed launch had been undertaken by China Great Wall Industry Corporation, a state-controlled missile, rocket and launch provider, with reported ties to Chinese intelligence services.
141. The satellite on board the Chinese Long March rocket contained an encryption device on a circuit board that controls the satellite’s communications and movements in space.
142. On information and belief, similar encryption devices are used in U.S. defense satellites, and, consequently, the devices are highly classified secrets of the U.S. Government.
143. On information and belief, the circuit board from the highly classified encryption device in the satellite that was destroyed during the February 15, 1996 launch was missing when the Chinese returned debris from the explosion to U.S. authorities, even though a control box containing the circuit board was recovered intact.
144. People’s Liberation Army soldiers and other Chinese agents reportedly sorted through the debris while U.S. officials were kept away
from the crash site for five (5) hours.
145. U.S. officials have publicly stated that they suspect the Chinese authorities took the board.