Spaceflight Insider

Firefly Space Systems burns out?

Firefly Space System's has encountered financial difficulties which could be catastrophic for the firm's efforts. Photo Credit: Firefly Space Systems

Firefly Space Systems has encountered financial difficulties which could be catastrophic for the firm’s efforts. Photo Credit: Firefly Space Systems

Firefly Space Systems, a NewSpace launch service provider that was founded in 2014 by Tom Markusic P.J. King and Michael Blum, has been developing the Firefly Alpha rocket which uses an aerospike engine cluster to deliver 400 kg payloads to LEO. They have been under legal pressure from Virgin Galactic regarding allegedly stolen intellectual property for aerospike engine designs.

The legal battle took a turn in Virgin Galactic’s favor earlier this month when the arbitrator in the case (case no. 01-12-0002-2467) made a terminating sanctions ruling determining that Markusic did take Virgin Galactic trade secrets, destroyed evidence, impeded the arbitration process, and transferred Virgin Galactic confidential information to Firefly computers. This ruling makes any further legal action by Virgin Galactic much simpler as they no longer have to prove Markusic took their confidential information.

Things appeared to be going well at Firefly before this ruling, with a high volume of new hiring going on, a $5.5 million Venture class launch services contract with NASA, test firings of their engine, and a successful raise of $19 million in funding. Things may have changed with a statement posted to Twitter today on their @Firefly_Space account stating they have “experienced a setback on funding”.  

The listed contact for additional information was from Sanitas International, a company specializing in PR for government contractors under scrutiny and potentially at risk of fines or criminal penalty. Anonymous sources at Firefly have told Spaceflight Insider that the company is out of money.

Forming an aerospace company is no easy feat, with many facing similar issues. XCOR, and its Lynx spaceplane, has seen many of its core members depart, its spacecraft shuttered, and reports appearing in Popular Mechanics and Parabolic Arc have stated that much of its staff has been laid off. Other companies that formed under the NewSpace banner are finding that financial support is difficult to come by.



Jason Rhian spent several years honing his skills with internships at NASA, the National Space Society and other organizations. He has provided content for outlets such as: Aviation Week & Space Technology,, The Mars Society and Universe Today.

Reader Comments

Original Sources

#516 by ringsider on 11 Sep, 2016 08:26
Bad news from the lawsuit for Markusic/Firefly – the arbitrator has made a terminating sanctions ruling that basically says Markusic did take Virgin trade secrets, destroyed evidence that he took it, stonewalled the arbitration process, and transferred Virgin confidential information to Firefly computers. All Markusic counterclaims and answers are stricken as a sanction and these things are now basically taken as fact – Virgin doesn’t need to prove he took all the information, just to prove that it was used. It is also taken as fact that he solicited a wide range of Virgin employees. Here are some extracts, this is public record in the LA court system case # BC609407:-

“It is appropriate to find that the destruction of evidence was intentional since it has been so systematic and thorough. Respondent [Markusic] claims ignorance about legal proceedings, but that protestation rings hollow at this point. Unlike the Williams case, Respondent did not allow someone else to destroy evidence – he did it himself, and more than once. He also orchestrated or failed to prevent destruction of files by others connected to Firefly.”

“A thorough review of the evidence in this case and a careful analysis of its history leaves the Arbitrator with the abiding conviction the Respondent and his compatriots [King, Blum, and Firefly] have completely undermined this action. Under the circumstances it is appropriate to foreclose any effort by Respondent to attempt to demonstrate that he does not possess Claimant’s [Virgin Galactic] claimed proprietary and trade secret information. The Arbitrator is of the view that at the evidentiary hearings, Claimant must prove only Respondent’s use of this information.” Aug 16 2016, Judge Lamothe, case no. 01-12-0002-2467.


Too bad. But there might be some openings soon at Michoud if Musk can get a cheap, long term use agreement with NASA. I guess his Mars rocket can fit under the roof. I doubt that the SLS will be funded for more than a few more years, since Bezos and Musk are both planning monster rockets. Like, how many do we need?
I think Musk just mentioned Louisiana to get a bidding war going between Texas and Florida, since a rocket 40 feet in diameter probably wouldn’t fit in Michoud.
He could have lawsuit troubles if he can’t get hooked up with the government. If he launches his Mars rocket from Florida, the sonic booms when it returns will soon generate noise lawsuits. You can’t sue NASA, but you can sue a private company. Maybe he can buy Venice, Louisiana now that the offshore oil industry is disappearing from the low oil price. Cat Island is too close to the Mississippi Coast. He might need to build an island. Too bad all those military islands off Southern California aren’t off Florida. Key West would be perfect.

They need to find a billionaire benefactor who’s interested in space such as Paul Allen and Jeff Bezos.
Also, I don’t get this law suit. Garvey Space which is part of Firefly has been doing work on aerospike nozzles for a decade. And the type of aerospike Firefly wants to use consists of multiple small nozzles arranged around a central spike which is what NASA was investigating 15 years ago for the X-33/VentureStar. So I don’t get how Virgin Galactic can claim to own these patents.

Bob Clark

For the record – Garvey is NOT a part of Firefly but was acquired by Vector Space Systems in 2016. It is true that Garvey Spacecraft Corp has been flying aerospace engines for years. That Firefly would have taken this information from Virgin is beyond bad. Its simply dumb. As for the billionaires, rumor has it that it was Vulcan Capital that withdrew the financing upon learning of the ruling against Markusic. Rumors have persisted that Firefly has soft peddled the lawsuit to investors as being one of ‘a jealous former employer pursuing a former employer out of vengeance”. Paul Allen apparently saw through this and pulled his money. Firefly is likely going to end up in the possession of Virgin in my opinion.

Yes, You’re right it was Vector Space. I remembered that Garvey was acquired by a company working on using an aerospike engine and conflated the two.
But, according to Markusic it was a European investor who pulled out, not Paul Allen. Allen could be the American investor though that Marcusic has mentioned that did not pull out.

Perhaps Firely could get funding from wealthy fans of the science fiction series “Firefly”. Or perhaps from the creator himself of the show, Josh Whedon.

Bob Clark

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