Litton Systems Inc. v. Honeywell Inc. CV-90-4823 (U.S.D.C. C.D CA)

Litton and Honeywell are the world’s sole suppliers of ring-laser gyroscopes and inertial reference systems (RLG/IRS), the directional navigation technology used in all commercial aircraft. Litton brought a claim of monopolization against Honeywell, challenging a number of the business practices it employed in gaining a dominant share of the market beginning in the mid-1980s.

John C. Beyer, Nathan’s president at the time, was the principal economic expert in Litton Industries’ successful prosecution of an antitrust case against Honeywell Inc. His damage model incorporated elements of the production efficiencies and technology changes inherent in the aircraft navigation equipment market.

During trial, Dr. Beyer assessed the impact of Honeywell’s contracting practices on commercial aircraft manufacturers, and explained how these practices kept Litton out of the market. Describing what Litton’s participation in the market would have been had Honeywell not employed these practices, Dr. Beyer calculated Litton’s resulting profitability for each commercial aircraft series produced over the past 15 years.

The jury found Dr. Beyer’s damage analysis persuasive and awarded Litton $250 million in damages, one of the largest antitrust judgments in 1998.