Up in the air
LVP, Pty., is an Australian manufacturer of advanced lithium cobalt oxide batteries for electric cars, located in Newcastle, New South Wales. Recently, it developed a battery for aerospace use and won a contract to supply BoeBus, a multinational aircraft manufacturer, with batteries for use on its new jetliner. Largely due to this contract, LVP has turned around its financial performance and is beginning its second profitable year. You are the general counsel of LVP. One evening at dinner, an engineer with the company, who is an old friend from your university days, confided to you that she feared the worst. She was convinced that the batteries may be prone to a condition called thermal runaway, which would cause them to overheat and even catch fire under some circumstances. Although the batteries passed all applicable design and safety standards when LVP won the contract with BoeBus, the company’s recent tests caused the engineer to believe that thermal runaway could occur if unusual demands were placed on the airplane’s electrical power system. The new BoeBus plane includes advanced electrical systems that might place heavy loads on the batteries. An in-flight fire, particularly the kind of rapidly accelerating fire characteristic of lithium-ion batteries, would almost certainly have catastrophic consequences. Your friend said she had informed the company’s president of the research but had been told not to discuss it with anyone else.