Raytheon wins damages after 2010 UK eBorders cancellation

WASHINGTON (Reuters) - U.S. weapons maker Raytheon Co on Monday said it had won damages of about 185 million pounds after a UK arbitration tribunal found the British government unlawfully terminated a border security deal with the company in 2010.

Britain cancelled its contract with Raytheon in 2010 for eBorders, a border-control system aimed at thwarting terrorism by collecting advance information on passengers travelling to the UK, saying the company was in default.

Raytheon later sued the government for 500 million pounds in damages, arguing that it had met its obligations on the programme, which has continued to be dogged by problems.

In its release, Raytheon said the UK Arbitration Tribunal denied all Home Office claims for damages and clawback of previous payments made to Raytheon Systems Ltd (RSL).

It also found that the Home Office had wrongfully retained the 50 million pounds it had drawn on Raytheon letters of credit in April 2011, but did not rule on the cost and interest payable to the company as a result.

"The Tribunal's ruling confirms that RSL delivered substantial capabilities to the UK Home Office under the eBorders programme. Raytheon remains committed to partnering with the UK Government on key defence, national security and commercial pursuits," the company said.

Raytheon spokesman Mike Doble declined further comment on the legal decision.

(Reporting by Andrea Shalal; Editing by Leslie Adler)