In this paper, a novel nonlinear observer and controller framework is suggested for achieving formation control of a cluster of satellites. Exploiting the skew symmetry in the satellite dynamics, a novel nonlinear observer which has roots in the super-twist sliding mode observer is proposed. Estimation of the entire states and unknown bounded disturbances (and also faulty, corrupted leader control signals) in finite time is demonstrated using an elegant Lyapunov analysis. The proposed distributed controller is based on the state estimates and the relative position output information which depends on the underlying communication topology. The novelty in the synthesis of the controller is mainly in the treatment of the underlying graph topology, the interaction amongst the satellites in terms of relative sensing, and the synthesis of the controller gains using a simple polytopic representation that depends on the graph Laplacian eigenvalues. A simulation example is provided to demonstrate the efficacy of the proposed approach.