Boeing, DOJ reach deal to avoid prosecution over 737 Max crashes

The U.S. Justice Department said Friday that it has reached a take care of Boeing that may allow the aircraft maker to avoid prosecution over two crashes of its 737 Max planes that killed 346 people.

The non-prosecution agreement would allow Boeing, a significant military contractor and top U.S. exporter, to avoid being labeled a felon. The choice means Boeing won’t face trial as scheduled next month, as crash victims’ relations have urged for years.

The Department of Justice met with crash victims’ relations last week to debate the potential deal.

In a court filing Friday the DOJ said it “is the Government’s judgment that the Agreement is a good and just resolution that serves the general public interest.”

The agreement “guarantees further accountability and substantial advantages from Boeing immediately, while avoiding the uncertainty and litigation risk presented by proceeding to trial.”

The DOJ said it intends to file a motion to dismiss the case once the “agreement in principle” is finalized, by no later than the tip of next week.

Under the agreement, Boeing may have to “pay or invest” greater than $1.1 billion, the DOJ said in its filing in federal court in Texas on Friday. That quantity features a $487.2 million criminal nice, though $243.6 million it already paid in an earlier agreement can be credited. It also includes $444.5 million for a brand new fund for crash victims, and $445 million more on compliance, safety and quality programs.

Boeing declined to comment.

The corporate has been trying for years to place the two crashes of its best-selling Max planes — a Lion Air flight in October 2018 and an Ethiopian Airlines flight lower than five months later — behind it. The Maxes were grounded worldwide for nearly two years after the second crash, a pause that gave rival Airbus a head start in recovering from the Covid pandemic.

But families of the crash victims have criticized previous agreements as sweetheart deals for Boeing, called for more accountability from the corporate and said its executives should stand trial. In 2022, a former chief technical pilot for Boeing was acquitted on fraud charges tied to the Max’s development.

Several of the victims’ relations issued an announcement through their lawyer shortly after the court filing was released criticizing the deal and saying it set a troubling precedent for other large corporations.

“This sort of non-prosecution deal is unprecedented and clearly incorrect for the deadliest corporate crime in U.S. history. My families will object and hope to persuade the court to reject it,” said the families’ lawyer, Paul Cassell.

The Justice Department said relatives of greater than 110 crash victims told the federal government they support the non-prosecution agreement or “support the Department’s efforts to resolve the case pre-trial more generally,” but added that others said they need the U.S. to take Boeing to trial and that they’d litigate to dismiss the deal.

The aerospace giant reached a settlement in 2021 within the final days of the primary Trump administration that shielded it from prosecution for 3 years.

Under that deal, Boeing agreed to pay a $2.51 billion nice to avoid prosecution. That included a $243.6 million criminal penalty, a $500 million fund for crash victims’ relations and $1.77 billion for its airline customers. The brand new fund can be on top of the $500 million that was already established.

That 2021 settlement was set to run out two days after a door panel blew out of a virtually recent 737 Max 9 operated by Alaska Airlines on Jan. 5, 2024, after the aircraft left Boeing’s factory without key bolts installed.

But last yr, U.S. prosecutors said Boeing violated the 2021 settlement, accusing the corporate of failing to establish and implement a compliance and ethics program to detect violations of U.S. fraud laws.

Last July, toward the tip of the Biden administration, Boeing agreed to plead guilty to the criminal fraud charge in a brand new settlement. A federal judge later rejected the plea deal, citing concerns with diversity, equity and inclusion requirements for selecting a company monitor.

Under that 2024 deal, Boeing would have faced a nice of as much as $487.2 million, though the Justice Department really useful that the court credit Boeing with half that quantity it paid under the previous agreement.

The U.S. had accused Boeing of conspiracy to defraud the federal government by misleading regulators about its inclusion of a flight-control system on the Max that was later implicated within the two crashes.

“Boeing’s employees selected the trail of profit over candor by concealing material information from the FAA regarding the operation of its 737 Max airplane and fascinating in an effort to cover up their deception,” then-acting Assistant Attorney General David Burns of the Justice Department’s Criminal Division said on the time of the 2021 deferred prosecution agreement.

Messages revealed in an investigation into the Max’s development showed the previous top Boeing pilot who was found not guilty of fraud in 2022, Mark Forkner, told the FAA to delete the flight-control system often called MCAS from manuals and, in a separate email, he boasted about “jedi-mind tricking” regulators into approving the training material.

Lawyers for victims’ relations railed against last yr’s preliminary plea deal, equating it to a slap on the wrist for the company giant, which recently won a contract value billions to construct the next-generation fighter jet and works on other military programs including outfitting two recent presidential jets.