The U.S. Justice Department asked a federal judge in Texas to dismiss its criminal case against Boeing Co. over two fatal crashes of its 737 Max jets more than six years ago, despite objections of family members of some crash victims.
The request, disclosed Thursday in a court filing, is part of a proposed settlement prosecutors reached with the planemaker last week. The case had been set to go to trial June 23.
The government’s agreement calls for Boeing to pay more than $1.1 billion in fees and fines, while taking steps to strengthen internal quality and safety measures. In return, the company will avoid criminal prosecution.
It is a notable reversal in the long-running criminal case against Boeing over two fatal crashes of its 737 Max jet in 2018 and 2019 that killed 346 people. Just last year, Boeing had agreed to plead guilty to the pending criminal conspiracy charge under a deal that was ultimately rejected by U.S. District Judge Reed O’Connor, who has been overseeing the case since it was filed in 2021.
Prosecutors said in the filing that their deal with the company “secures meaningful accountability, delivers substantial and immediate public benefits, and brings finality to a difficult and complex case whose outcome would otherwise be uncertain.”
While the government said some relatives of the crash victims didn’t oppose the agreement, other family members plan to file a formal objection with the judge.
‘Miscarriage of justice’
“Any resolution that allows Boeing to walk away without an admission of guilt is a miscarriage of justice,” Erin Applebaum, a partner at Kreindler & Kreindler LLP, said in a statement. “We trust the court will see the agreement for what it is and reject the government’s efforts to let Boeing escape accountability for the deaths it caused.”
Boeing said in a statement it is committed to complying with its obligations under the agreement, including “substantial additional compensation” for family members of crash victims.
“We are deeply sorry for their losses, and remain committed to honoring their loved ones’ memories by pressing forward with the broad and deep changes to our company that we have made to strengthen our safety system and culture,” Boeing said.
The new agreement is similar in many respects to the proposed plea deal that was rejected last year, with one notable exception: Boeing will not plead guilty to the pending criminal charge.
Instead, the company will admit to the underlying accusation of “conspiracy to obstruct and impede the lawful operation of the Federal Aviation Administration Aircraft Evaluation Group,” but that admission does not constitute a guilty plea.
However, the government could refile criminal charges against the company if Boeing is accused of violating the terms of the agreement, which has a term of two years.
Deal terms
The agreement requires Boeing to pay a total of $1.1 billion in assorted fines and fees. The total includes:
—$487.2 million for a criminal penalty, half of which the company already paid to the government during an earlier phase of the case
—$444.5 million for a new “Crash-Victims Beneficiaries Fund” that will be divided evenly by crash victim
—$455 million in investments to bolster its compliance, safety and quality programs
Boeing would be required to retain a so-called independent compliance consultant to oversee its efforts to improve the effectiveness of its anti-fraud compliance and ethics program. The consultant will be expected to make recommendations for improvements and report their findings directly to the government.
In December, O’Connor rejected the company’s proposed plea deal because he said it would improperly require race to be considered in the hiring of an independent monitor to review Boeing’s actions. The new proposed agreement states that selection of the independent consultant “will not take into account or otherwise engage in unlawful discrimination based on race, gender, or any other protected class.”
Victims’ families
Finally, the agreement calls for family members of crash victims to have the opportunity to meet with Boeing’s board of directors and speak to them about the impact of the company’s conduct and about its compliance and safety programs.
Relatives have spent years fighting for harsher penalties for Boeing and have opposed past attempts to resolve the case. Both crashes were linked to a flawed flight control system on 737 Max jets. The only Boeing official to face trial was a mid-level manager overseeing the pilot manuals and training materials. He was acquitted.
“While my client and I wanted to see a more vigorous prosecution, my hope is that the criminal case and the lawsuits motivated Boeing to improve safety,” Mark Lindquist, one of the attorneys for the victims’ families, said Thursday. “That’s what truly matters.”
In 2021, the company reached a deal with the government to defer prosecution in the criminal case, assuming it met certain requirements while under a period of government supervision.
Last year, two days before the supervision period was set to conclude and the charge would have been dismissed, a door-sized plug blew out of an airborne 737 Max. While no one was killed, the accident led to investigations and findings of lax controls in Boeing’s factories.
The case is U.S. v. Boeing, 21-cr-005, U.S. District Court, Northern District of Texas (Fort Worth).
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