On Friday, the U.S. Justice Department announced it has entered into a non-prosecution agreement with Boeing, stemming from two deadly crashes of the company’s 737 Max aircraft that resulted in 346 fatalities.
This agreement enables Boeing, an influential player in the military contracting sector and a leading U.S. exporter, to bypass being classified as a felon. Consequently, the company will not undergo a trial next month, a process that has been supported by the families of the crash victims for several years.
Last week, representatives from the Department of Justice met with family members of the victims to discuss this potential resolution.
In their court submission on Friday, the DOJ affirmed, “it is the Government’s judgment that the Agreement is a fair and just resolution that serves the public interest.”
The agreement is designed to ensure ongoing accountability and provide significant benefits from Boeing immediately, while also mitigating the uncertainties and risks associated with going to trial.
Once finalized, which is expected by the end of next week, the DOJ plans to file a motion to dismiss the case.
Under the terms of the agreement, Boeing is required to “pay or invest” over $1.1 billion, as indicated in the DOJ’s filing in Texas. This includes a $487.2 million criminal fine, offset by a $243.6 million amount Boeing previously paid under a different agreement. Additionally, the settlement allocates $444.5 million towards a new fund for victims’ families and another $445 million for enhancing compliance, safety, and quality programs.
Boeing has yet to release a comment on the matter.
The company has faced ongoing challenges as it seeks to move past the incidents involving its 737 Max jets—the first crash occurred in October 2018 with Lion Air, followed by another in March 2019 with Ethiopian Airlines. The Max fleet was grounded globally for nearly two years after the second crash, allowing rival Airbus to gain an advantage as the industry began recovering from the impacts of the Covid pandemic.
Families affected by the crashes have previously denounced earlier settlements as overly lenient, demanding greater accountability from Boeing and insisting that executives should face trials. In 2022, a former chief technical pilot at Boeing was found not guilty of fraud charges related to the development of the Max.
A settlement reached in 2021 during the last days of Donald Trump’s presidency offered Boeing immunity from prosecution for a period of three years. This earlier deal involved a $2.51 billion payment to avoid prosecution, which included a $243.6 million criminal penalty, a $500 million fund for the families of victims, and $1.77 billion aimed at supporting airline customers.
The 2021 agreement was set to expire just two days after an incident involving a new 737 Max 9 operated by Alaska Airlines, where a door panel malfunctioned due to missing bolts that had not been installed prior to leaving Boeing’s factory.
U.S. prosecutors accused Boeing last year of breaching the 2021 settlement by failing to implement an effective compliance and ethics program designed to detect violations of federal fraud laws.
As the Biden administration was winding down, Boeing had agreed to plead guilty to criminal fraud under a new settlement, a deal that was later rejected by a federal judge, who expressed concerns regarding diversity and inclusion mandates for selecting a corporate monitor.
The proposed arrangement in 2024 would have imposed a fine of up to $487.2 million, with the DOJ suggesting that the court could credit Boeing for half of this amount in light of prior payments made.
The U.S. government previously accused Boeing of engaging in a conspiracy to defraud regulators by misrepresenting the functionality of a flight-control system on the 737 Max linked to both fatal crashes.
“Boeing’s employees chose the path of profit over candor by concealing material information from the FAA concerning the operation of its 737 Max airplane and engaging in an effort to cover up their deception,” stated David Burns, the former acting Assistant Attorney General of the Justice Department’s Criminal Division, in announcing the deferred prosecution agreement in 2021.
Evidence revealed during the investigation indicated that Mark Forkner, the former top Boeing pilot acquitted in 2022, had instructed the FAA to omit the flight-control system known as MCAS from manuals and later claimed in an email to have “jedi-mind tricked” regulators into approving the training materials.
Legal representatives of the victims’ families expressed outrage over last year’s preliminary plea deal, branding it as a mere slap on the wrist for Boeing, which recently secured a multi-billion-dollar contract to develop the next-generation fighter jet and is involved in other significant military programs, including outfitting two new presidential aircraft.
