Boeing, DOJ reach deal over 737 Max crashes

THE US Department of Justice (DOJ) announced that it has reached a non-prosecution agreement with Boeing stemming from the two fatal crashes of its 737 Max aircraft, which together claimed 346 lives, reported IANS.

In its filing in the federal court in Texas, the DOJ described the agreement as “a fair and just resolution that serves the public interest,” emphasising that it ensures immediate accountability and substantial benefits for affected families while sidestepping the uncertainties and risks of litigation.

Under the deal, Boeing will avoid a felony conviction and the scheduled trial next month, reports Xinhua news agency.

Boeing will have to “pay or invest” more than $1.1 billion, according to the filing.

Crash victims’ fund

It includes a $487.2-million criminal fine. A $243.6-million fine it already paid in an earlier agreement would be credited. It also includes $444.5 million for a new fund for crash victims, and $445 million more on compliance, safety and quality programs. After the fatal crashes, Boeing was accused of conspiring to defraud regulators by withholding critical information about the 737 Max’s flight-control system, which was implicated in both crashes.

In 2021, the company entered a deferred prosecution agreement to avoid prosecution, paying a total of $2.51 billion – including a $243.6-million criminal penalty, $500 million for victims’ families, and $1.77 billion in compensation to airline customers.

“Boeing’s employees chose the path of profit over candour by concealing material information from the FAA concerning the operation of its 737 Max aeroplane and engaging in an effort to cover up their deception,” David Burns, then-acting Assistant Attorney General of the DOJ’s Criminal Division said after the 2021 deferred prosecution agreement.

Compliance failure

The 2021 settlement was set to expire two days after a door panel blew out of a nearly new 737 Max 9 operated by Alaska Airlines on January 5, 2024, after the aircraft left Boeing’s factory without key bolts installed.

Following the incident, prosecutors alleged Boeing had breached its 2021 settlement by failing to implement an effective compliance and ethics programme. In July 2024, Boeing agreed to plead guilty to a criminal fraud charge in a revised settlement carrying a potential $487.2-million fine. Lawyers for victims’ family members railed against the preliminary plea deal, equating it to a slap on the wrist for the corporate giant.

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