Justice Dept. to prosecute Boeing in 737 Max crashes and finds it broke deal
Boeing violated an agreement that allowed it to avoid criminal charges following two fatal 737 Max crashes, U.S. Justice Department attorneys announced Tuesday as they revived a prosecution paused three years ago.
That prosecution has been on hold since 2021, when Boeing and federal prosecutors struck a contentious agreement that required the airplane manufacturer to meet certain conditions related to safety for three years. Had Boeing been found to have complied with the agreement, it would have avoided the possibility of a criminal conviction in the two Max crashes, which killed more than 300 people.
The deferred-prosecution agreement expired in January, days before a panel blew off an Alaska Airlines Boeing 737 Max, reigniting scrutiny of whether Boeing had made required changes to its culture, quality assurance and compliance programs following the two fatal crashes.
On Tuesday, the Justice Department determined Boeing had not complied with the terms of the agreement, opening the door for federal prosecutors to pursue criminal claims against the company.
Paul Cassell, an attorney who is representing many of the families who lost loved ones in the Max crashes, said the Justice Department’s decision was “a positive first step, and for the families, a long time coming.”
Boeing disputed the Justice Department’s findings following their release on Tuesday.
“We believe that we have honored the terms of that agreement, and look forward to the opportunity to respond to the Department on this issue,” a Boeing spokesperson said in a written statement. “As we do so, we will engage with the Department with the utmost transparency, as we have throughout the entire term of the agreement, including in response to their questions following the Alaska Airlines 1282 accident.”
After the fatal crashes in 2018 and 2019, federal prosecutors charged Boeing with one criminal count of fraud, alleging the company failed to disclose information to Federal Aviation Administration regulators about a new software system in the Max planes. An error with that system, the Maneuvering Characteristics Augmentation System, or MCAS, caused two planes to nosedive shortly after takeoff, killing 346 people in Indonesia and Ethiopia.
In the 2021 deferred prosecution agreement, Boeing agreed to pay $2.5 billion, as well as to review and update its policies around safety and compliance with federal regulators. It agreed to set up an ethics and compliance program meant to prevent any violations of U.S. fraud law and to provide consistent reports to the Justice Department about its progress.
On Tuesday, federal prosecutors said Boeing failed to “design, implement and enforce a compliance and ethics program to prevent and detect violations of the U.S. fraud laws throughout its operations,” according to a letter sent to the families who lost loved ones in the crashes and shared with The Seattle Times.
“For failing to fulfill completely the terms of and obligations under the DPA, Boeing is subject to prosecution by the United States for any federal criminal violation of which the United States has knowledge,” the letter continued.
Boeing has 30 days to respond to the Justice Department to “explain the nature and circumstances of such breach, as well as the actions (Boeing) has taken to address and remediate the situation.”
Boeing has until June 13 to respond.
Federal prosecutors have until July, six months after the deferred-prosecution agreement’s expiration, to determine if Boeing breached additional terms of the agreement, according to the letter.
The Justice Department can also continue to investigate “potential misconduct” by Boeing during that time.
The Justice Department is set to meet with the families of those who died in the crash on May 31 to discuss its decision and “potential next steps.”
Cassell, the attorney representing the victims’ families, said he would still like to see “further action” to hold Boeing accountable. He plans to use the upcoming meeting with federal prosecutors to “explain in more details what we believe would be a satisfactory remedy to Boeing’s ongoing criminal conduct.”