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

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

Ethiopian Federal policemen stand at the scene of the Ethiopian Airlines Flight ET 302 plane ******, near the town of Bishoftu, southeast of Addis Ababa, Ethiopia March 11, 2019.

Tiksa Negeri | Reuters

The U.S. Justice Department said Friday that it has reached a deal with Boeing to avoid prosecution over two crashes of the plane maker’s 737 Max that killed 346 people.

The so-called non-prosecution agreement would allow Boeing, a major military contractor and top U.S. exporter, to avoid being labeled a felon. The decision means Boeing won’t face trial as scheduled next month.

The Justice Department said it reached a deal with Boeing in a letter to victims family members, which was seen bc CNBC. Boeing and the DOJ didn’t immediately comment.

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

But families of the ****** victims have criticized previous agreements as sweetheart deals for Boeing, called for more accountability from the company 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.

The aerospace giant reached a settlement in 2021 in the

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of the first Trump administration that shielded it from prosecution for three years.

Under that deal, Boeing agreed to pay a $2.51 billion fine to avoid prosecution. That included a $243.6 million criminal penalty, a $500 million fund for ****** victims family members and $1.77 billion for its airline customers. 

Rescuers work at the scene of an Ethiopian Airlines flight ****** near Bishoftu, or Debre Zeit, south of Addis Ababa, Ethiopia, Monday, March 11, 2019.

Mulugeta Ayene | Reuters

That 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 Jan. 5, 2024, after the aircraft left Boeing’s factory without key bolts installed.

But last year, U.S. prosecutors said Boeing violated the 2021 settlement, accusing the company of failing to set up and enforce a compliance and ethics program to detect violations of U.S. fraud laws.

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

Under that 2024 deal, Boeing would have faced a fine of up to $487.2 million, though the Justice Department recommended that the court credit Boeing with half that amount it paid under the previous agreement.

Family members hold photographs of Boeing 737 MAX ****** victims lost in two deadly 737 MAX crashes that killed 346 people as Boeing CEO Dennis Muilenburg testifies before a Senate Commerce, Science and Transportation Committee hearing on “aviation safety” and the grounded 737 MAX on Capitol Hill in Washington, October 29, 2019.

Sarah Silbiger | Reuters

The U.S. had accused Boeing of conspiracy to defraud the government by misleading regulators about its inclusion of a flight-control system on the Max that was later implicated in the two 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,” then-acting Assistant Attorney General David Burns of the Justice Department’s Criminal Division said at the time of the 2021 deferred prosecution agreement.

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

Lawyers for victims’ family members railed against last year’s preliminary plea deal, equating it to a slap on the wrist for the corporate giant, which recently won a contract worth billions to built the next-generation fighter jet.

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