Boeing to plead guilty, pay $243.6M over 2018-19 crashes

Update: 

• Boeing does not need to face a criminal trial over a pair of deadly crashes in 2018 and 2019 after pleading guilty to conspiring to defraud safety regulators about the development of its 737 Max 8 aircrafts. 
• Boeing must pay the statutory maximum fine of $243.6 million and invest at least $455 million in its compliance and safety programs, per the plea deal.  
• Boeing must also impose an independent compliance monitor and allow the court to determine the amount of restitution for families. 
• The plea agreement will not provide immunity to Boeing for any other conduct, according to court documents. 

(Jan. 8, 2021)

Boeing will pay $2.5 billion to resolve a criminal complaint filed against it by the Department of Justice over claims it conspired to withhold safety information about its 737 Max jets, the government announced this week.

Under the terms of the deal, Boeing will pay a $243.6 million criminal penalty, will compensate its customers with $1.77 billion and will create a $500 million beneficiary fund for the families of the 346 passengers who were killed in crashes involving 737 Max jets in 2018 and 2019, CNN reported. Boeing also admitted to concealing vital safety information from the Federal Aviation Administration (FAA) about the 737 Max’s Maneuvering Characteristics Augmentation System.

As a result of the company withholding the data, key points about the way the system was known to Boeing to interact with its flight control system were omitted from the 737 Max operating and pilot training manuals, according to an Associated Press report.

In exchange for Boeing’s payments and admissions, the Justice Department agreed to defer for three years the charges of conspiracy to defraud the government. If Boeing complies with all the terms, the government will drop the charges completely at the end of the three years.

Lion Air Flight 610, which plunged into the Java Sea in Indonesia in October 2018 killing all 189 people on board, was the first 737 Max to crash. Less than six months later, another, flown by Ethiopian Airlines, crashed and killed all 157 people on board. The crashes led U.S. officials to ground all Boeing 737 Max jets in March 2019.

Boeing has been drawn into several class action and civil lawsuits regarding the 737 Max.

In July 2019, two pilots filed a class action lawsuit against the company in state court in Illinois, claiming they and more than 100 other pilots suffered wage loss due to the controversy, in addition to emotional and mental pain and suffering because of the safety risks.

In another case, a group of airline passengers filed a class action lawsuit against Boeing and Southwest in federal court in Texas, claiming they were intentionally misled about the safety of flying on 737 Max jets.

Many of the families of the victims of the fatal 737 Max crashes have also filed civil and class action lawsuits against the manufacturer.

Since the 737 Max jets were grounded, Boeing redesigned the problematic Maneuvering Characteristics Augmentation System and made it easier for pilots to disengage the automated features and override the controls manually.

The changes were made with FAA guidance, and in November 2020, the FAA gave its approval for the updated 737 Max planes to take flight again.

Would you feel safe flying aboard the Boeing 737 Max? Tell us what you think in the comment section below.

The U.S. government is represented by Cory E. Jacobs, Scott Armstrong and Michael T. O’Neill of the Department of Justice’s fraud section and Chad E. Meacham of the U.S. Attorney’s Office for the Northern District of Texas.

The 737 Max Lawsuit is U.S. v. The Boeing Co., Case No. 4:21-cr-00005, in the U.S. District Court for the Northern District of Texas.

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