Boeing’s criminal plea deal should be accepted, US DOJ says

A plea deal struck with Boeing on a criminal charge related to software linked to two deadly 737 MAX crashes should be accepted, the US Justice Department said Wednesday, after some relatives of the 346 people killed in two crashes requested its rejection.

Last month, the planemaker finalized a deal to plead guilty to a felony fraud conspiracy charge and pay at least $243.6 million after violating a deferred prosecution agreement until 2021. The government said the manufacturer of aircraft knowingly made false statements to the Federal Aviation Administration regarding key software for the 737 MAX.

The Justice Department said in a court filing Wednesday that the settlement “is a strong and meaningful resolution that holds Boeing accountable and serves the public interest.”

Boeing is being asked to “accept the maximum statutory penalty of $487.2 million, on top of the billions the company has already paid” in connection with the 2021 deferred prosecution agreement and previous or ongoing civil suits, the Department said of Justice.

The department rejected claims by victims’ families that Boeing should face much higher fines after crashes in Indonesia in 2018 and Ethiopia in 2019 killed their relatives.

“The government cannot prove beyond a reasonable doubt that Boeing’s fraud directly and proximately caused the crash of the 737 MAX,” the Justice Department said, adding that it could not prove beyond a reasonable doubt that the loss or gain from the fraudulent activity of Boeing topped $243.6 million.

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Paul Cassell, an attorney for some of the families, said in a court filing last month that the fine of up to $487 million “is inadequate — or, at the very least, based on misleading accounting and inaccurate accounting “.

Boeing did not immediately respond to a request for comment.

The Justice Department has a separate ongoing criminal investigation into the January 5 Alaska Airlines ALK.N 737 MAX 9 emergency and noted that the plea agreement “does not provide immunity for any other wrongdoing, including the Alaska Airlines incident” . .

The plea agreement reached last month requires Boeing to spend $455 million to strengthen its compliance, safety and quality programs during three years of court-supervised probation that “will directly benefit the public by reducing the risk of reoccurrence of Boeing’s fraudulent misconduct”. the department said. Boeing will also face oversight from an independent monitor, it said.

U.S. District Judge Reed O’Connor may also decide to require Boeing to pay restitution, which could include compensation for victims’ families beyond what many have already received in settlements or as part of $500 million for relatives under the 2021 agreement.

(Reporting by David Shepardson and Jasper Ward; Editing by Eric Beech and Jamie Freed)