A U.S. District Court judge’s recent ruling threatens to upend a deferred plea deal between federal prosecutors and the aerospace company Boeing. The 2021 deal was made to resolve criminal fraud charges stemming from the conduct of the Virginia-based company leading up to the two crashes of its 737 Max airplane in 2018 and 2019.
After the Department of Justice (DOJ) found sufficient evidence that Boeing was guilty of intentionally “impairing, obstructing, defeating and interfering” with U.S. government regulators’ ability to properly certify the airworthiness of the 737 Max, the company accepted a $2.5 billion settlement.
Of the settlement, $1.77 billion was mandated as payments to its customers, which included Dallas-based airlines Southwest and American, and $500 million was set aside for claims by the 346 victims’ families.
A criminal fine of $244 million was also assessed as part of the deal.
“The tragic crashes of Lion Air Flight 610 and Ethiopian Airlines Flight 302 exposed fraudulent and deceptive conduct by employees of one of the world’s leading commercial airplane manufacturers,” said acting Assistant Attorney General David P. Burns in a statement.
“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,” he concluded.
However, a North Texas U.S. district judge questioned the validity of this plea deal, as he ruled that the relatives of the people killed in these crashes were “crime victims under federal law.”
As such, these individuals were entitled to be aware of private negotiations between the government and Boeing to conclude the matter without criminal prosecution.
The DOF took issue with Judge Reed O’Connor’s assessment of the standing of the relatives under federal law, but their arguments did not persuade him in his ruling.
“The Court finds that the tragic loss of life that resulted from the two airplane crashes was a reasonably foreseeable consequence of Boeing’s conspiracy to defraud the United States,” O’Connor wrote in a scathing opinion. “In sum, but for Boeing’s criminal conspiracy to defraud the FAA, 346 people would not have lost their lives in the crashes.”
Surviving family members of the victim applauded O’Connor’s decision. Michael Stumo, who lost his daughter in one of the crashes, said in a statement that “Boeing captured the FAA to get the deadly MAX 8 certified. They captured the Department of Justice under Trump and Biden to deny crash families’ rights to participate in the criminal investigation and prosecution. They thought they could capture a federal judge in Fort Worth, Texas.”
“Families like mine are the true victims of Boeing’s criminal misconduct, and our views should have been considered before the government gave them a sweetheart deal,” scolded Naoise Connolly Ryan who lost her husband in the same crash that Stumo lost his daughter.
O’Connor echoed this sentiment when he wrote that the deferred plea deal was “negotiated in violation of the victim’s rights.”
“Next, the court must decide the question of remedy,” O’Connor concluded.
Boeing has not provided any comment on this latest ruling.