Boeing accused of violating 737 Max settlement with DOJ

Bloomberg

Families of 737 Max crash victims say Boeing Co. violated terms of a 2021 deferred-prosecution agreement with the US government when the company pleaded not guilty in Texas last week to a fraud charge tied to its role in hiding flight-control flaws from regulators.
In a motion filed in federal court, lawyers for the relatives claimed the aircraft maker’s plea to the criminal charge violates its deal with the US Department of Justice (DOJ), which prohibits Boeing from denying it misled the Federal Aviation Administration (FAA) about the 737 design flaws blamed for two crashes that killed 437 people.
“A criminal corporation who has refused to accept responsibility for its crime is more dangerous than one who has so accepted,” lawyers for the families told US District Judge Reed O’Connor in the court filing.
Boeing dismissed the allegation as “legally baseless and factually wrong,” according to a filing. The company said it has complied with the DOJ agreement for two years, and the not-guilty plea was a procedural necessity that would allow the case to move forward.
“A DPA provides a middle ground between a criminal conviction and a decision to forego criminal charges,” Boeing lawyers said in the filing. “While the DPA is in effect, requiring a defendant to plead guilty to the deferred charge would be contrary to the essence of the agreement, as it would prevent the government from dismissing the charge upon the defendant’s successful compliance with the agreement’s terms.”
Many families are seeking to overturn the deferred prosecution deal, saying they were never consulted before the agreement was reached. Boeing set aside $500 million to compensate the families, but the bulk of the $2.5 billion in fines it agreed to pay went to its airline customers. Family members also are urging O’Connor to appoint an independent monitor. Under its deal with DOJ, information about Boeing’s compliance is confidential.
A Boeing executive entered the not guilty plea on the company’s behalf in Fort Worth, Texas, on January 26. Boeing had avoided the formal arraignment under its earlier deal with DOJ, but O’Connor ordered the hearing after ruling in October that the relatives were legal crime victims who should have been consulted on the deal’s terms.
At the arraignment, family members of the victims were able to publicly address Boeing executives for the first time to explain how the crashes had
affected their lives.
Attorneys for Boeing and the DOJ also told the judge that an independent monitor was unnecessary because the company has been complying with the terms of the agreement.