Boeing will have a felony conviction if it follows through on an agreement with prosecutors to plead guilty to fraud in connection with approval of its 737 Max before two of the planes crashed, killing 346 people off the coast of Indonesia and in Ethiopia.
The American aerospace giant has apparently made the calculation that admitting to a crime is better than fighting the charge and enduring a long public trial.
The plea deal is not yet a sure thing, however.
Relatives of some of the passengers who died have indicated they will ask a federal judge in Texas to throw out the agreement, which they say is too lenient considering the lives that were lost. They want a trial, they want a huge fine, and they want Boeing leaders to face charges.
In a legal filing late Sunday — minutes before a midnight deadline — the Justice Department disclosed the agreement and said the fraud charge was “the most serious readily provable offense” it could bring against Boeing. Prosecutors say Boeing will pay another $243.6 million fine, matching a fine it paid in 2021 for the same crime.
The Justice Department says a conviction for fraud will hold Boeing accountable for “misstatements” it made to regulators who certified the 737 Max in 2017. The crashes took place less than five months apart in 2018 and 2019.
The company still faces investigations into the blowout of a panel from an Alaska Airlines Max in January, increased oversight by the Federal Aviation Administration, and accusations from current and former employees about poor workmanship and retaliation against whistleblowers.
Here is what to know about the case and what could be next for Boeing:
Boeing agreed to plead guilty to conspiracy to defraud the United States — in this case, deceiving the Federal Aviation Administration.
The Justice Department first filed that charge in 2021, but it agreed not to prosecute Boeing if it paid a fine and successfully completed three years of a form of corporate probation under what is called a deferred-prosecution agreement.
In May, however, the department determined that Boeing had not lived up to that agreement, setting in motion the events that led to Sunday’s plea deal.
The plea deal could help Boeing resolve a black mark on its reputation — the felony charge that the American aerospace giant deceived regulators who approved the airplane and the pilot-training requirements to fly it safely.
Boeing will pay another fine, bringing the total to $487.2 million, which the Justice Department says is the legal maximum for the fraud charge. The deal also requires the company to invest at least $455 million to improve safety. It will be on court-supervised probation for three years, and the Justice Department will name an independent monitor to oversee Boeing’s compliance with terms of the plea agreement.
Boeing’s board of directors will be required to meet with families of the victims.
Yes. There will be a hearing before U.S. District Judge Reed O’Connor in Fort Worth, Texas. He can accept the agreement, in which case he can’t change terms of Boeing’s punishment. Or he can reject it, which would likely lead to new negotiations between Boeing and prosecutors. A date for the hearing has not been set.
Deals in which the defendant and the federal government agree on a sentence are controversial in legal circles.
“Judges don’t like them. They feel that it usurps their authority,” said Deborah Curtis, a former Justice Department lawyer.
O’Connor, however, has shown deference before to the Justice Department’s power. When families of the crash victims tried to undo the 2021 deferred-prosecution agreement, the judge criticized what he called “Boeing’s egregious criminal conduct” but ruled that he had no authority to overturn the settlement.
Many are outraged by the agreement.
Zipporah Kuria, a 28-year-old London woman whose father, Joseph, was on the Ethiopian Airlines Max that crashed in March 2019, wanted a trial that she thinks would have unearthed new details about what led up to the crashes.
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