The United States Department of Justice is calling for Boeing to plead guilty on charges of criminal fraud in connection with two fatal 737 Max jetliner crashes, offering the company what an attorney for the crash victims described as “a sweetheart deal” in exchange for avoiding a trial. Meanwhile, the embattled plane maker is preparing to buy out struggling subsidiary Spirit AeroSystems for $4.7 billion, a move intended to improve manufacturing standards and quality control after a series of concerning safety failures.
In a Sunday meeting between Justice Department officials, family members of crash victims, and their attorneys, the DOJ determined that Boeing will have to pay $243.6 million on top of an identical sum paid in a 2021 deferred prosecution agreement, bringing the total payments from the case up to just under $500 million. Additionally, Boeing will be required to hire a corporate monitor to report on progress for the next three years.
The two plane crashes in question—Lion Air Flight 610 off Indonesia in 2018 and Ethiopian Airlines Flight 302 near Addis Ababa in 2019—claimed the lives of a combined 346 passengers. Under the 2021 agreement, Boeing agreed to pay out a total of $2.5 billion and vowed to improve its manufacturing process. At the time, two relatively low-level employees were held accountable for misleading the Federal Aviation Administration about the safety failures.
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In May of this year, following a series of system failures aboard Boeing jets—including the infamous door plug blowout on an Alaska Airlines flight over Oregon—the DOJ reopened the case and accused the aviation company of violating the original agreement.
Boeing has until the end of the week to decide whether to accept the plea agreement or take the risk of going to trial. According to Bloomberg, if the offer is accepted, “the fine the department will seek falls far short of a nearly $25 billion fine the families requested — with the possibility of suspending $14 billion to $22 billion of that if Boeing devotes those funds to an independent corporate monitor and improvements to its safety programs.”
A guilty plea could also have implications on Boeing’s ability to take on government contracts with the US Military, which make up a significant portion of the company’s revenue.
Paul Cassell, one of the attorneys representing the families of the victims of the crashes, called it a “sweetheart plea deal” that leaves Boeing with little more than a “slap on the wrist.”
“The deal will not acknowledge, in any way, that Boeing’s crime killed 346 people,” he said in an email. “The families will strenuously object to this plea deal.”
Robert Clifford, another attorney in the case, said the DOJ is “afraid to prosecute a company that they believe is too big to fail.”
“The families believe that they have been misled for months by a DOJ that went through the motions to meet with them and let the families speak up, but never having the [intention] to do anything other than punish Boeing while wearing kid gloves,” he told POLITICO after the Sunday meeting.
Related: Boeing CEO Defends Company’s Safety Record Before Senate, Apologizes to Plane Crash Victims
While company executives weigh their options, Boeing is also finalizing plans to reacquire subsidiary spinoff company Spirit AeroSystems for $4.7 billion. Spirit (unaffiliated with the airline by the same name) was spun off from Boeing in 2005 to manufacture the company’s fuselages. The company was responsible for the faulty door plug that sparked the renewed investigation into its former parent company.
On Monday, Boeing announced that it will pay $37.25 per share of Spirit.
“We believe this deal is in the best interest of the flying public, our airline customers, the employees of Spirit and Boeing, our shareholders and the country more broadly,” Boeing President and CEO Dave Calhoun said. “By reintegrating Spirit, we can fully align our commercial production systems, including our Safety and Quality Management Systems, and our workforce to the same priorities, incentives, and outcomes – centered on safety and quality.”
Connor Walcott is a staff writer for Valuetainment.com. Follow Connor on X and look for him on VT’s “The Unusual Suspects.”
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