United Airlines

Boeing to Pay Over $2.5 Billion to Settle Criminal Charge

BoeingBoeing has agreed to pay over $2.5 billion to settle a federal criminal charge stemming from two 737 MAX airplane crashes that left 346 people dead.

Design Flaws and Cover-Up Revealed

On October 29, 2018, a 737 MAX-8 jetliner operated by Lion Air in Indonesia crashed into the Java Sea shortly after takeoff from Jakarta’s airport. All 189 people on board were killed. On March 10, 2019, a 737 MAX-8 operated by Ethiopian Airlines crashed into a field after taking off from the Addis Ababa airport, killing 157 people.

Immediately following the second crash, the Boeing 737 MAX was grounded while the Federal Aviation Administration (FAA) investigated the cause of these incidents. Investigators uncovered a design flaw with the 737 MAX’s Maneuvering Characteristics Augmentation System (MCAS), a new flight control system that forced both planes into nosedives that the pilots could not reverse.

The investigation also faulted a cover-up of a known defect by Boeing and certification lapses by the FAA. On November 18, 2020, the FAA cleared the 737 MAX to return to service once necessary design modifications to the MCAS had been made.

Boeing Admits to Criminal Misconduct

On January 7, 2021, the Justice Department announced that it had reached a deferred prosecution agreement to resolve a charge against Boeing of criminal conspiracy to defraud the FAA. As part of the settlement, Boeing admits to criminal misconduct for misleading FAA regulators about the safety of its 737 MAX jetliner and waives its rights to a trial. However, the company is not pleading guilty to the charge. If the airplane manufacturer complies with the agreement, the government will drop the criminal charge in three years.

While the agreement protects Boeing from further prosecution, that protection does not extend to employees who may have engaged in criminal misconduct. Federal prosecutors claim that key Boeing employees deceived the regulators about the safety of the MCAS system, with the company itself placing the majority of the blame on two former technical pilots.

An investigation found that those employees misled the FAA about the significance of MCAS and did not mention the system in pilot training and flight deck manuals. As a result, most pilots did not even know MCAS existed prior to the first crash.

Under the terms of the deal, Boeing must pay a criminal penalty of $243.6 million. Another $1.77 billion will compensate airlines that purchased 737 MAX planes for revenue lost while they were grounded. An additional $500 million will go to a fund to help compensate the families of the passengers killed in the crashes.

“An Insult to the 346 Victims Who Died”

The settlement is considered a significant victory for Boeing, which is a large federal defense contractor. A criminal conviction would have prohibited the company from receiving future government contracts.

But for the families of the victims of these crashes, dozens of whom have ongoing lawsuits against the aviation giant, this settlement represents nothing less than an insult to the memory of those they lost.

“This is a Boeing protection agreement,” said Michael Stumo, whose 24-year-old daughter Samya Rose Stumo died in the Ethiopian Airlines crash.

“There’s nobody being held accountable personally,” he added, noting that the Justice Department “is letting the fraudsters off the hook.

“A couple of people could not have made this killer plane. It took large organizational conduct.”

A number of critics agree, including Rep. Peter DeFazio of Oregon, who chairs the House Transportation Committee. During an investigation into the incident, the Committee found widespread evidence of management and engineering failures at the company, along with grossly insufficient FAA oversight.

“This settlement amounts to a slap on the wrist and is an insult to the 346 victims who died as a result of corporate greed,” said DeFazio. “I hope the DOJ can explain its rationale for this weak settlement to the families, because from where I sit this attempt to change corporate behavior is pathetic and will do little to deter criminal behavior going forward.”

Committed to Fighting for Consumers

These tragic crashes are only the latest examples of one of the saddest facts of modern life. Far too often, companies place profits over safety, sometimes with devastating, even deadly results for consumers, all in the service of the bottom line.

But if you or a loved one have been the innocent victim of corporate greed, there is a way for you to hold those who harmed you responsible – by doing what so many others have done before you and turning to GWC Injury Lawyers LLC.

For more than four decades, GWC’s personal injury attorneys have fought tirelessly to make sure that even the largest international conglomerates are not above the law. With over $2 billion recovered in verdicts and settlements on behalf of our wrongfully injured clients, GWC has the experience, the determination, the resources, and the reputation of success necessary to get you and your family the justice you deserve.

Contact GWC today to schedule a free, no-obligation case evaluation with one of our Chicago personal injury lawyers. You may call our office at (312) 464-1234 or click here to chat with a representative at any time.