DOJ Tells Boeing It Will Be Charged With Fraud, Crash Victims Respond

According to a Bloomberg report today (June 30), “people familiar with the matter” have revealed that the U.S. Department of Justice (DOJ) has told Boeing it will be charged with fraud. That would leave the storied but shamed manufacturer with the unpleasant legal choice of pleading guilty or risking a jury trial. According to the Bloomberg sources, Boeing will have to pay a fine and be subject to a corporate monitor.

Meanwhile, a law firm representing families of passengers killed in two Boeing 737 MAX accidents provided AVweb with a statement characterizing its clients as having reacted “vehemently” to a two-hour meeting today with the DOJ and what they described as a “sweetheart deal” for Boeing.

The Sunday meeting came on the heels of a scathing sanction from the National Transportation Safety Board asserting that Boeing had “blatantly” violated terms of its participation agreement in the investigation into the in-flight separation of a door-plug in an Alaska Airlines 737 MAX earlier this year. Also, the DOJ ruled in May that Boeing had violated its deferred prosecution agreement from 2021, an agreement that would have enabled Boeing to avoid criminal prosecution if it would meet certain conditions. As part of the agreement, Boeing paid a $243 million fine and “admitted to deceiving the FAA about an important feature of the 737 MAX that impacted the flight control system,” according to the Bloomberg report.

Robert Clifford is Founder and Senior Partner of the Clifford Law Offices and lead counsel in litigation pending with the federal district court in Chicago. The firm represents family members of passengers who were killed in the crashes of Boeing 737 MAX aircraft. Regarding the DOJ actions involving Boeing, Clifford said in a statement, "...the families will most certainly object before Judge Reed O'Connor and ask that he reject the plea if Boeing accepts."

Boeing stock is down by some 33% this year and the company has warned that it is on track to record some $8 billion in cash expended in through the first half of 2024, largely attributed to a production slowdown initiated by the MAX crashes. The FAA has directed Boeing to cap production of the MAX line and mandated the company to submit comprehensive plans for addressing quality control issues.

The Bloomberg report also cited a “leadership shakeup” at Boeing, as current CEO David Calhoun prepares to step down later this year.