A federal judge on 5 December rejected Boeing’s guilty plea with the US Department of Justice (DOJ), a move that throws fresh uncertainty over the company’s 737 Max fraud case and could require Boeing negotiate a new deal.
In striking down the deal, Judge Reed O’Connor with US District Court for the Northern District of Texas cites concerns about an anti-fraud monitor and the DOJ’s commitment to choose monitor candidates based on “diversity and inclusion”.
The ruling comes as a victory for families of the 346 people killed by 737 Max crashes in 2018 and 2019. Attorneys for those families had challenged the plea deal, which they faulted for failing to recognise the deaths caused by the two accidents.
“The plea agreement requires the parties to consider race when hiring the independent monitor. Additionally, the plea agreement marginalises the court in the selection and monitoring of the independent monitor. These provisions are inappropriate and against the public interest,” O’Connor writes in the 5 December order.
Neither Boeing nor the DOJ responded to requests for comment.
“Boeing has admitted it is guilty of the crime, so it can’t go to trial on this case,” says Paul Cassell, an attorney representing victims’ families. “This effectively means this case now goes back to be renegotiated in terms of a plea deal.”
Any new plea deal must “take into account the victims’ families,” Cassell adds. “That’s the fundamental problem with the current plea. There is no recognition of the deaths.”
The DOJ in 2021 filed criminal charges against Boeing for defrauding the Federal Aviation Administration during the 737 Max’s certification, arguing that former employees failed to inform the FAA about critical aspects of the aircraft’s Maneuvering Characteristics Augmentation System. That flight-control system put two 737 Max 8s – a Lion Air jet in October 2018 and an Ethiopian Airlines jet in March 2019 – into dives from which the pilots could not recover.
Boeing initially sidestepped prosecution by signing a deferred prosecution agreement (DPA).
Notably, according to Cassell, that document included a “Statement of Facts” in which Boeing admitted to actions that “defrauded” the FAA. Because of Boeing’s admission, Cassell cannot foresee the case going to a trial, saying, “The trial would last five minutes”.
The DOJ in May said Boeing violated the DPA, a move following manufacturing defects that led a mid-cabin door plug to blow out of a 737 Max 9 in January.
With the DPA torn up, Boeing in July agreed to plead guilty. Its plea agreement would have subjected the company to a three-year probation period supervised by an “independent compliance monitor”. The DOJ would have picked monitor candidates “in keeping with the department’s commitment to diversity and inclusion”, the plea deal said.
Judge O’Connor’s 5 December order rejected the plea, taking issue with provisions related to the monitor.
Although the DOJ committed to picking monitors “solely based on merit and talent”, O’Connor says he is “skeptical”. He notes that the DOJ’s policies, and a 2021 executive order signed by president Joe Biden, “encourage consideration of race in hiring.”
“The court is not convinced… that the government will not choose a monitor without race-based considerations, and thus will not act in a non-discriminatory manner,” the judge writes.
He also rejects the plea because it would not require Boeing to comply with the monitor’s recommendations, and because it would not give the court oversight of the monitor programme.
“It is fair to say the government’s attempt to ensure compliance has failed,” O’Connor writes. “At this point, the public interest requires the court to step in.”
