Boeing said on Monday it had reached a settlement with the US Justice Department over two deadly 737 Max crashes, with court documents indicating the aviation giant will likely plead guilty to fraud.
The settlement comes after prosecutors concluded that Boeing violated an earlier agreement to deal with disasters that killed 346 people in Ethiopia and Indonesia more than five years ago.
“We have reached an agreement in principle with the Department of Justice on the terms of a settlement, subject to the approval and conferral of specific conditions,” Boeing said in a statement to AFP.
Court documents filed in Texas on Sunday said the company had agreed to plead guilty to “conspiracy to defraud the United States” during the certification of the Max planes.
Under the settlement, Boeing will be fined and required to invest a minimum of $455 million in “compliance and safety programs”, while compensation for the families will be determined by the court.
Boeing’s latest legal dilemma arose from the DoJ’s decision in mid-May that the company had ignored a 2021 deferred prosecution agreement (DPA) by not meeting requirements to improve its compliance and ethics program following the MAX crashes.
Families of victims of the Max plane crash are “deeply disappointed” by the settlement reached between Boeing and the Justice Department, said a Clifford Law attorney representing them.
“Over the past five years, overwhelming evidence has been presented that demonstrates there has been no change in Boeing’s culture of prioritizing profits over safety. This plea agreement only furthers that skewed corporate objective,” senior partner Robert A. Clifford said in a statement.
The families will ask the court to reject the plea agreement at an upcoming hearing, according to an opposition filed by their legal team.
The original DPA was announced in January 2021, alleging that Boeing had intentionally defrauded the Federal Aviation Administration during certification of the MAX.
Under the agreement, Boeing was to pay $2.5 billion in fines and restitution in exchange for immunity from criminal prosecution.
The three-year probationary period was set to end this year. But in January, Boeing faced another crisis when a 737 Max flown by Alaska Airlines had to make an emergency landing after a fuselage panel ruptured mid-flight.
In a May 14 letter to a U.S. court, Justice Department officials said Boeing violated its obligations under the DPA by “failing to design, implement and enforce a compliance and ethics program to prevent and detect violations of U.S. fraud laws in the course of its operations.”
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