The US Justice Department is considering a deal with Boeing that would prevent criminal prosecution of the aerospace giant but could appoint a federal monitor to oversee the company’s progress on safety improvements, the New York Times reported on Friday.
People familiar with the discussions told the daily that the terms of the possible alternative settlement, known as a deferred prosecution agreement, or DPA, are still subject to change.
The Justice Department official involved in the case, Glenn Lyon, chief of the criminal division’s fraud section, said in an email to a civil party lawyer seen by AFP that the department had “not yet made a decision” about the path to take with regard to Boeing.
The DOJ concluded in May that Boeing could be prosecuted for violating a criminal agreement following two deadly 737 Max crashes in 2018 and 2019 that killed 346 people.
But the Times, citing sources familiar with the discussions, reported that after substantial internal debate, Justice officials “concluded that prosecuting Boeing would be too legally risky.”
Officials also believe appointing a monitor would be a “more prompt, efficient way” of ensuring improvements in safety and quality control, according to the newspaper.
Last month, the Justice Department told the judge in the case that he would hand down his decision before July 7.
The DOJ’s Leon sent an email to Paul Cassel, a lawyer for the families in the criminal case against Boeing, saying the Times’ reporting was “simply not accurate.”
Boeing did not respond to AFP requests for comment.
– No decision –
The embattled plane maker objected to the department’s findings in mid-June but has acknowledged the severity of the safety crisis and CEO Dave Calhoun told Congress that Boeing was “taking action and making progress.”
In January 2021, Justice announced a preliminary DPA, in which Boeing agreed to pay $2.5 billion to settle allegations of fraud over the certification of the 737 MAX.
But since the start of 2023, the manufacturer has faced a number of production and quality control problems on its commercial planes, as well as mid-flight incidents such as in January, when the door plug panel of an Alaska Airlines 737 Max 9 blew off.
The Justice Department says Boeing violated several provisions of the initial agreement, including measures to strengthen internal controls to detect and prevent fraud, which could lead to prosecution of the company.
The victims’ families have sought criminal charges against Boeing and its executives and a penalty of about $25 billion.
The new DPA will allow the US government to resolve Boeing’s violations without litigation.
This could be a win-win for Boeing, as the company is considered vital to the US aviation industry as well as national security.
Cassel, the families’ attorney, warned against settling to avoid a trial.
“We hope the Department is not using its claim that it has not yet made a ‘final decision’ as a ploy to gain additional time to sign a DPA agreement with Boeing,” Castle said in a statement.
“The first DPA deal failed. There’s no reason to think the second deal will be any better,” he said, adding that it was time “to move forward with a trial and get a guilty verdict against Boeing.”
Such lawsuits in the past have forced companies to file for bankruptcy, the Times reports, and a conviction could prevent Boeing from receiving government contracts.
Boeing’s defense, space and security segment is projected to generate $25 billion in 2023, about a third of the company’s sales.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
