Families of Boeing 737 Max crash victims tell judge to ditch $940 million criminal plea deal

FORT WORTH, Texas (CN) — Relatives of the 346 people killed in two Boeing 737 Max crashes implored a Texas federal judge Friday to reject a $940 million criminal plea agreement reached with federal prosecutors, calling it a “rotten deal” for the families.

Attorney Paul Cassell told U.S. District Judge Reed O’Connor that the families he represents believe the Justice Department is going too easy on the Virginia-based aerospace manufacturer.

“This was the deadliest corporate crime in history,” said Cassell, a University of Utah law professor, during the pre-sentencing hearing. “They want you to sentence as if there were not 346 deaths.”

Cassell accused federal prosecutors of “swallowing the gun” by not providing all relevant facts before reaching the settlement. He accused prosecutors of telling the families during a Zoom call that the terms of the deal were not negotiable before allegedly going behind closed doors to negotiate further with Boeing.

He also criticized federal prosecutors for pinning the blame only on mid-level managers at Boeing.

“This is a long-running corporate conspiracy,” Cassell said. “It ran from the pilots up to the C-suite to the CEO.”

Boeing pleaded guilty three months ago to one count of conspiracy to defraud the Federal Aviation Administration Evaluation Group. It agreed to pay a $243.6 million criminal fine in addition to an earlier $243.6 million in fines paid under a deferred prosecution agreement reached with the Trump administration in 2021.

Boeing escaped a criminal conviction under the first agreement. But the deal was rescinded five months ago, shortly after a door plug on a 737 Max 9 blew out mid-flight on Alaska Airlines Flight 1282.

In July, Boeing further agreed to serve three years of probation and to pay $455 million toward “investment in compliance, quality and safety.”

Boeing admits it “breached the terms of the deferred prosecution agreement by failing to sufficiently design, implement, and enforce a compliance and ethics program to prevent and detect violations of U.S. fraud laws throughout its operations,” according to the five-page plea agreement.

Two pilots were accused of deceiving the Federal Aviation Administration in 2017 about software designed to push down the nose of the 737 Max to prevent stalling. Boeing reportedly added the software due to the craft’s larger, more fuel-efficient LEAP1-B engines requiring higher mounting points on the wing, which changed the center of gravity of the plane compared to earlier models.

The FAA grounded the 737 Max on March 13, 2019, after the deadly crashes of Lion Air Flight 610 five months earlier and Ethiopian Airlines Flight 302 three days earlier. The agency allowed the 737 Max to return to service on Nov. 18, 2020.

Boeing attorney Mark Filip, with Kirkland Ellis in Chicago, apologized to the victims’ families in the courtroom as he urged the judge to approve the settlement.

“Boeing profoundly regrets your unspeakable losses,” he said. “I want to again apologize to you.”

He said Boeing’s employees “carry the weigh of these losses every day” and will seek to do more as the company accepts criminal and civil liability. He said Boeing has paid billions in criminal fines to other federal agencies.

“Over 90% of cases settled to pay full compensatory damages,” Filip said.

Cassell pushed Judge O’Connor to appoint his own independent compliance monitor and not rubber-stamp the one selected by Boeing and the Justice Department.

The attorney said Boeing further violated its deferred prosecution agreement by failing to comply with previous investigation into the crashes for six months. “Boeing [and the Justice Department] had three years to get the house in order and failed,” he said.

Sean Tonolli, senior deputy chief of the Justice Department’s Fraud Section, disagreed with the families’ assessment of the government’s ability to effectively monitor Boeing if the settlement is approved. He said the “these are procedures that work,” adding that monitorship and compliance are the only issues at stake if the settlement is rejected.

Tonolli emphasized that restitution will be paid to the relatives under the deal and that pending objections by airlines put that in peril.

Adrian Vuckovich, with Collins Bargione in Chicago, told the judge the families he represents believe the government and Boeing should have no role in appointing the monitor because “they are in an ongoing business relationship.” Boeing is one of the primary suppliers of military aircraft and spacecraft to the federal government.

“When left to their own devices, they fail,” Vuckovich said. “It has to be someone qualified with technical expertise.”

Vuckovich disagreed with the Justice Department’s argument that the objections to the settlement are infringing on prosecutorial discretion, stating the families are simply taking a position on the plea deal.

The courtroom gallery was packed with approximately 60 people. O’Connor delayed the hearing by two weeks to allow as many relatives as possible to attend the hearing.

Federal prosecutors have so far only taken one criminal case regarding the 737 Max to trial, accusing former Boeing chief test pilot Mark Forkner of lying to the FAA and airlines about the craft’s software. A Fort Worth federal jury acquitted Forkner of four counts of wire fraud in 2022 after deliberating for one hour. He faced up to 80 years in federal prison.

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