Boeing pleaded not guilty to a fraud charge before a federal judge in a Texas courtroom today — as loved ones of the victims of the deadly 737 MAX crashes looked on.
The aerospace giant came to an agreement with the Department of Justice two years ago to avoid prosecution by paying $2.5 billion in fines to the families and to the airlines that had to ground their 737 MAXs.
However, US District Court Judge Reed O’Connor has now ordered Boeing to be arranged after the victims’ families filed a brief stating that it was unfair for the deferred prosecution to be reached without their knowledge or participation.
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The two 737 MAX crashes — an October 2018 Lion Air crash in Indonesia and a March 2019 Ethiopian Airlines crash in Ethiopia —occurred within half a year of each other and killed a total of 346 people. In both cases, investigators found that a Boeing flight control system was part of the cause.
Seattle personal injury attorney Charles Herrmann has represented 50 of the victims’ families in lawsuits against Boeing, and was in the Fort Worth courtroom supporting his clients during the arraignment.
“Judge O’Connor recently ruled that the deferred prosecution agreement with Boeing violated the victims’ rights because they weren’t given input into it,” he said.
He said that some of the loved ones spoke in the courtroom about how hurt they were by the way in which the agreement between Boeing and the Department of Justice was reached.
“This is without precedent that you have a fraud by a corporation that it perpetrated against the government which results in the death of 346 people,” Herrmann said.
In a statement, Boeing expressed sorrow for the families of the victims.
“We are deeply sorry to all who lost loved ones on Lion Air Flight 610 and Ethiopian Flight 302, and greatly respect those who expressed their views at the hearing today,” the company stated. “We will never forget the lives lost in these accidents and their memory drives us every day to uphold our responsibility to all who depend on the safety of our products.”
Federal investigations have found that Boeing intentionally hid details about its Maneuvering Characteristics Augmentation System from the FAA, which pushes the nose of a plane down to avoid a stall.
“They didn’t inform the FAA when they made that change — in fact, they filed false reports and hid it from the FAA,” Herrmann said.
Herrmann explained that the motivation for keeping quiet about the system known as MCAS was financial — alerting airlines to this change would have required extensive pilot training, which would have been costly for Boeing.
“In the sale of 391 of these MAX planes to Southwest, it was written into the contract that if extensive training was required, Boeing would have to pay a penalty of a $1 million,” Herrmann said. “So they were facing, conceivably, $391 million that they would’ve had to pay to properly train the pilots.”
In its statement, Boeing said that it made safety improvements to the MAX during the nearly two years that the planes were grounded.
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“We have made broad and deep changes across our company, and made changes to the design of the 737 MAX to ensure that accidents like these never happen again,” Boeing said. “We also are committed to continuing to comply scrupulously with all of our obligations under the agreement we entered into with the Justice Department two years ago.”
If the Department of Justice throws out the previous settlement and Boeing is found guilty, Herrmann believes the company will be hit with sanctions, fines, and stricter oversight.
“I think you’re talking, first of all, full disclosure, number-one — so everyone can see exactly what Boeing did or did not do,” Herrmann said. “Secondly, that they do pay fines and additional compensation. And thirdly, that there’s some sort of monitoring and conditions to make sure that Boeing goes forward with safe manufacturing practices.”
One test pilot has been criminally prosecuted because of the MAX crashes, but was found not guilty.
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