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Boeing will make a “favorable” deal with the accident victims’ group, says 737 Max lawyer

Lindsey Wasson/Reuters

An aerial photo shows Boeing 737 MAX aircraft parked on the tarmac at Boeing’s factory in Renton, Washington, USA, on March 21, 2019.



CNN

The US Department of Justice is close to reaching an agreement with Boeing that would provide for control of the company and a fine in exchange for an admission of guilt. This is what lawyers for the families of the victims of two fatal crashes involving a 737 Max say. They strongly rejected the offer and described it as a “favor deal”.

The charges and possible settlement come after repeated safety failures at Boeing that have led to numerous federal investigations and sharp criticism from airlines, customers, lawmakers and regulators. A criminal charge against a large corporation such as Boeing is rare and would seriously affect the company’s already precarious financial situation and further damage its battered reputation.

However, the victims’ families expressed anger that Boeing could avoid trial because the government would thereby absolve the company of responsibility for the deaths of their loved ones.

“I can tell you that the families are very unhappy and angry with the Justice Department’s decisions and proposals,” Robert Clifford, lead attorney in the civil case against Boeing, said in a statement. “There is no accountability, no admission that Boeing’s admitted crime caused the 346 deaths, and the families will certainly appeal before Judge Reed O’Connor and ask him to reject the confession if Boeing accepts it.”

Clifford and Paul Cassell represent numerous family members of victims of the 2018 Lion Air crash and the 2019 Ethiopian Air crash involving Boeing 737 Max jets. They and some of the families they represent were notified of the deal by the Justice Department on Sunday.

The deal would include three years of probation, a “small” fine and a safety compliance monitor, Cassell told CNN. Other specific terms of the proposed offer were not immediately known, and CNN has not reviewed the proposal firsthand. Bloomberg first reported on the potential deal on Sunday.

Boeing declined to comment and the Justice Department did not respond to a request for comment.

Last month, the Justice Department told Boeing that the latest series of safety defects and production problems violated the terms of the 2021 agreement that helped the company avoid criminal prosecution for two fatal 737 Max crashes. A door stopper on an Alaska Airlines flight was blown off shortly after takeoff in January, and the ensuing investigation uncovered a series of quality defects and safety vulnerabilities.

The Justice Department subsequently said Boeing had been prosecuted but did not publicly announce its decision on whether to pursue the case. Last week, prosecutors asked the Justice Department to file charges.

Boeing has until the end of the week to decide whether to accept the deal or go to trial. The deadline for the Justice Department to file charges in the case is July 7.

Cassell said the families were upset that the Justice Department agreement precludes criminal prosecution of individual Boeing employees.

“The deal in no way acknowledges that Boeing’s crime cost the lives of 346 people. It also appears to be based on the assumption that Boeing did not harm any victim,” Cassell said in a statement.

While the Justice Department acknowledged the families’ strong desire to see the criminal case against Boeing go to trial, the families’ lawyers said the Justice Department fears it will not be able to prove the charges beyond a reasonable doubt – the higher standard of proof required for a conviction in a criminal trial.

More than a dozen whistleblowers have spoken out against Boeing in recent years, and the number has risen significantly since the doorstop incident in January. Last week, for example, a whistleblower from a contractor at Spirit Aerosystems, a Boeing manufacturing partner, said he had informed the company about large gaps in a key part of the 787 Dreamliner aircraft that posed a “catastrophic” danger to passengers.

As part of its plan to strengthen its safety program, Boeing said it was seeking to buy back Spirit to bring production of its planes entirely within the company. Boeing spun off Spirit in 2005. According to Reuters, Boeing and Spirit agreed to a deal on Sunday, but it was not publicly announced and Boeing declined to comment to CNN.

The Federal Aviation Administration (FAA) and the National Transportation Safety Board (NTSB) have launched several investigations into Boeing due to ongoing quality and safety deficiencies at the company.

The FAA has said a six-week review of Boeing factories in late winter uncovered numerous problems with the company’s manufacturing practices. A separate report found “gaps” in Boeing’s safety culture, including a disconnect between management and employees and employees’ fear of retaliation if they report safety concerns.

Boeing CEO Dave Calhoun apologized for Boeing’s recent safety failures in testimony before a Senate committee earlier this month, but denied allegations that the company had retaliated against those who brought safety flaws to light. Calhoun said Boeing was “far from perfect” and acknowledged that the company would not easily regain the public’s trust.

This story has been updated with additional context and developments.

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