The U.S. Justice Department is pushing Boeing to plead guilty to criminal fraud in connection with two deadly plane crashes involving its 737 Max jetliners, according to several people who heard federal prosecutors detail a proposed offer Sunday.
Boeing will have until the end of the week to accept or reject the offer, including the giant aerospace company agreeing to an independent monitor overseeing its compliance with anti-fraud laws.
The case stems from the department’s determination that Boeing violated an agreement to resolve a 2021 conspiracy charge to defraud the U.S. government. At the time, prosecutors alleged that Boeing misled regulators who approved the 737 Max and set pilot-training requirements for the plane. The company blamed two relatively low-level employees for the fraud.
The Justice Department told relatives of some of the 346 people who died in the 2018 and 2019 crashes about the plea offer during a video meeting. The family members, who want Boeing to face a criminal trial and pay a $24.8 billion fine, reacted angrily. One said prosecutors were gaslighting the families; another shouted at them for several minutes when given a chance to speak.
“We are upset. They should just prosecute,” said Massachusetts resident Nadia Milleron, whose 24-year-old daughter, Samya Stumo, died in the second of two 737 Max crashes. “This is just a reworking of letting Boeing off the hook.”
Prosecutors told the families that if Boeing rejects the plea offer, the Justice Department will seek a trial, meeting participants said. According to a person familiar with the situation, Justice Department officials presented the offer to Boeing during a meeting later Sunday.
The plea deal would prevent U.S. District Judge Reed O’Connor from increasing Boeing’s conviction sentence, and some families plan to ask the Texas judge to reject the deal if Boeing agrees to it.
“The underlying outrageous piece of this deal is that it doesn’t acknowledge that Boeing’s crime killed 346 people,” said Paul Cassell, one of the lawyers for victims’ families. “Boeing is not going to be held accountable for that, and they are not going to admit that that happened.”
Sanjiv Singh, a lawyer for 16 families who lost relatives in the October 2018 Lion Air crash off Indonesia, called the offer “extremely disappointing.”
Another lawyer representing families suing Boeing, Mark Lindquist, said he asked the head of the Justice Department’s fraud section, Glenn Leon, whether the department would add additional charges if Boeing turned down the plea deal. “He wouldn’t commit one way or another,” Lindquist said.
The meeting with crash victims’ families came weeks after prosecutors told O’Connor that the American aerospace giant breached the January 2021 deal that had protected Boeing from criminal prosecution in connection with the crashes, the second occurred in Ethiopia less than five months after the one in Indonesia.
Some legal experts believe a conviction could jeopardize Boeing’s status as a federal contractor. The company has extensive contracts with the Pentagon and NASA.
However, federal agencies can grant waivers to companies convicted of felonies to keep them eligible for government contracts. Lawyers for the crash victims’ families expect that Boeing would be given a waiver.
Boeing paid a $244 million fine as part of the 2021 settlement of the original charge. A person familiar with the matter who spoke anonymously about an ongoing case said the Justice Department will likely seek another penalty similar to the one in the new plea offer.
The deal would include a monitor to oversee Boeing, but the company would put forward three nominees and have the Justice Department pick one or ask Boeing for additional names. Participants said that the family members on the call particularly hated the provision.
Lindquist, a former prosecutor, said officials made clear during an earlier meeting that individuals — even CEOs — can be more sympathetic defendants than corporations. For example, the officials pointed to the 2022 acquittal on fraud charges of Boeing’s chief technical pilot for the Max.
It is unclear what impact a plea deal might have on other investigations into Boeing, including those following the blowout of a panel called a door plug from the side of a Boeing Max 9 during an Alaska Airlines flight in January.
