Boeing may avoid criminal charges with $1.1 billion.

Boeing Reaches an Agreement with the U.S. Justice Department: Pays $1.1 Billion to Avoid Prosecution

According to multiple U.S. media reports on World's largest foreign exchange trading platformJune 5, American aircraft manufacturing giant Boeing has reached a key agreement with the U.S. Department of Justice, potentially avoiding criminal prosecution related to two 737 MAX crashes. The agreement stipulates that Boeing will pay a total of $1.1 billion in settlement and continue to strengthen its safety and compliance reforms. If approved by a federal judge, Boeing will completely avoid charges of deceiving aviation regulators.

Two Crashes Resulted in 346 Fatalities

This legal dispute stems from two fatal air crashes in 2018 and 2019: a Boeing 737 MAX 8 operated by Indonesia's Lion Air crashed in October 2018, and another of the same model by Ethiopian Airlines crashed in March 2019, resulting in a total of 346 deaths. Investigations pointed out that Boeing used a software called the Maneuvering Characteristics Augmentation System (MCAS) in the 737 MAX's design, and erroneous activation of this system was deemed the primary cause of both crashes.

Boeing was accused of failing to adequately disclose critical information about the MCAS system to the Federal Aviation Administration (FAA) during aircraft certification. The Justice Department found former Boeing employees guilty of deceptive conduct.

Plea and Settlement Details: Commitment to Safety Reforms + Criminal Fines

According to a report from The Wall Street Journal, under the newly reached agreement, Boeing will undertake the following responsibilities:

• Pay a $487 million criminal fine (half of which was paid in 2021)
  
• Allocate $455 million to improve security, quality, and compliance systems
  
• Provide $444.5 million in compensation to the families of the crash victims
  

The agreement also stipulates that Boeing is not required to appear in the scheduled June trial, nor will it be formally convicted. This marks a possible softening in U.S. government enforcement against large corporations.

Background of the Settlement: Previous Deferred Prosecution Agreement Broken

It is noteworthy that as early as 2021, Boeing and the U.S. Department of Justice reached a three-year deferred prosecution agreement, whereby Boeing promised to improve its internal compliance system in exchange for a prosecution delay. However, in January 2024, just before the agreement was set to expire, a Boeing 737 MAX 9 operated by Alaska Airlines experienced a door detachment incident during flight, drawing widespread attention.

In May this year, the U.S. Department of Justice found Boeing in violation of the 2021 agreement terms, failing to effectively address potential non-compliance. Boeing then accepted a new plea deal, admitting fraudulent conduct in its disclosure of information on the MCAS system.

Strong Opposition from Victims' Lawyers

While the new agreement may relieve Boeing of criminal responsibility, it is not without controversy. According to The Wall Street Journal, several lawyers representing the victims’ families have expressed strong opposition to the agreement, arguing that it allows Boeing to evade appropriate legal consequences. They plan to formally appeal to the court to reassess whether the agreement is just.

One lawyer stated: "What we are witnessing is not judicial justice, but another corporate power triumph over the system."

Judicial Bargaining Continues

Boeing's crisis management is nearing its conclusion, but public and victims' family members remain skeptical as to whether the aviation giant is truly being held accountable. If a federal court refuses to approve the agreement, Boeing could still face more stringent judicial scrutiny. In the coming weeks, the court's ruling will be a critical juncture in the case's trajectory.

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