Boeing Plea Deal Is Now in Texas Judge’s Hands After Hearing (1)

The fate of Boeing Co.’s plea deal with US prosecutors over the two catastrophic crashes of its 737 Max jets now lies with a federal judge, after lawyers for the besieged planemaker, the government and victims’ family members argued their cases before him.

“You’ve given me a lot to think about, and I’ll get a ruling out just as soon as I can,” US District Judge Reed O’Connor said at the end of a sometimes intense 2 1/2-hour hearing in Fort Worth, Texas, on Friday, with more than a dozen family members in attendance.

Afterward the families gathered outside and held up posters with photos of the victims, some wearing the images of their lost loved ones around their necks.

Family members of 737 Max victims gather outside the courthouse after the hearing in Fort Worth, Texas, on Friday.

Photographer: Madlin Mekelburg/Bloomberg

If O’Connor approves the pact, Boeing will plead guilty to criminal conspiracy but avoid a trial after the Justice Department determined that the company breached a 2021 deferred prosecution agreement over the crashes. The US concluded that Boeing had failed to meet a requirement of that accord to implement an effective compliance program to prevent and detect violations of US fraud laws.

Criminal Fines

Under the plea deal, Boeing would pay hundreds of millions of dollars in criminal fines and invest $455 million in safety improvements. Sean Tonolli, a lawyer for the Justice Department, said the penalties represent “the most the government could achieve if this case went to trial and Boeing was convicted.” For the case the government has charged and can prove, Tonolli said, “we submit that this plea agreement is fair and just, and we urge the court to accept it.”

Read More: Government Watchdog Says FAA Lacks Bite in Oversight of Boeing

Family members have fought for years to get harsher penalties following the crashes of Lion Air Flight 610 in October 2018 and Ethiopian Airlines Flight 302 in March 2019. Both crashes were linked to a flight control system that Boeing later admitted it deceived regulators about.

In court on Friday, family members’ attorney Paul Cassell outlined the reasons he said the court should reject the “rotten plea deal.” He said the accord “rests on an airbrushed set of facts and conceals the truth about the case” — that “346 people died because of the lies the Boeing Company told.”

Paul Cassell, a lawyer for some of the victims’ families, addresses the press after court.

Photographer: Madlin Mekelburg/Bloomberg

Mark Filip, a lawyer for Boeing, confirmed that the company will plead guilty and pay hundreds of millions of dollars in penalties and in spending to bolster its compliance and safety programs. He echoed the Justice Department in saying the proposal represents “the most serious provable case the department could bring.”

If the deal is approved by the court, Filip said, the company will have been under the Justice Department’s supervision for at least six years.

Judge’s Questions

Toward the end of the hearing, the judge quizzed the government and Boeing on the parameters of the plea accord, which limits the court’s discretion in determining specific penalties for the company. Cassell had criticized the US for presenting the judge with a deal that constrains the court in making changes.

Ben Hatch, a lawyer for Boeing, said the deal would provide clarity for the Defense Department and other government agencies that contract with the company.

“There’s a lot of value to many, many stakeholders in the certainty of a decision,” he said.

O’Connor also pressed the Justice Department’s Tonolli on why diversity, equity and inclusion criteria in the selection of a monitor over Boeing had been built into the plea agreement, at one point asking him to define diversity. Boeing attorney Hatch later said the company is confident the monitor decision will be made based on the candidates’ merits.

Cassell told the judge the government had already demonstrated that it cannot adequately hold Boeing accountable, since the planemaker violated the terms of its earlier deal, the 2021 deferred prosecution agreement. He asked O’Connor to reject the deal and send the case to trial, or give the parties a chance to revise the plea accord to address family members’ concerns.

“If there was ever a case where business as usual should not happen, it’s this one,” Cassell said.

The case is US v. Boeing, 21-cr-005, US District Court, Northern District of Texas (Fort Worth).

(Adds arguments, details and context in second and third sections.)

To contact the reporter on this story:
Madlin Mekelburg in Austin at mmekelburg@bloomberg.net

To contact the editors responsible for this story:
Sara Forden at sforden@bloomberg.net

Peter Jeffrey, Elizabeth Wasserman

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