Boeing may avoid criminal charges over violations: report

Boeing CEO Dave Calhoun apologized to loved ones of passengers killed in crashes of Boeing jets during an appearance on Capitol Hill – Copyright AFP/File SAMUEL CORUM

The US Justice Department is considering a deal with Boeing that would see the aerospace giant avoid criminal prosecution but may appoint a federal supervisor to oversee company progress on safety improvements, The New York Times reported Friday.

People familiar with the discussions told the daily that the terms of the possible alternative settlement, known as a deferred prosecution agreement, or DPA, are still subject to change.

The Department of Justice (DOJ) is determining next steps after concluding in May that Boeing could be prosecuted for violating a criminal settlement following two fatal 737 MAX crashes in 2018 and 2019 which together claimed 346 lives.

But the Times, citing sources familiar with the discussions, reported that after substantial internal debate, Justice officials “appear to have concluded that prosecuting Boeing would be too legally risky.” 

Officials also reportedly believe that the appointment of a watchdog would be “a quicker, more efficient way” to ensure safety and quality control improvements are made, the newspaper said.

Last month, the DOJ told the judge in the case that it would give its decision no later than July 7.

The troubled planemaker had contested the department’s review conclusions in mid-June, but it has recognized the gravity of the safety crisis and CEO Dave Calhoun told members of Congress that Boeing is “taking action and making progress.”

In January 2021, Justice announced an initial DPA in which Boeing agreed to pay $2.5 billion to settle fraud charges over certification of the 737 MAX. 

But since early 2023, the manufacturer has experienced multiple production and quality control problems on its commercial aircraft, as well as mid-flight incidents including in January when a panel known as a door plug flew off an Alaska Airlines 737 Max 9.

The DOJ says Boeing’s violation of several provisions of the initial agreement, including measures requiring it to beef up its internal controls to detect and deter fraud, opened the company up to prosecution.

Crash victims’ families have called for the criminal prosecution of Boeing and its executives, and are seeking a nearly $25 billion fine.

A new DPA would allow the US government to resolve the Boeing violations without a trial. 

That could serve as a victory of sorts for Boeing, a company seen as critical to the US aviation industry as well as national security.

Such lawsuits in the past have forced companies into filing for bankruptcy, the Times reported, and a conviction could potentially prevent Boeing from receiving government contracts — a substantial portion of its business.

Boeing’s defense, space and security segment generated some $25 billion in 2023, or nearly a third of the company’s sales.