The U.S. Dept. of Justice confirmed it reached an out-of-court agreement with Boeing Corp., dropping its criminal fraud prosecution of the jet builder over the latter’s violation of a previous settlement and failure to ensure the safety and reliability of its 737 MAX aircraft. In a filing on May 23, DOJ reported Boeing will pay a $487.2 million criminal fine, which amount includes $243.6 million already paid in an earlier agreement would be credited.
The penalties also include $444.5 million to establish a new fund for crash victims, and $445 million to be invested in compliance, safety, and quality programs. In all, according to DOJ, Boeing’s outlay from the new agreement total more than $1.1 billion.
The Dept. of Justice filing with the court stated it “is the Government’s judgment that the Agreement is a fair and just resolution that serves the public interest.”
While agreeing to the penalties, Boeing avoids a criminal judgment and thereby remains available to compete for future government contracts.
Attorneys for some family members of the 346 people killed in two crashes of 737 MAX jets described the non-prosecution agreement as “unprecedented,” and others have stated their intention to litigate the settlement. Victims families have been prevented from prosecuting Boeing by a previous settlement between the DOJ and the company.
DOJ claimed that other relatives supported the government’s current efforts to resolve the case.
The two crashes happened in 2018 and 2019, leading to an extended grounding of 737 MAX jets and a pause in production.
In 2021, Boeing entered into a deferred prosecution agreement by which it pled guilty to criminal fraud conspiracy to mislead inspectors prior to the certification of that twin-engine aircraft, in 2017.
In that agreement Boeing agreed to pay more than $2.5 billion in fines and compensation to airlines, and to a fund for victims' families. It also agreed to address its compliance and safety standards, and it accepted oversight by an independent monitor.
The trial had been set to begin on June 23, on fraud charges related to the January 2024 incident when a side door plug failed in midflight aboard an Alaska Airlines 737 MAX 9. In July, Boeing pled guilty to a criminal fraud conspiracy charge and agreed to pay a fine of up to $487.2 million.
But federal court rejected the agreement in December 2024, on the grounds that federal and corporate diversity policies would discredit the selection of a new independent monitor of Boeing operations. Boeing later withdrew its guilty plea, leading to negotiations with DOJ about the new settlement.
