The ruling creates uncertainty over the aerospace giant’s prosecution over the development of its best-selling plane.
ADVERTISEMENTA federal judge on Thursday rejected a deal that would have allowed Boeing to plead guilty to a felony conspiracy charge and pay a fine for misleading U.S. regulators about the 737 Max before the two planes crashed, killing 346 people.
U.S. District Judge Reed O’Conner in Texas said the diversity, inclusion and equity or DEU policies in government and at Boeing could cause race to be a factor in the selection of officials to oversee Boeing’s compliance with the agreement.
The ruling creates uncertainty over the aerospace giant’s prosecution over the development of its best-selling plane.
The judge gave Boeing and the Justice Department 30 days to tell him how they plan to move forward. They could negotiate a new plea deal, or prosecutors could go to trial against the company.
The Ministry of Justice said it was reviewing the verdict. Boeing had no immediate comment.
Paul Cassell, a lawyer for the families of passengers killed in the crashes, called the decision an important victory for the rights of crime victims.
“No longer can federal prosecutors and powerful defense attorneys create backroom deals and just expect judges to approve them,” Cassell said. “Judge O’Connor recognized that this was a cozy deal between the government and Boeing that failed to focus on the core concerns — holding Boeing accountable for its deadly crime and ensuring that nothing like it happens again in the future.”
The relatives have been fighting for a public trial for years
Many relatives of passengers who died in the crashes, which happened less than five months apart off the coast of Indonesia and Ethiopia in 2018 and 2019, have spent years demanding a public trial, prosecution of former company officials and more. a harsh financial penalty for Boeing.
The deal rejected by a judge was reached in July and would have allowed Boeing to plead guilty to defrauding regulators who approved pilot training requirements for the 737 Max nearly a decade ago. Prosecutors said they had no evidence to suggest Boeing’s deception played a role in the accidents.
In his ruling, O’Connor focused on a part of the agreement that called for an independent monitor to oversee Boeing’s steps to prevent fraud violations during the three years of probation.
O’Connor expressed particular concern that the agreement “requires the parties to consider race when hiring an independent monitor … ‘in line with the commitment of the (Justice) Department of Diversity and Inclusion.’
Selection must be based solely on competence
In Thursday’s decision, the judge wrote that he was “not convinced… The government will not choose a monitor regardless of race.”
He wrote: “In a case of this magnitude, it is in the best interest of justice that the public be assured that this selection of monitors is made solely on the basis of competence. The parties’ DEI efforts only serve to undermine this confidence in the government and Boeing’s ethics and anti-fraud efforts.”
Todd Haugh, an expert in business law and ethics at Indiana University, could not recall any previous corporate plea deals that had been rejected because of DEI. He said the bigger question is how the agreement took sentencing power away from the court.
“It’s a legitimate argument from which to reject a plea deal, but this particular judge really stood on the DEI issue,” Haugh said. “It comes loud and clear in the sequence.”
ADVERTISEMENTBoeing negotiated the plea deal only after the Justice Department found this year that Boeing violated a 2021 agreement that protected it from prosecution on the same fraud and conspiracy charges.
The case is just one of many challenges facing Boeing, which has lost more than $23 billion (22 billion euros) since 2019 and has fallen behind Airbus in sales and deliveries of new planes.
The company went through a strike by factory workers that shut down most of its aircraft production for seven weeks this fall and announced that it would lay off 10% of its workforce, about 17,000 people.
Its shares have fallen about 40% in less than a year.
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