Boeing violated an agreement that allowed the company to avoid criminal prosecution after two deadly crashes involving its 737 Max planes, the Justice Department told a federal judge on Tuesday.
The Justice Department must now decide whether to bring charges against the plane maker amid growing scrutiny over the safety of its planes. Prosecutors will tell the court no later than July 7 how they plan to proceed, the Justice Department said.
In January 2021, Boeing reached a $2.5 billion settlement with the Justice Department to avoid prosecution on one count of fraud – misleading regulators who approved the 737 Max. Boeing accused two relatively low-level employees of deception.
The manufacturing giant is under new scrutiny after a door panel was torn off the 737 Max during a plane crash. Alaska Airlines flight in January. The company is under numerous investigationsand the FBI told passengers on the flight that they may be victims of crime.
Boeing did not immediately respond to a request for comment.
Glenn Leon, head of the Justice Department’s fraud division, said in a letter filed in federal court in Texas that Boeing did not make changes to prevent it from violating federal anti-fraud laws, a condition of the 2021 settlement.
The decision means Boeing could be held liable “for any federal criminal violation of which the United States has knowledge,” including fraud charges it had hoped to avoid with a $2.5 billion settlement, the Justice Department said.
However, it is unclear whether the government will pursue legal action against the manufacturing giant.
“The government is determining how it will proceed in this matter,” the Justice Department said in a statement. Prosecutors said they will meet with the families of the crash victims on May 31.
Paul Cassell, a lawyer representing the families of passengers killed in the Max plane crash in Ethiopia, called it “a positive first step and there is a long way to go for the families.”
“But we need to see further action from the Department of Justice to hold Boeing accountable, and we plan to use our May 31 meeting to explain in more detail what we believe will be a satisfactory remedy for Boeing’s ongoing criminal conduct.” Cassell said.
Investigations 2018 And 2019 The crashes pointed to a flight control system Boeing added to the Max without notifying pilots or airlines. Boeing downplayed the system and did not repair it until the second crash.
The Department of Justice investigated Boeing and settled the case in January 2021. After secret negotiations, the government agreed not to prosecute Boeing on charges of defrauding the United States by deceiving regulators who had approved the plane.
In exchange, the company paid $2.5 billion—a $243.6 million fine, a $500 million fund to compensate victims and nearly $1.8 billion to the airlines whose Max planes were grounded.
Boeing faces civil lawsuits congressional investigations and huge damage to its business after disasters in Indonesia and Ethiopia.