Boeing faces fraud charge over MAX jet crashes

Boeing's chief safety officer pleaded not guilty Thursday on behalf of the aerospace giant to a criminal charge of conspiracy to commit fraud related to the crashes of two 737 MAX jets that killed 346 people.

The company officer, Mike Delaney, who made the plea in a federal court in Texas, said that Boeing was not guilty of concealing information about flight-control systems.

US District Court Judge Reed O'Connor of the Northern District of Texas last week ordered Boeing to be publicly arraigned on the felony charge, finding that the US Justice Department violated a victims' rights law by not including the families in a settlement between Boeing and the US government.

In a brief filed with the court, families of the crash victims requested that the judge require Boeing to cooperate with an independent corporate monitor, who will evaluate the company's compliance with the terms of a deferred prosecution agreement with the Justice Department in 2021.

"Only an independent monitor — the proverbial second set of eyes — can begin to restore confidence in Boeing and ensure safety of the community," the families wrote in their court filing.

The MAX jets first went into service in 2017. In October 2018, a MAX jet flown by Indonesian carrier Lion Air crashed into the Java Sea during a routine flight from Jakarta to Pangkal Pinang. A total of 189 passengers and crew died.

Less than six months later, in March 2019, a MAX jet flown by Ethiopian Airlines crashed a few minutes after takeoff, killing 149 passengers and crew, including 21 staff members of the United Nations.

An investigation showed that both accidents were triggered by design flaws, in particular the flight-control software MCAS. It was designed to assist pilots familiar with previous generations of the 737 and eliminate the need for costly extra training.

However, erroneous information from a single sensor caused the system to malfunction. In both crashes, it forced the jets into a nosedive that the pilots couldn't correct.

US investigations revealed that Boeing hadn't included information about the MCAS system in pilot manuals or training guidance and had deliberately sought to downplay the impact of the system in its communications with the US Federal Aviation Administration (FAA).

After the second crash, more than 380 MAX jets were grounded worldwide for 20 months, the longest such time in aviation history.

In 2021, the US government brought fraud charges against Boeing, and both parties eventually reached a settlement. Boeing agreed to pay $2.5 billion in damages and fines and to tighten safety compliances. If Boeing complied with the terms of the settlement, the federal government would drop fraud charges three years later.

The negotiation process was kept secret until the settlement was announced.

Many of the relatives of those killed in the crashes strongly objected.

"It was a sweetheart deal. It wasn't justice," Naoise Connolly Ryan of Ireland, whose husband Michael, 39, was killed in the Ethiopian crash, told NPR last year upon learning of the settlement. "And by giving this immunity, basically, the decision makers have not been held to account."

In the court brief, the relatives of the crash victims stated that Boeing "committed the deadliest corporate crime in US history", contending that the court has already determined that, "In sum, but for Boeing's criminal conspiracy to defraud the FAA, 346 people would not have lost their lives in the crashes."

During the arraignment on Thursday, Judge O'Connor allowed family members of some crash victims to be heard, ruling that federal law and criminal court rules "require this court to publicly arraign Boeing and permit the crime victims' representatives to be heard at or in advance of the proceeding".