Boeing marks legal victories in fraud cases following 737 MAX crashes
Boeing marked two legal victories last week in a slew of litigation related to two fatal 737 MAX crashes, allowing the manufacturer to avoid a costly payment to an airline flying the 737 MAX and paving the way for a deal with the Justice Department to drop a criminal fraud charge.
A jury in Seattle ruled Friday that Boeing did not fraudulently mislead LOT Polish Airlines, which in a 2021 lawsuit accused the manufacturer of providing "false representations and omissions" about its then-new 737 MAX plane in order to make a sale.
On the same day, the Fifth Circuit Court of Appeals in New Orleans upheld an agreement between Boeing and the Justice Department allowing the manufacturer to avoid a fraud charge alleging it misled safety regulators about a new software system on the MAX plane. An error with that system - the Maneuvering Characteristics Augmentation System, or MCAS - in both crashes repeatedly pushed the nose of the plane down, causing the pilots to lose control of the aircraft.
That's the second time the appeals court has upheld the deal, known as a nonprosecution agreement, following two requests from the families who lost loved ones in the fatal crashes. Those families argue that the deal does not hold Boeing accountable for the two crashes, which killed 346 people.
The families could now appeal the decision, taking the case to the U.S. Supreme Court. But it's unlikely they will do so, said Sanjiv Singh, an attorney representing 16 families who lost loved ones in the first crash in Indonesia in 2018.
The ruling "may very well be the final word on this," Singh said in a statement Tuesday. But, he continued, "there is a silver lining - namely that this fight has set an important precedent for future victims to aggressively challenge prosecution decisions early and steadfastly."
Boeing declined to comment on the appeals court ruling.
Allegations from an airline
In October 2018, a 737 MAX plane crashed off the coast of Indonesia, killing 189 people on board. In March 2019, a second 737 MAX plane crashed in Ethiopia, killing 157 people.
Aviation authorities grounded the plane after the second crash and the 737 MAX remained out of service for nearly two years.
In the aftermath of the fatal crashes, Boeing faced a slew of legal actions from airlines, the families of the victims and federal prosecutors. Seven years later, Boeing is still winding its way through that maze of litigation.
In Seattle, a jury trial began this month to determine whether Boeing was responsible for the losses incurred by LOT Polish Airlines while the MAX was grounded. LOT claimed it lost millions of dollars because of Boeing's "false representations and omissions" about the MAX.
Boeing had told airline customers like LOT that the 737 MAX was "essentially the same" as its earlier 737 Next Generation aircraft, leaving out key details about the new software system, LOT wrote in its lawsuit.
While the plane was grounded, LOT said it had to cancel flights, reimburse passengers, continue to pay idled employees and acquire other planes to fill in gaps in its network. The airline estimated it lost $250 million as a result.
Boeing argued that LOT had not purchased any planes from Boeing. It entered into lease agreements with aircraft lessors who had purchased the planes, including one agreement after the first fatal MAX crash.
After an eight-day trial, a jury ruled in favor of Boeing, finding LOT had not provided clear and convincing evidence to support its claims of fraudulent misrepresentation or concealment.
A spokesperson for Boeing said this week, "we are gratified by the jury's verdict in our favor."
LOT could not be reached for comment Tuesday. But a spokesperson for the airline told Reuters last week that the legal process may not yet be concluded, indicating the company may appeal the jury's decision.
Dropping the criminal charge
Just as LOT claimed Boeing had misled its customers about the new software system on the MAX, the Justice Department accused Boeing of misleading safety regulators about MCAS when it was certifying the new plane.
The Justice Department charged Boeing in 2021 with fraud and, on the same day, announced it had reached a deal to drop that charge if Boeing met certain conditions.
That deal fell apart in 2024 after a midair panel blowout on another Boeing MAX plane. Prosecutors determined Boeing had violated the terms of the original deal and the victims' families saw that decision as a chance for more accountability, potentially reopening the door for criminal prosecution.
Later that year, Boeing and the Justice Department entered into a new deal that would similarly allow the company to avoid criminal prosecution if it met certain conditions but Judge Reed O'Connor, a federal judge in Texas, struck down that agreement.
In November, O'Connor approved the parties' second attempt at a new deal; this time through a nonprosecution agreement. In his ruling, O'Connor warned the deal won't ensure the safety of the flying public but that case law did not support denying the motion just because the court disagrees with the government.
Judges in the Fifth Circuit Court of Appeals upheld that ruling in April, agreeing that they lacked the authority to review a district court's decision to grant a motion dismissing a criminal prosecution. The appeals court also found the Justice Department followed the Crime Victims' Rights Act as it considered the most recent deal with Boeing, dismissing another complaint from the families who lost loved ones in the crashes.
An earlier ruling in 2023 determined federal prosecutors had violated that statute by not conferring with victims' families as they discussed the original deferred prosecution agreement with Boeing.
The victims' families asked the Fifth Circuit court to again reconsider the deal. On Friday, the judges denied that request, paving the way for the nonprosecution agreement to move forward.
Copyright 2026 Tribune Content Agency. All Rights Reserved.