Boeing’s plea deal with U.S. prosecutors over two crashes of 737 Max jets was rejected by a federal judge, in a blow to the aircraft maker’s plan to move forward after the fatal crashes that led to criminal charges against the company.
U.S. District Court Judge Reed O’Connor supported family members of the crash victims, who asked the judge to reject the settlement. O’Connor said the agreement’s provisions for choosing an independent monitor inappropriately required consideration of the appointee’s race and minimized his role in the process. The judge asked both parties to meet and decide the next steps.
“These provisions are inappropriate and contrary to the public interest,” O’Connor said in his decision this Thursday (5).
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Earlier this year, Boeing agreed with the US Department of Justice (DOJ) to plead guilty to criminal conspiracy, pay a fine and install an independent corporate monitor. Additionally, the company would have to spend at least $455 million to strengthen its compliance and security programs.
O’Connor cited provisions related to the selection of the independent monitor as his motivation for rejecting the agreement, including language that directed prosecutors to consider diversity and inclusion when selecting the monitor. He also questioned the requirements that the monitor answer to the government rather than the court.
The judge’s rejection of the proposed settlement comes months after he made an unusual request for both parties to explain language in the settlement that directed the DOJ to consider diversity and inclusion when selecting an independent monitor. The government defended this practice as a reflection of a long-standing practice at the agency.
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Paul Cassell, one of the lawyers representing families of the crash victims, said O’Connor’s ruling is an important victory in his efforts to hold the company accountable.
“Judge O’Connor recognized that this was a collusive agreement between the government and Boeing that failed to focus on the overriding concerns — holding Boeing accountable for its deadly crime and ensuring that nothing similar happens again in the future,” Cassell said in a statement . “This decision should lead to a significant renegotiation of the plea agreement to reflect the deaths caused by Boeing and implement appropriate remedies for the future.”
A Boeing representative did not immediately comment on the decision.
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The company’s shares were down less than 1% at 12:33 p.m. in New York. The stock has lost about 39% this year, the biggest drop in the Dow Jones Industrial Average.
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