The Volokh Conspiracy
Mostly law professors | Sometimes contrarian | Often libertarian | Always independent
Important Questions for Boeing's CEO at Tomorrow's Senate Commerce Committee Hearing
Boeing CEO Kelly Ortberg should explain whether Boeing continues to plan to plead guilty to conspiring to defraud the FAA, or whether it will attempt to shirk its responsibility for the deadliest corporate crime in U.S. history.
Tomorrow, Senator Ted Cruz has scheduled a hearing entitled "Safety First: Restoring Boeing's Status as a Great American Manufacturer." Boeing CEO Kelly Ortberg is scheduled to testify about steps Boeing has taken to address safety issues that have arisen in recent years. Foremost among these issues is Boeing's conspiracy to defraud the FAA about the safety of its 737 MAX aircraft—a proven criminal conspiracy which directly and proximately led to two crashes of Boeing 737 MAX aircraft.
Like Senator Cruz, I truly hope that Boeing will, in its next chapter, be restored to its status as a great American manufacturer. But moving onto that next chapter is not possible until Boeing concludes its current chapter. Over the next few weeks, Boeing's leadership will decide how it will conclude the criminal case that has been pending against it for more than four years. Boeing's decision will shed considerable light on whether it truly committed to again becoming a great and responsible manufacturer.
As is well known, Boeing defrauded the FAA about the safety of its 737 MAX aircraft. In January 2021, Boeing entered into a deferred prosecution agreement (DPA) with the Justice Department, in which it admitted the crime. In exchange for the Government's agreement to defer prosecution, Boeing promised to address safety issues connected with the 737 MAX and, more broadly, its internal safety procedures.
I am representing (on a pro bono basis) some of the two crashes victims' family members. As I have blogged about before (see here, here, here, and here), the DPA was concluded in violation of the Crime Victims' Rights Act because the parties (the Justice Department and Boeing) kept that agreement secret from the 346 families who lost loved ones in the two crashes. Indeed, Senator Cruz wrote a powerful amicus brief supporting the families' position that they represented "crime victims" of Boeing's conspiracy. Senator Cruz explained that "Boeing engaged in criminal conduct that defrauded government regulators and left hundreds of people dead in preventable plane crashes.… This is not a mine-run fraud case where some low-level employee lied or committed a technical violation; it is a long-running conspiracy that directly led to some of the worst air travel disasters of the 21st century."
During the DPA's three-year term, Boeing failed to deliver on its promises to improve safety processes. In May, 2024, Boeing's failures led the Justice Department to declare that Boeing had breached its DPA obligations, setting up the issue of how to resolve the pending conspiracy charge. Last summer, Boeing agreed to plead guilty. But after the victims' families objected to the proposed "sweetheart" deal, Judge O'Connor rejected the proposed plea agreement for various reasons. Judge O'Connor then directed the parties to explain how they intended to proceed. Whether Boeing intends to plead guilty to the charge, go to trial, or try to do something else is currently pending.
During the last week, news reports have suggested that Boeing is now lobbying the Justice Department to cut some kind of new deal. According to these reports, Boeing wants an even sweeter deal in which it would not have to even acknowledge that it committed a crime, much less that its senior leadership engaged in a "long-running conspiracy that directly led to some of the worst air travel disasters of the 21st century." If these reports are true, Boeing is now seeking to shirk its responsibility for its past crime and simply jump to the next chapter in its corporate history.
Following these reports that Boeing was waffling on its previously expressed plan of pleading guilty, the judge handling the case (Judge Reed O'Connor in the Northern District of Texas) sua sponte set a trial date in June to finally resolve the case. Boeing is, of course, free to pursue its own interests as it sees them. But it is important to highlight that Boeing seems to want to have it both ways—one the one hand, appearing to be contrite about causing the crashes, while seeking to skate through the criminal justice system without admitting its guilt on the other.
For example, last summer, at another Senate hearing, outgoing Boeing CEO Dave Calhoun turned to apologize directly to the family members in the gallery who lost loved ones in Boeing crashes and said:
I would like to speak directly to those who lost loved ones on Lion Air Flight 610 and Ethiopian Airlines Flight 302. I want to personally apologize, on behalf of everyone at Boeing. We are deeply sorry for your losses. Nothing is more important than the safety of the people who step on board our airplanes. Every day, we seek to honor the memory of those lost through a steadfast commitment to safety and quality.
This made for good theater—while the cameras were rolling during Calhoun's testimony. But Calhoun's statement appears to have been carefully crafted to avoid acknowledging the full scope of Boeing's crime. A few lowlights are worth recounting, which are all clearly established in an earlier congressional report, internal Boeing emails, an SEC investigation, and Boeing's own admissions.
Boeing's conspiracy involved its Chief Test pilot and others who deceived the FAA into believing that there was no need to include information about a new, powerful software system on the 737 MAX (called MCAS) because MCAS could only activate during
rare situations—not during routine flight operations. By concealing MCAS's expanded operational scope from the FAA, Boeing defrauded the FAA and obtained a low-level (less rigorous level) of training for pilots transitioning to fly to the new 737 MAX aircraft. And pilots flying the 737 MAX aircraft were not given relevant information about the scope of MCAS and how to respond to improper MCAS activation—which could produce a crash.
Tragically, this was no mere theoretical possibility. On October 29, 2018, Lion Air Flight 610, a Boeing 737 MAX, crashed shortly after takeoff into the Java Sea near Indonesia. All 189 passengers and crew on board died due to improper MCAS activation, which the pilots did not respond to because they had not been trained in proper responses. After the Lion Air crash, Boeing investigators quickly identified MCAS as the cause. But rather than be forthcoming about what had happened, Boeing attempted to focus attention on the foreign pilots as the accident's central cause. However, they did not disclose that one of Boeing's own test pilots in late 2012 had failed to recover from uncommanded MCAS activation in a flight simulator. This was a fundamentally important event that Boeing chose not to share with the FAA or its MAX customers.
While Boeing knew the deadly truth about MCAS, it concealed that truth from pilots and the public. For example, on November 13, 2018, then-Boeing CEO Dennis Muilenburg appeared on the FOX Business Network and claimed that Boeing had been "very transparent on providing information," the MCAS procedure was already "part of the training manual," and the "737 MAX is a very safe airplane." These were false statements—all designed to keep Boeing's stock price from declining further and to buy time for Boeing's engineers to continue working behind he scenes to fix the MCAS problem. In other press releases, Boeing failed to mention that it had identified an ongoing "airplane safety issue" associated with MCAS and that it feverously working on a planned software redesign. Indeed, Boeing did not mention MCAS at all. Instead, at the specific direction of CEO Muilenburg, Boeing lied to the world, saying that "[a]s our customers and their passengers continue to fly the 737 MAX to hundreds of destinations around the world every day, they have our assurance that the 737 MAX is as safe as any airplane that has ever flown the skies."
A stunning example of how Boeing hid the truth is how it refused to answer pointed questions from Ethiopian Airlines pilots (information that the capable legal team I am working with pried out of Boeing through civil discovery). Shockingly, on December 1, 2018, the Ethiopian Airlines Head of Flight Operations emailed Boeing with three questions from the group's pilots about its directions to pilots in the event of uncommanded and erroneous MCAS activation. Senior Boeing officials declined to answer two out of the three questions. If Boeing had responded to each of the questions instead of refusing to answer them, the pilots' ability to respond to the situation it described would have been full explained, likely preventing the crash of flight ET 302 on March 10, 2019 … and saving 157 lives. But answering the questions would have revealed the truth about the serious MCAS problem—imperiling Boeing's stock price.
At the Senate Commerce Committee hearing tomorrow, I hope that the Senators will explore these questions. The key issue now is whether is Boeing still apologizing and willing to admit it criminally caused 346 deaths? If so, how does it explain recent news reports that its lawyers are working behind the scenes to cut another deal that would avoid any accountability for these losses? Has Boeing considered the devastating harm that it will cause to the 737 MAX victims' families if it manages, through high-powered lawyering and back-room deal cutting, to avoid pleading guilty to its deadly crime?
Perhaps such a deceitful maneuver will lead to some short-term advantage. But in the long run, such an outcome would signal that Boeing will do whatever it takes to avoid admitting a mistake, even a deadly one. That path does not seem calculated to return Boeing to the status of being one of America's great manufacturers. The Senators holding tomorrow's hearing should ask CEO Ortberg whether he plans to have his company admit in court the deadly crime it has committed.
Update: I changed the punctuation in the subtitle.
