After two fatal crashes that killed 346 people, Boeing reaches a deal with the U.S. Department of Justice: No criminal charges, $1.1 billion in fines and compensation

On May 23rd local time, the U.S. Department of Justice announced that it had reached a principle agreement with Boeing, sparing the company from criminal charges related to the two 737 MAX crashes that killed 346 people. While Boeing avoids a felony conviction, for the families who lost loved ones, it’s a bitter blow.

According to documents filed in the federal court in Texas, the Justice Department will ask the judge to dismiss the criminal case against Boeing, but reserves the right to refile charges. In return, Boeing will admit to “conspiring to defraud and obstruct” the FAA’s investigation and pay over $1.1 billion in fines and compensation, including:

• $243.6 million in additional criminal fines;
• $444.5 million for a fund for crash victims’ families;
• $445 million to enhance safety and compliance programs.

The Justice Department called the deal a “fair and in the public interest resolution,” ensuring accountability and immediate relief for affected families while avoiding the uncertainties of a prolonged trial.

Nevertheless, there is opposition to the agreement. U.S. Senator Elizabeth Warren previously wrote to the Attorney General urging the DOJ not to sign the deal, arguing it lets Boeing “escape accountability for its failed corporate culture and deadly misconduct.”

To recap: In October 2018 and March 2019, Lion Air and Ethiopian Airlines flights using Boeing 737 MAX 8 aircraft crashed, killing 346 people. In January 2021, Boeing entered a three-year deferred prosecution agreement (DPA) with the DOJ, agreeing to pay over $2.5 billion and to improve compliance.

However, on January 5, 2024—just two days before the DPA expired—an Alaska Airlines 737 MAX 9 experienced a door plug blowout incident. The DOJ then determined Boeing had failed to implement promised compliance improvements, violating the DPA.

In May 2024, Boeing accepted a plea deal admitting it conspired to defraud the FAA in the two MAX crashes, but some victims’ families strongly opposed the deal, calling it too lenient. The court eventually rejected it.

On May 23, Boeing shares dipped slightly during the day but recovered after hours. The stock is up more than 10% this month, with a market cap of $152.6 billion.