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Boeing Co. (NYSE:BA) has been spared from a criminal conspiracy charge related to the two 737 Max jetliner crashes that claimed 346 lives.
A federal judge in Texas dismissed the criminal case against Boeing after the aircraft maker agreed to pay or invest an additional $1.1 billion toward fines, compensation for crash victims' families, and internal safety and quality improvements, AP News reported on Thursday.
The company did not immediately respond to Benzinga‘s request for comment.
This decision comes after a crucial court hearing in September, where families of the 737 Max crash victims opposed the Department of Justice’s motion to dismiss the fraud charge against Boeing.
The DOJ had charged Boeing with conspiracy to commit fraud, alleging that the company deceived FAA regulators about the Maneuvering Characteristics Augmentation System (MCAS) flight-control software implicated in both fatal crashes.
The first crash, of Lion Air Flight 610 in Indonesia, occurred in late October 2018, while the second crash, of Ethiopian Airlines Flight 302, occurred nearly five months later, in March 2019.
On Thursday, the judge approved the agreement, noting that the court could not reject the dismissal merely for disagreeing with the government's assessment that the deal serves the public interest, AP News reported.
Boeing’s legal challenges have coincided with its efforts to recover from the 737 Max crisis. The company is also reportedly in the early stages of developing a new single-aisle aircraft to replace the 737 Max Jet, a move that could potentially reshape its future in the aviation industry.
Despite the legal and operational challenges, some analysts believe that Boeing’s recovery story could defy its biggest hurdles yet, citing improving operational stability and solid commercial momentum. Bank of America analyst Ronald J. Epstein said Boeing's operations are stabilizing, aided by FAA approval to boost 737 production to 42 jets per month and sustain 787 output at seven. However, a $4.9 billion charge and the 777X's delay to 2027 continue to weigh on sentiment.
Benzinga's Edge Rankings place Boeing in the 69th percentile for momentum and the 31st percentile for growth, reflecting its strong performance in both areas. Check the detailed report here.
Price Action: On a year-to-date basis, Boeing climbed 14.33%, as per Benzinga Pro. On Thursday, the stock fell 1.12 points to close at $196.50.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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