Boeing Faces 'The Deadliest Corporate Crime' Trial As Judge Sets June Date In 737 MAX Fraud Case

Boeing Co. BA is set for a pivotal moment in its ongoing legal battle, with a U.S. judge scheduling a criminal fraud trial for Jun. 23, highlighting the aerospace giant’s persistent challenges stemming from two fatal 737 MAX crashes that claimed 346 lives.

What Happened: The trial comes after U.S. District Judge Reed O’Connor rejected a previous plea deal, criticizing a diversity provision and setting the stage for a potentially landmark legal proceeding, reported Reuters. In 2023, O’Connor described Boeing’s actions as potentially “the deadliest corporate crime in U.S. history.”

The original plea agreement, struck in July, included a potential fine of $487.2 million and a three-year probation period with an independent monitor. However, victims’ families have consistently argued that the deal fails to adequately hold Boeing accountable.

Boeing did not immediately respond to Benzinga's request for comment.

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Why It Matters: The case centers on Boeing’s alleged misrepresentations to U.S. regulators about critical flight control systems on the 737 MAX. The company’s legal challenges are compounded by recent safety incidents, including a January 2024 in-flight door panel blowout on an Alaska Airlines flight that exposed ongoing quality concerns.

Despite these legal and operational hurdles, Boeing has secured some positive developments, including a significant U.S. Air Force contract for next-generation fighter aircraft, potentially worth tens of billions of dollars.

The company continues to face delivery challenges, with airlines like Malaysia Aviation Group and Akasa Air experiencing significant aircraft order delays.

Price Action: Boeing closed at $182.59 on Monday, up 0.97% for the day. In after-hours trading, the stock dipped 0.10% to $182.40. Year to date, Boeing’s stock has gained 6.24%. However, over the past year, the stock has declined by 2.62%, according to data from Benzinga Pro.

Boeing lacks a strong growth forecast and valuation, according to Benzinga Edge’s ranking. For more insights, sign up for Benzinga Edge.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.