Judge Vetoes Boeing Guilty Plea Over Diversity Terms

A Texas federal judge on Thursday struck down a plea deal between Boeing and the Justice Department concerning two 737 MAX crashes, ruling that the agreement inappropriately imposed diversity considerations when selecting a compliance monitor.

U.S. District Judge Reed O’Connor ruled that the agreement between the Justice Department and Boeing improperly limited the court’s decision-making power and inappropriately focused on diversity when choosing a supervisory monitor, according to a court document. O’Connor said that the Justice Department’s reasons for considering race and diversity when appointing a compliance monitor didn’t quite add up.

“These provisions are inappropriate and against the public interest,” O’Connor wrote.

Boeing entered a guilty plea in July for criminal fraud charges stemming from incidents in 2018 and 2019 that collectively claimed 346 lives. The plea deal also involved a $244 million criminal fine and a continuation of corporate probation for Boeing.

O’Connor also criticized how the Justice Department handled the original probationary agreement, suggesting it wasn’t effective in making sure Boeing followed safety standards. He insisted that any appointed monitor should report directly to the court rather than to the Justice Department, to enhance oversight and public trust.

This ruling comes in the wake of renewed scrutiny over Boeing’s safety practices, reignited by an incident in January involving a fuselage panel blowout on a 737 MAX operated by Alaska Airlines. In response, the Justice Department accused Boeing of violating its probation terms earlier this May.

Boeing axed its global diversity, equity, and inclusion (DEI) division in October in response to severe financial setbacks, ongoing union strikes, and mounting concerns over safety and production. The company has reallocated the DEI division’s staff to enhance the employee experience, aiming to streamline operations amid various challenges.

Boeing also announced in October a 10% reduction in its workforce, cutting around 17,000 jobs due to an extended machinist strike. CEO Kelly Ortberg announced the layoffs as part of a strategy to streamline operations and prevent further furloughs, responding to ongoing financial and operational challenges.