Passengers on an Alaska Airlines Boeing 737 Max plane that lost a panel in midflight are accusing the airplane manufacturer of fraud, according to new filings in a civil lawsuit stemming from the Jan. 5 incident over Portland.
Those passengers allege Boeing defrauded the Federal Aviation Administration, the Department of Justice and the flying public with statements that the company had improved its safety culture in the five years since two deadly Max crashes killed 346 people.
When a panel blew off a 737 Max 9 headed out of Portland in January, federal regulators and the flying public began to reexamine whether Boeing had made enough changes to its safety culture, manufacturing practices and compliance with safety regulations.
“Boeing knew about the safety problems and repeatedly promised everyone it would fix them,” said attorney Dan Laurence, who is representing 37 passengers who were on the Alaska Airlines flight. “Now it is clear that was public relations covering up much deeper failures, so it could maximize aircraft deliveries.”
Laurence, an attorney with the Stritmatter firm in Seattle, is one of several attorneys representing Alaska Flight 1282 passengers suing Boeing, Alaska and Boeing supplier Spirit AeroSystems following the blowout. The Stritmatter firm filed a proposed class-action lawsuit against Boeing and Alaska in January claiming both companies were negligent and did not ensure the plane was safe to fly.
On Friday, the firm updated its complaint to include allegations of fraud and corporate misconduct, and to seek punitive damages. It also dropped the class-action status, choosing instead to file individual claims arising out of the same conduct, and added Spirit as a defendant.
The firm is seeking punitive damages under Illinois law, where Boeing was headquartered until 2022 and where it made many corporate decisions regarding its culture, compliance and manufacturing processes, attorneys representing the passengers alleged.
Boeing did not immediately respond to the claims Friday. In March, in court documents responding to the original complaint, Boeing denied it had failed to design and construct the 737 Max 9 plane safely and denied allegations that it had prioritized profits and speed of production over safety. It asked the court to drop the claims against it.
The National Transportation Safety Board is investigating the panel blowout. The investigation found four bolts meant to secure the panel in place were missing.
The new allegations of fraud against Boeing could ultimately connect the Alaska Airlines incident with the Max crashes in 2018 and 2019.
After the two deadly crashes five years ago, Boeing faced a criminal charge of fraud from the Justice Department over allegations that it had intentionally misled regulators from the FAA when it was seeking certification for the 737 Max planes.
Boeing engineers failed to disclose some information about a new software system in the Max planes, according to the Justice Department. Later, an error in that system — the Maneuvering Characteristics Augmentation System, or MCAS — caused two planes to nose-dive shortly after takeoff, killing everyone on board in each case.
In 2021, Boeing entered into an agreement with the Justice Department that allowed it to avoid criminal charges if it met certain conditions for three years, including improving its compliance with federal safety regulations and promoting a culture of safety on its manufacturing floors.
Days before that agreement expired, the panel blew off at the start of Flight 1282. That incident has led many to question whether Boeing had followed up on the promises it made in the aftermath of the deadly crashes.
The Justice Department is still determining whether Boeing complied with the deferred prosecution agreement after the Max crashes. If federal prosecutors determine Boeing did not comply, the company could again face criminal claims.
Andrew Ackley, another attorney with the Stritmatter firm, said Friday that if the deferred prosecution agreement with the Justice Department “wasn’t enough motivation for Boeing, we hope this lawsuit will help protect the public.”
In court records, attorneys representing the passengers went back even further than the Max crashes to illustrate Boeing’s promises to make changes to its safety culture.
In 2015, Boeing and the FAA agreed to a settlement that required Boeing to improve its safety management, regulatory compliance and internal audits of its compliance internally and that of its suppliers.
Boeing promised in December 2015 that it would “never compromise on our commitment to quality and compliance,” attorneys wrote in court records.
In 2021, after the Max crashes, Boeing reached a separate settlement with the FAA to identify and address the “root causes” of regulatory violations in order to prevent future incidents, according to the complaint.
Attorneys for the Alaska Airlines passengers pointed to a recent expert report that found there was a disconnect between Boeing leadership’s statements on safety and how employees felt it was prioritized on the floor. The report, commissioned by the FAA following the Max crashes, found employees were fearful of retaliation if they raised safety concerns and lacked confidence that problems would be addressed.
Boeing said it would take the report’s “detailed assessment to heart and will act on their findings and feedback.”
“Since 2020, Boeing has taken important steps to foster a safety culture that empowers and encourages all employees to raise their voice,” a spokesperson said in April. “We know we have more work to do, and we are taking action across our company.”
In the amended complaint, attorneys representing Alaska Airlines passengers wrote that Boeing had “knowingly and intentionally” refused to change its culture in the last several years, resulting in the panel blowout in January.
“Boeing, through its deliberately misleading statements, lulled plaintiffs into a false sense of security that the airplane was safe,” attorneys wrote. “Boeing’s actions and omissions … breached Boeing’s duty not to commit fraud.”
