- Boeing is talking to families of the victims from the Lion Air 737 Max crash about reaching a settlement, rather than going through the court system.
- Settling would allow Boeing to avoid long, highly publicized trials that could prove damaging for the company as its conduct is scrutinised and as it seeks to return its Max planes to service.
- A lawyer representing multiple families told Business Insider it was in Boeing’s “best interest” to settle, as it would stop lawyers from going through evidence to see whether there were any issues with the plane’s design or manufacturing.
- But he suggested Boeing might be seeking to drive down the settlement price in ways he would oppose.
- Visit Business Insider’s homepage for more stories.
Boeing is in talks with the relatives of people who died in the first of two fatal crashes by its 737 Max jets to explore settling their cases out of court.
The company confirmed to Business Insider that it had “agreed to work together” with bereaved families explore the idea of keeping the cases out of court.
Ending the lawsuits without a trial would be in Boeing’s interest, multiple lawyers told Business Insider, because it would avoid the spectacle of Boeing’s conduct around the crash being put under the spotlight and prevent a deeper dive into how the company designed, made, and communicated about the plane.
“Boeing and the claimants in the Lion Air Flight 610 cases have agreed to work together to explore early settlement of these claims, so that those affected can receive compensation without the need for prolonged litigation,” Boeing told Business Insider in a statement.
The 737 Max 8 operated by the Indonesian low-cost carrier Lion Air crashed into the Java Sea shortly after takeoff in October, killing all 189 people on board.
Boeing is facing lawsuits from families around the world over that crash and also the one involving an Ethiopian Airlines 737 Max 8 plane in March, in which all 157 people on board died. The plane’s design is under scrutiny over both crashes.
Settling would let Boeing put the crashes behind it “and start focusing on the other things that need to be done,” Brian Kabateck, an attorney representing 14 Lion Air families suing Boeing, told Business Insider.
Kabateck told Business Insider that he was “going to see in July how serious they are about their reported interest in trying to resolve cases.”
“It’s in the best interest of my clients to explore it at least for an additional month or so to see how serious they are,” he said.
Kabateck previously told Business Insider that he was also interested in settling out of court so his clients would be “able to put this behind them as quickly as possible.”
“The litigation always tends to spawn an emotional response, understandably, from the families, and this case is certainly no different, of course compounded by the fact that it’s been so public,” he said.
He said many of the people on the plane were travelling for work and were the main earners in their families. “That’s a significant issue,” he said.
Kabateck said settling with families could be the “best” move for Boeing, as it would prevent lawyers from making arguments in court based on the plane’s design, manufacturing, and certification.
It would also avoid the possibility of a trial dominating Boeing’s media coverage. “If every single week there’s stories about the lawsuits and the trials and the families, that’s bad for business,” Kabateck said.
“It would be the smartest thing Boeing could possibly do, to put these cases behind them.”
Matt Clarke, an aviation attorney not involved the cases, told Business Insider that Boeing might be motivated in “pushing for early settlements” so that lawyers “don’t really do a deep dive into everything that Boeing knew and what all the problems are with the aircraft.”
He said settling could ease the scrutiny on the company and the plane. “I’m afraid there’s not going to be enough eyes looking closely enough at whether they really have fixed the underlying problems with the aircraft,” he said.
There could, however, be more at play than avoiding scrutiny for Boeing and a painful trial for families.
Velvet glove, iron fist
Kabateck said the settlement could also part of a wider strategy to move the cases from the US to Indonesia, where the legal situation is likely to favour Boeing.
Attorneys for Boeing indicated in federal court in March that the company would formally ask to have the cases heard in Indonesia, rather than in US federal court in Chicago, where the company is based. And while Boeing is not prioritising this strategy, lawyers say it could still be in play.
Compensation for the families would be much lower in Indonesia, as well as in Ethiopia, where Boeing could seek to move the cases from the second crash.
“If Boeing can get the cases sent back to either Indonesia or Ethiopia, those cases really become worthless,” Mike Danko, an aviation attorney and pilot, told Business Insider.
Boeing did not answer when asked by Business Insider whether it would still pursue this strategy, but other lawyers representing families in the two crashes told Business Insider they would resist such a move.
Kabateck said he was still preparing to oppose any effort to move the cases. He told Business Insider the attempt to shift jurisdiction could be part of a strategy to “drive down the settlement value of the case based on the threat.”
Danko said that in similar cases, the parties would often meet to find a “reasonable settlement” partway between what they might get in the US compared with the other country.
Boeing did not answer Business Insider’s question on whether it was using this strategy.
“Boeing extends our heartfelt condolences and sympathies to the families and loved ones of those onboard Ethiopian Airlines Flight 302 and Lion Air Flight 610,” it said in a second statement.
It added: “As the investigations continue, Boeing is cooperating fully with the investigating authorities.”
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