Prosecutors to seek guilty plea from Boeing tied to 737 MAX crashes

Prosecutors plan to ask Boeing to plead guilty to deceiving air-safety regulators about a crucial aspect of the 737 MAX planes implicated in two disastrous crashes, wiping out a more lenient agreement the company received more than three years ago.

The company will have until the end of the week to accept the guilty plea or opt to fight the fraud-conspiracy charge in court, according to people familiar with the matter. The government isn’t willing to negotiate with Boeing and accept a settlement weaker than the terms it proposed, the people said.

Under the guilty-plea agreement outlined Sunday to families of the crash victims, Boeing would have to agree to hire an outside consultant to monitor its compliance with safety regulations. It also would pay an additional corporate penalty of about $243 million.

A guilty plea would seal a legal odyssey that had appeared to be resolved in January 2021, when the company admitted two former employees misled the Federal Aviation Administration and prosecutors gave Boeing a form of corporate probation. That earlier deal was upended in May, when prosecutors said Boeing had violated its requirements, exposing itself to the possibility of a criminal trial on a fraud-conspiracy charge.

A guilty plea would push Boeing to a legal brink that few major public companies have faced: the risk of being convicted of a felony crime, which could hurt its ability to win contracting work for the federal government. Companies with felony convictions face the prospect of being suspended or barred as defense contractors, but they can seek a waiver from that consequence.

The families have fought the earlier settlement prosecutors gave Boeing in 2021, when it obtained a form of corporate probation that was supposed to last three years. The families said they should have been told in advance of that deal because they were representatives of crime victims. A federal judge who presided over the settlement agreed with them in 2022 but declined to reopen the settlement.

Andrew Tangel contributed to this article.

Write to Dave Michaels at dave.michaels@wsj.com and Sharon Terlep at sharon.terlep@wsj.com