By David Shepardson
WASHINGTON (Reuters) -The U.S. Justice Department on Tuesday opposed a bid by families of people killed in two Boeing (NYSE:BA) Co 737 MAX crashes asking a judge to declare that the government violated their legal rights when it reached a $2.5 billion settlement with the plane maker last year to resolve a criminal charge.
Despite opposing the families' request, the department said in a court filing that "the government apologizes for not meeting and conferring with these crash victims' beneficiaries before entering into" the deferred prosecution agreement - a type of corporate plea deal. It also said it had "no legal obligation" to hold such a meeting.
The settlement, reached in January 2021 near the end of former President Donald Trump's administration, capped a 21-month government investigation into the design and development of the 737 MAX following the two crashes, in Indonesia in 2018 and Ethiopia in 2019, that killed a total of 346 people.
Boeing also will oppose the families' legal requests, the Justice Department said in the filing. Boeing declined comment.
In the filing, the department explained its decision not to take Boeing to a trial on a criminal charge of conspiring to defraud the Federal Aviation Administration, the agency that regulates Boeing and evaluated its airliners.
"There was no doubt that Boeing had conspired to defraud the federal government when it deceived the FAA Aircraft Evaluation Group," the filing said.
"The government's investigation, however, did not produce evidence that it believed would allow it to prove beyond a reasonable doubt what factors had caused the crashes of Lion Air Flight 610 and Ethiopian Airlines Flight 302," it added, referring to the two fatal flights.
Paul Cassell, a lawyer for the families, criticized the Justice Department's position that relatives of those killed in the crashes do not qualify as "crime victims" under federal law.
"The Department of Justice's claim that the families are not the 'victims' of Boeing's crimes is unconscionable and unsupportable," Cassell said in a statement.
The families in December asked Texas-based U.S. District Judge Reed O'Connor to declare that the deferred prosecution agreement was negotiated in violation of their rights as crime victims under federal law and to set a briefing schedule on the appropriate remedies.
U.S. Attorney General Merrick Garland on Jan. 26 met with some of the family members.
The Justice Department said on Tuesday that it is working to revise its internal policies and guidelines to "ensure that if this situation arises in the future, consultation and notice will occur." It also apologized that its own victims' rights ombudsman in February 2020 "conveyed inaccurate information" to representatives of the families.
The settlement allowed Boeing to avoid prosecution, and included a fine of $243.6 million, compensation to airlines of $1.77 billion and a $500 million fund for crash victims over fraud conspiracy charges related to the plane's flawed design.
The Justice Department said that $471 million - 94% of the $500 million - has been disbursed to relatives of 326 of the 346 crash victims.
A former chief technical pilot for Boeing was charged last October with fraud for deceiving federal regulators evaluating the company's 737 MAX jet. He has denied wrongdoing.
The crashes, which cost Boeing some $20 billion and led to a 20-month grounding of the plane that ended in 2020, prompted the U.S. Congress to pass legislation reforming new airplane certification.