Bloomberg-Boeing Co. is offering $100 million to support the families of victims and others affected by two crashes of its 737 Max jetliner, which killed 346 people and have led to scores of lawsuits.
The money will go toward “education, hardship and living expenses for impacted families, community programs and economic development in impacted communities,” Boeing said Wednesday in a statement. The funds would be committed over multiple years.
The pledge — described as an “initial outreach” — underscores the high stakes for Boeing as it navigates one of the worst crises in its 103-year history. The Chicago-based planemaker has come under scrutiny from wary passengers, investors, customers and regulators after a pair of fatal crashes prompted the grounding of its marquee Max jet family.
Settling lawsuits on behalf of victims could cost Boeing about $1 billion, Bloomberg Intelligence estimated, although legal experts have said payouts could be higher if evidence shows that Boeing knew about flaws in the planes before the tragedies.
Claims Process
Robert Clifford, a Chicago lawyer who has filed suit on behalf of 23 victims in the second crash, called the new offer by Boeing “highly unusual.” He noted that such pledges of assistance after a crash often come with stipulations or limits.
“All you can really say about it is, the devil is in the details,” Clifford said in an interview. “Tell me how it works. Tell what the details of the claiming process will be. Who is the universe of beneficiaries?”
Boeing’s stock closed little changed at $354.47 a share Wednesday in New York as the session closed early for Independence Day. The shares have dropped 16% since March 10, when an Ethiopian Airlines crash marked the second Max accident in five months.
No Ties
Boeing plans to work with local governments and nonprofit organizations to deploy the funds. The total averages about $289,000 per crash victim, although the amount any person receives could be far less once payments are made to all stakeholders. The company isn’t placing restrictions related to litigation over how the money can be used, said spokesman Charles Bickers.
“It’s absolutely independent from the lawsuits by the families,” Bickers said. “It’s a constructive step that we can take right now.”
Sanjiv Singh, a co-council and member of the Kabateck LLP legal team representing families from both crashes, questioned the timing of Boeing’s announcement and said the funds being promised were inadequate.
“This is a child-size band-aid on a deep gaping wound,” Singh said in an emailed statement. “I am highly suspicious of this maneuver.”
The Ethiopian Herald July 5/2019
