On December 5th Texas federal judge, Reed O’Connor, of the 5th U.S. District in Fort Worth, Texas rejected Boeing’s plea agreement, with the U.S. Department of Justice. Reed pointed to two major issues: the DOJ’s policies of considering diversity, equity and inclusion when selecting an independent compliance monitor, and the court’s “erroneously marginalize[d]” role in picking and overseeing that monitor. The judge gave the DOJ and Boeing 30 days to rework how they plan to proceed in the matter, adding new complications for the embattled American aerospace titan and the legal saga over its 737 Max jets.
What might’ve seemed like a standard reference by the DOJ and Boeing to their DEI policies ended up hampering their chance at getting the court’s blessing on the finalized deal under Federal Rules of Criminal Procedure 11(c)(1)(C), which is typically known as a “take it or leave it” deal.
Experts say the ruling underscores the increasing vulnerability of corporate and government diversity, equity and inclusion policies.
Boeing pled guilty to conspiring to defraud U.S. regulators over the 737 Max 8’s development, agreeing to pay millions more in penalties.in an attempt to avoid a high-profile criminal trial over the deadly Lion Air Flight 610 in 2018 and Ethiopian Airlines Flight 302 crash in 2019. They also agreed to be scrutinized by an independent compliance monitor for three years.
But Judge O’Connor found it problematic that when “taken in totality,” President Joe Biden’s June 2021 executive order promoting diversity, equity, inclusion, and accessibility in the federal workforce, the history of the Justice Department’s diversity and inclusion requirements and the parties’ DEI policies “requires the government to prioritize, among other things, race as part of the corporate monitor-selection process in furtherance of the goal to turn the federal workforce into ‘a model for diversity.'”
Judge O’Connor also said the plea agreement that would give the DOJ final say on selecting and overseeing the monitor, “marginalized” the court by elbowing the court from having any role in ensuring Boeing adheres to an ethics and anti-fraud compliance program.
Michael Wynne, a partner and white collar criminal defense attorney with Gregor Wynne Arney PLLC, said rejecting the plea agreement was “absolutely the correct decision” and that “30 days, based on my experience, is more than enough time to redraft the documents to comply with the court’s instructions.”
“It should not be difficult … you can do it and there’s absolutely no excuse not to do it in 30 days,” he told Law360 in a recent interview.
“While there may be a place for DEI considerations in various parts of the government, this is not the place,” Wynne added. “Most critical here is the public perception and the actual fact that ongoing maintenance and compliance will be the safest and best possible. … This [is an] effort to include a provision that must’ve been pushed by some ivory tower idealist with no experience in the real world. The judge, thank God, short-circuited an agreement that was going to cause huge problems in the future.”
Meanwhile, crash victims’ families who objected to the plea deal and relentlessly pushed for Boeing to face a criminal trial are also eager to have more say in any renegotiated plea agreement.
The judge and victims’ families are very concerned that the individuals providing oversight of the corrective measures being proposed should be the best available in the field of aviation engineering or manufacturing processes, and that less emphasis should be placed — if any at all — on DEI issues.
