Boeing shareholder files class-action suit over fallout from 737 MAX crashes

Boeing shareholder files class-action suit over fallout from 737 MAX crashes

According to the WSJ, it has been granted a broad mandate to study and certify the 737 MAX's safety; in particular, fixing the plane's Maneuvering Characteristics Augmentation System (MCAS), which has been identified as the possible cause of the Lion Air and Ethiopian Airlines tragedies.

Boeing shareholders have filed a class action lawsuit against the aircraft maker, accusing it of withholding information on safety deficiencies in its 737 MAX planes which led to two deadly crashes within six months.

Boeing is updating its software to fix the problem detected in both of the 737 MAX plane crashes. In addition to Boeing, CEO Dennis Muilenburg and Chief Financial Officer Gregory Smith are named as defendants.

It alleges that Boeing "effectively put profitability and growth ahead of airplane safety and honesty", misleading investors about its core commercial-airplanes operation. By doing so, investors bought shares at "artificially inflated prices".

The lawsuit, seen by Reuters, seeks damages for alleged securities fraud violations, as the latest crash of Boeing's 737 MAX 8 jet, operated by Ethiopian Airlines, wiped about $34 billion out of the company's market value.

Boeing did not immediately respond to a request for comment.

The family of one passenger, 24-year-old Samya Stumo, filed a wrongful death lawsuit against the company. In all, 346 people died.

Its stock hit $440 early last month, then fell to $362 after the Ethiopian Airlines crash.

To get its 737 MAX jets, which have been grounded worldwide, back in the air, the US-based corporation needs approval from the US Federal Aviation Administration.

The lawsuit said that Boeing should have told investors that the safety features were optional on the Max jets it sold. Pilots on each flight fought unsuccessfully to regain control, according to flight data retrieved from the planes. The company is also facing probes by the U.S. Justice Department and the Transportation Department's inspector general.

The FAA has for decades delegated some certification duties to Boeing and other manufacturers.



Latest news

Former Obama White House Counsel Gregory Craig Indicted in Foreign Lobbying Probe
Craig is a prominent Washington attorney and was the first White House counsel to former President Barack Obama . The agreement included providing advice on improving prosecutions by the ministry, according to court filings.

Turkey, Qatar: Iran's IRGC is Not a Terrorist Organization
Washington's ally, Saudi Arabia, has similarly balked, and seeks to plug the Shia breach in Yemen with bloody resolve. Since coming to power in the White House in January 2017, Trump has been venting anger against Iran.

The Nipsey Hussle Celebration of Life
Rapper Nipsey Hussle will be mourned at a public memorial expected to draw thousands to the Staples Center in Los Angeles . While the venue is a large arena, Staples Center seats only 21,000 people.

House of Representatives set to vote on net neutrality
The Trump administration said the bill would "return to the heavy-handed regulatory approach of the previous administration". In addition, the bill would restore the FCC's authority to regulate and oversee broadband networks.

NY orders mandatory measles vaccinations, blasts misinformation fuelling outbreak
Measles is a highly-contagious disease which is spread through the air and by person-to-person contact. Anti-vaxxers have been specifically targeting the Orthodox Jewish community with misinformation.

Other news