Boeing Directors Sued Over Missed Warning Signs on 737 Max 8
- Board accused of failed oversight of design flaws, crash probe
- Invesotr claims actions hurt Boeing profit, reputation, value
Photographer: David Ryder/Bloomberg
Boeing Co. directors were careless in their oversight of the flawed 737 Max 8 airliner and failed to react promptly after two crashes killed more than 300 people, according to a shareholder lawsuit seeking to hold company board members accountable.
The directors missed repeated red flags during development of the 737 Max’s automated flight-control systems and then waited months to investigate the role of design flaws in a fatal Lion Air crash late last year in Indonesia, according the suit filed Monday in Delaware Chancery Court by the Kirby Family Partnership LP. In March, an Ethiopian Airlines 737 Max crashed in Africa.
In its rush to get the 737 Max to market, Boeing didn’t property test the new system or adequately train pilots, the lawsuit alleges. Along with the subsequent grounding of all 737 Max aircraft, the board’s actions hurt the company “through loss of credibility in the marketplace, a damaged reputation and billions in potential business costs and liability,” according to Kirby, which says it has owned Boeing shares since 2018.
While Boeing already faces dozens of claims from victims’ families, the Delaware suit may be the first to target directors for their role in the controversy over the crashes.