DOJ: Boeing violated deal reached to avoid 737 MAX prosecution

The Justice Department found that Boeing (BA) violated the terms of the 2021 agreement it reached to avoid prosecution over the two deadly crashes involving its 737 MAX jets. Prosecutors must decide by July 7 whether to file charges against the aircraft company.

Boeing has until June 13 to challenge the Justice Department's findings, according to The Wall Street Journal, and Boeing believes it has honored the terms of the agreement.

Despite this latest news, Wall Street remains bullish on the stock, feeling optimistic about the company's future as it comes under new leadership.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Melanie Riehl

Video transcript

Boeing has violated the terms of the agreement it reached to avoid prosecution over the two deadly crashes involving its 737 max jets, according to the Justice Department.

Prosecutors now have until July 7th to decide whether or not to file charges against the plane maker.

You're taking a look at chairs of Boeing here.

Year to date, they're down by about 30%.

Of course, this has been a year with even more swirling around the company, especially following the fuselage blowout of an Alaska Airlines flight separate from the 2737 max crashes.

That really started the spotlight of scrutiny over the internal culture that came to light of negligence and then, additionally, uh, ousted CEO thereafter and Dennis Muhlenberg at the time.

And then you had Dave Calhoun, and now he is on the way out as well.

And so all of these things considered, it will be interesting to see what the Justice Department ultimately has in terms of its ruling as a result of this deal that they had reached, I mean a deal that was essentially a slap on the wrist, given the crash.

The proceedings that took place thereafter And, of course, the families impacted as well from those two deadly crashes.

And Boeing has about a month until June 13th to challenge the department's findings here.

That was, according to a letter that The Wall Street Journal cited and Boeing, at least from the statement that Wall Street Journal got excuse me, looking to test some of these findings here.

They they believe that they have honoured the terms of the 2021 agreement.

No surprise.

We obviously expected them to say that, saying that they are going to engage the department with the utmost transparency, as we have throughout the entire term of the agreement, including in their in response to their questions following the Alaska Airlines 1282 incident accident.

So again, Boeing standing by what they have done here over the last several months just in terms of upholding that agreement that they had agreed to back in 2021.

But again, I think this just adds even more clouds here that are over that aren't over hiding here for the stock When you talk about the fact that analysts largely remaining actually bullish on Boeing, given the current valuation given the underperformance that we've seen since the start of the year.

It's going to come under new management.

We are going, you get a CEO.

And many of the analysts that we have talked to here in Yahoo Finance remain optimistic on Boeing's business going forward.

I think the next couple of months might be a bit murky as we do work out the details as we do, I get more and more here.

But again, we have seen that massive underperformance of Boeing stocks since the start of the year.

And as a result, despite all these issues, it's been interesting that Wall Street has remained largely bullish on this name, right and largely because Boeing had already set aside even more than they had pledged within the settlement.

It was about a $500 million settlement that they had made for the families specifically in the fund there.

Boeing had already set aside about $2.5 billion there, so it's really just kind of looking at what they're already doing on their own balance sheets versus what's actually coming forward within the rulings and of course this is just another step in that as well