Boeing (BA) 737 MAX Case on Misleading

The Boeing (BA) 737 MAX suffered a recurring failure in the Maneuvering Characteristics Augmentation System (MCAS), causing two fatal crashes, Lion Air Flight 610 and Ethiopian Airlines Flight 302, in which 346 people died.

• According to the SEC, Boeing knew after the first crash that a flight control system posed a safety issue, but assured the public that the 737 MAX airplane was "as safe as any that has ever flown the skies."

• In September 2022, $BA agreed to pay $200 million to settle civil charges by the SEC that it misled investors about its 737 MAX, which was grounded for 20 months after two fatal crashes.

Well-known captain “Sully” Sullenberger characterized the final version of MCAS as a “death trap.” In an October 13, 2019 letter to the editor of The New York Times Magazine, Sullenberger said that he is “one of the few who have flown a Boeing 737 MAX Level D full motion simulator” and that “the MCAS design should never have been approved, not by Boeing, and not by the FAA.”

Investors suspect that $BA and Accountables failed to disclose significant issues, including legal troubles, the grounding of the 737 MAX fleet, and problems with automated flight systems, leaving pilots unprepared.