Boeing in Hot Water: Class Action Suit Allowed to Proceed

A federal judge has allowed Boeing shareholders to pursue a class action suit, accusing the company of prioritizing profit over safety before a 737 MAX 9 incident. Shareholders argue Boeing's misleading statements inflated stock prices after two fatal crashes. The class action could increase recoveries at a lower cost.

A federal judge has certified a class action lawsuit against Boeing, accusing the company of prioritizing profits over safety measures, following a recent incident involving an Alaskan Airlines 737 MAX 9. The lawsuit alleges Boeing overstated its safety commitments.

U.S. District Judge Leonie Brinkema, overseeing the case in Alexandria, Virginia, ruled that Rhode Island's state treasurer and other shareholders, who owned Boeing stock between January 2021 and January 2024, could pursue damages as a group. The shareholders sought an earlier class period start date, but Judge Brinkema aligned it with the resolution of a prior U.S. Department of Justice criminal case linked to Max safety concerns.

Class action lawsuits enable larger recoveries at reduced costs compared to individual cases. Boeing's shareholders argue that misleading statements artificially inflated stock prices following two deadly 737 MAX crashes in 2018 and 2019, which claimed 346 lives.

(With inputs from agencies.)