Fifth Circuit Keeps Boeing Crash Documents Under Wraps

One thing is clear from the litigation fallout of the two Boeing 737 Max crashes that took the lives of 346 passengers and crew – Boeing and its lawyers are taking every possible measure to make sure that incriminating evidence of its criminal wrongdoing does not see the light of day.

First there was the sweetheart deferred prosecution that Boeing engineered earlier this year that let Boeing off the criminal hook with no guilty plea, no charge against Boeing executives, no monitor appointed and no public release of incriminating evidence.

Then last month, the Fifth Circuit Court of Appeals helped out Boeing’s cover-up campaign with a little-noticed decision that overruled a Texas federal district court ruling ordering Boeing to turn over certain documents “in fully unredacted form.”

The case, Damonie Earl et. al. v. The Boeing Company, is a class action lawsuit against Boeing and Southwest Airlines brought by Southwest passengers alleging that Boeing and Southwest Airlines conspired to defraud the flying public by concealing various alleged design defects with the Boeing 737 MAX 8 aircraft and encouraging the public to fly aboard these aircraft.

During discovery, Boeing turned over several logs of what it claimed were attorney-client privileged communications and, after Boeing entered into a deferred prosecution agreement, plaintiffs moved to compel over two hundred of the privileged documents under the crime-fraud exception. 

The district court determined that lawyers representing the Southwest passengers established a prima facie case and that the crime-fraud exception to attorney-client privilege applied to the requested documents and ordered Boeing to produce them for in camera review.

Upon review, the court ordered Boeing to produce fifty-three documents, concluding that nineteen of them lacked attorney-client privilege and thirty-four of them were subject to the crime-fraud exception.

The Circuit Court upheld the District Court’s ruling that the nineteen documents lacked attorney-client privilege.

On the nineteen documents, the district court found that “the thoughts and commentary in the thread concern public response to inquiries regarding the 737 MAX 8 in the wake of the Lion Air accident – there is seemingly no legal advice offered on the face of the communications. The primary contributors to the discussion are Boeing’s communications and technical personnel, and their aim appears to relate to the general public’s consumption of the discussed messaging.”

But the Circuit Court overruled the district court on the thirty-four crime-fraud exception documents, saying they were not subject to the crime-fraud exception.

The District Court held that “the only communications falling under this exception are those shown to hold ‘some valid relationship’ to the prima facie violation such that they ‘reasonably relate to the fraudulent activity.’”

“In this instance, the prima facie violation is Boeing’s admitted ‘conspiracy to defraud’ the Federal Aviation Administration,’ detailed in the deferred prosecution agreement. Therefore, any communications reasonably relating to Boeing’s fraudulent conduct against the Federal Aviation Administration fall within the crime-fraud exception and must be produced by Boeing.”

After conducting its in camera review, the district court found that “the material under the following tabs to reasonably relate to Boeing’s fraudulent conduct” regarding the established prima facie violation:

• Tab 28: Email thread regarding upcoming meeting with the FAA Aircraft Evaluation Group (“AEG”)

• Tab 102: Email thread regarding upcoming meeting with the FAA AEG

• Tabs 113, 117, 120–123: Email thread preparing standard language to describe the Maneuvering Characteristics Augmentation System (MCAS) system in the wake of the Lion Air crash, with the FAA being an intended recipient

• Tab 133: Email thread preparing material for a meeting with the FAA concerning certification of the 737 MAX 8

• Tabs 169, 174–183: Email thread working on an official response to a letter from the FAA AEG

• Tab 185: Email thread discussing preparation for Boeing’s presentation to the FAA

• Tab 186: Email thread involving discussion of a conversation Patrik Gustavsson had with the FAA

• Tab 187: Email thread discussing the submission the provision of technical plan updates to the FAA

• Tabs 188–190: Email thread regarding an evaluation proposal prepared for submittal to the FAA AEG

• Tab 191: Email thread comparing information provided to the FAA compared to other regulators

• Tabs 200–203: Email thread with attachments preparing response to an FAA request

• Tab 211: Instant message chat between Patrik Gustavsson and another Boeing employee regarding impending and potential communications with the FAA

• Tabs 220–221: Email thread discussing response to the FAA’s evaluation of a Boeing submittal

“Finding these materials to fall within the crime-fraud exception,” the district court ordered their production “in fully unredacted form.” 

But the Circuit Court agreed with Boeing on the crime-fraud exception.

“As Boeing argues, the district court clearly erred in finding that plaintiffs established a prima facie case that the contested documents were subject to the crime-fraud exception,” the Circuit Court ruled. “The district court concluded that the contested documents were reasonably connected to the fraud based on one finding only – that the documents sought ‘fell within the period Boeing admitted to having knowingly and intentionally committed fraud’ in the DPA. However, a temporal nexus between the contested documents and the fraudulent activity alone is insufficient to satisfy the . . .showing that the crime-fraud exception applies.” 

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