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The Boeing Company

Case Details

Class Period: October 23, 2019 - January 24, 2024
Date Filed: January 30, 2024
Case Number: 1:24-cv-00151
Jurisdiction: Eastern District of Virginia
icon-casetype Case Type: Securities Case
Days Left to
Seek Plaintiff:
27

Case Summary

The Boeing Company (“Boeing” or the “Company), headquartered in Arlington, Virginia, is one of the largest aerospace companies in the world. Its Commercial Airplanes Segment is a leading producer of commercial aircraft and offers a family of commercial jetliners including its 737 MAX. Approximately five years ago, two Boeing 737 MAX 8 planes were involved in fatal crashes caused by malfunctions due to design flaws in the 737 MAX’s flight control software. The first crash occurred in October 2018 and the second crash occurred in March 2019 killing a total of 346 people and leading to 737 MAX planes being grounded from March 2019 to December 2020.

The Class Period starts on October 23, 2019, when Defendants boasted that Boeing was making progress towards the safe return to service of the 737 MAX. Throughout the Class Period, Defendants continued to assure investors that Boeing was laser-focused on safety and quality. Defendants also claimed that Boeing did not make trade-offs between safety and profit, and that safety was Boeing’s priority.

Unbeknownst to investors, statements such as those above were false and misleading because Boeing failed to disclose that it had been prioritizing its profits over safety, which led to poor quality control standards in the production of its commercial aircrafts such as the 737 MAX, resulting in a heightened risk of manufacturing flaws which could render the Company’s new airplanes unsafe. This very risk had materialized during the Class Period. These false and misleading statements caused Boeing stock to trade at artificially inflated prices during the Class Period.

It took a near disaster to expose this heightened safety risk. The public first learned about it on January 5, 2024 when a panel called a “door plug” flew out of the side of a 737 MAX 9 (a variant of 737 MAX) during Alaska Airlines Flight 1282. This left a gaping hole in the plane’s main cabin, feet from where passengers were sitting. Over the next few weeks, investigations into the incident continued and problems with such door plugs on other 737 MAX planes were discovered including loose bolts holding the door plugs in place, further revealing the Company’s manufacturing and production missteps and leading to the grounding of many 737 MAX 9 planes. In reaction to these and other related disclosures, Boeing’s stock price plummeted from $249.00 on January 5, 2024 to $201.88 on January 25, 2024, a $47.12 per share or 18.9% decline.

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