Boeing offers to pay $100M to victims families.

[Swedishflyingkiwi]

And now the liability questions seem to be coming clearer...

https://www.bbc.com/news/business-48859463

/Mike

[Seat4A]

Boeing Press Release


Boeing Pledges Support to Families, Communities Affected by Lion Air Flight 610 and Ethiopian Airlines Flight 302 Accidents

"CHICAGO, July 3, 2019 /PRNewswire/ -- Ahead of Independence Day in the U.S., Boeing [NYSE: BA] announced $100 million in funds to address family and community needs of those affected by the tragic accidents of Lion Air Flight 610 and Ethiopian Airlines Flight 302. These funds will support education, hardship and living expenses for impacted families, community programs, and economic development in impacted communities. Boeing will partner with local governments and non-profit organizations to address these needs. This initial investment will be made over multiple years.

"We at Boeing are sorry for the tragic loss of lives in both of these accidents and these lives lost will continue to weigh heavily on our hearts and on our minds for years to come. The families and loved ones of those on board have our deepest sympathies, and we hope this initial outreach can help bring them comfort," said Dennis Muilenburg, Boeing chairman, president and CEO.

"We know every person who steps aboard one of our airplanes places their trust in us. We are focused on re-earning that trust and confidence from our customers and the flying public in the months ahead."

Boeing will release additional information in the near future.

Consistent with Boeing's regular process for employee charitable donations, company employees will also have the opportunity to make donations in support of the families and communities impacted by the accidents. Boeing will match these employee donations through December 31, 2019."

https://boeing.mediaroom.com/2019-07...-302-Accidents (https://boeing.mediaroom.com/2019-07-03-Boeing-Pledges-Support-to-Families-Communities-Affected-by-Lion-Air-Flight-610-and-Ethiopian-Airlines-Flight-302-Accidents)

[WingNut60]

A pre-emptive ambit offer

[tdracer]

A pre-emptive ambit offer

Given that Boeing has publicly stated that accepting the money will in no way affect their rights to sue Boeing for damages, I don't see how that can be the case.

[marchino61]

$100M is barely much more than what just 1 of these Max aircraft cost at list price. Do they expect us to be taken away by their gratitude? :rolleyes:

It's over $250,000 per person killed in the crash. Which might be more than the families could get in damages in their local courts. It's more than my family got in the UK after my father died due to asbestos exposure.

[kiwi grey]

$US100,000,000 / 367 is roughly $US272,500 each.
Enough for an interim, initial, "welfare support" payment perhaps.
Surely you'd have to add another zero at least for a full settlement, so that's a cool billion before you start placating the airlines who are not flying their expensive assets, and/or having to lease in aircraft to fill some of the gaps, the lessors who have airframes they couldn't lease, and the ravening pack of lawyers each wanting a chunk of the money

Sounds like a lot of money until you remember how much the 787 still owes them

[WingNut60]

Given that Boeing has publicly stated that accepting the money will in no way affect their rights to sue Boeing for damages, I don't see how that can be the case.

Whether it is or not will be better indicated by whether the lawyers representing the victims agree to accept it or not.
My guess is that they will not.

As I understand it, while Boeing has publicly stated that accepting the money will in no way affect their rights to sue, they are simultaneously saying that any legal action should be in the country of ownership, not in the USA.

Wait a bit and we'll know soon enough.

[Eclectic]

But what is the possible end game here for Boeing?
So far no heads have rolled when from a distance it appears that they might have a problem with corporate culture.
And there is always the distant possibility of a charge of corporate homicide? Already there seem to be efforts to deflect culpability.
But will passengers ever be prepared fly in the plane? Will airlines buy more of them? Will all the world's certifying authorities clear it for use?
All the world's ambulance chasing lawyers will want to jump onto a juicy gravy train, with the cost to Boeing potentially infinite.
The production line continues unabated. Is this a case of cognitive dissonance or will Boeing create a magic fix for a seeming fundamental design flaw?
Could this actually bust Boeing, with the component parts of the company then sold off to the highest bidder?
To what extent will heritage certification and grandfather rights be allowed in future? Will all substantial derivatives require complete re-certification?
How long will the 777X be delayed?
As a dispassionate and relatively uniformed observer it appears that Boeing's main problems over this haven't even started yet.

[Bend alot]

But what is the possible end game here for Boeing?
So far no heads have rolled when from a distance it appears that they might have a problem with corporate culture.
And there is always the distant possibility of a charge of corporate homicide? Already there seem to be efforts to deflect culpability.
But will passengers ever be prepared fly in the plane? Will airlines buy more of them? Will all the world's certifying authorities clear it for use?
All the world's ambulance chasing lawyers will want to jump onto a juicy gravy train, with the cost to Boeing potentially infinite.
The production line continues unabated. Is this a case of cognitive dissonance or will Boeing create a magic fix for a seeming fundamental design flaw?
Could this actually bust Boeing, with the component parts of the company then sold off to the highest bidder?
To what extent will heritage certification and grandfather rights be allowed in future? Will all substantial derivatives require complete re-certification?
How long will the 777X be delayed?
As a dispassionate and relatively uniformed observer it appears that Boeing's main problems over this haven't even started yet.
The main problem started years ago but recently surfaced, now there are resultants of that big problem - decided years ago.

The strange thing is that they have and want to based blame at poorly trained pilots, but are adamant that Computer Based Training is all that is required to fly the MAX. But several "American" pilots have said certain scenarios in the simulator were "challenging" in the MAX Simulator.

[PAXboy]

Eclectic
So far no heads have rolled when from a distance it appears that they might have a problem with corporate culture.
And there is always the distant possibility of a charge of corporate homicide? Already there seem to be efforts to deflect culpability.
When a small boy is caught misbehaving by his parents, his first shout is, "It wasn't me" As evidence is presented against him, he screams all excuses and insults and blame he can muster.

Thus, when they are sitting around the board room table - they do exactly the same thing.

[ve3id]

It's over $250,000 per person killed in the crash. Which might be more than the families could get in damages in their local courts. It's more than my family got in the UK after my father died due to asbestos exposure.
I seem to remember reading on the back of a ticket that the Warsaw convention set an amount of 2.5 million per person. That's 869 million for the two planes.

[ve3id]

Eclectic

When a small boy is caught misbehaving by his parents, his first shout is, "It wasn't me" As evidence is presented against him, he screams all excuses and insults and blame he can muster.

Thus, when they are sitting around the board room table - they do exactly the same thing.
That's sexist! Are you saying that little girls don't misbehave? :-)

[groundbum]

I wonder if the $100M will end up in Government programs in these two far off countries... countries whose regulators are leading the accident investigations and who also have a lot of sway of what lawsuits do or do not get started in their countries and... not that I'm saying the $100M will disappear down various rabbit holes or build football stadiums in Senators backyards ohno..

G

[marchino61]

I seem to remember reading on the back of a ticket that the Warsaw convention set an amount of 2.5 million per person. That's 869 million for the two planes.

That number is a maximum, not a fixed amount. It is also the liability of the carrier, so has no connection with whatever Boeing might have to pay out.

[tdracer]

If the victims families wait for the lawsuits to worm their way through the US Court system, it'll be at least five years before they see a dime. That's a rather long time for a family who lost their breadwinner to wait for help.
I'm not surprised that the lawyers are recommending against this course of action - it makes their sob story better, and they don't get their 50% cut of anything the families receive directly from Boeing.
I am surprised that many on this forum think that's what they should do....

[WingNut60]

......I'm not surprised that the lawyers are recommending this course of action....

Are they? Do you have a source for that?
I'd have thought that the lawyers would have just thrown back an opposing ambit claim.

You can bet that the relatives would see only a small portion of that (or any) money in the end.
There will be syphon hoses lined up all the way down the disbursement trough.

[autoflight]

Some countries in the ME have laws that give compensation to the eldest brother rather than the wife of a victim. I hope Boeing can arrange their gifting to allow wives to receive the funds in their hands. My Kuwait based expat friend died in a Gulf Air A320 accident and his wife never saw a cent. It would be more generous to consider a trust or some other way to pay in certain circumstances.

[tdracer]

Are they? Do you have a source for that?
I'd have thought that the lawyers would have just thrown back an opposing ambit claim.

You can bet that the relatives would see only a small portion of that (or any) money in the end.
There will be syphon hoses lined up all the way down the disbursement trough.

Sorry, my bad, I left out a word in my post - the lawyers are recommending against accepting anything from Boeing - calling the whole thing 'insulting'. Of course they're not responsible for feeding the victims family, paying rent, etc. They just want to make sure they get their rather oversized slice of the pie and they don't mind waiting...

[WingNut60]

I can't speak for Ethiopia, but Indonesia having only rudimentary social security safety nets has a well developed "extended family" system upon which most lower socio-economic group families can rely.
I am sure that it is not easy for them but I doubt that any of the surviving families will perish while waiting for an equitable settlement.

In my mind, any seemingly generous first offer will be heavily weighted in the favour of those making the offer.
They will only be making any such offer because they see it as a strategic move to minimise the long-term cost to them. Generosity or humility will not be factors at all.
I suspect that any lawyers currently involved will be seeing it that way too.

In the Indonesian environment it is probably better for those families to reject any initial offers anyway, try to avoid the leeches, and hope that KOMNAS HAM and their lawyers (or some reputable NGO group) gets involved to protect their interests.

[Repos]

I seem to recall that this is paid upon identification of the victim

Wikipedia
Under the Montreal Convention, air carriers are strictly liable (https://en.wikipedia.org/wiki/Strictly_liable) for proven damages up to 113,100.00 special drawing rights (https://en.wikipedia.org/wiki/Special_drawing_rights) (SDR), a mix of currency values established by the International Monetary Fund (https://en.wikipedia.org/wiki/International_Monetary_Fund) (IMF) equal to roughly US$170,000.[3] (https://en.wikipedia.org/wiki/Montreal_Convention#cite_note-3) Where damages of more than 113,100.00 SDR are sought, the airline may avoid liability by proving that the accident which caused the injury or death was not due to their negligence or was attributable solely to the negligence of a third party.[4] (https://en.wikipedia.org/wiki/Montreal_Convention#cite_note-4) This defense is not available where damages of less than 113,100.00 SDR are sought. The Convention also amended the jurisdictional provisions of Warsaw and now allows the victim or their families to sue foreign carriers where they maintain their principal residence, and requires all air carriers to carry liability (https://en.wikipedia.org/wiki/Legal_liability) insurance.
https://en.wikipedia.org/wiki/Montreal_Convention

[Repos]

Given all the talk about Senior Management and working conditions at Boeing, I wonder how their employees will feel about this part.

"Consistent with Boeing's regular process for employee charitable donations, company employees will also have the opportunity to make donations in support of the families and communities impacted by the accidents. Boeing will match these employee donations through December 31, 2019."

I know it's a good cause etc but personally I hate this kind of fund-raisng under such circumstances.

[clipstone1]

I seem to recall that this is paid upon identification of the victim

Wikipedia
Under the Montreal Convention, air carriers are strictly liable (https://en.wikipedia.org/wiki/Strictly_liable) for proven damages up to 113,100.00 special drawing rights (https://en.wikipedia.org/wiki/Special_drawing_rights) (SDR), a mix of currency values established by the International Monetary Fund (https://en.wikipedia.org/wiki/International_Monetary_Fund) (IMF) equal to roughly US$170,000.[3] (https://en.wikipedia.org/wiki/Montreal_Convention#cite_note-3) Where damages of more than 113,100.00 SDR are sought, the airline may avoid liability by proving that the accident which caused the injury or death was not due to their negligence or was attributable solely to the negligence of a third party.[4] (https://en.wikipedia.org/wiki/Montreal_Convention#cite_note-4) This defense is not available where damages of less than 113,100.00 SDR are sought. The Convention also amended the jurisdictional provisions of Warsaw and now allows the victim or their families to sue foreign carriers where they maintain their principal residence, and requires all air carriers to carry liability (https://en.wikipedia.org/wiki/Legal_liability) insurance.


https://en.wikipedia.org/wiki/Montreal_Convention

The Montreal Convention doesn't apply to all carriage by air, outside of the EU it is generally only international carriage. Thus it applies to the Ethiopian flight, but the carrier can limit their liability to SDR113k, since it is largely known the crash wasn't their fault. Lionair was a domestic flight, thus local legislation applies, which is cUSD88k.

Now, none of this matters in a claim against Boeing since there is no legislation limiting the amount that can be claimed, however the issue will be that the airlines might need to prove Gross Negligence on the part of Boeing, since otherwise Boeing will seek to rely on the indemnity in the purchase agreements and pass the cost of the claims back to the actual airlines!

So at strict liability, the Ethiopian claim for passenger liability could be USD27m and the Lionair could be USD16m. The challenge for the claimants lawyers is getting the claim into either an EU or US court, then the number and be multiplied, but in theory only against in a claim against Boeing not the airlines.

[568]

Repos:"Given all the talk about Senior Management and working conditions at Boeing, I wonder how their employees will feel about this part"Boeing didn't care about their employees when they made changes to the pension plans a number of years ago!