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Ddraig Goch
8th Sep 2021, 05:21
Another set back for Boeing as shareholders take Boeing to court for loss of value of shares

https://www.bbc.co.uk/news/business-58483150


Boeing's board of directors must face a lawsuit from shareholders over two fatal crashes involving its 737 Max plane, a US judge has ruled.

Morgan Zurn said the first crash was a "red flag" about a key safety system on the aircraft "that the board should have heeded but instead ignored".

He said the real victims were those who died and their families but investors had also "lost billions of dollars".

Boeing said it would "consider next steps".

In his ruling the Delaware judge said (https://courts.delaware.gov/Opinions/Download.aspx?id=324120): "While it may seem callous in the face of [the families'] losses, corporate law recognizes another set of victims: Boeing as an enterprise, and its stockholders.

"Stockholders have come to this court claiming Boeing's directors and officers failed them in overseeing mission-critical airplane safety to protect enterprise and stockholder value."

DaveReidUK
8th Sep 2021, 06:26
"Warning: The value of your investments and the income from them can go down as well as up and is not guaranteed at any time."

CW247
8th Sep 2021, 07:41
This will be thrown out, if anything, to further save a national treasure from further disgrace.

Maninthebar
8th Sep 2021, 09:49
I think you may underestimate the combination of iconoclasm and masochism that drives much of the American judicial system. See also Enron, Arthur Andersen and Worldcom.

340drvr
8th Sep 2021, 10:18
Wait, shouldn't the victims' families get to sue the shareholders? After all, shareholders are the ones that pressure the boards to increase profits by taking safety shortcuts.

beardy
8th Sep 2021, 14:14
Don't be daft. You can't sue for 'pressure'. The shareholders don't make operational decisions, the directors do and they should be held accountable both to the users of their products and to the shareholders.

hoistop
8th Sep 2021, 14:44
Yes, this is the real culprit, but I think it is not possible to sue for that in court.
But, this is where our entire society is pushing - we all expect our shares/bonds/investments to go up and up (see Bitcoin and similar gambling etc.) and we often want to get the lowest possible price per flight ticket, and that results in cattle-wagon like way of air transport, zero hours pilot contracts and questionable safety practices, in short, race to the bottom. The one who adds a little piece to all this might be staring at you (me) in the mirror every morning.

Lonewolf_50
8th Sep 2021, 15:59
For 340driver and hoistop: thanks, I needed that.
I don't think that the title of this thread is correct: it's Boeing in the news, and their suits.

Winemaker
8th Sep 2021, 16:15
The first step in this fiasco was when McDonnell-Douglas bought Boeing with Boeing's money and Stonecipher slithered in. It's been downhill since then.......

Economics101
8th Sep 2021, 22:09
Hang on a minute. Boeing is owned by its shareholders, and if the plaintiffs (shareholders) succeed in extracting millions from Boeing their own investment in the firm will suffer. In effect they are suing themselves. Crazy stuff.

tdracer
8th Sep 2021, 22:42
Presumably they are suing the Board members personally - not the Boeing Company - since as noted any payoff from Boeing to the shareholders would be silly.
Problem with that is, Board members are basically protected so long as they were acting legally and in good faith - the company has to defend them and would be responsible for any damages (I have some familiarity with this, the board having been sued when I was on the Board of my racing sanctioning body). Now, if the Board members broke laws or engaged in some sort of fraud, all bets are off - but that would be extremely hard to prove. Plus, while I'm sure the Board members have deep pockets, I don't think they are anywhere near that deep. We're talking several tens of billions of dollars of stock value - total net worth of the Board would be a small fraction of that.
Perhaps WillowRun will step in with a more legalistic take on this, but my take is this is some shareholders having a hissy fit that will simply make lawyers richer at the expense of Boeing and it's shareholders.

pattern_is_full
9th Sep 2021, 03:52
Boeing is (since 1934) incorporated in the State of Delaware.

This opinion was based on a precedent in Delaware law: In re Caremark International Inc. Derivative Litigation. The key point of which is that a Board's failure to effectively monitor Management with regard to product safety is prima facie evidence of bad faith. In other words, Boards can commit sins of omission as well as commission - and if those omissions lead to a specific loss (including shareholder value), the Board can be held responsible.

It is difficult to prove an omission, but in this era of email-trails, not as hard as it once was. The Board overall's lack of interest in safety vis-ŗ-vis sales and production and stock value and "face" - at least until after the Ethiopian crash - is pretty well documented.

Caremark is a food service company. That case found the following deficiencies in how the Caremark Board operated. Substitute "aircaft" for "food," or "aircraft safety" for "food safety," and see where Boeing's Board comes out.

• no board committee that addressed food safety existed;
• no regular process or protocols that required management to keep the board apprised of food safety compliance practices, risks, or reports existed;
• no schedule for the board to consider on a regular basis, such as quarterly or biannually, [whether] any key food safety risks existed;
• during a key period leading up to the deaths of three customers, management received reports that contained what could be considered red, or at least yellow, flags, and the board minutes of the relevant period revealed no evidence that these were disclosed to the board;
• the board was given certain favorable information about food safety by management, but was not given important reports that presented a much different picture; and
• the board meetings are devoid of any suggestion that there was any regular discussion of food safety issues.

Boeing's Board had an Audit Committee that was supposed to evaluate and inform itself - and the rest of the Board - as to any and all risks to the company's well-being. That committee failed to supervise risks to the company's well-being due to faults in aircraft (product) safety.

Some of Boeing's Directors made documented false statements to the press and others as to what role the Board played in supervising product safety. Which may not be illegal, but can definitely be considered evidence of bad faith.

Board members have responsibilities, including: Fiduciary Duty of Care (as a representative of the shareholders, you have to pay attention and be vigilant, as well as honest) and Fiduciary Duty of Loyalty (as a representative of the shareholders, the company's value as an institution comes ahead of all other factors, including short-term finances).

I'm on a Board myself (non-profit organization) - and just last spring we had to dismiss the Board Chair/COO for failure to responsibly execute those duties of care and loyalty (engaging in personal bias). And I spent the next 2 months - improving - the organization's By-Laws to prevent a recurrence.

I read the In re Boeing opinion and checked myself against it - "yep, took care of that," "yep, took care of that," etc.

WillowRun 6-3
9th Sep 2021, 12:44
In keeping with contemporary custom, "good morning, good afternoon and good evening....."

The ruling allowing some of the Plaintiffs' derivative claims to proceed is 103 pages and now it has become a must-read for yours truly. In the interim though, a couple of quick notes that might be legalistic (and thank you, tdracer).

A derivative action is a claim belonging to the Company against directors and/or officers of the corporate entity -- it's called "derivative" because it is brought by the shareholders on the Company's behalf. This can be seen in the content of the court's ruling which refers to the Director Defendants as well as Officer Defendants. (Those accessing the court's ruling could have noted that the judge is a "Chancellor" and the court division is "Chancery" - greatly oversimplifying, many state courts still are divided into the law courts and courts of equity, depending on the type of relief sought by the plaintiffs, and shareholder derivative suits are considered to seek equitable relief. In such litigation the process and other factors can be quite different than in, for example, liability suits for damages brought by survivors of people who were killed in the accidents.)

Second, the court dismissed two of the three claims brought in the derivative litigation. ("the stockholders have failed to allege the board is incapable of maintaining a claim against Boeing’s officers. The stockholders’ other claim against the board, regarding their handling of the chief executive officer’s retirement and compensation, is also dismissed." Opinion, at 2.) The wheels of court process may turn slowly, yet this sort of early skirmish over the scope of claims the court will allow to move forward under the relevant legal standards often receives intensive serious attention by the court.

One interesting and possibly impactful aspect of this litigation is that under Delaware corporate law, shareholders have a statutory right to obtain volumes of company records and documents even in advance of filing in court. Discovery conducted in liability lawsuits and other similar litigation usually would take some time and it would not typically be preceded by disclosure like that noted by the court: "Plaintiffs received over 44,100 documents totaling over 630,000 pages. It is reasonable to infer that exculpatory information not reflected in the document production does not exist." (Opinion at 1, fn.1.)

Not least, even just the first few pages of the opinion suggest to this SLF/attorney, strongly, that this opinion collects and recites persuasively a wide swath of the facts and contexts which, collectively, paint the picture of devastating malfeasance and nonfeasance that led to the overall 737 MAX debacle or, plural, debacles.

Sam Asama
9th Sep 2021, 20:46
WillowRun

Thanks for that clear and enlightening summary of the matter (as it now stands)!

Peter47
10th Sep 2021, 05:58
I have serious doubts about American corporate governance (and elsewhere). The roles of Chairman & Chief Executive should not be combined. Whilst shareholding activism is fine in principle (many Boards need shaking up) you only have to look at what Carl Icahn did to TWA & T Boone Picken's advances at Boeing to see what can happen. The whole governance issue needs considering & I would like to see a move towards the 'stakeholder' economy but you have to decide who the stakeholders are As previous posters have said, in the US shareholders are by far the pre-eminent stakeholder group so shareholders are effectively suing themseves! That said the business of how directors get elected is a very real one.

You cannot expect a Board to be experts on safety but they must make certain that there is an effective process in place. Where does negligence start?

It is said that American companies tend to be run by lawyers, British ones by accountants & German ones by engineers. Fine, but look at what happened at Volkswagen.

Boeing is a Delaware corporation as are many large corporations. Is it the equivilent of operating under a flag of convenience? Fun fact. The last time I checked Delta flew in 49 of the 50 states. The missing one Delaware. Guess which one it is registered in.

Ancient Observer
10th Sep 2021, 12:20
Risk is a very tricky area for Boards to manage. Of the 3 I've been on, none were anywhere near perfect. The lawyers will have a great fee earning bunfight.........

tdracer
10th Sep 2021, 18:02
You cannot expect a Board to be experts on safety but they must make certain that there is an effective process in place. Where does negligence start?


At least when I retired (5 years ago), Boeing Commercial did have a robust safety process. I was a long time member of the Propulsion SRB (Safety Review Board), and often participated in the Aircraft level and Cross Model SRBs. I never had any significant issues with how the SRBs handled their tasks, and with minimal 'interference' from higher ups, and this extended to the new program board I dealt with during the 747-8 development. More than once, I found that we needed to make an expensive change to meet safety and cert requirements and had to go to program to get the change approved. It may have been grudgingly, but the changes were approved. I have no reason to believe that changed significantly after I left (including feedback from coworkers that stayed on after I left). Interestingly, the one time I did get into it with a Chief engineer about an expensive (one million dollars) change I insisted was required to meet the regs was well before Boeing became a Delegated Organization - in fact my experience was factored into the 'undo pressure' rules to protect the designated "Authorized Representatives" (AR - the delegated equivalent of a DER).
So, unless the Board somehow interfered with the existing processes in place, it would not be unreasonable for them to have done a cursory review of the processes - found them adequate - and left them alone.
If, OTOH, the Board did somehow interfere with the existing safety processes which contributed to the MAX disasters, I'd think criminal charges would be in order.

pattern_is_full
10th Sep 2021, 18:36
As previous posters have said, in the US shareholders are by far the pre-eminent stakeholder group so shareholders are effectively suing themseves!

Ignorance.

Any sensible company or organization carries Directors/Officers Liability Insurance, precisely to protect the "company," as well as the individuals, against malfeasance or nonfeasance.

https://www.investopedia.com/terms/d/directors-and-officers-liability-insurance.asp

Boeing's insurer will pick up the tab (if any). Boeing may face increased insurance premiums - and then again they may not, if the Board (now under "new management") can persuade the insurer that they have cleaned up their act.

It does amaze me (perhaps it shouldn't) that pilots here, who are grossly offended by the ill-informed opinions of SLF or flight simmers regarding aviation, are perfectly happy to babble on about business and law, where they often share an equally substandard level of knowledge.

TURIN
13th Sep 2021, 00:26
Pattern is full.

If this was PLRuNe (Professional Lawyers Rumour Network) I would agree.

tdracer
13th Sep 2021, 02:15
pattern_is_full

I wouldn't swear to this, but what I remember is that Boeing is basically self insured.

pattern_is_full
13th Sep 2021, 07:00
Thank you. Sounds risky to me, but many companies do take that option. I certainly wish Boeing the institution all the best, and hope it can recover its pre-McD/D reputation and "engineering-first" culture.

I'm sure I'm a "stockholder" by way of various mutual funds, but I haven't been counting the pennies. I just would like the company to get back to being as respectable as most of the people on the assembly floors and in the design offices.

WillowRun 6-3
15th Sep 2021, 01:39
On occasion lawsuits against big corporate entities hold significance because of the impact the litigation is likely to have on other aspects of the corporate entity's business prospects and even its existence.

The court's opinion tells the story of the 737 MAX in what might be - up to this point - pretty unique way. Recall that the plaintiffs, suing in the form of derivative action on behalf of the company, had obtained volumes of company documents and records prior to filing the "complaint" that is the basis of the court's decision. To indulge posters who wish that lawyers would just go away, and presumably would be willing either to fend for themselves in whatever form of legal and court system might obtain (or in the absence of any such system), I'm not using the formal nomenclature of this pleading here. But...

It actually is important to note that it is a "Verified" complaint. Unless Delaware law (I'm not licensed in that State, hence the caveat) contains some quirky wrinkle, when the complaint is "Verified" it means the parties filing it have sworn, under penalty of perjury - just like on the witness stand at trial in open court - to the truth of the factual assertions stated in the complaint. In other words, this is a significantly more advanced foray into the sordid facts of how badly Boeing went astray than the more familiar kind of complaints which are filed mostly just to get the courtroom process started.

I have to wonder, though, about how this Board "should" have considered the question of "safety" as that term has gained the prominence it now holds in this case. In an earlier client engagement of mine, a senior official of the entity was fond of remarking how much it irked him when the Board members wanted to get involved in "how the grass was getting cut" - the entity wasn't a golf course or anything where it would matter to the fundamental direction of its existence. Here, the right answer can't possibly be that the Directors were supposed to be quadruple, quintuple, x-multiple-guessing the evidently vast corporate bureaucracy responsible for deriving yet one more version of that venerable old workhorse airplane, "the" 737.

Isn't the better understanding of what the Boeing Board failed to do, that it failed to structure and direct the management of the business so to assure a very high degree of fidelity to all applicable regulatory and safety requirements, with a margin of safety to spare? I mean, several derivatives into "the" 737 is it realistic to envision any director, let alone the Board in a formal way, saying, "but will it be safe? Are airplanes ever safe? Sometimes there are crashes, you know." The notion that a derivative, the next derivative in what had become a very long line, was either safe or unsafe seems a bit, well, simplistic.

Maybe it's unfair to see the prominent role "safety" has claimed as the equivalent of requiring the board to question fundamentals of aeronautical design, calculations of lift and drag, intricacies of how synthetic airspeed might interact with possibly conceivable in-flight instrument failures and emergencies, at such an organic level.

In any event, with the changes made by the legislation hammered out by Rep. DeFazio's (excellent) Committee, oversight of Boeing not only by FAA, but by the professional staffs on Capitol Hill, and increasingly by other regulatory authorities especially in Europe, isn't going back to sleep at the switch. The progress of this shareholder lawsuit in Delaware, and the revelations that could yet occur, very likely will underscore the importance of implementing that legislation and doing so effectively, regardless of partisan political games being played. But please, no one need refer to "safety infrastructure."

Big Pistons Forever
15th Sep 2021, 03:26
Who ultimately green lighted the MAX program? That decision to proceed must have contained important caveats as to time lines and approved maximum spending. These were obviously fatally flawed so is the board responsible for incentivizing a corporate culture of cheap over safe and fast over good or is the problem centred in the C suite ?

DaveReidUK
15th Sep 2021, 07:48
WillowRun 6-3

If that's a roundabout way of saying that safety should never be a Band-Aid, but rather the lifeblood that courses through the veins of any company making things that can kill people, then I suspect few would disagree.

WillowRun 6-3
15th Sep 2021, 20:21
DaveReidUK

Thanks for articulating that point, though I wasn't trying to suggest there is much disagreement with regard to the intrinsically fundamental nature of "safety" for an airplane manufacturer.
(That said, we could summarily describe what the company did in the case of the 737 MAX as indeed putting a Band-Aid on a fatally flawed aircraft type variant.)
What I was trying to get at, is the idea that the particular engineering, design, and flight operations details about the flaws in the MAX - which obviously implicate safety of the aircraft - would not be subjects the Directors ordinarily would be expected to be deeply knowledgeable about. These subjects all are delegated to managerial ranks and their staff cadres. To draw on my Board experience, a trustee of a university viewing a presentation about expansion of a degree program wouldn't ask the presenters to justify and explain why specific pages of assigned reading are listed on a course syllabus for the degree program (if the syllabus was even tabled to start with).
So the failure of the Board here to drill down from the level of production plans, revenue projections, customer order statuses and so on, to particular detailed workings of - say - number of AoA sensors for anything being included that might bear resemblance to how stability matters were addressed in the KC-46 tanker -- such failure isn't the same as not having a focus on and oversight of safety.
But it is a failure to direct management. I'm not defending this Board (and while I give Kirkland its due, is this why any of them went to law school?).
A university trustee shouldn't ever have to ask if course syllabus content is being done right. Continuous attention to current matters in Academic Affairs should give enough sense about these occasional concerns. Of course building airplanes is much, much different than teaching college students. And much more difficult......but I hope the Delaware court gets more focused on the specific information flows the company's board failed to elicit. Not just "safety" as a broad overall category.

tdracer
16th Sep 2021, 01:35
Big Pistons Forever

It might be worthwhile remembering why Boeing launched the MAX.
Boeing didn't really want to do another 737 and was working on a completely new 737 replacement - I knew people who were on the program. But, when Airbus launched the A320 NEO series, it caught Boeing with their pants down. There were two major problems with launching a brand new 737 replacement to answer the NEO - first off Boeing was still struggling to get the initial 787 and 747-8 aircraft certified and into service - the engineering resources to launch an all new aircraft simply were not available. Second, launching a new aircraft means a bare minimum of 5 years from launch to entry into service - probably quite a bit longer (and that's without accounting for the engineering resource shortage). Worse, it takes time to ramp up the build rate of a new aircraft - and at the time they were pumping out 737's at over 2/day, a rate that would probably take another five years from EIS to achieve. So, basically conceding the massive single aisle market to Airbus for about 10 years. Now, ten years later with the benefit of 20-20 hindsight of what happened, that doesn't look so bad. But at the time, conceding that massive market - several thousand aircraft - to Airbus was simply unthinkable. Hence the scramble to come up with the MAX.

Less Hair
16th Sep 2021, 06:14
And Airbus scrambled to meet the CSeries performance with the neo ending up owning the A220.

procede
16th Sep 2021, 07:22
The A220-300 basically killed sales of the A319neo, but it does not compete with the A320neo and A321neo. Airbus was also more than happy to use the A319 production slots tot produce more profitable A320's and A321's.

WillowRun 6-3
17th Sep 2021, 02:53
Wall Street Journal reporting (article by Dave Michaels and Andrew Tangel) that former chief technical pilot, Mark Forkner, is expected to be charged criminally relating to his role in the development of the 737 MAX. The article does not identify what specific charge or charges are expected to be filed.

Among several factual items (familiarity with which is now presumed, among those following the sordid tale of the MAX) supporting a decision to charge - according to the article - are the explicit admissions made by Boeing about misconduct on the part of certain unnamed employees in Boeing's "plea bargain" in federal court in Texas, several months ago. More widely known is the regrettable reference to "jedi mind tricks" played on FAA, of course.

Whether this is part of a prosecutors' effort to "go up the ladder", I won't speculate. Especially after the recent posts here about decisions made by company officers and directors, though, if the employee -- whose job it was to carry out a plan for the MAX where that plan had deep and significant flaws to begin with -- gets charged, isn't it logical to expect serious consideration given to charging also those higher-ups who formulated that plan and authorized and directed its implementation from the start?

megan
17th Sep 2021, 07:05
isn't it logical to expect serious consideration given to charging also those higher-ups who formulated that plan and authorized and directed its implementation from the startYou would think so given comments made by employees, managers in big companies though like to sheet the blame for any hiccup down to the lowest on the totem pole.

“This airplane is designed by clowns, who are in turn supervised by monkeys”
“I just jedi mind tricked this fools. I should be given $1,000 every time I take one of these calls. I save this company a sick amount of $$$$.”
“Would you put your family on a MAX simulator trained aircraft? I wouldn’t.”
“I’ll be shocked if the FAA passes this turd.”
“This is a joke. This airplane is ridiculous.”
“Best part is we are re-starting this whole thing with the 777X with the same supplier and have signed up to an even more aggressive schedule!”
“Jesus, it’s doomed.”

I find it interesting that Forkner threw in his towel with Boeing before the two crashes, one wonders his motivation, he knew what a cluster %@*^ it all was and was prescient to what he saw as an inevitable out come?

As DeFazio said. “This is not about one employee; this is about a failure of a safety culture at Boeing in which undue pressure is placed on employees to meet deadlines and ensure profitability at the expense of safety.”

WHBM
17th Sep 2021, 23:57
Boeing didn't really want to do another 737 and was working on a completely new 737 replacement - I knew people who were on the program. But, when Airbus launched the A320 NEO series, it caught Boeing with their pants down.
I've heard this view before. But surely Boeing would have known perfectly well what Airbus had in hand. The new engines coming along were a known, and doubtless long offered to Boeing on the same timescale. Airlines would have been approached and received presentations on the plans. Suppliers and vendors serving both would be early in on it. Personnel leave one company and join others, taking knowledge with them. Boeing market research, which they have long been regarded as world leaders in, would surely have been aware of where Airbus were heading. The issue that the new engines readily fitted under the A320 airframe but not the 737 was also long known.

spornrad
18th Sep 2021, 07:53
There is a piece by Scott Hamilton at leeham news (https://leehamnews.com/2021/09/13/pontifications-how-airbus-maneuvered-boeing-into-launching-a-re-engined-737/) about this. Apparently, Boeing was in a squeeze by the delays and budget issues with other types and then came the unexpected threat of loosing AA as an exclusive customer.

EDLB
18th Sep 2021, 11:08
Everyone in he industry knows since decades that higher efficiency engines mean higher bypass ratio, which means larger fan diameter. So nobody can tell me that this came as a surprise for Boeing.

On those decisions the fish stinks always from the head. You see it in the automotive industry too, that it easier to drag the mid management levels to court on misconduct. While every one knows that expensive decisions (or decisions to save said expenses) will be made by top management. Especial if sums way above 6 figures are involved.

The game at court then played out is who knew what at what time. As if CEOs or top managers get paid for not knowing their trade.

tdracer
18th Sep 2021, 18:36
As spronrad notes, the problem was that at that time Boeing was severely resource limited. Remember, the 787 was supposed to be certified and in service in 2008. Not only did the delays on the 787 mean that engineering couldn't be released to work another program, Boeing had tens of billions tied up in program (at one point it was estimated that Boeing had over $30 billion just in inventory costs related to the 787 delays). The 747-8 program was also going full tilt - and also over budget and behind schedule although not nearly as bad as the 787 (and most of the schedule issues on the 747-8 could be traced to our being resource starved due to the demands of the 787). There was barely enough to do what needed to be done to get the 787 and 747-8 certified and into service - forget launching an all new program...

The original plan had been to have a new 737 replacement aircraft ready by 2016 (for a while the development program was called 'Project 2016') - which incidentally is when the first A320NEO was delivered. But the fiasco of the 787 program meant that Boeing simply didn't have the resources necessary to do that - which ultimately lead to the MAX fiasco.

WHBM
19th Sep 2021, 06:56
If the Max really is such a boondoggle, one wonders why it nevertheless managed to make a very respectable sales volume with mainstream carriers. Putting the software incompetencies to one side for a moment, the rest of it seems to have formed a very significant sales competitor to the Neo, without the clean sheet development costs. It's like the strategy was right, but some aspects of the implementation were screwed.

Sallyann1234
19th Sep 2021, 08:48
How were the airlines to know?
They wanted a product that carried more passengers at less cost. The 737 MAX promised just that.
They relied on Boeing's reputation and the FAA's approval, which had always been sufficient before.
Even their pilots who flew it weren't aware of the safety defects.

Life of Leisure
19th Sep 2021, 12:04
As to why is the 737max such a sales sucess, two factors need to be remembered:

1. Airlines which already had 737s had already invested in trained crew, spares, etc. and changing to the A320 would nean new costs.

2. The total number of single aisle aircraft being ordered were far beyond the supply capabilities of Airbus. Two, or more, manufacturers were needed to meet the market demands.

Bergerie1
19th Sep 2021, 16:22
This looks to be an interesting development. Can anyone else shed light?
https://www.seattletimes.com/business/boeing-aerospace/criminal-indictment-imminent-for-former-boeing-737-max-chief-technical-pilot-report-says/

DaveReidUK
19th Sep 2021, 17:19
See post #29. No doubt more details will emerge in due course.

Bill Harris
20th Sep 2021, 13:58
One wonders where Boeing has wandered off to. In addition to the 737 issues, there have been continuing hardware and software problems with the Boeing Starliner space capsule .

Dr Jay
20th Sep 2021, 18:25
beardy

Directors of publically traded companies do not make operational decisions, especially at a company as large as Boeing. For the most part, the Directors are unaware of most operational decisions. The role of the Director is to act independently with the best interests of the shareholders in mind to guide the Executives in making strategic decisions.. They determine if the CEO and other officers are the best options for the company. They also, through the Audit committee, provide additional checks and balances in the finances of the company. I suppose if operational issues like where to place a factory has strategic impact the board might weigh in, but otherwise, no....

These lawsuits against Boards are hard to win because Delaware law protects Directors pretty strongly. Unless this is willful malfeasance by the Board that can be proved, the law suit will probably not go anywhere. It has to be this way, otherwise no one would serve on the Board of a publically traded company.

whitav8r
20th Sep 2021, 22:37
Forkner is in serious trouble for his outrageous lying to the FAA, but I still am troubled by the lack of sensor fault visibility that resulted in such a flawed design of MCAS. Maybe not the person who drew the block diagrams but those who would be responsible for the fault tolerance review and simulator testing with various failures for a system that would drive the most important control surface on an aircraft. Possibly they were newbies that had no past experience so the onus would fall on higher ups that knew the technology but had been promoted to management. Somebody has to be left who knows how to build an airplane!

tdracer
20th Sep 2021, 23:14
It all traces back to one bad call - the failure of MCAS was deemed to be no worse than "Major" - basically that if the stab trim started doing something unexpected or that the crew didn't understand, they'd simply disable it (which used an existing procedure). "Major" failures don't require redundancy in design. In 20-20 hindsight, that was a fatally bad call, but at the time it must have seemed reasonable. All the problems with the MCAS trace to that - had it been identified as "Hazardous" they never would have implemented it the way they did.

whitav8r
21st Sep 2021, 00:46
tdracer
Yes, I’ve heard that comment before about determining that it was simply a “major failure” and you simply used cut off switches after determining that in four seconds or less. However, since they didn’t call it out specifically other than a “ runaway” stab trim, it didn’t seem to the pilot like a runaway. Just a burp of stab trim every few seconds. Or if they had trained pilots with an AOA sensor failure, maybe. But as it was….

WillowRun 6-3
21st Sep 2021, 01:39
Some internal company communications, which logically ought to have taken place, have not yet been revealed, with regard to either the substance of the communications or documents reflecting or recording the substance (or both). This, despite the evidently large volume of documents and records tendered by the company to the plaintiffs in the Delaware suit, the federal agencies investigating the accidents and the causes, the Congressional committees and others.

Specifically referring to the evidently uphill battle faced by the defense for the company's former chief technical pilot (and others, potentially), it is undisputed that the MCAS system previously was used in the KC-46 tanker aircraft. The WSJ article of Sept. 29, 2019 - almost a year into the saga - was among the first to publicly discuss the background of MCAS. As well as the fact that its workings in the tanker were different, as compared to how it was ultimately used in the 737 MAX, in material and significant ways. "[E]ngineers who created MCAS more than a decade ago for the military refueling plane designed the system to rely on inputs from multiple sensors and with limited power to move the tankerís nose", according to that article.

Possibly one could believe it all happened in some different way but logic (and legal experience, if noting this weren't offensive to some forum members) indicates that there would have been communications about the workings of MCAS in the KC-46 in the context of how it was being considered for the 737 MAX, and especially how modifying its function could have unwanted or unacceptable effects. It does not appear reasonable to believe that someone with significant responsibilities in the MAX program simply lifted MCAS and did not have consultations or discussions with engineers or others who had at least a decade of experience with its workings. And that these communications, at least some of them, wound up in emails, memos, and so forth.

If these exist and have already found their way into the several very tall stacks of documents and records already disclosed to investigations or produced to adverse parties in discovery, then I'm sorry I've missed it. Regardless, if these exist, defense counsel will have headaches trying to portray any criminal defendants as just sounding like smart-alecks in messages but otherwise acting in good faith.

Big Pistons Forever
21st Sep 2021, 02:30
. Somebody has to be left who knows how to build an airplane!

Given all the continuing issues with the 787 and 777X, I would suggest that the jury is still out on that…….

krismiler
21st Sep 2021, 06:27
https://youtu.be/cnsNTj0SdhE

spornrad
21st Sep 2021, 08:19
A crime first turned to tragedy, now to farce
The $2.5 billion deferred prosecution agreement was heavily criticized because it effectively absolves Boeing management and instead places the entire blame on Forkner and his vice Gustavsson. The deal was negotiated and signed by a Justice Department lawyer named Erin Nealy Cox, a Trump appointee who left her job the day after, two days after Trump groupies stormed the US capitol..
Ms. Cox then joined Kirkland & Ellis, Boeing's lead law firm. She was publicly welcomed there as a partner by Mark Filip, who signed the agreement for Boeing.
The 2.5 billion was looking like a lot only at first glance. The agreement between the Justice Department and Boeing contains an incredible, completely unprecedented whitewashing phrase for the Boeing management:

"the misconduct was neither pervasive across the organization, nor undertaken by a large number of employees, nor facilitated by senior management"

Since DOJ had little time to conduct its own investigation, this is likely based exclusively on Boeing's own statements.
Together with the laughable, unusually low symbolic penalty of $246 million (< 10%, the lion's share of the 2.5 billion concerns compensation payments mainly to airlines and some to victim families negotiated long before), this is a real bargain for Boeing and a slap in the face for the victims' relatives.
Above all, Boeing has thus avoided any admission of guilt as a company, which could have jeopardized future business with the Department of Defense.
Financial times (https://www.ft.com/content/cc688f26-987e-4f2f-9011-6cdcffe582c9)
Seattle times (https://www.seattletimes.com/business/boeing-aerospace/boeing-agrees-to-pay-2-5b-to-settle-criminal-fraud-charges-over-737-max/)
The next logical act in this farce is now the prosecution of the cheap scapegoat Forkner, who was so stupid to document his behavior in emails and/or who had the bad luck that his vodka-juicy emails were perfectly suited for release by Boeing's IT Department to construct a small, subordinate scapegoat.

All that's left to do now is cross fingers for Forkner's defense and wish them well....
Although, tragically, as Boeing's chief pilot, he had talked Lion Air out of training its pilots on MAX simulators. That was "a difficult and unnecessary training burden for your airline." He boasted that would have saved Boeing "a sick amount of $$$$." Sure he did that without the knowledge and not on behalf of the management.
Boeing gave him the "Service Excellence Award" in September 2016 for persuading the FAA to keep MCAS out of the pilot instructions....
The "new" boss Calhoun claims to this day "off the record" that the accidents would have been prevented by well-trained US pilots.

To quote Max Liebermann, the famous German painter: "I can't eat as much as I would like to vomit".

megan
22nd Sep 2021, 02:30
Where is the Chief Engineer overseeing the program in all this, yes, I know he's pulled the pin. He ought to have been on top of all the MCAS issues, and supposedly giving his imprimatur to the product developed. Was he not in the habit of having a round table with all concerned departments? Doubt anything like this would have happened on Joe Sutter's watch.

pattern_is_full
22nd Sep 2021, 05:04
Transcript of interview of Michael Teal, vice president/chief project engineer of the MAX program, under the auspices of the Committee on Transportation and Infrastructure, U. S. House of Representatives. May 11, 2020,

148 pp. https://transportation.house.gov/imo/media/doc/FINAL%20Michael%20Teal%20(Boeing)%20Transcript%20and%20Exhib its%20and%20Attachment%20(9.9.20).pdf

Some apropos quotes.

(Mathew Weisman, Counsel, (House) Investigations and Oversight staff) Q: ....during the MAX certification process, which was from roughly 2012 to March of 2017, what was your title and what were your responsibilities related to the MAX program?

A: I was the vice president/chief project engineer of the MAX program, responsible for the requirements, the configuration, the design, the testing, the certification and overseeing of any issues in the build process, mainly the engineering work.

Q: And during that time, roughly how many people reported directly to you?

A: As the chief project engineer at The Boeing Company, no employees actually report to me. So, at one time, I think I had an OA that was working for me, an administrator, but no engineers directly report to me. They all are functionally aligned to the engineering leaders of the company.

Q: So can you explain to us how that management structure worked? Like, how would you oversee the work that was being done if no one reported directly to you?

A: So the structure of the program, we had a chief -- so I was the chief project engineer. And then, for example, all of the systems engineers worked for the systems integrated product team leader; all the structural engineers worked for the structural IPT leader; had a propulsion IPT leader; integration team leader; as well as an interiors team leader.

So all the engineers reported up through those five skills. They reported up through a director of engineering and reported to the program manager. And then I reported to the program manager as well.

Q: And who was the program manager to whom you reported?

A: In the beginning of the program, it was a gentleman named (redacted). I believe it was in 2013 - I can't exactly know the exact date - he left the program and was replaced by Keith Leverkuhn.

Q: Okay. And roughly how many people are involved in the MAX program?

A: From an engineering - of the Boeing engineers involved, around 1,500 engineers, approximately. But then throughout the supply chain, you know, CFM, the engine company, I had, you know, probably a thousand engineers. And then suppliers around the world had hundreds and hundreds of engineers. I don't have an exact number for you.



(GOP minority counsel Corey Cooke) Q: Okay. So during development of the 737 MAX, was it your understanding that MCAS was capable of activating repeatedly?

A: I had no knowledge that MCAS had a repeat function in it during the development.

Q: Why would you not have known that?

A: That is a technical detail that would be the technical leaders well below my level would have gone into that level of detail. So we have organizations down in the stability and control and flight controls working with the pilots. They would go into the details of the requirements for any particular function. My exposure to it would've been simply the team coming forward and saying we need a new function called MCAS, Maneuver Characteristic Augmentation System, on the airplane to pass certification requirements. That's the detail I would have gotten into.

Q: Would they have provided you with a description that would have described how and when it would operate, and would that description potentially have included that it would activate repeatedly in some circumstances?

A: I would not get into that level of detail.

megan
22nd Sep 2021, 05:49
Joe Sutter would have wept pif is my take on that.

Sallyann1234
22nd Sep 2021, 08:07
A: As the chief project engineer at The Boeing Company, no employees actually report to me. So, at one time, I think I had an OA that was working for me, an administrator, but no engineers directly report to me. They all are functionally aligned to the engineering leaders of the company.

According to his description, his position was entirely redundant. How can a Chief Project Engineer have no control over the Project staff?

I get that the guy wants to weasel out of any responsibility, but what was really going on there?

SamYeager
23rd Sep 2021, 07:05
It really begs the question as to just what did this guy do other than receive a pretty large salary?

procede
23rd Sep 2021, 08:10
His only job is to exist and look nice, so it seems that Boeing is taking overall product engineering seriously. But off course not really, because that would be to expensive.
And, off course, he is the scapegoat if it does goes wrong.
Bureaucracy and :mad: jobs at work.

Octane
23rd Sep 2021, 11:55
So, a Boeing Chief Project Engineer does not need to have an understanding of the systems of the aeroplane he is responsible for? Astonishing..

DType
23rd Sep 2021, 12:43
One of my colleagues used to say that the first appointment in every project was the future scapegoat.

Big Pistons Forever
23rd Sep 2021, 13:58
In the public service status is measured by how many people work for you, in industry it is the size of your budget,.

My question is what level of control did Mr Teal have over the MAX engineering budget ? My guess is the level of control was substantial, and not in a good way.

Boeing seems to have a lot of senior management with authority but no accountability…..

WillowRun 6-3
5th Nov 2021, 02:51
Wall Street Journal reporting that an agreement has been reached for settlement of the shareholder derivative suit. Main elements of the reported settlement include a monetary settlement of $225 million, to be paid by the insurers of the directors and former directors, and paid to the company. The suit was based on the central allegation that the Boeing Board of Directors failed in their fiduciary duty of overseeing safety matters, particular insofar as the 737 MAX aircraft is concerned.

Also reportedly part of the reported agreement is a requirement for Boeing to hire an ombudsman to handle certain internal matters - not further specified in the news report. Not least, the agreement also would require the company to appoint a director to its board with "experience in aviation safety."

No doubt the temptation will be strong for PPRuNers to get their nominations for this Board appointment in early (and often) . . . .

WHBM
5th Nov 2021, 09:34
Isn't that more than has been paid out to the accident victims ?

pattern_is_full
5th Nov 2021, 11:50
Boeing set aside $550 million for the victims on the flights - the catch is that victims' families have to take action (file a lawsuit/claim) to collect. That process is only getting started.

Boeing is also expected to pay $1.7 billion to airline "victims" - i.e. to cover airlines' losses due to grounding, additional training, etc. etc.

The Board malfeasance insurance payout covers 90% of Boeing's criminal fine ($250 million).

WHBM
5th Nov 2021, 12:08
Given that US claimant lawyers typically scoop up to 50% of such payouts for their fee, and that from Indonesia and Ethiopia not everyone will go through with such a convoluted US legal process, it looks like the Boeing stockholders may have done better financially out of the 737 crashes than those killed.

WillowRun 6-3
5th Nov 2021, 13:35
Fifty percent? Possibly airplane crash litigators work differently, but the standard attorneys' fee share in a contingent-fee lawsuit is, quite consistently in the U.S., one-third, not one half.

WHBM
5th Nov 2021, 19:32
OK, so only USD 150m for the stockholders and USD 75m for their lawyers, all agreed. Meanwhile :

the catch is that victims' families have to take action (file a lawsuit/claim) to collect. That process is only getting started.

Of course, the stockholders could announce that they are donating their USD 150m windfall to the victims' families support fund. But I'm not holding my breath.

WillowRun 6-3
6th Nov 2021, 13:16
The reported agreement to settle the derivative lawsuit in Delaware was (at the time of the news report, at least) pending court approval. I think the principal plaintiffs in the lawsuit are major institutional shareholders.

Perhaps among their presumably eminent attorneys and counselors, some lawyer whose idealism hasn't yet been crushed and shredded by the arts of law practice - pulling constantly "the drag-chain of the law" - will realize that a motion to modify and amend the agreement would be well taken at this time. Motion For Equitable Distribution and Assignment, or something. It would take some atypically creative legal thinking, so holding of breath still not recommended or advised.

(Drag-chain reference attributable to Howard Cosell on a tv sports broadcast - he was an attorney before gracing the airways, I mean airwaves.)

WHBM
6th Nov 2021, 14:28
I'm sorry, but is there a Plain English version of the above.

WillowRun 6-3
6th Nov 2021, 15:20
Sure, but plain English writing incurs a higher hourly rate.

The institutional shareholders - I'm not looking it up but my recall is that they're big pension funds or the like - wouldn't see any material benefit to the value of their shareholdings over the long term from the cash infusion into the corporation, as opposed to sending their settlement (even net of atty fees) to the victims' families fund.

The negotiated agreement for settlement doesn't contemplate this essentially public-spirited, even charitable, transfer. It would be a heavy lift for an enterprising lawyer somewhere on the service lists (that is, lists of the several attorneys who must receive copies of all papers filed in court)`who could see the opportunity to take some of the absurdity here and bring it before the court. It is a court of equity - Chancery - where interests recognized by law although not necessarily articulated in statute, codes or rules, can be vindicated.

The Howard Cosell item is just because he gives lawyers a good name, if one bothers to learn the bio..

WillowRun 6-3
6th Nov 2021, 15:52
About the compensation for the attorneys representing the plaintiffs:
The WSJ article in the weekend edition (by Andrew Tangel) reports that the attorneys' fees (and expenses) as stated in the negotiated settlement are a lot less. The article reports that the attorneys' fees (and expenses) are allocated in the amount of 29.7 million dollars (U.S.), or 12.5 percent of the settlement.

Also, as the article notes, this action in Delaware Chancery is a shareholder derivative suit, quite different from a securities fraud case. Among the objectives of such litigation are "governance changes". Whether the addition to the Board of a director with as-yet unspecified qualifications for "aviation, engineering or product-safety oversight experience" merits more than a cynical "yawn, so what? - same bean-counters in control, can't undo the McDonnell merger, too much damage done [insert other favorite indictments of Boeing here]" probably is more a matter of personal opinion than fact, so far. Maybe the specification that the Board include at least three directors with such experience (according to the article) could make a difference.

spornrad
14th Nov 2021, 09:28
FAA says Boeing is appointing people lacking expertise to oversee airplane certification (https://www.seattletimes.com/business/boeing-aerospace/faa-says-boeing-is-appointing-people-lacking-expertise-to-oversee-airplane-certification/)

Brain drain: during the downturn from the pandemic Boeing offered early retirement to many more senior FAA-authorized safety engineers.
An FAA letter of complaint to Boeing last week states that many of the replacement Boeing safety appointees the agency interviewed this summer did not measure up.
New rules are scheduled to take effect before year end that will require every proposed appointee to be interviewed by the FAA and then either approved or rejected by the agency.
Some lacked “direct experience requiring expertise in the general certification process.”
Some were not “cognizant of related technical requirements and problems related to civil aircraft approval.”
Some did not know the “technical and procedural requirements involved in obtaining such approvals.”
Weaknesses in the Boeing panels that appointed these engineers: lacking independent assessment of a candidate’s experience and technical capability.
The appointment process appear to be just a formality instead of being an independent validation that the candidate had made the grade.

GlobalNav
14th Nov 2021, 13:13
The FAA should revoke Boeing’s ODA and should probably not approve ODA at all in the future.

Fortissimo
14th Nov 2021, 14:01
This goes way beyond Boeing and other OEMs, it affects every organization in the industry. Regulators need to be confident that Boards, accountable and nominated persons (postholders) are "suitably qualified and experienced", yet they often have little influence over the appointment of people who are clearly ill-equipped to do the job. You can coach someone to get through an accountable manager interview but that is not the same as ensuring the individual understands, retains and uses the information.

We can all point to examples of managers applying pressure to short-cut or go beyond boundaries to improve returns to shareholders and by extension to themselves. Those who do this do not normally understand the system in which they are operating, the 2nd and 3rd order consequences of their decisions (such as the effect on safety culture), or even the basic principles of safety management. They are people who only see risk as being real in terms of profit/loss, who assume safety risks will not materialize on their watch, and who happily 'accept' safety risks on behalf of those who will bear the physical consequences of an accident.

It is time we did something about it, starting with requiring executives to demonstrate relevant knowledge. If we can't do that, then we should as a minimum expect some effort to learn the basics.

Big Pistons Forever
14th Nov 2021, 15:41
Unbelievable !

After everything that has happened and knowing that they are under a FAA microscope it is just same old same old with people appointed that management can count on to deliver the cheap, fast and nasty "solution" to every part of the aircraft build and certification process.:ugh:

I am already seeing the effects of Boeing's malfeasance in other regulators. They are definitely much more risk averse and more skeptical with any industry certification submissions. The result is significantly longer times to process applications. Boeing's greed and incompetence has ruined aviation certification processes for everybody.

Big Pistons Forever
14th Nov 2021, 15:55
GlobalNav

ODA is a vital part of the certification process, especially now with technologically advanced aircraft. The FAA will never have the resources or depth and breadth of experience to do all the certification work for Boeing. The problem is not the ODA process itself, it is Boeing management pathologies that has poisoned every level of the company. Personally I think Boeing is so broken it is not fixable without burning the company to the ground and starting over.

Bksmithca
14th Nov 2021, 16:36
Big Piston, a lot of the time in big corporations promotions are a case of who you know not what you know.

GlobalNav
14th Nov 2021, 20:03
Big Pistons Forever

ODA is not the only way to do delegation. Delegation has been done for a long time, including Boeing, before ODA was ever approved. Boeing does not have the corporate character (integrity) required for ODA to work as intended.

tdracer
14th Nov 2021, 22:05
spornrad

Two aspects that really stick out to me in that article. First off was the FAA finally recognized a fundamental flaw in the Boeing ODA system - the lack of direct contact between the Authorized Representatives (ARs) and the FAA. When I was a DER, if I had a concern or question, I simply picked up the phone and called my FAA advisor and talked to them about it (we actually become pretty good friends). In the ODA system, the ARs were specifically told not to directly contact the FAA - we had to go through the Boeing Cert Group. We could respond to calls from the FAA, but we were not to cold call the FAA. Although many of us ARs complained about this, and considered it to be counter productive, it was to no avail. During the 747-8 cert flight testing - we expedience a strange anomaly. During the post flight, the FAA pilot asked me to let him know when we figured it out - I responded 'So you're asking me to call you'. Puzzled look, to which I said 'just say yes'. The FAA pilot couldn't understand what I was talking about until another FAA specialist explained that I wasn't allowed to 'cold call' the FAA. The FAA pilot was flabbergasted, but it didn't change... Ten years later, the FAA finally recognized that they needed more open communication with the ARs, but it cost hundreds of lives.

Second, when I was there, becoming an AR was far from 'just a formality'. I mentored an "ARit" (AR in training) through the process - it took nearly two years, with independent check by other ARs to make sure he knew what he was doing before we got the final approval. It probably could have done more quickly (we were in the middle of the 747-8 program and really busy) but no way it could be done in less than a year - it was quite involved.
It sounds very much like Boeing got caught short handed due to the brain drain from all the early retirements, and simply did not have the time and resources to properly backfill all the ARs that were lost to retirement, so they short circuited the process with predictable results.

YRP
17th Nov 2021, 14:19
It all traces back to one bad call - the failure of MCAS was deemed to be no worse than "Major" - basically that if the stab trim started doing something unexpected or that the crew didn't understand, they'd simply disable it (which used an existing procedure). "Major" failures don't require redundancy in design. In 20-20 hindsight, that was a fatally bad call, but at the time it must have seemed reasonable. All the problems with the MCAS trace to that - had it been identified as "Hazardous" they never would have implemented it the way they did.

Agreed.

The part I find scary is that (as I understand it) they did not reclassify it during the updates. It is still not implemented with the proper by now fairly well understood design techniques for redundancy in software control systems. Nor will it have had the same level of testing / review scrutiny of a critical s/w system (at least it wouldn't have been formally required to, perhaps for this particular fix they will have, but wouldn't be required to repeat that in the future).

The reason seems clear: difficult to retrofit. But it seems clear it should have been hazardous in retrospect after the two accidents. While the new intended limits (single activation, etc) should keep it out of hazardous range, it should have the proper redundancy & testing to confirm that software keeps it in the non-hazardous range. I.e. the potential is still hazardous so the software that makes it non-hazardous ought to be implemented to the higher standard. And as I understand it isn't.

WillowRun 6-3
30th Nov 2021, 13:05
As reported by FlightGlobal the Chairman of the House Transportation and Infrastructure Committee, together with the Chairman of its Aviation Subcommitee, have issued correspondence to the FAA Administrator, pointedly seeking answers to two additionally specified issues concerning the 737 MAX. At the risk of omitting very significant details, the two issues are the inoperability of the AoA Disagree alert, and Boeing efforts to downplay the significance of the MCAS modification of the aircraft.

Though written in typical legal style associated with the Congressional legislative and Committee processes, this SLF/attorney believes the letter is worth the time to read it closely -- specifically because it constitutes a focused effort to implement the provisions of the Aircraft Certification, Safety, and Accountability Act, passed and enacted into law in the prior Congress. As the letter itself notes, the legislation is central to the context here; as it also notes, the letter is direct follow-up to recent testimony by FAA Administrator Dickson (rather pointed follow-up, one might note). As everyone following the 737 MAX saga recognizes, the legislation grew out of the several investigations by various authorities, in which the T&I Committee's work was an immensely heavy factor.

Letter to FAA Administrator (link from Committee website, accessed Nov. 30, 2021) follows. The Committee website also presents a relevant press release.
2021-11-29 - DeFazio-Larsen-Stanton LTR to FAA-Dickson RE Boeing Accountability - Enclosure Included.pdf (house.gov) (https://transportation.house.gov/imo/media/doc/2021-11-29%20-%20DeFazio-Larsen-Stanton%20LTR%20to%20FAA-Dickson%20RE%20Boeing%20Accountability%20-%20Enclosure%20Included.pdf)

WillowRun 6-3
2nd Dec 2021, 12:14
Reported by The Wall Street Journal today (on website):
"China Sets Boeing 737 MAX Directive for Flight Resumption" (byline, N. Khan and D. Cameron).

Article states that the CAAC, Civil Aviation Administration of China, has issued an AD requiring "certain software installation and a revision of the flight manual, among other changes." However no date has been provided for resuming flight operations.

Article quotes the CAAC: “After conducting sufficient assessment, CAAC considers the corrective actions are adequate to address this unsafe condition.”

DaveReidUK
2nd Dec 2021, 14:48
Unsurprisingly, the AD does not appear to contain any technical changes other than (presumably) those that have been applied to the Max in the rest of the world.

Per Reuters:

"The directive outlines specific procedures for pilots to perform in case of problems similar to those that emerged in two deadly crashes before the plane's grounding in March 2019. It also lists all the systems that must be functioning in order for the plane to be dispatched."

ATC Watcher
14th Dec 2021, 06:25
https://www.bbc.com/news/business-59646696
a short resume of the Whistleblowers report .

GlobalNav
15th Dec 2021, 00:23
During the congressional committee testimony given by the Chief Engineer, a fundamental flaw of the existing certification came out in a curious Q & A series, by both Democrat and Republican questions.

The engineer was asked whether the process that was alluded to as being the goal of the project worked and the answer was it had been effective, that process had worked. The fact that 346 people died was commented on by those conducting the questioning and resulted in about the only heated parts of the discussion. as one would imagine. The accidents were described as learning cases. They are, at some unfortunate cost in inconvenience to the N.O.K.

A system should learn from tragedies, to do otherwise is a disservice to the departed. However, the problem seems to this observer that the examination of the designs is done by the same people who do the design work, whether in the DER-NAA-ACO structure or ODA or DOA type systems, choose your poison. The viewpoint of the examiner is intimately entwined by circumstance to those doing the designs, and so the challenge of assumptions that a 4-year-old gives the designer of a toy doesn't occur. In HF terms, the potential for "group think" is high, and that effectively short circuits an examination of the merits of a product for compliance. Sure, anyone can tick boxes, as the testimony outlines, but there were no questions being raised, no curiosity, no what-ifs arising from the candor that comes from not having a common education, experience, assumptions, and biases as the person whose work is being evaluated.

Oddly, this is the same issue that arises from most QA audit processes, there is an emphasis on ticking checklists, and they get in the way of looking out and seeing curiosities in the design. Asking searching questions to understand how something works tend to get knocked out of the observer from the institution they end up working for.

Or give it to a marine, they know how to make things break.

e.g., 40 troops are stuck in 1st class in the back of a C-130; the loadmaster hands out 40 sets of EAR plugs, the foam yellow ones. After doing the rounds of the troops, the leader of the troops approaches the loadie and asks if he has more of the yellow candies, his guys had already consumed them all. How you think something works may be quite different to a 4 year old, or to someone who has a different point of view.

I would not say that it is the same people, exactly, who evaluate the design (for certification) that also created the design. But some of the people with certification responsibilities (ARís) are unfortunately subordinate to management and some who must divulge key information to the ARís are under career-threatening pressure from company management. Under older delegation arrangements, delegated engineers were directly subordinate to FAA engineers with regard to performance of their delegated tasks. This meant detailed technical oversight that was independent of the company.

The only way for a significant remedy to this chicken/fox paradigm is to eliminate the ODA, and return to the form of delegation that existed 25 years ago.

Unfortunately, there is also an existing core of management within the FAA who were selected during the last two decades with a long history of holding on to their positions of authority by defending the ODA, blinded, intentionally or not, to the fundamental flaws. This ďblindnessĒ will resist the changes that are necessary.

JRK
15th Dec 2021, 07:08
Hang on a minute. Boeing is owned by its shareholders, and if the plaintiffs (shareholders) succeed in extracting millions from Boeing their own investment in the firm will suffer. In effect they are suing themselves. Crazy stuff.


except in the real world it is not like in Economics 101 textbook... things are a "little" bit more complex...