A federal appeals court has stripped class-action status from a lawsuit accusing Boeing of misleading investors about its safety culture before a door-plug blowout on an Alaska Airlines 737 MAX 9 sent the company’s shares tumbling.
The 4th U.S. Circuit Court of Appeals ruled that shareholders had failed to establish a workable method for calculating damages across the entire proposed class. The court also found that the shareholders had not shown how Boeing’s alleged 40 misrepresentations affected its stock price at specific points in time.
Writing for a three-judge panel, Circuit Judge A. Marvin Quattlebaum Jr. criticized the shareholders’ damages analysis, saying it relied on a string of uncertain assumptions rather than a reliable calculation. He also said the lower court had failed to properly apply a 2013 U.S. Supreme Court ruling involving Comcast subscribers that set limits on how damages must be established in class actions.
The case was brought by shareholders led by Rhode Island’s state treasurer. They alleged Boeing had artificially boosted its stock price by making misleading statements about its commitment to safety and its willingness to allow employees to raise concerns.
Among the statements cited in the lawsuit was Boeing’s assertion that “safety dominates Boeing.”
The allegations followed two fatal MAX crashes in Indonesia and Ethiopia in 2018 and 2019 that killed 346 people.
The lawsuit gained renewed significance after an Alaska Airlines 737 MAX 9 lost a cabin panel shortly after takeoff from Portland, Oregon, on January 5, 2024. The incident left one flight attendant and seven passengers with minor injuries. Boeing’s stock fell about 8% on the next trading day.
The appeals court’s decision sends the case back to the lower court, where the litigation can continue without its class-action certification.
The Alaska Airlines incident also triggered a criminal investigation by the U.S. Department of Justice. Authorities later said Boeing had failed to comply with commitments made under a 2021 agreement connected to the earlier MAX crashes.
The National Transportation Safety Board said in June 2025 that four bolts intended to secure the cabin panel had not been installed and that Boeing lacked sufficient training and oversight to prevent the failure.
A separate shareholder class action involving the two fatal MAX crashes remains active. A federal judge in Chicago certified that case as a class action in March.
