Stanford Law’s Robert Rabin on Boeing Accidents and Grounding: Who Is Liable?

This week, the U.S. joined some 42 countries in grounding Boeing’s 737 Max aircraft.  In the Q&A that follows, Stanford Law Professor Robert Rabin, a torts expert, discusses the legal implications of the two accidents and liability for Boeing and others.

If it is determined that the Ethiopian Airlines Boeing 737 Max plane crashed because of a software or mechanical malfunction in the aircraft, who is liable? Does the supply chain complicate that question?

Boeing, as manufacturer of the airplane, would be liable under a defective products theory. The supply chain doesn’t complicate the situation: A component manufacturer (if there is one) might be jointly responsible, but that wouldn’t negate Boeing’s responsibility.

Robert L. Rabin
Stanford Law School Professor Robert Rabin

Are pilots liable? And how does Boeing’s responsibility to train pilots play into this? Pilots were reportedly kept in the dark about updates to key software in the updated jet.

Unless there was a finding of pilot error in steering the plane, the pilot would not be liable. If there were a finding of inadequate training as an alternative ground for liability, then Boeing could be responsible under a negligence theory for the inadequate training. But that inadequacy would need to be causally linked to the crash.

Does the Federal Aviation Administration have a role in verifying safety for new aircraft produced here in the U.S.? If yes, does the FAA provide some level of legal cover for Boeing? The House Transportation and Infrastructure Committee is reportedly planning to hold hearings to study the FAA’s process for approving the planes. The process was reportedly changed in 2005 in a cost-cutting move that gave oversight of the process to Boeing executives.

The FAA is mandated to assure airline safety via a certification process. But that wouldn’t provide legal cover for Boeing, which (as I understand it) has been ceded responsibility by the FAA for voluntarily assuring self-certification. This self-certification located primary responsibility (and potential liability) in Boeing.

Canada’s transport minister, and then later President Trump, cited newly available satellite-tracking data that suggests similarities between the Ethiopian crash last Sunday and the Lion Air accident last October. Both involved Boeing 737 Max planes and in both cases, it appeared that the pilots could not control the flight soon after takeoff. Are the similarities legally significant?

The similarities are potentially legally significant. The flight recorder data will provide some evidence of causation. But in the final analysis, responsibility is likely to turn on circumstantial evidence, which will make the similarities relevant on causation.

What redress do passengers and airlines have when flights are cancelled in situations like this?

The airlines’ redress is likely to turn on interpretation of the contractual provisions between Boeing and the airlines regarding economic loss (business loss) from grounding of the airplanes. The passengers on future flights are far less likely to have any recourse against Boeing (or against the airlines, which are in any event likely to provide alternative transportation options). Suits by the airlines are a real possibility based on breach of contract terms.

Do you expect airlines that have the 737 Max in their fleet to sue Boeing for having to substitute other planes in light of safety questions, the grounding, and customer reaction?

Suits by the airlines are a real possibility based on breach of contract terms.

What other potential liabilities are there?

Another source of potential legal liability is wrongful death suits by the survivors of the passengers on the airplanes in the two crashes. Success of these claims would turn on an international convention (treaty) applicable to international air carriers. The extent of recovery in these cases is subject to complicated rules of which countries’ laws apply. Settlements of these claims, entirely apart from formal litigation, are very common.

Robert L. Rabin, A. Calder Mackay Professor of Law at Stanford Law School, is an expert on torts and legislative compensation schemes with extensive knowledge of the history and institutional dynamics of accident law.