(Reuters) — A federal appeals court on Monday dismissed a class-action lawsuit accusing Boeing Co and Southwest Airlines Co. to cover up a fatal flaw in the design of the Boeing 737 MAX 8 plane and ordered that the dispute be dismissed.
In a 3-0 decision, the 5th US Circuit Court of Appeals in New Orleans said four classes of passengers who claimed they were overcharged on nearly 200 million Southwest and American Airlines tickets over 18 months could not prove they was damaged, which deprives federal courts of jurisdiction.
Brian Dunne, whose law firm represented the plaintiffs, declined to comment. Boeing and Southwest did not immediately respond to requests for comment.
The 737 MAX was grounded worldwide after 346 people died in the October 2018 crash of Lion Air Flight 610 in Indonesia and the March 2019 crash of Ethiopian Airlines Flight 302 in Ethiopia.
Passengers accused Southwest, Boeing’s launch customer for the MAX 8, of pressuring Boeing to deceive Federal Aviation Administration officials during the testing and certification process, ostensibly to lower pilot training costs.
They also alleged that the companies misled the FAA about a Boeing aircraft stability system that took control of both planes and improperly depressed the nose.
Passengers said they overpaid for tickets on Southwest and American, which also flew the MAX 8, because demand and prices on the plane’s routes would have dropped if the truth had been known.
However, Circuit Judge Andrew Oldham said the plaintiffs mostly complained of a “prior risk of physical harm to which they are alleged to have been exposed because of the defendant’s fraud,” and lacked standing because that risk never materialized.
He also said that “if anything, plaintiffs are likely better off financially” because they would have to pay more on other flights if the MAX 8 had been taken out of service sooner.
In January 2021, Boeing agreed to pay $2.5 billion to settle a criminal investigation by the US Department of Justice into the 737 MAX crash.
The case is Earl et al. v. Boeing Co. et al., 5th US Circuit Court of Appeals, No. 21-40720.