Boeing’s legal troubles continue to mount as the aerospace giant faced a costly loss in a lawsuit brought by a failed startup it had invested in. A federal jury found Boeing guilty of stealing trade secrets from Zunum Aero, a company known for its plans to develop a hybrid-electric airplane. The jury awarded Zunum a total of $81 million, with the potential for damages to reach $235 million depending on the judge’s decision. Boeing was also found guilty of tortious interference for allegedly dissuading a potential investor from funding the startup when it was in need of cash.
Zunum had alleged that Boeing stole trade secrets and used design details gathered during due diligence for their investment to develop a competing hybrid-electric plane. Boeing also allegedly approached Safran to develop a similar propulsion system based on Zunum’s IP. Boeing denied these claims, stating that they had no plans to build a competing aircraft and ultimately decided not to move forward with the venture due to concerns about Zunum’s technical abilities. The loss in the Zunum case adds to Boeing’s legal troubles, including violations of a 2021 agreement following fatal crashes of 737 Max planes in 2018 and 2019.
The court judgment in favor of Zunum will go towards repaying creditors and employees who continued to work for minimum wage during the startup’s final days. Zunum’s co-founders, CEO Ashish Kumar and CTO Matt Knapp, expressed their satisfaction with the outcome of the lawsuit, stating that it was primarily for the benefit of former employees. One of the creditors is Boeing itself, with the award discounted for the loans that Zunum failed to repay. The judgment comes as just the latest in a series of legal challenges for Boeing, raising questions about the company’s compliance and safety oversight.
Despite Boeing’s denials, the jury found sufficient evidence to prove that Boeing had engaged in malicious actions, resulting in significant damages for Zunum. The startup, once seen as a promising player in the aviation industry, struggled financially after failed fundraising attempts. Boeing’s involvement, although denied by the company, was deemed to have contributed to Zunum’s downfall. The ongoing legal battles for Boeing raise concerns about the company’s practices and compliance with regulatory agreements, including the recent violation of terms in a 2021 agreement following fatal plane crashes.
As the legal saga unfolds, Boeing faces the possibility of further penalties or criminal charges if federal prosecutors determine that the company has not complied with the terms of the deferred prosecution agreement. The recent incident involving a panel falling off a Max plane operated by Alaska Airlines has raised fresh concerns about Boeing’s quality control and safety oversight. The outcome of the Zunum case and the broader legal challenges facing Boeing highlight the ongoing struggle for the aerospace giant to regain trust and credibility in the wake of safety concerns and legal issues.
