JERE BEASLEY REPORT February 2020 I. II. plane and pilots didn’t respond correctly, it could cause a crash. The company may be CAPITOL UPDATE ON required to separate the bundles before the aircraft can be cleared to resume service OBSERVATIONS THE BOEING depending on the company’s findings. The LITIGATION wiring issue could also affect the MAX’s predecessor the 737 NG, which may also require repairs on the 6,800 planes 2020 CENSUS TO MAKE BIG DIFFERENCE FOR in service. MORE TROUBLE FOR BOEING AND ITS 737 MAX ALABAMA Further, the MAX engines are manufac- tured by CFM International (a joint venture An audit of the Boeing 737 MAX in This year Alabamians have a huge oppor- between General Electric and Safran). The December revealed more safety issues and tunity to affect the state’s future in a major company told the FAA it discovered a weak- concerns over the plane’s design. The inter- way. The 2020 Census will dictate the dis- ness in one of the engines’ rotors that could nal audit was conducted at the request of tribution of more than $675 billion in cause the part to shatter. The FAA told the Federal Aviation Administration (FAA) federal funding to local and state govern- Boeing to inspect as many MAX engines as after European Union Aviation Safety ments. This funding supports schools, possible before its service resumes but Agency (EASA) regulators rejected Boeing’s health care, infrastructure, community hasn’t required an immediate fix for the documentation regarding its latest pro- assistance and more. Its impact can last for weakened rotors yet. However, the agency posed software fix late last year. Findings decades and will affect the state in more from the audit were released last month ways than one. revealing previously unreported problems The census, which dates all the way back IN THIS ISSUE with wiring that helps control the aircraft’s to 1790, counts every person—both adults tail, according to The New York Times. It I. Capitol Observations ...............2 and children—living in the United States. also identified weaknesses in one of the The information gathered is then used to II. Update On the Boeing Litigation ......2 engine’s rotors and a manufacturing defect monitor changes in communities, identify that left the plane vulnerable to light- III. An Update On the Talc Litigation ......4 and address public service needs such as ning strikes. IV. An Update On the Opioid Litigation ....5 health care, education, public safety, Additionally, last month, Boeing released housing, food, and rural access to broad- V. Legislative Update .................6 more than 100 pages of documents expos- band. The Census Bureau also uses the data ing damning internal conversations among VI. Court Watch ......................7 to determine the number of seats each state employees regarding the 737 MAX to con- has in the U.S. House of Representatives. VII. An Update On the gressional investigators, The New York Whistleblower Litigation ............8 That is of critical importance. Times also reported. The documents were Starting March 12, each Alabama house- VIII. Product Liability Update ...........10 released just days after Boeing said it would hold will receive a postcard from the U.S. recommend simulator training for 737 MAX IX. An Update On the JUUL Litigation ....11 Census Bureau. It will contain instructions pilots before the aircraft resumes service. for how to complete the census. Residents X. Mass Torts Update ................13 The move on Boeing’s part was a complete can respond online, by phone or via tradi- XI. Business Litigation ................14 reversal of its previous efforts to discourage tional paper form. The survey takes less airline customers from demanding addi- XII. An Update On Securities than 10 minutes to complete. Each partici- tional pilot simulator training and to Insurance and Finance Litigation .....15 pant’s information is protected by law. deceive regulators into agreeing to no addi- XIII. Employment and FLSA Litigation .....15 The Alabama Counts! 2020 Census Com- tional training requirements. mittee, an organization dedicated to the XIV. Premises Liability Update ...........15 As discussed in previous editions of this Census and its importance to the state, is Report, 737 MAX planes were globally XV. Workplace Hazards ...............17 leading the effort to ensure Alabamians are grounded last March after two of the air- prepared to complete and return the form. XVI. An Update On Transportation craft crashed in separate incidents killing a Litigation .......................18 The committee was created by Gov. Kay total of 346 people. Both MAX crashes Ivey in an executive order in August 2018. XVII. Healthcare Issues ................20 were linked to problems with the MCAS, a Participation in the census is of the flight control software, that caused it to XVIII. Toxic Tort Litigation Concerns .......21 highest importance, since the next 10 years misfire and inadvertently sent the planes of federal funding will be determined by XIX. An Update On the Roundup Litigation . 21 into a nosedive shortly after takeoff. Con- the survey. It is estimated that in 2016 more XX. Update On Nursing Home Litigation ..22 gress launched investigations into the than $13 billion was allocated to the state development and certification of the MAX XXI. An Update On Class Action Litigation ..22 of Alabama from programs affected by the following the second of the two deadly previous census. The 2020 census will have XXII. The Consumer Corner .............26 crashes involving the aircraft. The U.S. even more money at stake for families in XXIII. Current Case Activity at Beasley Allen ..27 Department of Justice (DOJ) is also con- Alabama. Government employees, teachers, ducting a criminal probe. XXIV. Resources To Help Your Law Practice . 31 church leaders, business owners, and resi- XXV. Practice Tip Of the Month dents alike have much at stake. Alabama New safety risks uncovered. Counts! encourages everyone to talk to For Trial Lawyers .................32 those in their communities about the 2020 The additional safety risks regarding the XXVI. Recalls Update ...................33 wiring that were previously unreported Census and its importance to them and XXVII. Firm Activities ...................36 their families. More information is available involve two bundles that may be too close at www.census.alabama.gov. together. Boeing is trying to determine if XXVIII. Special Recognitions ..............37 the close proximity of the bundles could XXIX. Favorite Bible Verses ..............37 Source: ADECA cause a short circuit and how likely it is that this scenario could occur during flight. XXX. Closing Observations ..............38 If a short circuit occurred in this area of the XXXI. Parting Words ...................39 2 BeasleyAllen.com will require Boeing to address the manufac- dent in your region for other MAX approving the MAX for service. One of the turing defect that exposes the aircraft to customers. more contentious areas of concern was the lightning strikes and therefore exposes the need for increased pilot training. Foreign fuel tank and fuel lines to increased risk of Lion Air flight 610 was the first of the regulators favored simulator training and catastrophic fire. The New York Times two fatal MAX crashes. Shortly after the indicated they would not allow the MAX’s reported that Boeing workers at its Renton, crash, information about the new flight return to service in their respective coun- Washington, plant “ground down the outer control software MCAS, which has since tries without such a requirement. shell of a panel that sits atop the engine been determined defective and a major con- Also last month, regulators from various housing in an effort to ensure a better fit tributor to both crashes, surfaced along countries outside the U.S. were scheduled into the plane.” This step removed the with the fact that no one outside of Boeing to travel to Seattle. The company planned coating that protects the fuel tank and fuel was informed about the software. In 2016, to test the new software in a flight simula- lines in the event lightning strikes the air- Mr. Forkner convinced the FAA to remove tor. The regulators’ visits signaled to indus- craft while in flight. mention of the MCAS from the pilot’s try insiders that the regulators may be manual, leading the regulatory agency to ready to give the MAX’s changes a serious Internal documents embarrassing believe the system would engage in only evaluation. and damaging to Boeing. rare cases. Clearly, those with inside knowledge of There is no way to determine if addi- Boeing’s newer leadership. the MAX knew it was dangerous even tional training would have prevented the The company’s new CEO, David before the latest audit’s findings. In one of Lion Air crash. Likewise, there is also no Calhoun, took the reins last month and has the recently released internal documents, a way to determine if additional pilot training tall order for fixing the defectively designed Boeing employee tells another that they could have helped the pilots better navigate MAX, as well as repairing the reputation of would not put their family on the 737 MAX. the deadly situation created by Boeing’s a once highly respected company in the Yet, no adequate steps were taken to defective aircraft. Boeing took that option U.S. Mr. Calhoun has served on the compa- address the danger or warn the flying off the table for its customers. ny’s Board of Directors since 2009 so he is public. In fact, the messages demonstrate Boeing’s about-face on simulator not exactly an outsider, nor is he new to the the willingness of some employees to training. company’s leadership. Regardless, he has deceive Boeing customers and regulators. implemented changes and shifted the com- The documents reveal a corporate culture Boeing finally conceded and recom- pany’s public tone to one of a more concil- gone awry.