Boeing has friends in high places, thanks to its 737 crash czar

The crashes of two Boeing Co. 737 Max jetliners have put the aerospace giant on a perilous course through multiple U.S. investigations. But as it faces off against the government, Boeing will be dealing with a lot of familiar faces.

The myriad personal connections between the U.S. plane-maker and top officials were hinted at when Attorney General William Barr bowed out of a criminal investigation of the plane’s design and certification. Barr cited his past affiliation with Kirkland & Ellis LLP, a longtime legal adviser to Boeing that’s now helping with its defense in the matter.

Several other Trump administration officials have personal or professional ties to Boeing’s man at the center of the drama. He’s J. Michael Luttig, the longtime general counsel whom the company reassigned to lead its 737 response.

When he was a federal appellate court judge, Luttig brought on dozens of promising young clerks who are now spread throughout the judiciary and beyond. In more than a decade at Chicago-based Boeing, he stocked his department with ex-government lawyers. He also tapped Kirkland, which has a big Chicago presence, for matters as varied as acquisitions and contract disputes.

It’s little surprise, then, that the executive and judiciary branch of the U.S. government is dotted with Luttig friends, associates and proteges.

Christopher Wray, who once clerked for Luttig, is now the head of the Federal Bureau of Investigation; in that role, Wray oversees the agents who are interviewing Boeing engineers. Several others have ties to Kirkland, a favored firm of Boeing under Luttig. At least four top Justice Department officials are Kirkland veterans, including Barr, Deputy Attorney General Jeffrey Rosen and Assistant Attorney General Brian Benczkowski, whose Criminal Division oversees one of the crash probes. The department’s prosecutors will ultimately decide whether to take action against the company or its officials.

Luttig, 65 years old, is wired into the Supreme Court, too. He was a groomsman at the wedding of U.S. Chief Justice John Roberts.

His influence remains deep after three decades at the center of U.S. conservative legal circles. As the 737 Max controversy swirled, Luttig did some informal advising to the White House. He was quoted in articles over the past month suggesting how President Donald Trump’s administration might satisfy Supreme Court concerns about its push to add a citizenship question to the U.S. Census.

There are no claims anyone has been unduly swayed by the Luttig connections. There’s also no indication that officials including Rosen or Benczkowski worked directly on Boeing projects at Kirkland. Benczkowski previously worked as the chief of staff at the Justice Department for Mark Filip, a former deputy attorney general who’s now at Kirkland and leading its work for Boeing. The Justice Department didn’t respond to requests for comment.

And generally, personal relationships between Justice Department officials and lawyers for Boeing wouldn’t disqualify someone from an investigation, said Stephen Gillers, a professor at New York University School of Law who teaches ethics.

“It’s what you worked on," he said, “not whom you know."

Even so, the critical mass of personal associations may present a challenge to investigators seeking to assure the public, and the families of 346 people killed in the crashes, that the Boeing probes will be conducted free of political influence.

“Boeing has wired politics to an extent that allows them a considerable margin for error," said Jeff Hauser, executive director of the Revolving Door Project at the Center for Economic and Policy Research in Washington.

Boeing said there is no conflict of interest, or appearance of conflict, for Luttig in the matter.

“These circumstances present themselves every day in the law and litigation. Where required, the parties take affirmative steps to ensure there is no actual conflict possible. Boeing employees are bound to comply with all legal and regulatory requirements and to ensure they do not create any actual or perceived conflicts of interest," the manufacturer said in a written response to questions.

Regarding the Census matter, it said Luttig occasionally shares his opinion on constitutional law in his personal capacity because he’s a former federal judge “with deep expertise in the subject." Luttig declined to comment for this article.

The stakes for Boeing under Luttig’s current assignment are huge. Boeing said this week that it would report a $4.9 billion accounting charge to cover anticipated costs of disruption to airlines from the grounding of the 737 Max. That’s before counting legal costs. The Justice Department has the authority to impose criminal fines, and any finding of criminal wrongdoing could bolster civil lawsuits. Settlements from wrongful death lawsuits alone could reach $1 billion, according to Bloomberg Intelligence analyst Holly Froum.

A grand jury in Washington is hearing evidence gathered by the fraud section of the Justice Department’s criminal division, while FBI agents are seeking information from engineers and others involved in producing Boeing jets. The U.S. Congress, the Securities and Exchange Commission and the Transportation Department’s inspector general are conducting separate probes, some of which could scrutinize executives’ roles in deciding not to disclose cockpit sensor faults.

Powerful corporations have long handed their stickiest affairs to lawyers who have experience at high levels of the Justice Department or White House. As the Boeing matter shows, a great deal of influence now rests with a knot of former Kirkland lawyers atop the Justice Department. Their ties to one another could raise recusal questions in other matters as well.

Lawyers from Kirkland represented financier Jeffrey Epstein in a non-prosecution agreement for sex offenses in 2007 with the U.S. attorney’s office in Miami, then led by former Labor Secretary Alexander Acosta, himself a former Kirkland attorney. The Justice Department is now examining that deal; Barr has said he won’t be involved in that review, though he hasn’t recused himself from the latest Epstein case.

Luttig once worked with Barr at the Justice Department and has known him for more than 30 years. He memorialized that relationship in a Jan. 11 letter to the Senate gushing about Barr’s qualifications to serve as attorney general. Barr would be “the most highly qualified individual ever to hold the Office," Luttig wrote, adding that “he will be the finest Attorney General in our Nation’s history."

Boeing’s clout has extended to administrations of both political parties; the plane-maker is among the nation’s largest exporters, a massive manufacturing employer and a symbol of American technological prowess. President Barack Obama famously joked that he deserved a gold watch for helping close international sales.

On a visit to Japan in 2017, Trump called on Brett Gerry, then president of Boeing Japan, for special recognition. “Oh, look at my guy," he said. “Great job you’re doing." (Gerry, a Luttig hire who’d worked in the Justice Department in the early 2000s, was named Boeing’s chief counsel in May as Luttig took a role overseeing Max litigation.)

About a year into Trump’s presidency, former Boeing officials began to inhabit key slots in his administration. John Demers, one of Boeing’s Washington lawyers, was confirmed to run the Justice Department’s National Security Division. Former Boeing executive Pat Shanahan became acting defense secretary and was Trump’s pick in March for the permanent role, until he withdrew from consideration.

Luttig himself was mentioned as a possible replacement for FBI Director James Comey or Attorney General Jeff Sessions. He was at Boeing, poised to retire, when the company’s directors asked him to take on the Max defense.

The Boeing lawyer has a rare familiarity with top officials in the executive and judicial branches, much of it dating to his 15 years as an appellate judge in Richmond, Virginia.

Luttig gained a reputation as a feeder judge to career-making clerkships, and top-flight law students sought to work for him, said David Lat, founder of the Above the Law website and managing director of Lateral Link, a legal recruitment firm. Among his former clerks are Senator Ted Cruz, Solicitor General Noel Francisco and the FBI’s Wray.

So many of Luttig’s clerks went on to work for U.S. Supreme Court justices that Lat’s online publication coined a term for them: “Luttigators." About 40 of the clerks that Luttig hired while at the Fourth Circuit went on to stints at the top court.

Luttig had a reputation for high standards and for turning out clerks who were “very smart, very detail-oriented and very hard-working," Lat said. “His network in the legal world is unparalleled."

Luttig’s clerks also benefited from his relationships with the late Justice Antonin Scalia, for whom he’d been a clerk in the 1980s, as well as Justice Clarence Thomas and retired Justices David Souter and Sandra Day O’Connor -- all three of whom Luttig helped prepare for confirmation hearings. Luttig himself was passed over three times for a seat on the U.S. Supreme Court during the George W. Bush administration.

In 2006, Luttig made the unusual career move of leaving his lifetime appointment. He joined Boeing as general counsel after an approach by the company’s lead director at the time, Kenneth Duberstein, a former White House chief of staff who’d known Luttig as a young lawyer in the Reagan administration.

At Boeing, Luttig upended the corporate law department by hiring about a dozen former Supreme Court clerks, many of them proteges of conservative justices like Scalia and Thomas -- a cadre of lawyers who often eschew practicing corporate law. To persuade them to forego the partner track at big law firms for less-glamorous careers as in-house lawyers, he dangled lucrative contracts and the opportunity to tackle “very important and complicated work," Lat said.

Luttig’s hires are studded throughout Boeing’s management. B. Marc Allen, a Luttigator who also clerked for retired Justice Anthony Kennedy before joining Boeing more than a decade ago, is a rising star who sits on Boeing’s executive council with Luttig and his replacement as general counsel, Gerry.

Luttig’s team of lawyers handled contracts for multibillion-dollar sales and carried out some of its most important strategies, from union negotiations to a trade challenge of a competitor, Canada’s Bombardier Inc. He also continued Boeing’s work with outside firms including McGuireWoods and Kirkland. The latter helped Boeing with a $4.25 billion acquisition of a parts supplier and litigation against a software supplier.

Today, Kirkland alumni fill the highest ranks of the Justice Department. In addition to Barr and Rosen, the department’s No. 3 official, Acting Associate Attorney General Claire McCusker Murray, also worked at the firm. So did Benczkowski, who heads the department’s criminal division and oversees matters handled by the fraud section, which has one of the crash investigations.

The Justice Department hasn’t said whether any former Kirkland lawyers aside from Barr have recused themselves from the investigation or have reason to do so.

If Rosen worked on Boeing’s defense team at any point, he must recuse himself under department rules. Justice Department employees also have to remove themselves from matters involving a client of their former law firm for two years after leaving the practice. Because Rosen left Kirkland in March 2017 to become a senior adviser and then deputy to Transportation Secretary Elaine Chao, he wouldn’t have to recuse himself under this rule.

Benczkowski earlier received a waiver allowing him to oversee the government’s criminal investigation into corruption and fraud involving Malaysia’s investment fund 1MDB. In that matter, Kirkland & Ellis is representing Goldman Sachs Group Inc. Barr also received a waiver in that case.

Such waivers are issued by the White House’s counsel. That position is currently held by Pat Cipollone, another Kirkland alum.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed

Source: Livemint.com

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