After being hit with two lawsuits related to delays in its 787 Dreamliner, the Boeing Co. will “vigorously defend” itself, the company said Tuesday.
Boeing shocked investors in June when it postponed the first flight of its 787 Dreamliner for the fifth time just days after company executives gave assurances the plane would fly by July 1.
The class-action suits, filed in Illinois, allege that Boeing executives made false statements that caused artificial fluctuations in the company’s stock.
Boeing dismissed the lawsuits as “without merit” in a filing with the Securities Exchange Commission on Tuesday. Regardless, Boeing said it will defend itself from the legal action.
At the heart of the lawsuits is the question of which Boeing executives knew specific information about the 787’s delays and when the executives knew it.
From late April through June 17, Boeing and its executives, including Chief Executive Jim McNerney and then-commercial airplanes president Scott Carson, said several times that the 787 was on track to fly by the end of June.
The class-action suit filed by four law firms late last week cites prepared statements, media interviews at the Paris Air Show and SEC filings in which Boeing insisted the Dreamliner would fly by July 1. Boeing’s stock climbed from under $40 to the mid-$50s in mid-June.
On June 23, Boeing announced that its 787 would not fly as planned because of a structural weakness found in the area where the wings and fuselage meet. The company said it had found the flaw several weeks earlier but had not believed the problem was significant.
Boeing shares dropped 6.5 percent the day of the 787 delay announcement. The following day, the 24th, Boeing’s stock declined another 6 percent.
The lawsuit claims that Boeing executives made misleading comments about its ability to meet the 787’s first flight and delivery schedule to “forestall further cancellations” of its 787. The comments allowed Boeing to “make a positive presentation” at the Paris Air Show in mid-June, the suit claims.
Anyone who acquired Boeing stock between May 4 and June 22 can join the complaint. About 200 million shares were traded on the New York Stock Exchange during that period.
On Tuesday, Dallas-based Kendall Law Group said it was pursuing a class-action suit against Boeing on the same basis. The law firm said it is led by a former federal judge and a former U.S. attorney.
Boeing declined further comment Tuesday about the lawsuits.
As recently as Monday, Boeing said the company has reinforced the structural flaws on three 787s. Boeing said it plans to put the 787 in the air by the end of the year, with first delivery by the end of 2010. Boeing shares closed at $52.51 Tuesday, up 3 cents.