Rostec ready to cut deal with Boeing over 737 MAX legal action

Avia Capital Services (ACS), a subsidiary of Russian conglomerate Rostec, has said it is ready for an out-of-court settlement with Boeing over its order for 35 Boeing 737 MAX jets.

Rostec said on Tuesday its unit had filed a lawsuit in the United States to cancel its order for the 35 MAX jets. The Financial Times, which first reported the move, said ACS gave Boeing a cash deposit of $35m.

The jets ordered by Avia were first expected to be delivered in October 2019, but the date was moved to March 2022. A spokesman said ACS was suffering losses from non-delivery.

“If Boeing executives show goodwill, we are ready to hold talks and find a mutually beneficial out-of-court settlement for compensation of the losses we have suffered,” said the Avia spokesman.

Boeing MAX 737 jets have been grounded worldwide and airlines have cancelled contracts with the American aircraft manufacturer following crashes in October and March that killed 346 people.

Avia’s jets were ordered for a number of Russian air companies, including domestic low-cost firm Pobeda, a unit of the state carrier Aeroflot.

Russia is mainly using Boeing and Airbus jets for passenger flights, with many domestic airlines also adding Russian-made Sukhoi Superjet aircraft to their fleets.

ACS now wants the deposit to be returned by Boeing with interest, along with $75m in “lost profit” and about $115m in compensatory damages, plus “several times the amount” in punitive damages, the FT said.

Rostec declined to provide further details about the lawsuit.