Judge Removed After Overturning $72 Million Verdict Against Boeing

In a pivotal 2024 legal decision, a judge who had initially ruled in favor of Boeing was later removed from the case. His removal came after it was discovered he had been involved in trading Boeing stocks.

The appeals court has recently reinstated the $72 million verdict against Boeing, previously nullified, due to concerns over the judge's impartiality.

Judge James Robart came under scrutiny after it was revealed that he engaged in stock trades of Boeing during the litigation period of Zunum Aero's lawsuit against the aerospace company.

According to Robart, the transactions were initiated by the bank that managed his spouse's retirement portfolio, and he asserted they did not influence his judicial decisions. He did submit a formal notice of the trades to the court.

Court's Concerns About Impartiality

The US Court of Appeals for the Ninth Circuit found the delayed disclosure, alongside Robart's consistent pro-Boeing rulings, problematic enough to potentially cast doubt on his neutrality in ongoing proceedings.

Experts in judicial conduct, consulted by Business Insider, perceived Robart's trading activities and the postponement of their disclosure as a relatively minor issue, yet the optics remained troubling.

Background of Zunum Aero's Case

After exhausting its finances in 2019, Zunum accused Boeing of dragging its feet and obstructing their efforts to secure additional funding. The startup had been aiming to introduce a compact hybrid-electric aircraft by 2022 and had ambitions for larger models.

In a prior decision, jurors determined that Boeing and its partner, HorizonX, harmed Zunum by unlawfully utilizing its proprietary information, resulting in a $72 million award.

Appeals Court's Findings

The appellate judges criticized Robart for ignoring substantial proof of Boeing's misdeeds and Zunum's claims, which supported the jury's prior determinations.

The case has continued with debates over whether Zunum must liquidate its intellectual property to satisfy the debt owed to HorizonX, amid worries the company's patents could be undervalued.

Despite their setback, Zunum's lawyers argued that due to the verdict being nullified, Boeing ought to be held liable for upwards of $160 million, reflecting the severity and intentionality of Boeing's actions as perceived by the jurors.

Both Zunum and Boeing representatives declined immediate response to comments. Judge Robart also chose not to provide a statement.