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$25 million to be paid in drone whistleblower case

Bingen, Wash.-based Insitu, a Boeing subsidiary, has agreed to pay $25 million to settle allegations that it used recycled parts rather than new parts in military drones, the Justice Department announced today.

The parts were put into drones that Insitu built for the U.S. Special Operations Command and the Department of the Navy between 2009 and 2017, according to the U.S. Attorney’s Office for the Western District of Washington.

When Insitu was awarded the contracts to supply the drones, under the terms of no-bid contracts, the company said it would use new parts and materials. But according to the allegations, Insitu substituted less expensive recycled, refurbished, reconditions and reconfigured parts.

“Taxpayers deserve to get what they paid for — especially in significant no-bid military contracts,” U.S. Attorney Brian Moran said in a news release. “Cases such as this one should be seen as a warning to defense contractors that false claims have no place in military purchasing.”

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Boeing will pay $2.5B to resolve 737 MAX criminal case

Boeing says it’s entered into a $2.51 billion agreement with the U.S. Justice Department to resolve a criminal charge related to the Federal Aviation Administration’s evaluation of Boeing’s 737 MAX airplanes.

The deferred-prosecution agreement addresses a single charge of conspiracy to defraud FAA inspectors about the safety of the 737 MAX’s automated flight control system. Investigators say changes to a component known as the Maneuvering Characteristics Augmentation System, or MCAS, were to blame in a pair of catastrophically fatal 737 MAX crashes that occurred in Indonesia in October 2018 and in Ethiopia in March 2019.

Those crashes led the FAA and other regulators to ground hundreds of 737 MAX planes operated by airlines around the world. After more than a year of investigations, software fixes and revisions to pilot training requirements, the FAA cleared the planes to return to service last November.

The agreement calls for Boeing to pay a penalty of $243.6 million, provide $1.77 billion in compensation to the airlines that purchased 737 MAX jets, and establish a $500 million fund to compensate the families of the 346 people who were killed in the two crashes. Boeing also agreed to cooperate with investigators and strengthen its anti-fraud compliance program.

If Boeing complies with the requirements of the agreement, filed today with a federal court in Texas, the criminal charge will be dismissed after three years.

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Boeing ends an era at composites research center

Boeing says it’ll be repurposing the Seattle-area facility that has served as the focus for research into the composite materials used in aircraft ranging from the B-2 Stealth bomber to the 787 Dreamliner.

In an emailed statement, Boeing said much of the work being done at the Advanced Developmental Composites Center, situated across the street from Seattle’s Museum of Flight, will be distributed to other Boeing facilities — mostly in the Puget Sound region. Other work, unrelated to Boeing Commercial Airplanes, will continue to be done at the 600,000-square-foot facility.

Boeing cast the move as a cost-saving and efficiency-enhancing measure.

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The year in aerospace: Comebacks in the skies above

Boeing’s rebuilding year drew to a close today with a milestone capping a momentous year in aerospace: the first U.S. passenger flight for a 737 MAX jet since the worldwide fleet was grounded.

American Airlines Flight 718 carried 87 passengers from Miami to New York’s LaGuardia Airport, more than 21 months after two catastrophic crashes in Indonesia and Ethiopia brought a halt to 737 MAX flights.

The incidents led to months of investigation, focusing on an automated flight control system that was found to be vulnerable to software glitches. Boeing had to revamp the system and rework pilot training routines in cooperation with airlines. The Federal Aviation Administration gave the go-ahead for the return to commercial operations just last month.

Brazil’s Gol Airlines and Aeromexico resumed flying 737 MAX jets earlier this month, but Flight 718 was the first time since the grounding that a MAX carried paying passengers on a regularly scheduled U.S. flight.

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FAA rules could smooth the way for drone deliveries

After months of feedback and fine-tuning, the Federal Aviation Administration today issued its final versions of safety rules for drones that fly over people and at night — including the drones that Amazon is developing to make package deliveries.

“The new rules make way for the further integration of drones into our airspace by addressing safety and security concerns,” FAA Administrator Steve Dickson said in a news release. “They get us closer to the day when we will more routinely see drone operations such as the delivery of packages.”

Draft versions of the rules were issued a year ago, kicking off a review period during which the FAA received about 53,000 comments. The final rules take effect in about two months.

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Self-driving tractors: Next frontier for Boeing’s ex-CEO

It’s been almost a year since Boeing fired CEO Dennis Muilenburg over his handling of the 737 MAX crisis, but now he’s found a new role in the manufacturing industry — as an investor and adviser at a company building self-driving electric tractors.

California-based Monarch Tractor says Muilenburg, who grew up on a farm in Iowa and served as a Boeing engineer and executive for more than 30 years, will bring his experience in the aerospace world to agricultural technology.

“Monarch is at the perfect intersection of my experience paths,” Muilenburg said in a news release.

The company unveiled its “driver optional” tractor just last week. The electric vehicle is designed to perform pre-programmed tasks in farm fields, but also will be capable of being driven either remotely or in the cab. The first tractors are due to be shipped in the fall of 2021, at a starting price of $50,000.

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QuantumScape pursues ‘breakthrough’ in batteries

Bill Gates isn’t just investing in QuantumScape’s potentially revolutionary lithium-metal battery technology — he’s giving the venture advice as well.

“I didn’t honestly think he knew anything about chemistry, and we are all about chemistry,” Fortune quotes QuantumScape CEO Jagdeep Singh as saying.

But Singh found out that Microsoft’s billionaire co-founder is a quick learner. “When he thinks something is important he can dive really deep and become an expert in that area,” he told Fortune. “He has gotten very deep into this area.”

Today QuantumScape reported eye-opening progress in its campaign to produce a solid-state alternative to lithium-ion batteries, the current industry standard for energy storage applications ranging from smartphones and laptops to electric cars and airplanes.

The Silicon Valley company said its tests with prototype single-layer cells demonstrated the ability to recharge batteries up to 80% capacity in just 15 minutes. The data suggest that the technology could produce car batteries capable of lasting hundreds of thousands of miles and weathering temperatures as low as -30 degrees Celsius (22 degrees below zero Fahrenheit).

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Trump signs order guiding federal adoption of AI

President Donald Trump today signed an executive order that puts the White House Office of Management and Budget in charge of drawing up a roadmap for how federal agencies use artificial intelligence software.

The roadmap, due for publication in 180 days, will cover AI applications used by the federal government for purposes other than defense or national security. The Department of Defense and the U.S. intelligence community already have drawn up a different set of rules for using AI.

Today’s order could well be the Trump administration’s final word on a technology marked by rapid innovation — and more than a little controversy.

Future regulations could have an outsized impact on Amazon and Microsoft, two of the largest developers of AI technologies. The sharpest debates have focused on facial recognition software, but there are also issues relating to algorithmic biasdata privacy and transparency.

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Kymeta rolls out next-gen connectivity service

Kymeta Corp., the Redmond, Wash.-based connectivity venture backed by Microsoft co-founder Bill Gates, is making the next generation of its hybrid satellite-cellular mobile service for voice and data available to commercial markets starting today.

And although commercial availability of Kymeta’s u8 terminal and Kymeta Connect service marks a milestone, the company’s executives consider the government and military market to be just as important.

“Government and military need the most reliable and seamless connectivity to safely fulfill their missions,” Walter Berger, Kymeta’s president and chief operating officer, said in a news release. “These men and women often go to the most remote or disaster-stricken areas of the world, and they need reliable communications to rescue lives, keep property safe and complete missions.”

During beta testing, the u8 system faced a trial by fire — literally.

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AI experts do a reality check on ‘Superintelligence’

Seattle, Microsoft and the field of artificial intelligence come in for their share of the spotlight in “Superintelligence” — an HBO Max movie starring Melissa McCarthy as the rom-com heroine, and comedian James Corden as the world’s new disembodied AI overlord.

But how much substance is there behind the spotlight? Although the action is set in Seattle, much of the principal filming was actually done in Georgia. And the scientific basis of the plot — which involves an AI trying to decide whether or not to destroy the planet — is, shall we say, debatable.

Fortunately, we have the perfect team to put “Superintelligence” to the test, as a set-in-Seattle movie as well as a guide to the capabilities of artificial intelligence.