NEW YORK/WASHINGTON (Reuters) -Boeing ( BA ) has reached a tentative nonprosecution agreement with U.S. prosecutors in a fraud case stemming from two fatal 737 MAX plane crashes that killed 346 people, people familiar with the matter said.

The agreement would forestall a June 23 trial date the planemaker faces on a charge it misled U.S. regulators about a crucial flight control system on the 737 MAX, its strongest-selling jet. It would require a judge's approval.

The agreement, if approved, would be a blow to families who lost relatives in the crashes and have pressed prosecutors to take the U.S. planemaker to trial.

Boeing ( BA ) has no longer agreed to plead guilty in the case, prosecutors told family members of crash victims during a Friday meeting, the sources said. The company's posture changed after a judge rejected a previous plea agreement in December, prosecutors told the family members.

DOJ officials are still weighing whether to proceed with a nonprosecution agreement or take Boeing ( BA ) to trial, a DOJ official said during the meeting. No final decision has been made, and Boeing ( BA ) and DOJ officials have not yet exchanged papers to negotiate final details of any nonprosecution agreement, the official told family members.

Boeing ( BA ) and the DOJ had no comment.

"I think this is a terrible deal," Paul Cassell, a lawyer for family members, said during the meeting according to one of the sources.

Nadia Milleron, who lost her daughter in one of the Boeing ( BA ) plane crashes in 2019, told Reuters she questioned how the DOJ, and Attorney General Pam Bondi, could justify cutting a deal with a repeat offender.

In December, U.S. District Judge Reed O'Connor in Texas rejected a previous plea agreement in the case, faulting a diversity and inclusion provision in the deal related to the selection of an independent monitor.

The decision prolonged the case into the incoming Trump administration, which has overhauled the Justice Department. Boeing ( BA ) agreed to the initial plea deal during the final months of the Biden administration.

Boeing ( BA ) in July agreed to plead guilty to a criminal fraud conspiracy charge after the two fatal 737 MAX crashes in Indonesia and Ethiopia spanning 2018 and 2019, and to pay a fine of up to $487.2 million.