WASHINGTON (Reuters) -A U.S. judge approved a request by the Trump administration's Justice Department to dismiss a criminal case against Boeing ( BA ), allowing the planemaker to avoid prosecution on a charge stemming from two fatal 737 MAX plane crashes that killed 346 people, but he harshly criticized the government's decision.

Judge Reed O'Connor, of the U.S. District Court in Fort Worth, Texas, disagreed with the department that dismissing the case, which had been pursued by the Biden administration and initially resulted in an admission of guilt, was in the public interest.

O'Connor said in 2023 that "Boeing's ( BA ) crime may properly be considered the deadliest corporate crime in U.S. history."

But on Thursday the judge said he had no authority to reject the government's decision to make a deal with Boeing ( BA ), even though he said it "fails to secure the necessary accountability to ensure the safety of the flying public."

Boeing ( BA ) said it would honor the obligations of its agreement with the Department of Justice.

"We are also committed to continuing the significant efforts we have made as a company to strengthen our safety, quality, and compliance programs," it added.

The Justice Department rejected the judge's criticism. "Rather than allow for protracted litigation, this agreement provides finality for the victims and requires Boeing ( BA ) to act now," a spokesperson said. "We are confident that this resolution is the most just outcome."

BOEING HAD AGREED TO PLEAD GUILTY

Boeing ( BA ) last year had agreed to plead guilty to a criminal fraud conspiracy charge after the fatal 737 MAX crashes in Indonesia and Ethiopia in 2018 and 2019.

But the finalization of an agreement was delayed when O'Connor, who has a record of ruling in favor of conservative causes, raised questions over an element of the Biden administration's deal. It said the Justice Department would follow its "commitment to diversity and inclusion" when selecting an independent monitor to audit Boeing ( BA ).

After U.S. President Donald Trump took power, the Justice Department reversed course in May and dropped the demand for a guilty plea.

Admitting to a criminal charge would have potentially threatened Boeing's ( BA ) ability to secure lucrative government contracts with the likes of the U.S Defense Department and NASA, although government agencies could waive any restrictions.

In September, O'Connor held a three-hour hearing to consider objections to the deal, questioning the government's decision to drop a requirement that Boeing ( BA ) face oversight from an independent monitor for three years and instead hire a compliance consultant.

He heard anguished objections from relatives of some of those killed in the crashes in Indonesia in 2018 and Ethiopia in 2019 to the non-prosecution agreement.

A lawyer for the families said on Thursday they would quickly file an appeal.

O'Connor, in his ruling on Thursday, noted the government's position appeared to have shifted over time.

"Boeing ( BA ) committed crimes sufficient to justify prosecution, failed to remedy its fraudulent behavior on its own during the (deferred prosecution agreement) which justified a guilty plea and the imposition of an independent monitor, but now Boeing ( BA ) will remedy that dangerous culture by retaining a consultant of its own choosing," he said.

O'Connor said the families were correct in asserting that "this agreement fails to secure the necessary accountability to ensure the safety of the flying public."

The government argued Boeing ( BA ) has improved and the Federal Aviation Administration is providing enhanced oversight. Boeing ( BA ) and the government argued O'Connor had no choice but to dismiss the case in light of their non-prosecution agreement.

Under the deal, Boeing ( BA ) agreed to pay an additional $444.5 million into a crash victims' fund to be divided evenly per victim of the two fatal 737 MAX crashes, on top of a new $243.6 million fine and over $455 million to strengthen the company's compliance, safety, and quality programs.

In September, the FAA proposed fining Boeing ( BA ) $3.1 million for a series of safety violations, including actions tied to the January 2024 Alaska Airlines 737 MAX 9 mid-air emergency, and for interfering with safety officials' independence.