KSF investigates Southwest Airlines amid chaos and brand crisis

Saturday, January 27, 2024

Charles C. Foti, Jr., Esq., the former Attorney General of Louisiana and a partner at Kahn Swick & Foti, LLC (“KSF”), has announced that KSF is initiating an inquiry into Southwest Airlines Co.

On December 22, 2022, Southwest Airlines disclosed the cancellation of flights scheduled for December 22-23 due to Winter Storm Elliott. This decision led to a substantial technical and logistical breakdown, resulting in over 16,700 flight cancellations in the following days. Approximately 2 million passengers and employees were stranded during the holiday season. Reports from industry insiders suggested that the severe weather challenges were compounded by the company’s utilization of outdated and ineffective technology, coupled with an aggressive flight scheduling system. Allegedly, the company executives had disregarded warnings about these issues over the years. The Company estimated the financial impact of the meltdown to be as high as $825 million.

Following the incident, Southwest Airlines experienced what is arguably the most significant damage to its brand in its 51-year history. It became the subject of investigations by the U.S. Department of Transportation and U.S. Congress, as well as facing consumer class action lawsuits and an ongoing securities class action lawsuit. The latter accuses the company and its executives of violating federal securities laws by failing to disclose material information.

KSF’s investigation is focused on determining whether Southwest’s officers and/or directors breached their fiduciary duties to shareholders or violated state or federal laws.

« Back to Page