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Southwest shareholders are suing the airline, saying it hid the problems that caused its winter meltdown

Travelers queue up at the check-in counters for Southwest Airlines in Denver International Airport, Friday, Dec. 30, 2022, in Denver.Travelers queue up at the check-in counters for Southwest Airlines in Denver International Airport, December 30, 2022.

AP Photo/David Zalubowski, File

  • Southwest shareholders are suing the airline following its mass flight cancellations in December.
  • The lawsuit accuses it of downplaying or not noting previous issues in its scheduling system.
  • The company cancelled almost 17,000 flights in December and said its scheduling system was a factor.

A group of Southwest Airlines shareholders are suing the carrier, alleging that the airline hid problems that led to its major meltdown in December, when thousands of flights were cancelled across the country, stranding fliers sometimes overnight in airports as they looked to travel during the holidays.

The shareholders filed a class action lawsuit against the airline, its CEO, CFO, and executive chairman on Thursday, in federal court in Houston, alleging that the airline had downplayed or did not note failures in its scheduling system earlier.

The lawsuit describes the airline as having a “meltdown over the 2022 holiday season” and said the company had tried to “downplay” previous issues with its scheduling.

As such, shareholders “have suffered significant losses and damages” because the company’s market value dropped, it said.

It’s not clear how many shareholders have joined the lawsuit.

Southwest canceled almost 17,000 flights in December, and pointed to its scheduling system as a factor.

The cancelled flights meant staff and customers were stranded across the US, with some customers making days-long journeys to get to their destinations, some saying they lost thousands of dollars, and with staff sometimes needing to book their own hotel rooms after they got stuck.

Southwest cancelled significantly more flights than any other airline during the severe December weather.

The vice-president of the Southwest Airlines Pilots’ Association, Mike Santoro, told Insider that the company’s “outdated” scheduling system made the disruption worse, saying it also meant that the airline could not figure out where its own crew was.

Last week the airline’s CEO, Bob Jordan, took responsibility in an interview with Reuters, saying that there were a lot of reasons that this happened “but it’s on me at the end of the day.”

He added that “it just can’t happen again.”

The union that represents the airline’s pilots has also been scathing in its response.

The vice captain of the  Southwest Airlines Pilots’ Association accused former Southwest Airlines CEO Gary Kelly, who stepped down in January 2022 but is still the company’s executive chairman, of turning the airline “into a headquarters-centric cult.”

It also said that “our executives continue to apologize and ‘accept responsibility’ out of one side of their mouths while making banal excuses that deflect from the true cause out of the other side.”

This new lawsuit adds to its woes.

Read the original article on Business Insider