Norton Rose Fulbright obtains Fifth Circuit affirmance of dismissal for Southwest Airlines

Norton Rose Fulbright helped client Southwest Airlines (Southwest) secure a dispositive unanimous opinion from the Fifth Circuit Court of Appeals on August 6. This opinion affirmed the dismissal with prejudice of a nationwide breach-of-contract class action against Southwest related to security-fee refunds.

On behalf of a putative class of passengers with nonrefundable tickets, Plaintiffs had claimed that Southwest breached its Contract of Carriage by issuing travel credits (rather than refunds to the customer’s original form of payment) for TSA security fees that were collected at the time of purchase. Southwest moved to dismiss by asserting that the claims were preempted by the Airline Deregulation Act (ADA). The district court dismissed the claims, and the Fifth Circuit affirmed.

Addressing the “Wolens exception” to ADA preemption, the Fifth Circuit held that the provision of travel credits was not a breach of Southwest’s “own, self-imposed undertakings,” as required by the Supreme Court’s Wolens decision. Although Plaintiffs pointed to language in the Southwest Contract of Carriage stating that “[t]axes, security fees, and Passenger Facility Charges associated with a nonrefundable fare are also not eligible for refund except as required by applicable regulations,” the Court held that language merely referencing “applicable regulations” was not sufficient to “demonstrate that Southwest has voluntarily undertaken a contractual obligation to provide such refunds.” Among other things, the Fifth Circuit noted that no specific regulation or body of regulations were referenced in the contract’s language, and it explained that unlike “affirmatively agreeing to undertake an obligation unless legally barred from doing so,” Southwest simply “warned that it would not take certain actions unless required by law.” 

This marks the fourth nationwide class action lawsuit against Southwest Airlines for which Norton Rose Fulbright has achieved significant wins in the last two years.

Norton Rose Fulbright’s litigation team was led by Michael Swartzendruber and included James Leito and Joseph Simmons (Dallas) as well as appellate lawyers Peter Siegal and David Kearns (Washington, DC).