Did you lose money on investments in Southwest Airlines? If so, please visit Southwest Airlines Co. Shareholder Class Action Lawsuit or contact Joseph R. Seidman, Jr. at (877) 779-1414 or seidman@bernlieb.com to discuss your rights.
NEW YORK, Feb. 8, 2023 /PRNewswire/ -- Bernstein Liebhard LLP, a nationally acclaimed investor rights law firm, reminds investors of the deadline to file a lead plaintiff motion in a securities class action lawsuit that has been filed on behalf of investors who purchased or acquired the securities of Southwest Airlines Co. ("Southwest" or the "Company") (NYSE: LUV) between June 13, 2020 and December 31, 2022, inclusive (the "Class Period"). The lawsuit was filed in the United States District Court for the Southern District of Texas and alleges violations of the Securities Exchange Act of 1934.
Winter storms disrupted holiday travel during the 2022 holiday season, leaving thousands of travelers stranded in airports around the United States. However, not all domestic airlines were affected equally. Southwest Airlines flight cancellations accounted for the vast majority of domestic flight cancellations, leaving travelers unable to visit loved ones over the holidays, attracting the ire of the federal government.
As flights were getting cancelled around the country, it soon emerged that the root cause behind Southwest Airlines' cancellations was outdated and ineffective technology; in particular, its crew scheduling system (called "Sky Solver"). Further compounding on this issue, Southwest Airlines used an aggressive flight schedule that left it prone to greater cancellations than its competitors in the event of unusual conditions, such as nationwide storms.
Plaintiff alleges that Defendants made materially false and misleading statements throughout the Class Period. Specifically, Plaintiff alleges that Defendants failed to disclose that: (1) Southwest Airlines continuously downplayed or ignored the serious issues with the technology it used to schedule flights and crews, and how it stood to be affected worse than other airlines in the event of inclement weather; and (2) it did not discuss how it's unique point-to-point service and aggressive flight schedule could leave it prone in the event of inclement weather.
As various national news outlets focused on how Southwest Airlines' utter failure to provide adequate services to its customers left thousands stranded at airports across the country, the truth about the Company's business began to emerge.
On December 26, 2022, Business Insider published an article about Southwest Airlines entitled "U.S. Department of Transportation says it plans to look into Southwest Airlines following the airline's unacceptable holiday flight cancellations." The article highlighted that the Department of Transportation had announced that it would examine "whether cancellations were controllable," and whether Southwest Airlines was complying with its stated customer service plan, after reports of a lack of prompt customer service in the wake of cancellations.
Then, on December 27, 2022, Reuters published an article entitled "Southwest cancels thousands more flights; U.S. Government Vows Scrutiny." This article quoted Casey Murray, president of the Southwest Airlines Pilots Association (the "SWAPA"), who said "Southwest is using outdated technology and processes, really from the '90s, that can't keep up with the network complexity today."
The Reuters article also discussed Southwest Airlines' flight schedule. Rather than flying out of hubs, Southwest Airlines relies on the aforementioned point-to-point service, which leaves Company staff vulnerable to being stranded during disruptions (such as inclement weather). Executing this complex and aggressive business model was possible only with software that was more effective than Sky Solver, Southwest Airlines' proprietary software used to match flight staff personnel with different flights.
On this news, Southwest Airlines stock fell from a closing price of $36.09 on December 23, 2022, to $33.94 on the next trading day, December 27, 2022, and then to $32.19 on December 28, 2022, a drop of over 12%.
More news emerged about Southwest Airlines over the following days. On December 30, 2021, My Tech Decisions published an article about Southwest Airlines entitled "Southwest Airlines' Holiday Collapse Due in Part to Outdated IT Systems," which discussed how the SWAPA had warned that the Company needed to improve its technological infrastructure.
On December 31, 2022, The New York Timespublished an article entitled: "The Shameful Open Secret Behind Southwest's Failure," which discussed how it was an "open secret" within Southwest Airlines that it desperately needed to modernize its scheduling systems. In particular, the article discussed how software shortcomings had "contributed to previous, smaller-scale meltdowns," and that Southwest Airlines worker unions had warned the Company about the software at various times before the Company's meltdown over the 2022 holiday season.
On this news, Southwest Airlines' stock price fell $1.07 per share to close at $33.67 per share on January 3, 2023.
If you wish to serve as lead plaintiff, you must move the Court no later than February 13, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any recovery doesn't require that you serve as lead plaintiff. If you choose to take no action, you may remain an absent class member.
If you purchased or acquired Southwest Airlines securities, and/or would like to discuss your legal rights and options please visit Southwest Airlines Co. Shareholder Class Action Lawsuit or contact Joseph R. Seidman, Jr. at (877) 779-1414 or seidman@bernlieb.com.
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the Firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the Firm has been named to The National Law Journal's "Plaintiffs' Hot List" thirteen times and listed in The Legal 500 for ten consecutive years.
ATTORNEY ADVERTISING. © 2023 Bernstein Liebhard LLP. The law firm responsible for this advertisement is Bernstein Liebhard LLP, 10 East 40th Street, New York, New York 10016, (212) 779-1414. Prior results do not guarantee or predict a similar outcome with respect to any future matter.
Contact Information:
Joseph R. Seidman, Jr.
Bernstein Liebhard LLP
https://www.bernlieb.com
(877) 779-1414
seidman@bernlieb.com
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