Southwest To Pay $3.5M To Settle Safety Violation Suit

Law360, New York (October 27, 2009, 2:24 PM EDT) -- Southwest Airlines Co. has agreed to pay $3.5 million to settle a shareholder derivative lawsuit alleging the company breached its fiduciary duty by allowing its planes to fly without performing mandatory inspections for fuselage fatigue cracking.

The airline announced the settlement Friday in a filing with the U.S. Securities and Exchange Commission. A hearing on the proposed settlement is scheduled for Dec. 7 in Texas state court, the company said.

The Carbon County Employees Retirement System filed the suit in August 2008, naming Southwest directors and...
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