Southwest Said Bag Fees Would Lose $300 Million A Year—Changed Its Rules To Avoid Lawsuits
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Southwest Airlines once said charging for checked bags would cost it $300 million a year. After they started charging anyway, a shareholder accused directors of sacrificing the airline's interests to save their own jobs under pressure from an activist investor who took control of the board.
The airline beat the suit by changing who was allowed to sue: under a new Texas law, they adopted a rule requiring a 3% ownership stake. At the time, that meant more than half a billion dollars in stock.
The airline beat the suit by changing who was allowed to sue: under a new Texas law, they adopted a rule requiring a 3% ownership stake. At the time, that meant more than half a billion dollars in stock.
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