I.                   WHY SHOULD I READ THIS NOTICE?

The purpose of this Notice is to inform you of the proposed Settlement in this class action.  This Notice describes the class action and the Settlement, advises you of the date, time, and place of a hearing to be held by the Court to determine whether to approve the Settlement, and informs you of your rights with regard to the Settlement.  You should carefully read this entire Notice.  If the Court approves the Settlement, your legal rights may be affected. 

II.                WHAT IS THIS LAWSUIT ABOUT?

Plaintiff filed this class action against Southwest Airlines Co. (“Southwest”) on January 21, 2005, in the District Court of Dallas County, Texas.  Plaintiff alleges breach of contract and unjust enrichment claims against Southwest based on its practices regarding the collection, retention, and distribution of two federally mandated fees: September 11th Security Fees (“Security Fees”) and Passenger Facility Charges (“PFCs”).  Specifically, Plaintiff claims that Southwest owes a legal duty to refund these fees to passengers who do not use their nonrefundable tickets.  On behalf of herself and all members of the Class, Plaintiff has sought a refund of these fees, paid in connection with the purchase of a nonrefundable airline ticket, and attorneys’ fees expended in pursuit of this litigation.

Southwest has denied all of the allegations made by the Plaintiff and maintains that it possesses valid defenses to the asserted claims.  This Notice does not imply that there has been a finding of any violation of law by Southwest or that the Plaintiff is entitled to recovery in a certain amount.  The Court has made no determination about the strengths and weaknesses of Plaintiff’s or Southwest’s positions in this case, and this Notice does not express opinions of the Court on the merits of the claims or defenses raised by either party.

III.             WHO IS IN THE SETTLEMENT CLASS?

On October 6, 2008, the Court preliminarily certified this case as a class action for settlement purposes.  The Settlement Class includes anyone (1) who, between January 21, 2000 and March 31, 2008, purchased nonrefundable airline tickets from Southwest that included amounts charged for the PFC and/or the Security Fee; (2) who did not receive a refund of the amounts charged for the PFC and/or the Security Fee when those tickets were not used; and (3) for whom the allotted time period within which the tickets could be used has expired.  Excluded from the Settlement Class are (1) Southwest; (2) any parent, subsidiary, or affiliate of Southwest; and (3) all officers and directors who are, or who have been, employed by Southwest at any time between January 1, 2000 and March 31, 2008.  Also excluded are those individuals who choose to exclude themselves (“opt out”) from the Settlement Class.

If you come within the definition of the “Settlement Class” as described above, you are automatically a Settlement Class member.  You do not need to do anything to remain a member.  But, if you wish to be excluded from the Settlement Class, you must follow the instructions provided in Section VI.C of this Notice.  If the Court approves the Settlement, Settlement Class members who do not opt out may receive benefits under the Settlement and will be bound by the terms of the Settlement.  Persons who exclude themselves from the Class will not be bound by the Settlement, and will not share in the Settlement benefits.

IV.             WHAT ARE THE TERMS OF THE PROPOSED SETTLEMENT?

The proposed Settlement was negotiated with Southwest by the attorneys for the Settlement Class (“Settlement Class Counsel”).  Settlement Class Counsel reached this proposed Settlement after weighing the benefits associated with this Settlement against the risks, uncertainty, and costs of continuing the litigation.  Settlement Class Counsel believe that this Settlement is fair, reasonable, and adequate in light of all circumstances and that it is in the best interest of all Settlement Class members.  As part of the proposed Settlement, the parties have agreed to the following:

A.                Relief Provided to Class Members

If approved by the Court, the Settlement Agreement will provide the following relief:

1.                  Partial Refund of the PFC and Security Fee.  Southwest agrees to provide a refund of $4.00 to each eligible Settlement Class member.  Eligible Settlement Class members are those members of the Settlement Class who (1) originally purchased an electronic (ticketless), nonrefundable ticket(s) on or between January 1, 2006 and June 30, 2006; (2) cancelled the ticket(s); and (3) did not receive a refund or reuse all or part of those funds within the one-year eligibility period set forth in Southwest’s Contract of Carriage.  Defendant will refund the designated amount to each eligible Settlement Class member by crediting the credit card used to purchase the ticket(s) at issue.

2.                  Revision of Definition of Nonrefundable.  Southwest will revise its Contract of Carriage to make clear that forfeiture of a nonrefundable ticket includes forfeiture of the amounts specified for the Security Fees and the PFCs.  Specifically, Southwest has agreed to amend its explanation of nonrefundable tickets to include the following language:

Should a passenger fail to apply the nonrefundable ticket toward the purchase of future travel within the eligibility period, the entire amount of the fare, which includes, without limitation, all fees, taxes, and charges, will be forfeited.

Southwest agrees to include in its Customer Service Commitment the following language:

No cash refunds or credit card adjustments are made on any amounts paid for nonrefundable tickets, including taxes, security fees, and passenger facility charges associated with a nonrefundable fare.

Additionally, the online bullet-point summary of the “Wanna Get Away” fare shall include the following:

Should a passenger fail to apply the nonrefundable ticket toward the purchase of future travel within the eligibility period, the entire amount of the fare, which includes, without limitation, all fees, taxes, and charges, will be forfeited.

Southwest agrees to make sure that any future amendment to these explanations will continue to reflect that forfeiture of a nonrefundable ticket includes forfeiture of the Security Fees and PFCs applicable to such a ticket.

B.                 Release of Claims

The proposed Settlement is intended to settle all claims contemplated by the release in the Settlement Agreement.  If the Court approves the Settlement, the Plaintiff and all Settlement Class members who did not properly and timely opt out will be deemed to have released Southwest from all past, existing, and future claims for civil damages and/or equitable relief concerning, pertaining to, arising from, or relating to Southwest’s actions in connection with the collection, retention, and/or disbursement of the Security Fees and PFCs associated with the purchase of nonrefundable airline tickets, including, without limitation, the collection, retention, and/or disbursement of the Security Fees and PFCs on nonrefundable airline tickets sold under the policies and practices contemplated by the Settlement Agreement.  Southwest will release Plaintiff, Plaintiff’s Counsel, and all members of the Settlement Class from all claims arising out of, in any way relating to, or in connection with the institution, prosecution, assertion, settlement, or resolution of the case. 

C.                Dismissal of this Class Action

On approval of the Settlement Agreement, the Court will enter a final judgment that will dismiss the case with prejudice on the merits as to all members of the Settlement Class who did not opt out.  This means that if the Court approves the Settlement, members of the Settlement Class who did not exclude themselves will not be able to bring their own lawsuits for recovery on any of the released claims listed herein in Section IV.B.

D.                Payment to Class Representative

If the Court approves the Settlement, Plaintiff will receive a Class Representative incentive award in the form of vouchers for two round-trip tickets between any destinations serviced by Southwest.

V.                WHO REPRESENTS THE SETTLEMENT CLASS?

A.                Plaintiff and Settlement Class Counsel

The Court has designated Jodi Kaye to serve as the class representative in this lawsuit.  The Court has appointed the following attorneys as Settlement Class Counsel:

Coughlin Stoia Geller Rudman & Robbins, LLP 655 W. Broadway, Suite 1900 San Diego, CA 92101	The Pierce Law Group LLC 4641 Montgomery Ave., Suite 500 Bethesda, MD 20814
Lanskroner Greico Madden, Ltd. 1360 West 9th St., Suite 200 Cleveland, OH 44113	Shackelford, Melton & McKinley, LLP 3333 Lee Parkway, 10th Floor Dallas, TX 75219

Settlement Class Counsel represent the interests of the class and you will not be charged for their services.  You may hire your own attorney to advise you, but if you hire your own attorney, you will be responsible for paying that attorney’s fees.

B.                 Attorneys’ Fees.

Settlement Class Counsel will seek an award of not more than $120,000 for attorneys’ fees and costs associated with this case.  Southwest has agreed not to oppose this request, but it remains subject to the Court’s approval.  Any request for attorneys’ fees and expenses is not part of the Settlement, and the Court will consider such a request independently of its consideration of the fairness, reasonableness, and adequacy of the Settlement.

VI.             WHAT ARE MY RIGHTS AND OPTIONS?

If you are a Settlement Class member, you have the following options:

A.        You may remain a member of the Settlement Class, represented by Settlement Class Counsel, in which case there is nothing that you need to do right now to preserve your rights.  As a Settlement Class member, you will be represented by Settlement Class Counsel, and you will not be charged for their services.  If you choose to remain a member of the Settlement Class, you will be bound by the judgment entered by the Court. 

B.        You may remain a member of the Settlement Class, but choose to hire your own attorney to represent you.  If you do not wish to be represented by Settlement Class Counsel, you may hire your own attorney.  Even though your own attorney represents you, you will continue to be a Settlement Class Member.  You will be responsible for any fees and costs charged by your attorney.  If you wish to hire your own attorney to represent you in this lawsuit, your attorney must file a Notice of Appearance by February 9, 2009, with the Clerk of the Court, 68th Judicial District Court, Dallas County District Clerk’s Office, 600 Commerce Street, Dallas, Texas, 75202.  Your attorney must also send a copy of the Notice of Appearance to Counsel for the parties at the addresses listed below.

On behalf of Plaintiff: Susan  G. Taylor Coughlin Stoia Geller Rudman & Robbins, LLP 655 W. Broadway, Suite 1900 San Diego, CA 92101

On behalf of Southwest: Michael L. Raiff Vinson & Elkins LLP 3700 Trammell Crow Center 2001 Ross Avenue Dallas, TX 75201

C.        You may request exclusion from the Settlement Class.  If you are a Settlement Class member, but do not want to remain in the Settlement Class, you may exclude yourself.  If you exclude yourself from the Settlement Class, you will lose any right to object to or participate in the Settlement. You will be free to pursue any claims you may have against the Defendant on your own behalf, but Settlement Class Counsel will not represent you.  To exclude yourself from the Settlement Class, you must execute a written request for exclusion that includes: (1) the name of this lawsuit, Kaye v. Southwest Airlines Co.; (2) your full name and current address; (3) a specific statement of your intention to exclude yourself from the lawsuit (for example, “Please exclude me from the proposed class in the Kaye v. Southwest Airlines Co. litigation.”); and (5) your signature.  You must send your request for exclusion, postmarked on or before January 26, 2009, to the following address:

 

Michael L. Raiff Vinson & Elkins LLP 3700 Trammell Crow Center 2001 Ross Avenue Dallas, TX 75201

If you do not comply with these instructions and the deadline for exclusions, you will lose any opportunity to exclude yourself from the Settlement Class, and your rights will be determined in the lawsuit by the Settlement Agreement, if it is approved by the Court.

D.        You may object to the proposed Settlement.  If you do not exclude yourself from the Settlement Class, you may object to the certification of the Settlement Class, to the terms of the proposed Settlement, or to the application for attorneys’ fees.  To do so, you or your own attorney must file a written objection with the Clerk of the Court for the Dallas County District Court by February 9, 2009.  The objection must contain: (1) the name of this lawsuit, Kaye v. Southwest Airlines Co.; (2) your full name and current address; (3) proof of membership in the Settlement Class; (4) the specific reason(s) for your objection; and (5) any and all evidence and supporting papers (including, without limitation, all briefs, written evidence, and declarations) that you would like the Court to consider.  You must also deliver, by hand or certified mail, a copy of your objection, proof of Settlement Class membership, and any supporting material to the parties’ Counsel at the addresses listed below.  Counsel must receive your objection on or before February 9, 2009.  You do not need to attend the Settlement Hearing for the Court to consider your objection.  If you wish to appear and be heard orally in support of, or in opposition to, the Settlement, you must indicate your desire to appear personally or through counsel in your written objection.

On behalf of Plaintiff: Susan G. Taylor Coughlin Stoia Geller Rudman & Robbins, LLP 655 W. Broadway, Suite 1900 San Diego, CA 92101

On behalf of Southwest: Michael L. Raiff Vinson & Elkins LLP 3700 Trammell Crow Center 2001 Ross Avenue Dallas, TX 75201

If you do not comply with these procedures and the deadline for submitting objections, you will lose any opportunity to have your objection considered at the Settlement Hearing or to otherwise contest the approval of the Settlement.  You will not be able to appeal any orders or judgments entered by the Court in connection with the proposed Settlement.

VII.          WHEN IS THE COURT HEARING?

On March 2, 2009, at 3:30 p.m., the Court will hold a public hearing before the Honorable Martin Hoffman to determine (1) whether the proposed Settlement is fair, adequate and reasonable and should be approved by the Court; (2) whether the Court should approve Settlement Class Counsel’s application for attorneys’ fees, costs and expenses; and (3) whether the claims asserted against the Defendants by Plaintiff and all members of the Settlement Class should be dismissed with prejudice pursuant to the Settlement Agreement.  The Court may continue or reschedule this Hearing without further notice.  If you are a Settlement Class Member and you support the proposed Settlement, you do not need to appear at the hearing or take any other action to indicate your approval.  If you object to the proposed Settlement, you must submit your written objection in accordance with the instructions outlined in Section VI.D above.

VIII.       WHERE CAN I GET MORE INFORMATION?

This Notice is only a summary of the proposed Settlement.  The Settlement Agreement, court orders, or other documents about this lawsuit are on file with the Court and are available for review at any time during regular business hours at the Dallas County District Clerk’s Office, 600 Commerce Street, Room 103, Dallas, Texas, 75202.

Please do not write or telephone the Court regarding this Notice.