1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA 11 12 Lead Case No.: 23-cv-00306-AJB-SBC Consolidated with: 13 Case No. 23-cv-00313-AJB-SBC 14 Case No. 23-cv-00633-AJB-SBC 15 In Re: Southwest Airlines Co. Flight Disruption Litigation ORDER GRANTING IN PART AND 16 DENYING IN PART SOUTHWEST’S MOTION TO DISMISS 17
18 (Doc. No. 50) 19 20 Defendant Southwest Airlines Co. (“Southwest”) has filed a motion to dismiss 21 Plaintiffs Mary Smith, Matt Grove, Paula Hill, Eva Piña, and Eric Capdeville’s 22 (collectively, “Plaintiffs”) Consolidated Third Amended Class Action Complaint (“TAC”). 23 (Doc. No. 50.) Plaintiffs filed an opposition (Doc. No. 54), to which Southwest replied, 24 (Doc. No. 55). After thorough consideration of the papers, the Court GRANTS IN PART 25 AND DENIES IN PART Southwest’s motion for the reasons set forth below. 26 I. BACKGROUND 27 This consolidated putative class action arises from the cancellation of flights by 28 Southwest during the winter holiday season of December 2022 to January 2023. (See 1 generally Consolidated Third Amended Class Action Complaint (“TAC”), Doc. No. 46.) 2 After two rounds of successful motions to dismiss (see Doc. Nos. 36 (Order Granting 3 Motion to Dismiss First Amended Complaint); 45 (Order Granting Motion to Dismiss 4 Second Amended Complaint)), Plaintiffs filed the TAC on December 17, 2024, after which 5 Southwest filed the instant motion to dismiss (Doc. No. 50). 6 A. Plaintiffs’ Allegations 7 Between December 22, 2022, and January 2, 2023, Southwest cancelled nearly 8 16,000 flights due to an alleged combination of an outdated software system and winter 9 storms. (TAC ¶¶ 4, 24, 106, 135, 155.) Each Plaintiff named herein had purchased tickets 10 for flights that Southwest cancelled during the impacted time. (Id. ¶¶ 40–41, 53, 55, 58– 11 59, 62–63, 69, 72, 184, 186, 190–92.) 12 For example, Plaintiff Mary Smith purchased a ticket for travel on 13 December 29, 2022, from San Jose, California to Indianapolis, Indiana. (Id. ¶ 40.) This 14 initial flight was cancelled after Plaintiff Smith had waited at the airport for ten hours. (Id. 15 ¶ 41.) Southwest rebooked Plaintiff Smith for travel on December 30, 2022, which was 16 subsequently cancelled as well. (Id. ¶¶ 42–43.) “Plaintiff Smith requested that Southwest 17 transport her on the next flight(s) on which space is available to her intended destination,” 18 but when “Southwest was unable to do this within a reasonable period of time after 19 cancelation,” she “was forced to purchase a replacement flight through Delta Airlines.” (Id. 20 ¶¶ 45–46.) 21 Similarly, Plaintiff Matt Grove originally purchased a ticket for travel on December 22 23, 2022, after the cancellation of which he made the same request. (Id. ¶¶ 53–55.) When 23 Southwest was unable to transport him within a reasonable period of time after cancelation, 24 “Plaintiff Grove was forced to rent a car and then drive from Oakland to San Diego in a 25 rental car[.]” (Id. ¶ 56.) Much like Plaintiff Grove, when Plaintiff Eva Piña’s flights were 26 cancelled, she made the same request, Southwest failed to transport her, and she “was 27 forced to find an alternative means of travel to get back to San Diego by booking a car 28 through a rental service for an 8-hour drive from Sacramento to San Diego.” (Id. ¶¶ 62– 1 64.) When Plaintiff Paula Hill’s round trip travel was canceled and delayed, she made the 2 same request, which Southwest did not fulfill within a reasonable period of time after 3 cancellation. (Id. ¶¶ 58–59.) 4 Plaintiff Capdeville originally booked a flight from New Orleans, Louisiana to 5 Portland, Oregon for travel on December 27, 2022, but it was cancelled. (Id. ¶¶ 69, 71.) 6 Plaintiff Capdeville “requested that Southwest transport him on the next flight(s) on which 7 space is available to his intended destination, but Southwest was unable to do this within a 8 reasonable period of time after cancelation.” (Id. ¶ 72.) He attempted to make other travel 9 plans to Portland, but because he was “unable to find a viable ticket to go to Portland, he 10 bought a plane ticket to instead have a vacation in Boston.” (Id. ¶ 74.) Plaintiff Capdeville 11 requested a refund for the cost of his ticket. (Id. ¶¶ 75, 209.) 12 After requesting refunds, Plaintiffs Smith, Hill, Piña, and Capdeville were not 13 refunded for the cost of their airline tickets within seven days of cancellation. (Id. ¶¶ 48, 14 61, 65, 75.) In fact, Plaintiff Capdeville, to his knowledge, was never issued a refund/credit 15 at all. (Id. ¶ 77.) Plaintiffs Smith, Grove, Piña, and Capdeville were not reimbursed for 16 their out-of-pocket expenses caused by the ticket cancellations within hours of the flight 17 during the holiday season. (Id. ¶¶ 49, 57, 66, 76.) 18 Plaintiffs bring claims for (1) breach of contract of carriage; (2) breach of contract 19 of carriage as modified, (3) breach of contract to reimburse for out of pocket expenses, (4) 20 promissory estoppel, and (5) judicial estoppel.1 (See generally TAC.) Southwest moves to 21 dismiss all five claims pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.2 22 (Doc. No. 50.) 23 /// 24 /// 25 /// 26 27 1 The fifth cause of action is misnumbered but referred to herein by the correct subsequent number. 2 All future use of Rule or Rules refer to the Federal Rules of Civil Procedure unless otherwise 28 1 B. Contract of Carriage 2 The TAC alleges each Southwest passenger’s air travel ticket is governed by the 3 Contract of Carriage (“CoC”) drafted by Southwest. (TAC ¶¶ 81, 83.) Section 9 of the CoC 4 provides in relevant part: 5 Failure to Operate as Scheduled 6 (1) Canceled Flights or Irregular Operations. In the event the Carrier 7 cancels or fails to operate any flight according to Southwest Airlines published schedule, or significantly changes the schedule of any flight, 8 or there is a significant delay, Carrier will, at the request of a Passenger 9 with a confirmed Ticket on such flight, take one of the following actions: 10 (i) Transport the Passenger at no additional charge on Southwest 11 Airlines next flight(s) on which space is available to the 12 Passenger’s intended destination, in accordance with Southwest Airlines established re-accommodation practices; or 13 14 (ii) Following a request by the Customer, refund the unused portion of the Customer’s fare in accordance with Section 4.c. 15 16 (CoC § 9.a.) Regarding the application of the CoC and its limitations on damages, it states: 17 Unless specifically stated otherwise herein or where any limitation would expressly violate any applicable law, the Carrier shall not be liable for any 18 consequential, compensatory, indirect, incidental, or punitive damages arising 19 out of or in connection with the performance of its obligations under this Contract of Carriage. 20 21 (Id. § 1.a(8).) 22 Moreover, “Southwest Airlines reserves the right, in its sole discretion and to the 23 extent not prohibited by law, to change, delete, or add to any of the terms of this Contract 24 of Carriage without prior notice. All changes must be in writing and approved by an 25
26 3 Plaintiffs attached Southwest’s Contract of Carriage, to which each passenger agrees to be bound 27 when they make a reservation or accepts transportation on Southwest, to their TAC. (See CoC (Doc. No. 46-1, Southwest Airlines Co. Contract of Carriage – Passenger (“CoC”).). Because the Contract of 28 1 authorized representative of Southwest Airlines.” (Id. § 1.a(2).) 2 Finally, the CoC includes a choice-of-law provision setting Texas state law as the 3 governing law. (Id. § 10.c(1).) 4 II. LEGAL STANDARD 5 “A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to 6 state a claim upon which relief can be granted ‘tests the legal sufficiency of a claim.’” 7 Conservation Force v. Salazar, 646 F.3d 1240, 1241–42 (9th Cir. 2011) (quoting Navarro 8 v. Block, 250 F.3d 729, 732 (9th Cir. 2001)). Dismissal is proper “where there is no 9 cognizable legal theory or an absence of sufficient facts alleged to support a cognizable 10 legal theory.” L.A. Lakers, Inc. v. Fed. Ins. Co., 869 F.3d 795, 800 (9th Cir. 2017) (quoting 11 Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010)). “To 12 survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted 13 as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 14 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)); see also 15 L.A. Lakers, Inc., 869 F.3d at 800 (“In conducting this review, we accept the factual 16 allegations of the complaint as true and construe them in the light most favorable to the 17 plaintiff.”). 18 III. DISCUSSION 19 Plaintiffs plead five counts—breach of contract of carriage, breach of contract as 20 modified, breach of unilateral contract to reimburse for out of pocket expenses, promissory 21 estoppel and judicial estoppel—all of which Southwest seeks to dismiss.4 The Court will 22
23 4 Southwest asserts that Plaintiffs’ TAC violates Rule 15 and the Court’s prior order because the 24 Court dismissed each claim with leave to amend. (Doc. No. 50-1 at 10–12.) To Southwest, this means that 25 “the Court provided Plaintiffs with leave to amend their three dismissed claims: (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, and (3) bailment.” (Id. at 10–11.) Plaintiffs 26 rely on the conclusion of the Court’s order—wherein the Court granted Southwest’s motion to dismiss with leave to amend—as providing leave to allege new allegations about Southwest[’s] representations 27 about its promise to reimburse for out of pocket expenses.” (Doc. No. 54 at 24–25.) The Court is not persuaded by Plaintiffs’ characterization of the new allegations as “newly identified statements” (see Doc. 28 1 address each in turn. 2 A. Breach of Express Contract 3 Southwest moves to dismiss Plaintiffs’ first cause of action for breach of express 4 contract. (Doc. No. 50-1 at 13, 16–17, 19–23.)5 5 “In Texas, the essential elements of a breach of contract action are: (1) the existence 6 of a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of 7 the contract by the defendant; and (4) damages sustained by the plaintiff as a result of the 8 breach.” Smith Int’l, Inc. v. Egle Grp., LLC, 490 F.3d 380, 387 (5th Cir. 2007) (cleaned 9 up). 10 The first cause of action alleges two different breaches of CoC: (1) Southwest failed 11 transport Plaintiffs on the next flight to their intended destinations on which space was 12 available and (2) refund the unused portion of Plaintiffs’ fare. In comparing the allegations 13 in the operative complaint with those of the previous complaint, Plaintiffs have added four 14 paragraphs to amend the replacement flight claim and three paragraphs to amend the refund 15 claim. First, Plaintiffs now allege that the CoC is “ambiguous” as to the time of 16 performance making it susceptible to parole evidence demonstrating that “within a 17 reasonable time” should be inferred. (TAC ¶¶ 193–96.) Second, Plaintiffs identify where 18 the CoC references compliance with all applicable laws and allege Plaintiff Capdeville 19 requested a refund, which Southwest did not process within seven days. (Id. ¶¶ 207–09.) 20 1. Failure to Provide a Replacement Flight 21 The first claim within the first cause of action alleges that, after Southwest cancelled 22 flights for which they had purchased tickets, “Plaintiffs requested that Southwest transport 23 them on the next flight(s) on which space is available to their intended destination, but 24
25 26 55 at 11.) However, considering the “extreme liberality” with which Rule 15 is to be applied, Eminence Cap., LLC v. Aspeon, Inc., 316 F.3d 1048, 1051 (9th Cir. 2003), the Court will address all Plaintiffs’ 27 claims, including those pleaded for the first instance. 5 For clarity and consistency, the Court cites to the page numbers in the header applied by the 28 1 Southwest was unable to do this within a reasonable period of time after cancelation,” 2 which based on Section 9 of the CoC as interpreted by the parties’ beliefs, statements, and 3 representations at the time, meant “later that day or the next few days.[.]” (Id. ¶¶ 188–96.) 4 Plaintiffs assert that parole evidence is permissible to interpret Section 9 of the CoC 5 because it is ambiguous as to when performance is to occur. (Id. ¶ 193.) 6 With regard to Plaintiffs’ ambiguity argument, the relevant CoC provision states 7 that, in the event of a canceled flight, Southwest will, at the request of a passenger with a 8 confirmed ticket on such flight, “[t]ransport the Passenger at no additional charge on 9 Southwest Airlines next flight(s) on which space is available to the Passenger’s intended 10 destination[.]” (CoC § 9.a(1)(i).) 11 When interpreting contract language, “[i]f the language lends itself to a clear and 12 definite legal meaning, the contract is not ambiguous and will be construed as a matter of 13 law.” Great Am. Ins. Co. v. Primo, 512 S.W.3d 890, 893 (Tex. 2017). Although Plaintiffs 14 allege the language is ambiguous (see TAC ¶ 193), “the Court is not required ‘to accept as 15 true a legal conclusion couched as a factual allegation,’” Harris v. Cnty. of Orange, 682 16 F.3d 1126, 1131 (9th Cir. 2012) (quoting Iqbal, 556 U.S. at 678), and “[w]hether a contract 17 is ambiguous is a matter of law for the court,” In re Davenport, 522 S.W.3d 452, 456 (Tex. 18 2017). See also Great Am. Ins. Co., 512 S.W.3d at 893 (“An ambiguity does not arise 19 merely because a party offers an alternative conflicting interpretation[.]”). Because 20 Plaintiffs’ additional allegation is a legal conclusion, it does not receive the assumption of 21 truth Plaintiffs’ factual allegations warrant when considering a motion to dismiss. 22 Instead, the Court turns to the actual contractual language at issue. As previously 23 interpreted, the provision has a clear and definite meaning of “specifically provid[ing] a 24 fixed time to provide an alternative flight in the event a flight is cancelled: (1) on 25 Southwest’s next flight to the passenger’s intended destination (2) on which space is 26 available.” (Doc. No. 45 at 8 (emphasis in original).) The language of the CoC has not 27 changed between the SAC and the TAC, and as such the Court’s interpretation of this 28 language as unambiguous will not change either. 1 Having determined that Plaintiffs have alleged the existence of a valid contract and 2 what the terms of that contract were, the Court turns to the next element of a breach of 3 contract claim: that the plaintiff performed or tendered performance as contractually 4 required. See West Loop Hosp., LLC v. Houston Galleria Lodging Assocs., LLC, 649 5 S.W.3d 461, 491 (Tex. App. 2022). Pursuant to Section 9 of the CoC, an impacted 6 passenger, namely one who purchased a ticket on a subsequently cancelled flight, must 7 request to be rebooked or refunded. (See CoC § 9.a(1).) All named Plaintiffs allege they 8 purchased tickets for Southwest flights and, once Southwest cancelled their flights, 9 requested Southwest transport them on the next flight(s) on which space is available to 10 their intended destinations. (See TAC ¶¶ 40, 45, 53, 55, 59, 62–63, 69, 72, 184, 186, 190– 11 92.) This element is sufficiently pled. 12 Next, Plaintiffs must allege “the defendant breached the contract by failing to 13 perform or tender performance as contractually required.” See West Loop Hosp., LLC, 649 14 S.W.3d at 491. All Plaintiffs allege that “Southwest was unable to do this within a 15 reasonable period of time after cancelation.” (TAC ¶¶ 45, 55, 59, 63, 72, 190 (emphasis 16 added).) Plaintiffs do not allege that Southwest did not rebook them on the next flight to 17 their intended destination on which space was available. Rather, it appears that none of the 18 named Plaintiffs waited for there to be a breach before taking alternative action. Because 19 Plaintiffs fail to allege Southwest breached the contract, they fail to state a claim for breach 20 of contract. The first cause of action regarding replacement flights is DISMISSED. 21 2. Failure to Provide a Refund 22 The second claim within the first cause of action alleges that, after Southwest 23 cancelled flights for which they had purchased tickets, Plaintiff “Capdeville requested a 24 refund of the cost of his ticket[,] but Southwest did not refund his ticket within seven days,” 25 as required by Section 1 of the CoC, which incorporates the Airline Deregulation Act. 26 (TAC ¶¶ 206–09.) 27 Southwest asserts that Plaintiffs’ claim that “the CoC incorporates by reference a 28 federal regulation requiring that airlines refund the cost of cancelled flights in seven 1 days . . . has already been rejected by this Court, and their new allegations fail to undermine 2 that prior ruling.” (Doc. No. 50-1 at 16.) 3 Plaintiffs fail to address this argument. (See generally Doc. No. 54.) 4 Although the TAC now identifies the specific provision upon which Plaintiffs’ claim 5 rests—section 1—the Court previously analyzed this provision and determined that “a 6 mere reference to the U.S. Department of Transportation ‘and laws, regulations, and rules 7 imposed by U.S. or foreign governmental agencies . . . does not create a ‘self-imposed 8 obligation’ . . . [and thus] Southwest was not required to provide a refund within seven 9 days.” (Doc. No. 45 at 12.) Considering that the TAC relies on the same provision of the 10 CoC which the Court has previously interpreted and Plaintiffs fail to oppose Southwest’s 11 argument for dismissal, the Court reaffirms its prior analysis and conclusion: Southwest 12 was not required to provide a refund within seven days. Thus, the applicable contract 13 provision Plaintiffs allege Southwest breached states that, in the event of a canceled flight, 14 Southwest will, “[f]ollowing a request by the Customer, refund the unused portion of the 15 Customer’s fare in accordance with Section 4.c.” (CoC § 9.a(1).) 16 Having identified the applicable contractual language, the Court turns to the rest of 17 the elements of a breach of contract claim. Southwest fails to address any other aspects of 18 this claim beyond the inapplicability of the alleged seven-day limitation for refunds. (See 19 generally Doc. No. 50-1.) 20 First, as discussed supra, all named Plaintiffs allege they purchased tickets for 21 Southwest flights. (See TAC ¶¶ 40, 53, 55, 59, 62–63, 69, 72, 184, 186, 190–92.) However, 22 only Plaintiff Capdeville alleges that he requested a refund for the cost of his ticket. (Id. ¶¶ 23 75, 209.) As such, Plaintiffs only sufficiently allege this element as to Plaintiff Capdeville. 24 Next, Plaintiff Capdeville alleges Southwest breached the contract by failing to perform as 25 contractually required.6 See West Loop Hosp., LLC, 649 S.W.3d at 491. Specifically, 26
27 6 In addition to failing to allege their own performance under the contract, Plaintiffs Smith, Grove, 28 1 Plaintiff Capdeville alleges that Southwest “did not issue Plaintiff Capdeville a 2 refund/credit at all and, as well, not within seven days of cancelation.” (TAC ¶ 77.) 3 Although the seven day limitation is not applicable, Plaintiff Capdeville alleges that 4 Southwest failed to ever refund him, thus sufficiently pleading this element. Finally, 5 because Plaintiff Capdeville’s flight was cancelled by Southwest and he did not receive a 6 refund, despite requesting one, he sustained damages as a result of Southwest’s breach. See 7 Sacks v. Hall, 481 S.W.3d 238, 246 (Tex. App. 2015) (quoting Bowen v. Robinson, 227 8 S.W.3d 86, 96 (Tex. App. 2006)) (“In a breach of contract action, the normal measure of 9 damages ‘is just compensation for the loss or damage actually sustained, commonly 10 referred to as the benefit of the bargain.’”). Specifically, Plaintiff Capdeville neither used 11 his ticket nor otherwise received the benefit of his bargain with Southwest. (See TAC ¶ 12 187.) Plaintiff Capdeville sufficiently alleged damages in the amount of the unused portion 13 of his purchased fare.7 See Sacks, 481 S.W.3d at 246 (quoting Matheus v. Sasser, 164 14 S.W.3d 453, 459 (Tex. App. 2005)) (“Benefit-of-the-bargain damages ‘measure the 15 difference between the value as represented and the value as received.’”). 16 Accordingly, the first cause of action regarding refunds is DISMISSED as to 17 Plaintiffs Smith, Grove, Hill, and Piña. However, Southwest’s motion to dismiss the first 18 cause of action is DENIED as to Plaintiff Capdeville’s refund claim (and those of the 19 putative class similarly situated). 20 B. Breach of Contract as Modified 21 Plaintiffs’ second cause of action asserts that “Southwest modified the Contract of 22 Carriage by making the ‘self-imposed’ promises to Plaintiffs and Class Members and 23 Congress that it would reimburse Plaintiffs and class members for these out-of-pocket 24 25 and Piña allege Southwest did not issue a refund within seven days of cancellation, while Plaintiff Grove 26 does not allege Southwest failed to reimburse him at all. (See TAC ¶¶ 48 (Smith), 61 (Hill), 65 (Piña); see generally id. ¶¶ 52–67 (Grove).) 27 7 Although the TAC includes allegations about other damages, such as “the cost of replacement tickets on other airlines, ground transportation, hotels, and other out-of-pocket expenses,” (see id. ¶¶ 202– 28 1 expenses, including reimbursement of flights on alternative airlines, caused by its failure 2 to transport them on Southwest[‘s] next plane with available space.” (TAC ¶ 223.) 3 Plaintiffs assert that such unilateral modification was permitted by Section 1 of the CoC, 4 which reserves the right to Southwest “to change, delete, or add” to the CoC “without prior 5 notice,” so long as the changes are “in writing and approved by an authorized representative 6 of Southwest Airlines.” (Id. ¶¶ 16, 222.) Specifically, Plaintiffs allege that Southwest 7 modified its CoC to include that they would honor reasonable reimbursement requests for 8 out-of-pocket expenses based on a December 27, 2022 traveled disruption notice, a 9 December 28, 2022 video message from Southwest’s Chief Commercial Officer, and two 10 written media releases. (See id. ¶¶ 95–100.) 11 In the instant motion, Southwest argues that Plaintiffs fail to sufficiently allege that 12 the CoC was modified because elements required by Texas contract law and contractual 13 requirements set by the CoC itself are not pled. (Doc. No. 50-1 at 13–16.) 14 1. Requirements for Valid Modification 15 Applying Texas contract law, Southwest argues Plaintiffs fail to plead the elements 16 of intent and consideration. (Doc. No. 50-1 at 14–15.) First, Southwest argues that 17 Plaintiffs’ allegations regarding “when (1) [Southwest’s] representatives testified before 18 the Senate, (2) when it made statements on its public website, or (3) or when it set up a 19 page to allow passengers of cancelled flights to submit requests for reimbursement,” do 20 not “demonstrate that Southwest intended to modify the terms of the 37th version of the 21 CoC,” because none of Southwest’s “statement[s] . . . even reference[] the CoC[.]” (Id. at 22 14.) Second, Southwest argues that even if Plaintiffs could establish Southwest intended to 23 modify the CoC, the modification would fail because there was no new consideration 24 supporting the modification. (Id. at 15.) 25 The general rules of contract dictate that “[p]arties have the power to modify their 26 contracts[, but] modification must satisfy the elements of a contract: [namely] a meeting of 27 the minds supported by consideration.” Hathaway v. Gen. Mills, Inc., 711 S.W.2d 227, 228 28 (Tex. 1986); see also Walden v. Affiliated Computer Servs., Inc., 97 S.W.3d 303, 314 (Tex. 1 App. 2003) (“Texas courts have consistently adhered to the rule that a modification to a 2 contract must itself be supported by consideration to be valid.”). “Whether a contract is 3 modified depends on the parties’ intentions and is a question of fact.” Hathaway, 711 4 S.W.2d at 228–29. “In determining whether the parties had a meeting of the minds 5 concerning a modification of a contract, the focus is on what the parties did and said, not 6 their subjective states of mind.” Arthur J. Gallagher & Co. v. Dieterich, 270 S.W.3d 695, 7 702 (Tex. App. 2008). “The burden of proving modification rests on the party asserting the 8 modification.” Hathaway, 711 S.W.2d at 229. 9 Despite the general rules, “Texas law recognizes and protects a broad freedom of 10 contract.” Nafta Traders, Inc. v. Quinn, 339 S.W.3d 84, 95 (Tex. 2011). “As a rule, parties 11 have the right to contract as they see fit as long as their agreement does not violate the law 12 or public policy.” In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 129 (Tex. 2004). “This 13 ‘paramount public policy’ mandates that courts ‘are not lightly to interfere with this 14 freedom of contract.’” Shields Ltd. P’ship v. Bradberry, 526 S.W.3d 471, 481 (Tex. 2017) 15 (quoting Gym–N–I Playgrounds, Inc. v. Snider, 220 S.W.3d 905, 912 (Tex. 2007)); see 16 also Nafta Traders, Inc., 339 S.W.3d at 95–96 (“[I]f there is one thing which more than 17 another public policy requires it is that men of full age and competent understanding shall 18 have the utmost liberty of contracting, and that their contracts when entered into freely and 19 voluntarily shall be held sacred and shall be enforced by Courts of justice.”). “Absent 20 compelling reasons, courts must respect and enforce the terms of a contract the parties have 21 freely and voluntarily entered[.]” Shields Ltd. P’ship, 526 S.W.3d at 481 (quoting Phila. 22 Indem. Ins. Co. v. White, 490 S.W.3d 468, 485 (Tex. 2016)). 23 The CoC that Southwest drafted expressly states that it “reserves the right, in its sole 24 discretion and to the extent not prohibited by law, to change, delete, or add to any of the 25 terms of this Contract of Carriage without prior notice,” (CoC § 1.a(2); see also TAC ¶ 26 16), which reserves to Southwest the right to unilaterally modify the CoC. Southwest 27 proffers no argument nor any case law addressing why such a provision should not be 28 enforced against its drafter in light of Texas’s strong public policy of upholding a broad 1 freedom to contract. Cf. Shields Ltd. P’ship, 526 S.W.3d at 483 n.39 (“[F]reedom of 2 contract includes not only the power to make a contract, but also the freedom to waive, 3 modify, or unmake the contract.”). 4 Because the CoC provides for Southwest’s unilateral modification, it is the terms of 5 that provision, not the general contract provisions, that governs Plaintiffs’ claim. Pursuant 6 to the CoC, “[a]ll changes must be in writing and approved by an authorized representative 7 of Southwest Airlines.” (CoC § 1.a(2).) As such, Southwest’s arguments that modification 8 requires new consideration and a meeting-of-the-minds both fail as those requirements 9 have been contracted around. Gym-N-I Playgrounds, Inc. v. Snider, 220 S.W.3d 905, 912 10 (Tex. 2007) (“Freedom of contract allows parties to bargain for mutually agreeable terms 11 and allocate risks as they see fit.”). 12 2. Southwest’s Alleged Modification 13 Next, the Court turns to whether Plaintiffs allege sufficient facts to state that 14 Southwest’s modification was contractually valid pursuant to CoC § 1(a)(2): namely 15 whether Plaintiffs allege there was a change (1) made in writing and (2) approved by an 16 authorized representative of Southwest. 17 In the second cause of action, Plaintiffs simply allege that, “during and after this 18 disruption, Southwest modified the Contract of Carriage by making the ‘self-imposed’ 19 promises to Plaintiffs and Class Members and Congress that it would reimburse Plaintiffs 20 and class members for these out-of-pocket expenses, including reimbursement of flights 21 on alternative airlines, caused by its failure to transport them on Southwest next plane with 22 available space.” (TAC ¶ 223.) Plaintiffs do not include other factual allegations 23 specifically addressing the modification in the second count; however, they incorporate the 24 preceding allegations (see id. ¶ 211), which include a subsection of the factual background 25 addressing the promises Southwest allegedly made through Chief Operating Officer 26 (“COO”) Andrew Watterson’s testimony to the Senate, Chief Commercial Officer Ryan 27 Green’s video message, Chief Executive Officer Bob Jordan’s message, and statements on 28 Southwest’s website (see id. ¶¶ 95–104). 1 First, there is no document that Plaintiffs point to that expressly states it is modifying 2 the CoC. As a result, the Court must assess whether Plaintiffs sufficiently “plead facts that 3 ‘allow[] the court to draw the reasonable inference’” that Southwest modified its CoC. See 4 Scheibe v. ProSupps USA, LLC, 141 F.4th 1094, 1099 (9th Cir. 2025) (quoting Iqbal, 556 5 U.S. at 678). Southwest asserts in its motion that none of the relevant allegations attributed 6 to Southwest in the TAC even reference the CoC. (Doc. No. 50-1 at 14.) In reply, however, 7 Southwest concedes that Watterson testified to Congress regarding the CoC. (Compare id. 8 with 55 at 6.) The Court agrees with Southwest that the statements on its website, those 9 made by Green, and those made by Jordan as alleged in the TAC do not address the CoC 10 or modification thereto. Thus, it would be unreasonable to infer on those factual allegations 11 that Southwest modified its CoC. As Watterson’s testimony to the Senate does reference 12 the CoC, the Court will analyze his testimony further below. 13 Second, none of the oral statements cited by Plaintiffs—such as Watterson’s 14 testimony and Green’s video message— themselves fulfill the “in writing” requirement for 15 a valid modification. (See Doc. No. 50-1 at 14 (“Southwest’s testimony to the Senate was 16 not ‘in writing.’ Thus, Plaintiffs’ alleged ‘modification’ to the CoC not only fails to satisfy 17 the legal requirements for modification, but it also fails to meet the contractual 18 requirements for it, too.”) (citations omitted). Southwest’s argument misses how Plaintiffs 19 are relying on Watterson’s testimony—not as the contract modification itself but as an 20 admission by an authorized representative that Southwest already had changed the terms. 21 (See Doc. No. 54 at 18 (“Said differently, Southwest admitted under oath that Southwest 22 unilaterally changed its terms to be that Southwest would reimburse passengers for their 23 alternative travel expenses incurred due to its operational failure.”).) 24 In the TAC, Plaintiffs quote the following exchange between Watterson and Senator 25 Kyrsten Sinema: 26 Senator SINEMA. . . . On the topic of reimbursements, we heard that Southwest wasn’t promising to reimburse expenses until multiple days after 27 the cancellations began. So, a lot of customers in the early days didn’t book 28 alternative transportation, like they didn’t book expensive alternative flights 1 because they didn’t know whether or not Southwest would pay them back. So, my question is, why did it take so long to make this commitment? And for 2 customers who are concerned about this for the future, I am asking that you 3 update your contract of carriage to clearly state that reasonable expenses will be reimbursed in the event that a similar disruption occurs in the future. 4 Mr. WATTERSON. Thank you, Senator. The early part disruption was a 5 weather event like everyone else experienced, and then it turned into a crew 6 mix event that only we experienced. And when that happened, my recollection is that we then changed our language to be that we would reimburse. And then 7 I believe we have held true to that word as well. And as far as the updates to 8 our contract of carriage, I believe we are consistent with the DOT policy. We certainly want and endeavor to reimburse our customers, but I will commit 9 you that we will go back and we look at that language and make sure it is up 10 to date. 11 (TAC ¶ 106 (emphasis omitted).) To reasonably interpret Watterson’s use of “our 12 language” as meaning the CoC, the sentence must be read in isolation, as the TAC initially 13 quotes it. (See id. ¶ 25.) When read in context, Senator Sinema asked Watterson two 14 questions, only the second of which involved the CoC. Watterson addressed each point 15 separately. The transition of “[a]nd as far as the updates to our contract of carriage” makes 16 clear that “our language” was distinct from the CoC. Cf. Balandran v. Safeco Ins. Co. of 17 Am., 972 S.W.2d 738, 741 (Tex. 1998) (“We must read all parts of the contract together, 18 striving to give meaning to every sentence, clause, and word to avoid rendering any portion 19 inoperative.”) (citations omitted). As such, the Court finds that, based on Watterson’s 20 testimony in the full context provided by the TAC, it would be unreasonable to infer that 21 Watterson is asserting that Southwest modified its CoC. 22 Although the Court finds that Plaintiffs sufficiently pleaded that a unilateral 23 modification to the CoC by Southwest is permitted, Plaintiffs have not provided sufficient 24 factual allegations, taken as true, to state that Southwest did unilaterally change the CoC 25 to provide that Southwest would reimburse for the disruption. Thus, Plaintiffs fail to state 26 a claim for breach of contract as modified. The Court DISMISSES Plaintiffs’ second cause 27 of action. 28 /// 1 C. Breach of Contract to Reimburse Out-of-Pocket Expenses 2 Plaintiffs’ third cause of action alleges that Southwest’s promise to reimburse 3 constituted an offer for a unilateral contract which Plaintiffs are attempting to accept 4 through bringing the lawsuit. (TAC ¶¶ 235–43.) 5 In its motion, Southwest asserts that (1) its post-disruption statements were general 6 statements to Congress and the public-at-large, not an offer, (2) Plaintiffs failed to accept 7 in compliance with the alleged offer because they filed a lawsuit instead of submitting an 8 Expense Reimbursement Request, and (3) Plaintiffs do not allege that they provided any 9 consideration for the alleged contract. (Doc. No. 50-1 at 18–19.) 10 “Unlike a bilateral contract, in which both parties make mutual promises, a unilateral 11 contract is created when a promisor promises a benefit if a promisee performs.” City of 12 Houston v. Williams, 353 S.W.3d 128, 135 (Tex. 2011) (citations omitted). “The 13 performance or forbearance constitutes both acceptance of a promisor’s offer and 14 consideration[;]” thus, “[t]he contract becomes enforceable when the promisee performs.” 15 Vanegas v. Am. Energy Servs., 302 S.W.3d 299, 302, 304 (Tex. 2009) (citations omitted). 16 1. Southwest’s Offer 17 First, the Court turns to whether the TAC alleges sufficient facts that Southwest 18 promised a benefit if Plaintiffs performed. “To prove that an offer was made, a party must 19 show (1) the offeror intended to make an offer, (2) the terms of the offer were clear and 20 definite, and (3) the offeror communicated the essential terms of the offer to the offeree.” 21 Matter of Texxon Petrochemicals, L.L.C., 67 F.4th 259, 263 (5th Cir. 2023) (quoting 22 Domingo v. Mitchell, 257 S.W.3d 34, 39 (Tex. App. 2008)). 23 Plaintiffs point to Watterson’s testimony to the Senate, Green’s video message, 24 Chief Executive Officer Bob Jordan’s message, and statements on Southwest’s website as 25 “additional ‘self-imposed’ promise[s]” that “constitute[] a unilateral contract[.]” (See TAC 26 ¶¶ 95–104 (factual background subsection setting forth allegations regarding Southwest’s 27 promises), 235–43 (Count III).) 28 /// 1 None of Watterson’s quoted testimony is itself an offer because it is not “sufficiently 2 definite in its terms” to determine what obligations each party undertook. See T.O. Stanley 3 Boot Co. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex. 1992) (“A contract must be 4 sufficiently definite in its terms so that a court can understand what the promisor 5 undertook.”). However, Watterson’s testimony may be construed as referencing an offer. 6 (See TAC ¶¶ 23 (“We will not pay them cash to be in another airline unless it is for 7 reimbursement of a flight they took in the disruption.”), 24 (“And when that happened, my 8 recollection is that we then changed our language to be that we would reimburse.”), 25 9 (responding affirmatively when asked if Southwest is still working to ensure customers are 10 made whole), 26 (listing action steps that include “[m]aking the unilateral determination 11 that every flight disruption between December 24th and January 2nd was treated as ‘within 12 the airline’s control,’ regardless of the actual cause, meaning that we would grant all 13 reasonable reimbursement requests for our Customers’ out-of-pocket expense”). 14 On the other hand, the messages on Southwest’s website state that for “additional 15 expenses (e.g., hotel, rental car, food, etc.),” impacted travelers “may submit receipts for 16 consideration via Email Us on Southwest.com” and that Southwest “will honor reasonable 17 requests for reimbursement for meals, hotel, and alternate transportation.” (Id. ¶¶ 96, 102, 18 104; see also id. ¶ 99 (“We’ve set up a page at Southwest.com/traveldisruption for 19 Customers to submit refund and reimbursement requests for meals, hotel, and alternate 20 transportation; as well as to connect Customers to their baggage.”).) Considering 21 Watterson’s testimony referencing offering refunds (id. ¶¶ 23–26), Jordan’s message 22 referencing offering refunds (TAC ¶¶ 27, 100), and the messages on Southwest’s website 23 in the light most favorable to Plaintiffs, Southwest made an offer to reimburse reasonable 24 meal, hotel and alternate transportation expenses for those “impacted by a flight 25 cancellation or significant flight delay between December 24, 2022, and January 2, 2023,” 26 which Plaintiffs can accept by “submit[ting] receipts for consideration via Email Us on 27 Southwest.com.” 28 /// 1 In their opposition, Plaintiffs assert that Southwest’s offer did not set the method of 2 performance. (Doc. No. 54 at 15–17 (analyzing Green’s video message, Watterson’s 3 testimony, and Southwest’s website).) With regard to Green’s video message, Plaintiffs 4 rely heavily on the use of “ways” in the video’s caption as authorizing multiple methods 5 of acceptance. (Doc. No. 54 at 15–16.) As alleged in the TAC, “Southwest represented that 6 the message ‘offers ways for travelers to submit receipts for travel expenses incurred in 7 disrupted travel, to request a refund for canceled or significantly delayed flights, and to 8 share information to help Southwest to deliver delayed bags free of charge.’” (TAC ¶ 28.) 9 Plaintiffs argue that, “[b]ecause Southwest used the word ‘ways’, the inference here is that 10 there is more than one way for a customer who acted on Southwest’s offer to submit a 11 request for reimbursement of out of pocket expenses.” (Doc. No. 54 at 16.) However, based 12 on sentence construction, the use of the plural is due to addressing three different actions 13 impacted individuals can take. 14 Plaintiffs also assert that Watterson’s testimony never referenced requiring impacted 15 travelers to fill out a reimbursement request form in order to obtain reimbursement. (Id. at 16 16–17.) However, Watterson’s testimony did in fact address how Southwest “create[ed] a 17 highly-visible, user-friendly webpage where Customers could easily find information and 18 directions on how to request refunds and reimbursements[.]” (TAC ¶ 26.) Moreover, as 19 discussed supra, Watterson’s testimony cannot be interpreted to be an offer based on its 20 language and timing. 21 Considering the allegations of the TAC in the light most favorable to Plaintiffs, 22 Southwest’s offer to reimburse reasonable expenses set the method of acceptance: 23 performance by submitting receipts to Southwest by the Email Us link and completing the 24 subsequent prompted steps. The Court finds that Plaintiffs allege sufficient facts to state 25 that Southwest made an offer for a unilateral contract. 26 /// 27 /// 28 /// 1 2. Plaintiffs’ Performance 2 Next, the Court turns to whether the TAC alleges sufficient facts that Plaintiffs 3 accepted Southwest’s offer through performance.8 “Where . . . an offer prescribes the time 4 and manner of acceptance, its terms in this respect must be complied with to create a 5 contract.” Town of Lindsay v. Cooke Cnty. Elec. Co-op. Ass’n, 502 S.W.2d 117, 118 (Tex. 6 1973); see also Cantu v. Cent. Educ. Agency, 884 S.W.2d 565, 566 (Tex. App. 1994) (“The 7 aphorism ‘the offeror is the master of his offer’ reflects the power of the offeror to impose 8 conditions on acceptance of an offer, specify the manner of acceptance, or withdraw the 9 offer before the offeree has effectively exercised the power of acceptance.”); Domingo, 10 257 S.W.3d at 39 (“An acceptance must be identical to the offer; otherwise, there is no 11 binding contract.”). 12 As discussed supra, Southwest promised the benefit of reimbursement if Plaintiffs 13 performed by submitting receipts to Southwest by the Email Us link and completing the 14 subsequent prompted steps. In contrast to the terms of the unilateral contract, the TAC 15 alleges that “Plaintiff and putative class members through this lawsuit are attempting to 16 accept that offer.” (TAC ¶ 241.) Because Plaintiffs do not allege that they submitted 17 receipts through the Email Us function on Southwest.com as required by the offer, 18 Plaintiffs fail to allege performance in response to Southwest’s promise. See, e.g., Hill v. 19 Concho Res., Inc., 634 F. Supp. 3d 359, 364 (W.D. Tex. 2022) (“The Release Agreement 20 gave the ‘time and manner of acceptance.’ Plaintiff did not perform as the Release 21 Agreement required and did not accept the offer. And without Plaintiff’s acceptance, be it 22 a contract for benefits or an employment agreement, no contract was formed.”); Town of 23 Lindsay, 502 S.W.2d at 118 (“The use of a different method of acceptance by the offeree 24 will not be effectual unless the original offeror thereafter manifests his assent to the other 25 party.”). Without Plaintiffs’ performance, there is no unilateral contract to enforce. See 26
27 8 Because the consideration of a unilateral contract is performance, Southwest’s second and third 28 1 Vanegas, 302 S.W.3d at 302. 2 Accordingly, Plaintiffs fail to state a claim for breach of a unilateral contract for 3 reimbursement. The third cause of action is DISMISSED. 4 D. Promissory Estoppel 5 Plaintiffs bring a claim of promissory estoppel. (TAC ¶¶ 244–52.) Specifically, 6 Plaintiffs allege: 7 Southwest voluntarily and unequivocally promised to reimburse Plaintiffs and 8 members of the proposed class for out-of-pocket expenses incurred to purchase air travel on an alternate airline to reach their designated locations. 9 Southwest made this promise knowing and intending that Plaintiffs and class 10 members would rely on it by purchasing tickets on alternate airlines. Reyling on Southwest’s promise, Plaintiffs and class members incurred substantial 11 out-of-pocket expenses to purchase tickets for air travel on alternate airlines 12 to their designated destinations. This reliance was reasonable, foreseeable, and directly induced by Southwest’s representations. Plaintiffs and class 13 members made proper requests for reimbursement of these out-of-pocket 14 expenses through this lawsuit. Despite its promise, Southwest refused to reimburse Plaintiffs and class members for their incurred expenses. 15 16 (Id. ¶¶ 244–49.) 17 “The requisites of promissory estoppel are: (1) a promise, (2) foreseeability of 18 reliance thereon by the promisor, and (3) substantial reliance by the promisee to his 19 detriment.” Henry Schein, Inc. v. Stromboe, 102 S.W.3d 675, 686 n.25 (Tex. 2002) 20 (quoting English v. Fischer, 660 S.W.2d 521, 524 (Tex. 1983)). “Although promissory 21 estoppel is normally a defensive theory, it may serve as a substitute for an unsuccessful 22 breach of contract claim.” Rice v. Metro. Life Ins. Co., 324 S.W.3d 660, 673 (Tex. App. 23 2010). “Promissory estoppel is not applicable to a promise covered by a valid contract 24 between the parties[] but can apply to a promise outside a contract.” Baylor Scott & White 25 v. Project Rose MSO, LLC, 633 S.W.3d 263, 292 (Tex. App. 2021). 26 Southwest asserts that “Plaintiffs did not incur out-of-pocket expenses because 27 Southwest said it would reimburse them,” but rather “[t]hey incurred those expenses before 28 any promises by Southwest.” (Doc. No. 50-1 at 25.) 1 Although it may be the case that some individuals purchased alternative flights or 2 rental cars in reliance on Southwest’s promise to reimburse such expenses, the TAC fails 3 to set forth such allegations for the named Plaintiffs. Plaintiff Smith purchased a 4 replacement flight; however, the TAC fails to allege when the replacement flight was 5 purchased or that Plaintiff Smith made that purchase relying on Southwest’s 6 representations of reimbursement. (See TAC ¶¶ 45–46.) In their opposition, Plaintiffs state 7 that “Plaintiff Smith relied on the promise because she purchased her ticket on December 8 29th, after Defendant Southwest voluntarily undertook to reimburse customers for out-of- 9 pocket expenses related to alternative flights as alleged supra.” (Doc. No. 54 at 20 10 (emphasis in original).) However, the date of purchase is not alleged in the TAC and, even 11 if it were, the fact that Plaintiff Smith purchased an alternative ticket after Southwest’s 12 reimbursement representations is not sufficient to allege that her actions were caused by 13 reliance on those representations. For Plaintiffs Grove and Piña, the TAC fails to allege 14 when they rented cars, whether it was after representations made by Southwest, and 15 whether either Plaintiff booked their rental cars relying on the representation that they 16 would be reimbursed. (See TAC ¶¶ 52–57, 62–67.) The TAC does not allege that Plaintiff 17 Capdeville bought a flight to a different locale based on Southwest’s representations. (See 18 id. ¶¶ 68–77.) Finally, there are no allegations that Plaintiff Hill took any action at all, let 19 alone action in reliance on Southwest’s representations. (Id. ¶¶ 58–61.) 20 Because Plaintiffs fail to sufficiently allege that any named Plaintiff substantially 21 relied on Southwest’s promise to reimburse, the TAC fails to state a claim for promissory 22 estoppel. The fourth cause of action is DISMISSED. 23 E. Judicial Estoppel 24 Plaintiffs bring a claim of judicial estoppel (TAC ¶¶ 253–58), specifically alleging: 25 Southwest is judicially estopped from claiming it has no obligation to reimburse out-of-pocket expenses under the Contract of Carriage because: (1) 26 Southwest took the clearly inconsistent position before Congress that it would 27 reimburse all reasonable expenses during the disruption period; (2) Congress relied on these sworn statements in its oversight function, with multiple 28 1 Senators expressing approval of Southwest’s commitment to reimburse customers; and (3) Southwest gained an unfair advantage by using these 2 promises to avoid more stringent Congressional oversight and regulation 3 while later refusing to honor those same commitments to customers. Southwest’s Chief Operating Officer Andrew Watterson testified under oath 4 to Congress that Southwest would “grant all reasonable reimbursement 5 requests for our Customers’ out-of-pocket expenses (i.e., hotels, rental cars, meals, tickets on other airlines, etc.)” and characterized these payments as 6 mere reimbursements rather than settlements that would waive customers’ 7 legal rights. Having benefited from this position before Congress, Southwest cannot now reverse course and claim no such obligation exists. 8 9 (Id. ¶ 255–57.) 10 “The doctrine of judicial estoppel ‘precludes a party from adopting a position 11 inconsistent with one that it maintained successfully in an earlier proceeding.’” Pleasant 12 Glade Assembly of God v. Schubert, 264 S.W.3d 1, 6 (Tex. 2008) (quoting 2 Roy W. 13 McDonald & Elaine G. Carlson, Texas Civil Practice § 9.51 at 576 (2d ed. 2003)); see also 14 Perryman v. Spartan Texas Six Cap. Partners, Ltd., 546 S.W.3d 110, 117 (Tex. 2018) 15 (“Judicial estoppel is a common law doctrine that prevents a party from assuming 16 inconsistent positions in litigation.”). “The primary purpose of the doctrine is not to protect 17 litigants, but rather the integrity of the judiciary.” Andrews v. Diamond, Rash, Leslie & 18 Smith, 959 S.W.2d 646, 650 (Tex. App. 1997). 19 “[J]udicial estoppel is subject to several important limitations.” George Fleming & 20 Fleming & Assocs., L.L.P. v. Wilson (“George Fleming”), 694 S.W.3d 186, 191 (Tex. 21 2024). First, “a party cannot be judicially estopped if it did not prevail in the prior action.” 22 Ferguson v. Bldg. Materials Corp. of Am., 295 S.W.3d 642, 643 (Tex. 2009). “A party has 23 ‘prevailed’ if it persuaded the court to adopt the party’s position and thus grant the relief 24 that the party sought.” George Fleming, 694 S.W.3d at 191–92. Second, “the prior 25 ‘statement must be deliberate, clear, and unequivocal.’” Id. at 192 (quoting Am. Sav. & 26 Loan Ass’n of Hous. v. Musick, 531 S.W.2d 581, 589 (Tex. 1975)). Third, “judicial estoppel 27 applies only if the successful representation arose in a different case or, at most, ‘in another 28 phase’ of the same case.” Id. at 192 (quoting New Hampshire v. Maine, 532 U.S. 742, 749 1 (2001)). 2 Southwest argues that Plaintiffs do not identify a “prior judicial proceeding” or that 3 Southwest “successfully maintained the prior position” because the statements made to 4 Congress were not made in a judicial proceeding for which Southwest could obtain success. 5 (Doc. No. 50-1 at 25–26.) 6 Plaintiffs argue that “[b]ecause judicial estoppel is an equitable doctrine[,] the 7 decision of whether to invoke it [is] within a court’s discretion.” (Doc. No. 54 at 23 8 (quoting Siller v. LLP Mortg., LTD., No. 04-11-00496-CV, 2013 WL 1484506, at *5 (Tex. 9 App. Apr. 10, 2013)).) Specifically, Plaintiffs assert that the doctrine of judicial estoppel 10 applies because Southwest provided sworn testimony to Congress and “Congress relied on 11 these sworn statements in its oversight function, with multiple Senators expressing 12 approval of Southwest’s commitment to reimburse customers,” which then Southwest 13 benefit from by avoiding more stringent Congressional oversight and regulation. (Id. at 22– 14 23.) Essentially, Plaintiffs ask this Court to extent judicial estoppel to cover non-judicial 15 proceedings on the basis of justice. 16 “But ‘discretion is not whim, and limiting discretion according to legal standards 17 helps promote the basic principle of justice that like cases should be decided alike.’” 18 George Fleming, 694 S.W.3d at 193 (quoting In re Rudolph Auto., LLC, 674 S.W.3d 289, 19 308 (Tex. 2023)). “Consistent application of judicial estoppel follows from respect for the 20 requirements and limitations [the Texas Supreme Court] ha[s] described. Specifically, the 21 party to be estopped must have obtained a benefit by making a clear and unambiguous 22 statement that convinced a prior court to adopt a position that contradicts the party’s current 23 position.” Id. 24 The parties do not identify, nor is this Court independently aware, of any authority 25 stating that congressional hearings are judicial proceedings within the context of judicial 26 estoppel. Based on the limitations placed on the doctrine by both the U.S. Supreme Court 27 and Texas Supreme Court, the purpose of the doctrine to protect the integrity of the 28 judiciary, and language of opinions focusing on prior litigation, the Court declines to 1 extend the doctrine of judicial estoppel to this new context. See Kane v. Nat’l Union Fire 2 Ins., 535 F.3d 380, 385 (5th Cir. 2008) (“Judicial estoppel is a common law doctrine that 3 prevents a party from assuming inconsistent positions in litigation.”) (emphasis added); 4 New Hampshire, 532 U.S. at 750 (“[C]ourts regularly inquire whether the party has 5 succeeded in persuading a court to accept that party’s earlier position, so that judicial 6 acceptance of an inconsistent position in a later proceeding would create the perception 7 that either the first or the second court was misled[.]”) (citation omitted) (emphasis added). 8 Accordingly, because no prior proceeding has been alleged, Plaintiffs fail to state a claim 9 for judicial estoppel. The Court DISMISSES Plaintiffs’ fifth cause of action.9 10 IV. CONCLUSION 11 Based on the foregoing, the Court GRANTS in part and DENIES in part 12 Southwest’s motion to dismiss the TAC as follows: 13 1. The first cause of action is DISMISSED in its entirety as to Plaintiffs Smith, 14 Grove, Hill, and Piña. The replacement flight claim is also DISMISSED as to Plaintiff 15 16 17 9 In reply, Southwest retorts that “[i]f anything[,] judicial estoppel applies to Plaintiffs’ allegations 18 in the TAC” because Plaintiffs “previously took the position that the unmodified CoC was the contract that governed their claims; the Court adopted that position; and it is difficult to see the inadvertence in 19 failing to disclose a contract modification or separate unilateral contract allegedly in existence at the time of the first complaint.” (Doc. No. 55 at 9.) Southwest’s response is not well taken for myriad reasons, not 20 the least of which is that “[i]t is well-established in our circuit that an amended complaint supersedes the 21 original, the latter being treated thereafter as non-existent.” See Ramirez v. Cnty. Of San Bernardino, 806 F.3d 1002, 1008 (9th Cir. 2015) (quotations omitted). In fact, considering that all Southwest’s arguments 22 are made within the framework of a Rule 12(b)(6) motion, “there is nothing in the Federal Rules of Civil Procedure to prevent a party from filing successive pleadings that make inconsistent or even contradictory 23 allegations.” PAE Gov’t Servs., Inc. v. MPRI, Inc., 514 F.3d 856, 860 (9th Cir. 2007); see also Shirley v. Univ. of Idaho, Coll. of L., 800 F.3d 1193, 1194 (9th Cir. 2015) (Kozinski, J., concurring) 24 (“Inconsistency—even direct contradiction—between a current complaint and an earlier one is not a basis 25 for dismissal. The fact that the earlier complaint is inconsistent may have collateral consequences in the litigation, including possible sanctions under Rule 11 or undermining the plaintiff’s credibility, but it does 26 not render the current complaint legally insufficient under Rule 12(b).”) (citations omitted). Moreover, considering Southwest’s remark substantively, the Texas Supreme Court has opined, in addressing the 27 doctrine of judicial estoppel, that “[s]ame-case inconsistencies are often wholly unproblematic[, particularly because p]arties may maintain alternative positions as a case unfolds.” See George Fleming, 28 1 || Capdeville. Southwest’s motion to dismiss the first cause of action is DENIED with regard 2 || to Plaintiff Capdeville’s refund claim. 3 2. The second, third, fourth, and fifth causes of action are DISMISSED in their 4 || entirety. 5 3. Southwest must file an answer to the remaining claims of the TAC no later 6 March 16, 2026. 7 IT IS SO ORDERED. 8 Dated: March 2, 2026
10 United States District Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28