DOT waives final $11 million of Southwest Airlines fine after 2022 winter storm chaos

WASHINGTON (TNND) -- The U.S. Department of Transportation is waiving part of a fine against Southwest Airlines that was incurred after the company canceled thousands of flights during a 2022 winter storm.

Under a settlement during the Biden administration, Southwest agreed to a $140 million civil penalty. The penalty was the largest it had imposed on an airline for violation of consumer protection laws.

While most of the money from the penalty was used to compensate travelers, Southwest also agreed to pay $35 million to the U.S. Treasury. Southwest made a $12 million payment in 2024 and then an additional $12 million payment this year.

However, the Transportation Department issued an order on Friday, which waived the final $11 million payment, which was planned to be due on Jan. 31, 2026. The

"DOT believes that this approach is in the public interest as it incentivizes airlines to invest in improving their operations and resiliency, which benefits consumers directly," the department said in a statement. "This credit structure allows for the benefits of the airline's investment to be realized by the public, rather than resulting in a government monetary penalty."

The winter storm that the fine stemmed from in December 2022 halted Southwest flights in Denver and Chicago. The stop then grew larger as the crew's rescheduling system could not match the pace of the chaos.

Southwest had to cancel 17,000 flights and left 2 million travelers stranded as a result of the storm.

The Biden administration ultimately found that Southwest violated the law as it did not help stranded customers; many who called the company's service center received busy signals and were stuck on hold for hours.