* Fraud claims tossed, breach of contract claim survives
* Coupons for free drinks had no expiration date--lawsuit
* Passengers: Policy change left unused coupons worthless
By Jonathan Stempel
March 5 (Reuters) - Southwest Airlines Co has won the dismissal of part of a federal lawsuit by fliers who said the discount carrier improperly stopped honoring coupons for free alcoholic drinks, where the coupons had no expiration dates.
U.S. District Judge Matthew Kennelly in Chicago said federal airline law preempts claims accusing Southwest of unjust enrichment and violating state consumer fraud laws.
He did not address a breach of contract claim, after the carrier conceded in a court filing that a "narrow construction" of that claim could survive.
Kennelly also refused Southwest's request to delay the case while a similar case in Alabama is pending.
Adam Levitt and Herbert Malone, the plaintiffs, had sued over Southwest's August 2010 decision to require passengers in its premium-priced "Business Select" program to use their free drinks coupons only on the day of travel printed on the coupons, not whenever they wanted. The coupons otherwise would cost $5 each.
"The court's ruling has now liberated us to aggressively prosecute this case, which is exactly what we intend," said Joseph Siprut, a Chicago lawyer who represents the plaintiffs.
Southwest had no immediate comment.
Levitt lives in the Chicago area and Malone in Pennsylvania. They had attached to their complaint a respective 45 coupons and 12 coupons for free drinks, which they said they had accumulated and which Southwest's policy change left worthless.
In announcing that change, Southwest vice president Mike Hafner wrote on a company blog that "where the competition is always knocking (or banging) on the door and where watching the bottom-line is more important than ever, we owe it to our employees, customers, and shareholders to find ways to operate smarter."
Southwest is based in Dallas, and has long been financially among the healthiest major U.S. carriers.
The case is Levitt et al v. Southwest Airlines Co, U.S. District Court, Northern District of Illinois, No. 11-08176.