Australia's flagship carrier Qantas on Monday announced it would pay out $120 million Australian ($80 million US) to settle a lawsuit brought by consumer watchdog ACCC relating to cancelled flights.
In 2023, the ACCC launched action in court alleging Qantas engaged in "false, misleading or deceptive conduct," by advertising tickets for thousands of flights that it had already cancelled but not removed from sale.
The flight cancellation practices followed the restart of operations post-pandemic from May 2021.
On Monday, the airline and the watchdog said that they have reached a settlement.
Qantas said it would pay the more than 86,000 affected customers who made a booking on a flight two or more days after the cancellation decision amounts ranging from $225 to $450, adding up to about $20 million.
The carrier also said it would pay a $100 million civil penalty, subject to court approval.
"When flying resumed after the COVID shutdown, we recognise Qantas let down customers and fell short of our own standards," said Qantas boss Vanessa Hudson.
"We know many of our customers were affected by our failure to provide cancellation notifications in a timely manner and we are sincerely sorry. The return to travelling was already stressful for many and we did not deliver enough support for customers and did not have the technology and systems in place to support our people."
"We are pleased to have secured these admissions by Qantas that it misled its customers, and its agreement that a very significant penalty is required as a result of this conduct. The size of this proposed penalty is an important milestone in enforcing the Australian Consumer Law," ACCC chair Gina Cass-Gottlieb said.
"Qantas' conduct was egregious and unacceptable. Many consumers will have made holiday, business and travel plans after booking on a phantom flight that had been cancelled."