Business

By Jonathan Stempel

OMAHA, Nebraska, May 3 (Reuters) – Greg Abel earns wide praise from shareholders for his leadership and management abilities at Berkshire Hathaway, but the aura created by his predecessor and mentor Warren Buffett has begun to fade.

Empty seats and diminished crowds were noticeable throughout Berkshire’s annual shareholder weekend in Omaha, Nebraska, the first since Abel succeeded Buffett as chief executive officer in January, according to Reuters’ observations.

Abel presided at Berkshire’s annual meeting in a downtown arena, without Buffett on stage, though the 95-year-old billionaire watched from the audience and spoke briefly there.

Shareholders came away impressed with Abel’s knowledge of Berkshire’s operations, which sprawl across many industries including insurance, railroads, energy, manufacturing and retail.

But he’s not the same draw as the Oracle of Omaha or late Vice Chairman Charlie Munger, who died in 2023, who viewed themselves more as teachers when regaling shareholders in decades of prior meetings.

“I was a little bit disappointed,” said Xiao Zhang, a private investor from Boston. “In previous years, Warren Buffett and Charlie Munger sat on the stage, sharing their investing experiences and also life experiences and philosophies. This year, I didn’t hear something like that.”

Other shareholders said Buffett and Munger laid the groundwork for Abel, instilling his respect for the conglomerate’s culture. Berkshire, these shareholders say, will do just fine with a new CEO as its face.

“They built something to outlast them,” said John Wichita, a utility systems analyst from Omaha, referring to Buffett and Munger. “And I think it will. And the ideas they presented are much more powerful than their physical presence, in a way.”

NO SELLOUTS

“Picture with the Gecko! There’s no line!”

So shouted a staffer mid-Friday afternoon outside the Geico display at Berkshire’s annual shareholder shopping event featuring Berkshire-owned businesses, in an exhibit hall next to the arena, referring to the car insurer’s mascot.

Lines were fewer and shorter. By the time registers were closing on Saturday, See’s had hundreds of unsold boxes of Berkshire commemorative chocolates. Dairy Queen had leftover ice cream bars. Fechheimer Brothers had plenty of Andy Warhol-like T-shirts featuring Buffett and Abel.

In prior years, these products sold better, or sold out, based on Reuters’ observations.

The main event was also less of a draw. Buffett drew capacity crowds. But a Reuters reporter and photographer estimated that around 12,000 of the arena’s approximately 18,000 seats were occupied when Abel started this year’s annual meeting.

Berkshire did not immediately respond to requests for comment outside business hours about attendance and merchandise sales.

Lines to get in the arena before its 7 a.m. opening were also shorter, according to the Reuters reporters, though some still arrived early.

“I’ve watched it online, but flying here and communicating with people face to face is a better way to learn the meaning of value investing,” said Chandler Thien, a freelance writer from Beijing. “It was worth it to pay money for this trip.”

Many who stayed for the meeting came away impressed.

“Greg did a good job,” said Alexandra Cook, an accounting and finance professor at Palm Beach Atlantic University in Florida, who brought four students with her. “He had a job to do to reassure shareholders, and he did that. It was clear he knew the operations intimately, and it wasn’t just Warren’s opinion that that was the case.”

Others felt differently.

“Most people are here for investing knowledge and life philosophies. It was one of the reasons I was drawn to Berkshire,” said Sophia Deng, who runs an artificial intelligence startup in San Francisco. “With Greg Abel, the emphasis was very, very different. It (became) more of an operational excellence conference, and it’s not what I’m interested in as much.”

Deng plans to keep her Berkshire shares, but not buy more.

HOPE AND POSITIVITY

Some said the cost of travel, or resistance to traveling to the United States from other countries, may have dampened attendance.

But others see Berkshire – as a stock and for its culture – as a safe haven from torment elsewhere, and liked how Abel and other Berkshire executives who shared the stage focused on the company’s future.

“In light of everything that’s going on in the world, there doesn’t seem to be a lot of hope and positivity,” said Julie Vargas, a healthcare logistics manager from Omaha. “Having someone tell us what’s going to possibly happen and where we can look forward is a positive step in the right direction.”

Cindy Chin, CEO and chief space officer of Planetary Systems AI, said staying the course is also part of Berkshire’s appeal.

“We have a lot of volatility in geopolitics, but Berkshire’s investing philosophy has always been staying true to value investors and shareholders, and I don’t think that’s going to change,” she said. “This is Warren and Charlie’s legacy, and being here is still someplace special.”

Abel is 63, and has signaled he would like to run Berkshire for a long time, perhaps decades.

He has shareholders’ respect. He may need more to ensure that shareholders continue viewing Berkshire, and the shareholder weekend, as something special.

“The throngs of shareholders may abandon the meeting with the lack of the unique homespun feel of Warren’s wit,” said Richard Callahan, a retail banker at BMO in Omaha. “Abel may grow into it. But he’s no Warren Buffett.”

(Reporting by Jonathan Stempel in Omaha, Nebraska; Editing by Megan Davies and Christopher Cushing)

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May 3 (Reuters) – U.S. Federal Reserve Governor Michael Barr said stress in private credit could spark “psychological contagion” leading to a broader credit crunch, Bloomberg News reported on Sunday.

While direct links between banks and private credit do not yet appear “super worrisome,” there were other areas of concern such as the insurance sector’s overlaps with private lenders, Barr said in an interview with Bloomberg News.

“People might look at private credit, and instead of saying, ‘This is an idiosyncratic problem, these were high-risk loans, the rest of the corporate sector is different,’ they might say, ‘Wow, there seem to be cracks in our corporate sector. Maybe over here in the corporate bond market, there are also cracks,’” Barr said.

Barr also added that “then you could have a credit pullback, and that could lead to more financial strain.”

Private credit firms have been under stress because of the market’s recent downturn with some investors retreating from these investments due to worries about valuations and lending ​standards following a handful of high-profile bankruptcies.

Fed ​Chair Jerome Powell said in March central bank officials are watching developments in the private credit sector for signs of trouble, but do not currently see issues there bringing ​down the financial system as a whole.

(Reporting by Angela Christy in Bengaluru; Editing by Will Dunham)

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HAVANA (AP) — José Luis Amate López hasn’t had a customer in almost two weeks, not counting the scrawny brown kitten that slinks around the bodega where he works in central Havana.

The shelves once laden with goods during his childhood sat nearly empty in late April, with barely anything to offer the 5,000 clients who depend on the state-run store for subsidized food.

Government ration books that once provided for a healthy diet and kept families fully fed for a month are now shrinking.

As the economy collapses and prices soar, a growing number of Cubans find themselves unable to afford alternatives to state-run stores and struggle to subsist on meager salaries in a socialist country of nearly 10 million where basic goods increasingly are sold in U.S. dollars.

“No Cuban can truly survive on the products from the ration book anymore,” Amate López said.

Revolutionary leader Fidel Castro established the ration book — “la libreta”— in the early 1960s. It offered heavily subsidized goods ranging from milk to fish and even cigarettes. Cubans knew their assigned bodega would be stocked with everything they needed by the first of the month.

The ration book shrank during the “Special Period,” when Soviet aid plummeted in the 1990s and deprivation hit Cuba. During that time, Cubans lost an average of 5% to 25% of their body weight, according to one study published in a medical journal, with goods including bread, milk, eggs and chicken in scarce quantities.

Even so, many Cubans who lived through that period say the current situation is worse.

Amate López recalled that his assigned bodega was so full decades ago “you could barely walk.”

It’s now an empty room with dusty old posters detailing the prices and amounts of nearly two dozen goods no longer available, including yogurt, pasta and bars of soap. Two industrial freezers once packed with meat and chicken serve only to keep Amate López’s water bottle cold. In April, the only items he had available to sell were rice, sugar and split chickpeas.

Cuban teens turning 15, a landmark birthday in Latin America, used to receive cake and several cases of beer. Now they only get 3 kilograms (6.6 pounds) of ground beef. The government recently opted to celebrate those turning 65 by awarding them sardines, a bar of soap and a package of toilet paper. But Amate López said he doesn’t have those items.

Havana resident Ana Enamorado, 68, said she only was able to buy split chickpeas and 2 pounds (1 kilogram) of sugar at her assigned bodega in April.

She struggles to buy the remaining basic goods at small, privately owned stores known as “mipymes” with her salary and pension totaling some 8,000 Cuban pesos ($16) a month.

A carton of 30 eggs costs roughly 3,000 pesos ($125), 2 pounds of meat hash are nearly 900 pesos ($37) and 1 pound of cornmeal is roughly 200 pesos ($8).

“There’s hardly anything in the ration book,” she said. “We’re practically living off air.”

Her lunches and dinners are a rotation of rice, seasoned ground meat and cornmeal, or sometimes nothing at all. She recalled once upon a time being able to eat pork, lamb, fricassee, fried plantain slices and red beans and rice.

“Now we have to cut back, have one meal a day and live on memories,” Enamorado said.

Cuba imports up to 80% of the food it consumes, including goods offered at state stores that are increasingly unavailable given a lack of government resources.

“They just don’t have the money to do it anymore,” William LeoGrande, a professor at American University who has tracked Cuba for years, said about the government running out of funds. “Things come in an ad hoc way.”

LeoGrande said the government “bungled” the 2021 merging of two Cuban currencies and the resulting inflation has persisted because the state spends far more money than it takes in.

The government has to stop printing money and balance its budget without drastically cutting social services, a challenge since the bulk of state funds is spent on health, education, social welfare and food imports, he said.

“Any major cuts in state spending are going to have a profound social impact, which is why they haven’t done it,” LeoGrande said, adding that the government’s investment in tourism is “way higher” than the demand for tourism, which has plummeted.

In recent years, Cuba’s government has talked about subsidizing people in need instead of goods. That would free up money to import fuel, medicine and other items, LeoGrande said.

But many Cubans still depend on their ration books while the island’s crises deepen as severe power outages, petroleum shortages and a U.S. energy blockade persist.

Cuban comedians have spoofed the ration book, creating a character named “Pánfilo” who sings a rhyming chorus in a recent video posted online: “Place the notebook in a cemetery, because it’s ready to be buried.”

On a recent sunny afternoon, Lázaro Cuesta, 56, stood in line to receive a daily allowance of two small bread rolls for him and his wife.

“Before it was 80 grams and cost 5 (Cuban) cents. Now it’s 40 grams and costs 75 cents,” he said. “And the quality is worse.”

Cuesta works in food preparation and earns 6,000 Cuban pesos ($250) a month. His wife, a retired nurse, receives 4,800 pesos in monthly pension. They also receive $200 a month from her brother and daughter who live abroad.

The remittances allow them to eat avocados, eggs and red beans and rice, Cuesta said.

“If not for the remittances,” he said as he grabbed his neck with his right hand, “hang yourself.”

Roughly 60% of Cubans on the island receive remittances, but Rosa Rodríguez, 54, of Havana is not one of them.

“Everything is scarce here — everything — even that wretched bread they give us,” Rodríguez said. She earns 4,000 Cuban pesos ($8) a month, which she said isn’t a bad salary for Cuba, but “no matter how hard you work, it’s simply not enough.”

Rodríguez said the only product she obtained at her assigned bodega in April was a donation of 4 pounds (1.8 kilograms) of rice, while she struggles to buy other basic goods.

“If you buy beans, then you can’t buy sugar,” she said, noting that most of her salary is spent on a large carton of eggs. “If I retire, I die.”

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Follow the AP’s coverage of Latin America and the Caribbean at https://apnews.com/hub/latin-america

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By Jonathan Stempel

OMAHA, Nebraska, May 2 (Reuters) – Berkshire Hathaway CEO Greg Abel on Saturday welcomed a recent court decision that could limit liabilities at its PacifiCorp utility business as it defends against lawsuits over wildfires in Oregon and northern California.

Speaking at Berkshire’s annual shareholder meeting in Omaha, Nebraska, Abel said the April 8 decision by an Oregon state appeals court that a large wildfire case could not proceed as a class action relieves pressure on PacifiCorp, as it tries to persuade regulators to ensure it can charge enough to justify providing power.

“We’re back to first base” on the legal side, he said, meaning the threat has been dialed back.

PacifiCorp has been defending against litigation over a series of wildfires in Oregon and California, including several that victims blamed on its failure to shut off power lines during a 2020 Labor Day weekend windstorm.

In the biggest case, an Oregon jury in 2023 found PacifiCorp grossly negligent, exposing the Portland-based utility to tens of billions of potential liability in subsequent damages trials.

PacifiCorp has said it once faced as much as $55 billion of potential claims.

But the Oregon appeals court said the trial judge erred in instructing the original jury it could assume PacifiCorp’s wrongful conduct applied to all affected fire victims.

Before that decision, 171 plaintiffs had been awarded about $1.1 billion in a series of “mini-trials” that began in January 2024 and which had been expected to continue into 2028.

“They said, back to ground zero, start over again,” Abel said.

PacifiCorp has been working to push several western U.S. states to cap liability for wildfires, and set up state-administered wildfire funds to compensate victims, so long as utilities file and honor safety plans designed to mitigate damage.

Utilities such as PacifiCorp believe this arrangement provides a safety net that lets them invest effectively in maintenance and grid infrastructure without fear that indeterminate litigation could strain their liquidity or lead to bankruptcy.

Abel said PacifiCorp desires a “regulatory compact” where it can charge customers enough to justify spending more on infrastructure, without taking on excessive risk, but faces resistance from regulators and politicians who don’t want rates to go up.

States that have addressed utilities’ wildfire exposures include California, which boosted its wildfire fund by $18 billion following multiple fires that ravaged parts of the Los Angeles area in January 2025.

Abel has called Utah’s protections, which let large utilities surcharge customers and cap liability on some claims, the “gold standard.”

Oregon in particular has yet to follow.

PacifiCorp’s immediate parent is Berkshire Hathaway Energy, which Berkshire owns. Berkshire bought the utility for $5.1 billion in 2006.

(Reporting by Jonathan Stempel in Omaha, Nebraska, editing by Colin Barr and Sharon Singleton)

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By Jonathan Stempel

OMAHA, Nebraska, May 2 (Reuters) – Berkshire Hathaway shareholders on Saturday overwhelmingly rejected a proposal to publish a report discussing how the conglomerate oversees its more than 387,000 employees at nearly 200 businesses.

Shareholders also approved proposals backed by Berkshire’s board of directors that they grant non-binding approval of how Berkshire pays top executives, and every three years have an advisory vote on such compensation, known as “say on pay.”

All 13 directors, including Chief Executive Greg Abel and Chairman Warren Buffett, were also reelected to Berkshire’s board.

The oversight proposal from shareholder Myra Young said Berkshire’s decentralized structure led to “inconsistent approaches to human capital management.”

She said this has manifested itself in concerns raised by NetJets pilots about the luxury plane unit’s commitment to safety and effective training, and a 2021 fire at an Illinois plant run by the Lubrizol chemicals business that caused $380 million of property damage.

Berkshire maintained that its decentralization reflected the conglomerate’s culture, and left workforce decisions to subsidiaries best positioned to make them. It said this made a report discussing its oversight framework unnecessary.

(Reporting by Jonathan Stempel; Editing by Alistair Bell)

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The San Diego Padres have reached an agreement to sell control of the team to an investor group led by Kwanza Jones and José E. Feliciano.

The family of late owner Peter Seidler formally announced the deal Saturday. The sale must still be approved by Major League Baseball.

The deal with private equity billionaire Feliciano and his wife took shape last month at an MLB-record valuation of $3.9 billion. The Padres’ announcement of the deal didn’t give specifics on the members of the investor group or the purchase price.

“The Padres are more than a baseball team; they are a unifying force in San Diego, rooted in community, connection and belonging,” Jones and Feliciano said in a joint statement. “As life and business partners, and as a family, we are honored to lead this next chapter together. We have worked hard for everything we have achieved, and we have built it together. We see that same spirit in this team and its fans, and we know what it takes to win. We are committed to showing up, listening and earning the trust of this community while building on the strong foundation established by the Seidler family.

“This is about more than baseball — it’s about boosting the pride, energy, and connection that define the Padres, investing in community, deepening belonging and ensuring this team remains accessible and endures for generations. We are all in — with the goal of bringing a World Series championship to San Diego.”

Seidler’s family began to explore a sale of the Padres last November, two years after the death of the popular Peter Seidler, who became the Padres’ primary owner in 2020. His brother, John Seidler, has served as the Padres’ chairman since his death.

“When I became control person, my goal was to continue building on our recent success in pursuit of a World Series championship for the city of San Diego and our faithful fans,” John Seidler said in a statement. “As I pass the baton to Kwanza and José, I do so with full confidence that they share that vision as well as the Padres’ deep commitment to San Diego. It’s what the team, our fans and the community deserve. Our family loves this team.”

Peter Seidler joined the Padres’ ownership group in 2012 when John Moores sold the team for $800 million to a group headed by Ron Fowler. Seidler took over and immediately endeared himself to San Diego’s fans with his aggressive financial backing of general manager A.J. Preller, who built a team that has reached the playoffs in four of the past six years.

The Padres have been a hot ticket for several years as San Diego’s only team in the four biggest North American sports leagues, ranking second in the majors in attendance last season. Preller’s roster is off to another strong start this season, sitting second in the NL West at 19-12 heading into a home game against the Chicago White Sox on Saturday night.

Jones and Feliciano already got a start on their new endeavor last month when they traveled to Mexico City to watch the Padres’ international series against the Arizona Diamondbacks. The couple was spotted sitting with Padres CEO Erik Greupner.

Feliciano will become the second Latino owner in baseball, joining Los Angeles Angels owner Arte Moreno. Latino and Hispanic players comprise roughly 30% of major league rosters.

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AP MLB: https://apnews.com/MLB

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SEATTLE (AP) — The collapse of the U.S.-based Spirit Airlines may mark the end of an era for travelers with a certain financial sensibility.

But if you’ve been snagged in their now-defunct flight schedule, here are some things to know on how to get home, and get whole.

Many airlines that used to compete with Spirit are now parachuting in with deals to save their travelers. Airlines including American Airlines, United Airlines, Delta Air Lines, JetBlue Airways, Frontier Airlines and Southwest Airlines are capping or reducing ticket prices for people to book new flights.

There is a limited window for this deal, which prioritizes now-stranded travelers who need to find a new way to their next destination.

For example, Southwest’s offer is only available in person at an airport ticket counter through Wednesday, May 6, according to industry trade group, Airlines for America and the U.S. Department of Transportation. United, meanwhile, is allowing such bookings for up to two weeks, which can be accessed online.

For those who were planning to fly Spirit and now need to find an alternative to the ultra low cost carrier, American, Allegiant, Frontier and Delta advertised reduced fares on the same routes Spirit once flew.

Many company announcements include maps showing where its routes overlapped with Spirits, which can help narrow the search to find a comparable flight.

“Spirit Airlines played an important role in expanding access to affordable travel and bringing more low fares to more people,” said Bobby Schroeter, Frontier’s chief commercial officer. “We recognize this is a difficult time for their customers and team members.

Spirit Airlines said they were prepared for an “orderly wind-down” of its operations, and that it will automatically process refunds for any flights booked on a credit or debit card.

Travelers who booked through third-party travel agencies should direct refund requests to those agents.

Anyone else who got their reservation through vouchers, credit or points will have to wait and see though Spirit’s bankruptcy process.

If there are questions about whether your money will make a safe landing back to your wallet, there are other ways to try to claw back your cash for the Spirit flight not taken.

The DOT suggests contacting your credit card company and exercising your rights under the Fair Credit Billing Act, by requesting a “chargeback” for services not rendered.

If you purchased travel insurance or it is included in your credit card’s policy and perks, call them to see if they cover “insolvency” or “service cessation.”

The last resort would be filing a bankruptcy claim but officials warn this route eats up time and money, and ultimately may only result in a partial refund.

The National Consumers League warned travelers to keep all documentation to prove they were booked for Spirit flights, including receipts, booking confirmations, cancellation notices, and any correspondence with the airline. The nonprofit watchdog organization also urged those affected to act immediately as credit card and insurance companies may have strict deadlines that can be time-sensitive.

“Not all Spirit customers should assume a refund will automatically appear,” said John Breyault, the league’s vice president of public policy, telecommunications, and fraud. “When an airline shuts down this suddenly, it’s up to travelers to take proactive steps to have the best chance of getting their money back.”

American and United both said it is trying to adjust its fleet so it can help more stranded passengers. American said it is looking into tapping larger planes and United said it is potentially adding additional flights on routes where they overlapped with Spirit.

“We are reviewing opportunities to add additional capacity, including utilizing larger aircraft on critical routes — to support as many affected passengers as possible,” American said via an Airlines for America statement.

Southwest also said it will offer a status-match, by honoring Spirit’s Silver and Gold status members with its own A-List program.

The car rental company Hertz is also advertising deals for alternative transportation, offering one-way vehicles and up to 25% off for those find “the road might be the fastest way home in scenarios like this one.”

Spirit crew members who are stuck at their destination should be granted airline travel benefits, including spare jump seats where available on most major carriers.

American said: “We will provide transportation for Spirit team members who have been displaced on a work trip,” according to an Airlines for America statement.

The DOT also said the other companies are offering preferential interviews to help expedite the job search for former Spirit pilots, flight attendants and other employees. American said it will be setting up recruiting events for those former employees.

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By Suzanne McGee and Jonathan Stempel

NEW YORK/OMAHA, Nebraska, May 2 (Reuters) – Berkshire Hathaway reported improved first-quarter performance from the conglomerate’s insurance businesses, but CEO Greg Abel told investors the sector faces competitive headwinds.

“The reality is that … as our insurance business softens, we cannot realize the value we should for the related risk,” Abel told shareholders attending Berkshire’s annual meeting in Omaha, Nebraska, on Saturday. 

The boost in first-quarter revenue to $81.1 billion from $77.6 billion a year earlier reflected what Abel called a “pretty benign period” for insurance losses, one that passed without any major catastrophes such as wildfires or hurricanes.

The flip side, he said, is that new capital is entering the market, creating a more competitive pricing environment. 

CAUTIOUS APPROACH

Berkshire’s insurance businesses “will be much more cautious, specifically across the primary and reinsurance businesses” in response to the shifting balance between premiums they can charge in a competitive market and the associated underwriting risk.

He said striking the right balance has been a major focus at Geico, the Berkshire-owned auto insurer.

“We’ve seen unprecedented shopping activity across the auto space” by drivers looking for bargain-priced policies, Abel said.

Geico has “worked hard to segment” its customer base to retain as many customers as possible, even as premiums rose, Abel said. 

“It’s not going to be easy to just restart the growth engine,” Abel said.

Geico once ranked second in market share for car insurance after State Farm, but Progressive surpassed it after investing earlier in technology to find better drivers and ensure it charges the right prices, according to analysts.

But in the last few years, Geico, under former Chief Executive Todd Combs, regained momentum by tightening underwriting standards and slashing overhead, including a nearly one-third reduction in Geico’s workforce to 29,541 people at the end of 2025.

Vice Chairman of Insurance Operations Ajit Jain said in 2025 that Geico had caught up to rivals in telematics, where insurers use devices installed in vehicles to monitor behavior, including speed, braking, mileage and distracted driving. Safe drivers get rewarded with discounts, while other drivers are charged more.

In the first quarter, Geico’s pre-tax underwriting gains fell 35%, as it spent more on advertising while accident claims rose.

Combs left Geico in December to join JPMorgan Chase and was replaced by Nancy Pierce, previously the insurer’s chief operating officer. She joined Geico in 1986.

(Reporting by Suzanne McGee in Providence, Rhode Island, and Jonathan Stempel in Omaha, Nebraska; Editing by Rod Nickel)

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By Laila Kearney

NEW YORK, May 2 (Reuters) – U.S. travelers lamented news of the shutdown of Spirit Airlines on Saturday, saying that the closure of the ultra-low-cost carrier eliminates one of the few air travel options for low-income and working-class Americans.

Spirit abruptly cancelled flights overnight, stranding passengers and staff around the U.S., Caribbean and Latin America, after collapsing under financial pressures that included a sharp rise in fuel costs due to the Iran war.

On social media platforms such as Reddit and X, where disgruntled passengers often vent their frustrations about delayed or cancelled flights, former Spirit patrons recounted how the airline had provided a lifeline to money-conscious travelers.

“They truly were one of the last cheap — ‘get me there as fast and cheap as possible’ — options,” Reddit user AioliUpset7805 wrote on a thread about the airline’s closure. “I’ll miss them.”

Spirit, which had operated commercially since the early 1990s, became known for providing some of the cheapest available flights in exchange for limited luxuries and services. Unlike most U.S. airlines, Florida-based Spirit charged for bottled water, for example, and did not provide reclining seats.

While that lack of amenities sometimes became the topic of online memes, many travelers said Spirit cleared the way for Americans on a budget to take family holidays or to visit loved ones living in far-flung parts of the country.

“I can only imagine how many millions of families (there are) out there where vacations are now out of reach,” Reddit user BigBubby305 said, adding that the price difference between Spirit and carriers like Delta and American Airlines was, at times, more than $1,000 for a set of tickets for their family.

OTHER AIRLINES SEEK TO FILL GAP

At the Orlando International Airport overnight, a digital departure display sign was filled with bright red notifications of cancelled Spirit flights that had destinations everywhere from Nashville to San Juan, Puerto Rico.

Following Spirit’s halting of operations, multiple U.S. carriers — including Frontier, JetBlue and Southwest — introduced discount fares and plans for new summer routes.  Airlines like Delta and American Airlines were also offering temporarily lower fares to Spirit passengers.

Spirit’s closure comes at a time of rising prices across the American economy, which have been made worse by the U.S.-Israeli war against Iran.

The demise of Spirit, which according to data from aviation analytics firm Cirium had more than 4,000 domestic flights scheduled through May 15, and a recent doubling of jet fuel prices, are expected to heap more costs on American travelers.

“I always took great pride in knowing we were saving people money and allowing those to travel who couldn’t afford to otherwise,” wrote Reddit user Coryntrevors, who said they piloted Spirit’s signature bright yellow Airbuses out of Las Vegas for over a decade.

“To shut down forever tonight has been one of the saddest experiences of my life.”

(Reporting by Laila Kearney in New York, editing by Ross Colvin and Keith Weir)

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By Diana Novak Jones

May 2 (Reuters) – A trial beginning in New Mexico on Monday could prompt a judge to order sweeping changes to how Facebook, Instagram and WhatsApp operate – a move Meta Platforms has warned could force it to withdraw from the state.

The case, which will be tried before a judge in Santa Fe, stems from a lawsuit filed by New Mexico Attorney General Raúl Torrez, a Democrat, accusing the social media giant of designing its products to addict young users and failing to protect children from sexual exploitation on its platforms. 

At the heart of the trial is whether Meta’s platforms have created a “public nuisance” under New Mexico law. That finding would allow the judge to order wide‑ranging remedies aimed at curbing alleged harms to young users. The case is being closely watched as states, municipalities and school districts across the country pursue similar claims seeking to force changes at the industry level.

Monday’s trial marks the second phase of New Mexico’s lawsuit. A jury in March found Meta violated the state’s consumer protection law by misrepresenting the safety of Facebook and Instagram for young users. It ordered the company to pay $375 million in damages. 

Criticism of children’s safety on social media has been mounting for years. On Wednesday, Meta warned investors that legal and regulatory blowback in the European Union and the U.S. “could significantly impact our business and financial results.”

SWEEPING REMEDIES AT STAKE

Torrez’s office is expected to seek both billions of dollars more in damages and an order requiring Meta to make substantial changes to its platforms for New Mexico users, according to court filings.

Meta has said it has already addressed many of the state’s concerns and taken extensive measures to ensure its young users are safe. The company said in court filings last week that many of the changes Torrez’s office is seeking are impossible for it to comply with and may force it to withdraw from the state entirely.

“The New Mexico Attorney General’s focus on a single platform is a misguided strategy that ignores the hundreds of other apps teens use daily,” a Meta spokesperson said in a statement ahead of the trial. “Rather than providing comprehensive protections, the state’s proposed mandates infringe on parental rights and stifle free expression for all New Mexicans.”

A ‘PUBLIC NUISANCE’

The trial before Judge Bryan Biedscheid will examine whether Meta’s conduct meets the standard for a public nuisance under New Mexico law, which would allow the court to impose remedies aimed at abating the alleged harm. 

A public nuisance claim targets activities that unreasonably interfere with the health and safety of a community. Classic examples include blocking a public road, polluting a waterway or emitting noxious fumes. State governments have invoked public nuisance law in recent decades to pursue a broader range of industries, including litigation tied to tobacco, opioids, climate change, and vaping, said Adam Zimmerman, a professor at USC’s Gould School of Law. 

New Mexico’s case is among a growing number of lawsuits accusing Meta and other social media companies of intentionally designing products to be addictive to young people. While many cases have been filed by families over specific injuries to individuals, more than 40 other states and over 1,300 school districts have filed lawsuits seeking court-ordered changes and damages under public nuisance law.

New Mexico said it plans to ask the judge to order Meta to make changes including verifying users’ ages; redesigning its algorithm to promote quality content for minors; and ending autoplay and infinite scrolling for minors. 

“It will be an opportunity for us to explore more deeply the size and scale and effectively the monetary value of the public nuisance harm that was a product of this business’s behavior for the last, you know, 10 or 15 years,” Torrez told reporters at a press conference on Thursday ahead of the trial. 

The company has said in court filings that it cannot have created a public nuisance because it has not interfered with a public right. It also said there is no scientific evidence to support the idea that social media has caused mental health problems, and that many of the state’s requests are “technologically impractical or completely impossible.”

In a public nuisance case, the state can also seek money damages to abate the harm. That sum could be substantial when the impact is said to have affected large segments of the population. Torrez’s office has not detailed the amount it will seek.

Meta said in court filings New Mexico plans to ask for $3.7 billion in damages to fund a 15-year mental health plan including new healthcare facilities and hiring providers, a request it said would require it pay for mental health care for all teens in the state regardless of the cause of their needs.

(Reporting by Diana Novak Jones, Editing by Alexia Garamfalvi and David Gregorio)

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