May 15 (Reuters) - A U.S. judge signaled he will order

Southwest Airlines ( LUV ) to pay 1 cent to end a lawsuit by a

conservative group alleging that a now-defunct program awarding

free flights to Hispanic college students was discriminatory.

U.S. District Judge Sidney Fitzwater on Wednesday rejected a

request by Edward Blum's American Alliance for Equal Rights to

address the merits of its case, after Southwest ( LUV ) "unconditionally

surrendered" by scrapping its ¡Lánzate! program.

Blum has tried for decades to remove racial considerations

from parts of American life, including a successful push to

essentially end affirmative action in college admissions.

U.S. President Donald Trump, meanwhile, has made removing

diversity, equity and inclusion policies from society a hallmark

of his second White House term.

Southwest's ( LUV ) ¡Lánzate! program had since 2004 provided

assistance to 1,500 Hispanic undergraduate and graduate students

who lived at least 200 miles (322 km) from campus.

Fitzwater said it would waste time and money to keep

litigating whether the program violated a Civil War-era law

barring racial bias in contracting, because the plaintiff

achieved "total victory" after Southwest ( LUV ) effectively gave up.

"Granting an obstinate plaintiff total victory upon the

defendant's unconditional surrender is a reasonable response to

the problems and needs confronting the court's fair

administration of justice," the Dallas-based judge wrote.

Fitzwater gave both sides until May 28 to object.

Southwest ( LUV ), based in Dallas, had no immediate comment on

Thursday. Lawyers for the plaintiff did not immediately respond

to requests for comment.

While the plaintiff had sought 1 cent in damages, its

lawyers said the case's merits should be addressed because it

concerned "issues of substantial public importance" regarding

intentional ethnic discrimination by a major company.

"Southwest ( LUV ) cannot avoid liability by paying the Alliance via

a judgment that's not really a judgment, any more than it could

avoid liability by paying the Alliance via no judgment," the

lawyers wrote.

The case is American Alliance for Equal Rights v Southwest

Airlines Co ( LUV ), U.S. District Court, Northern District of Texas,

No. 24-01209.