Hawaii Superferry files for Bankruptcy

The Hawaii Superferry is not coming back to Hawai’i.  Now it will be interesting to see who buys the two high speed ferries.    This is a David vs. Goliath story of communities resisting powerful corporate, military and political forces and with the help of an honest court, winning!   See this article by Jerry Mander and Koohan Paik for more on the military ties to the Superferry and the heroic struggle to stop it.

Hawaii Superferry Files for Bankruptcy Protection

(Update1)

By Bob Van Voris

May 30 (Bloomberg) — Hawaii Superferry Inc., which provided high-speed ferry service for cars and passengers between Hawaii’s Oahu and Maui islands, filed for bankruptcy protection today.

Hawaii Superferry and parent HSF Holding Inc. filed Chapter 11 bankruptcy petitions in Wilmington, Delaware. They cited a Hawaii Supreme Court ruling in March that struck down a state law permitting the company to operate before completing an environmental impact statement.

Tom Fargo, Hawaii Superferry’s president and chief executive officer, said in a statement at the time that completing an environmental impact statement could take a year. As a result of the decision, ferry service was immediately shut down and the company’s two high-speed ferries docked in Mobile, Alabama.

The company, which reported more than $100 million in assets and debts in its bankruptcy petition, said it will use the bankruptcy to close its business completely and liquidate the operation.

Hawaii Superferry was formed in 2002 to provide high-speed ferry service among the four main Hawaiian islands of Oahu, Maui, Hawaii and Kauai. The company began carrying passengers in August 2007 on the Alakai, an aluminum-hulled catamaran that carried as many as 866 people and 282 cars, according to court papers in the bankruptcy case.

Decline in Tourism

The law struck down by the Hawaii Supreme Court was enacted in November 2007 to permit the ferry to keep operating despite a series of successful state court legal challenges, Hawaii Superferry said in a court filing. The high court ruled that the law was intended specifically to benefit the company, in violation of the state constitution.

In addition to the court decision, Hawaii Superferry said its business was hurt by a decline in tourism, a 2008 increase in fuel prices and a price war between airlines that provided inter-island service in Hawaii.

The case is: In re HSF Holding Inc., No. 09-11901, U.S. Bankruptcy Court, District of Delaware (Wilmington).

To contact the reporter on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net

Source: http://www.bloomberg.com/apps/news?pid=20601087&sid=aG5jmmubowI0&refer=home