Pennies on the dollar
June 29th, 2009 by Derrick DePledgeHawaii Superferry filed an objection today in U.S. Bankruptcy Court in Delaware to the state of Hawai’i’s request that the case be transferred to the Islands.
Attorneys for Superferry argue that the major secured creditors -- the federal Maritime Administration and Guggenheim Corporate Funding -- prefer that the case remain in Delaware.
The filing is interesting for its tone.
Superferry executives aggressively courted the state for years, helped convince state lawmakers to approve $40 million in harbor improvements, and urged the Lingle administration to exempt the harbor improvements from environmental review, which led to the legal challenges that wound up halting the project.
Now?
The State of Hawaii’s contention that a transfer of venue is warranted for the protection of its interest in a failed business enterprise that at one time received government support simply finds no support in the case law.
Sadly, it appears that only the State of Hawaii has refused to accept the fact that the Debtors’ were compelled to cease operations months ago as a result of an adverse judicial ruling that shut down ferry services, having terminated virtually all of their employees, with no assets remaining in Hawaii.
The Debtors have moved to abandon their vessels and are proceeding with the abandonment or liquidation, as the case may be, of their remaining assets.
To suggest, as the State of Hawaii does in its Motion, that “(t)he inherently interconnected nature of the Debtors (sic) operations and the interests of the State and its citizens strongly militates in favor of transferring venue to Hawaii,” flies in the face of common sense and logic.
Superferry attorneys go on to cite the fact that Hawaii “allegedly spent $40 million in taxpayer monies years ago” to help Superferry and claim that the state’s surprise the bankruptcy was filed in Delaware “bespeaks a faux naivete.”
As for the state’s unique interest in the case?
These Debtors stopped operating months ago, and they have little interest in engaging in significant legal disputes with the State of Hawaii when it appears that its claims, if ultimately allowed, may receive pennies on the dollar.
Superferry attorneys also argue that the issue of the operating agreement with the state should not be a matter for the bankruptcy court, given that Superferry “ceased ferry services months ago and have no intention of returning to Hawaii to resume those operations.”
June 29th, 2009 at 4:46 pm
Since the beginning, I've always maintained that HSF (their executives - garibaldi), did not care about Hawaii and its people, it was only concerned about its own success and was willing to dupe the state into believing that they were sincere. They blame everybody else for their demise, but it was their own doing - ignoring the aina and peopole and a failed business model. I am not surprised at this latest episode - such arrogance. But, remember HSF, what goes aroung, comes around. In Hawaii we call it "bachi." And your day will come for your arrogance and selfishness. Good riddance.
June 29th, 2009 at 8:35 pm
Amen, I.O.
June 29th, 2009 at 8:39 pm
Good insight, Derrick, about the tone of the filing. I think back to the company's advertising, esp. on TV, and can't help but see the wide divergence between that and these latest pleadings.