Joshua Gotbaum, the former Hawaiian Airlines trustee who piloted the company through a two-year bankruptcy, wants to be paid an $8 million bonus for his efforts.

Gotbaum requested the "success fee" in a Bankruptcy Court filing late Monday and immediately drew criticism from the airline's new owners and union leaders.

"Given current industry conditions and a realistic analysis of who did what during the bankruptcy, we think the requests are outrageous," said Larry Hershfield, chairman of the airline's parent, Hawaiian Holdings Inc., in a written statement.

The proposed fee — which is on top of $1.4 million in salary and expenses Gotbaum was paid for his two years of service — equals more than 2.4 percent of the airline's total assets. It's also more than double the compensation of the highest-paid Hawai'i CEO, Allan Landon, of Bank of Hawaii Inc., who earned about $3.4 million last year.

Gotbaum said that he's entitled to the fee given Hawaiian's successful emergence from bankruptcy in June: Creditors were paid in full and shareholders saw their stock values rise.

"Obviously, there is a range of potential compensation that has been paid to people in bankruptcy situations, and I tried to be on the conservative end of the range," said Gotbaum. "Hawaiian's bankruptcy has turned out amazingly well for its creditors, its shareholders and its extraordinary employees. Now the judge must decide what's right for Hawaiian's trustee."

U.S. Bankruptcy Judge Robert Faris will decide what Gotbaum should be paid and has scheduled a Sept. 21 hearing on Gotbaum's request.

Hawaiian is facing increased financial pressures with soaring fuel prices and the entry of new competitors such as America West.

If approved, Gotbaum's fee would be paid by the airline with money that could otherwise be used on aircraft leases or on restoring employees' wages and pension benefits that were reduced during Hawaiian's bankruptcy, said David Figueira, chairman of the 400-member Hawaiian unit of the Machinists union.

Gotbaum "surrounded himself with a bunch of high-priced consultants" who did most of the restructuring work and were well paid for it, Figueira said.

Kirk McBride, chairman of the 380-member Hawaiian unit of the Airline Pilots Association, agreed.

"This is a slap in the face of the pilots of Hawaiian who made significant structural changes in their contract to ensure the success of the company," McBride said. "I don't believe Gotbaum's tenure warrants this sort of success fee."

McBride said the $8 million success fee is equivalent to about 20 percent of the annual payroll of Hawaiian's pilots.

Gotbaum's court-approved compensation during the bankruptcy included $50,000 a month in salary plus $10,000 a month in living and other expenses.

Gotbaum, who is in the process of moving back to his Washington, D.C., home, said yesterday that he hasn't discussed his fee with the airline's controlling shareholder, Ranch Capital LLC.

Gotbaum's attorney, Sidney Levinson of Los Angeles, said the success fee was reasonable given the difficulties faced by the airline, which included a lawsuit against the airline's former chairman, John Adams, a tax dispute with the IRS and negotiations over aircraft leases.

All three disputes were successfully resolved during the bankruptcy, said Levinson, who said Gotbaum logged a total of 4,995 hours — or about 50 hours a week — during his tenure as Hawaiian's trustee.

Levinson said Gotbaum added $330 million in value to Hawaiian because he was able to achieve $179 million in cost cuts while increasing the airline's market capitalization by $151 million.

The Hawaiian bankruptcy is setting records for being the most expensive in Hawai'i.

An Advertiser analysis of Hawaiian's final billing statements shows that the airline's bankruptcy consultants and law firms billed Hawaiian more than $30 million during the past three years, or nearly double the previous record of $16 million paid by Liberty House Inc. in its 1998 bankruptcy.

The costs included more than $10 million in fees and expenses charged by the airline's lead bankruptcy firm, Hennigan, Bennett & Dorman LLP, and more than $4.5 million in fees billed by New York-based airline consultant Simat, Helliesen & Eichner Inc. Simat also is asking for more than $1.7 million in success fees.

In court papers, Levinson defended Gotbaum's proposed success fee as comparable to those received by trustees in similar bankruptcies. He noted that former Securities and Exchange Commission Chairman Richard Breeden received more than $13.8 million for his work in the liquidation of New York-based Bennett Funding, which went into bankruptcy in 1996 in one of the nation's largest fraud schemes.

"Ultimately, the compensation of the trustee should be measured against the results that were achieved in this bankruptcy case and his role in achieving that unprecedented success," Levinson said.