Posted on: Wednesday, June 29, 2005

Tour firm to pay $3 million in bus-sale settlement

By Rick Daysog
Advertiser Staff Writer

The state's largest private tour bus operator has agreed to pay $3 million to settle claims that it improperly obtained more than 100 tour buses from bankrupt competitor Trans Hawaiian Services Inc.

In court documents filed in U.S. Bankruptcy Court yesterday, Roberts Hawaii Tours and its affiliates agreed to settle charges by Trans Hawaiian's trustee John Candon that Roberts diverted the buses from Trans Hawaiian after it filed for bankruptcy protection in 2001.

The settlement requires the approval of Bankruptcy Judge Robert Faris, who has scheduled a July 28 hearing.

Jerrold Guben, Roberts' attorney, could not be reached.

Candon said that the proceeds from the settlement will be used to pay creditors, including Aloha Airlines, which sued Roberts and Trans Hawaiian last year for allegedly failing to pay for $2.5 million worth of airline tickets.

Trans Hawaiian, once Hawai'i's second-largest private tour bus operator, is a former unit of Honolulu-based International Management & Services Inc., which was headed by Regal Travel founder Raymond Miyashiro.

The bus company filed for Chapter 11 reorganization in July 2001, with debts of about $7 million and assets of $1 million but the case was converted into a Chapter 7 bankruptcy liquidation two months later.

Prior to the bankruptcy filing, Trans Hawaiian sold all of its buses and equipment to Roberts Hawaii in a lease back arrangement that Candon later alleged was improper.

Bankruptcy Judge Lloyd King ruled in Candon's favor last year, voiding the transfer of the buses to Roberts.