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The Honolulu Advertiser
Updated at 3:10 p.m., Monday, March 31, 2008

BANKRUPTCY
Governor tries to intervene in Aloha bankruptcy case

Advertiser Staff

Hawaii news photo - The Honolulu Advertiser

Gov. Linda Lingle is trying to stop Aloha Airlines from ceasing passenger operations for at least another month.

Advertiser file photo

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Gov. Linda Lingle this morning said the state has electronically petitioned the bankruptcy court to prevent Aloha Airlines from ceasing passenger operations for at least another month unless:

  • Aloha has exhausted all possibilities of finding a buyer for its flight operations or financing to reorganize the airline;

  • The airline has established that it doesn't have the cash or resources to operate for another month;

  • The views of the committee of unsecured creditors have been received and considered;

  • Aloha has complied with the state's dislocated worker's law; and

  • The court determines that Aloha and its secured lenders filed Chapter 11 in good faith.

    The administration also said today that the federal government also has concerns over the sale of cargo and contract services, which may also impact Aloha's plans to move forward with the shutdown.

    However, in case the petition fails, the governor said the state has also activated a rapid response team to help the 3,500 Aloha employees and their families, who will face the most immediate effects of the airline closure.

    Asked whether the state would guarantee employees salaries through April, Lingle said the airline has not proven that it can't cover payroll on its own. "We don't know what the cash position of Aloha Airlines is," she said. "We only know what they have said publicly."