Monday, June 29, 2009
Hawaii Superferry Challenges Transfer Motion
On Monday, Hawaii Superferry, Inc. and HSF Holding, Inc. filed an objection, accompanied by a memorandum of law, to the motion of the State of Hawaii seeking the transfer of their bankruptcy cases from the bankruptcy court in Delaware to the bankruptcy court in Hawaii. Hawaii Superferry filed for bankruptcy protection in Delaware on May 30, 2009 and the State of Hawaii sought the transfer on June 19th. Details of the State of Hawaii's transfer motion can be found in an earlier posting, which is available here.
In support of its objection, Hawaii Superferry makes several arguments. First, the company asserts that venue is proper in Delaware because HSF Holding, Inc. was formed as a corporation under Delaware law. Second, the company states that its two largest secured creditors - the United States Maritime Administration and Guggenheim Corporate Funding, LLC - support the cases remaining in the Delaware bankruptcy court. In fact, the United States Maritime Administration quickly filed a joinder in support of Hawaii Superferry's objection. The objection also notes that MARAD holds a secured claim in excess of $136 million and Guggenheim holds a secured claim of $50 million, while the State of Hawaii asserts a disputed third-lien claim of only $1.3 million. The objection suggests that such third-lien claims are likely to be out of the money.
Finally, Hawaii Superferry challenges the assertions made by the State of Hawaii that there is a strong connection between the companies and the State of Hawaii. While that may once have been the case, according to Hawaii Superferry, the companies have ceased all operations in Hawaii and no longer maintain any significant connection to Hawaii. According to the companies, they ceased all operations in Hawaii in March following an adverse court ruling that prohibited their continuing operation, they have laid off all employees in Hawaii and none of their assets remain in Hawaii (most notably, their most significant assets - the high-speed ferries - are now docked in Alabama). Hawaii Superferry also challenges the assertion that most of its creditors are located in Hawaii, noting that less than half of its 30 largest unsecured creditors (and two of the three members of the Official Committee of Unsecured Creditors) are located outside of Hawaii. Finally, the company notes that both its retained professionals and the Creditors' Committee's retained professionals are located in Philadelphia, New York, Washington, D.C., and Wilmington.
Download copies of every document filed in this case and the bankruptcy cases of over 600 other major corporations using netDockets.
In support of its objection, Hawaii Superferry makes several arguments. First, the company asserts that venue is proper in Delaware because HSF Holding, Inc. was formed as a corporation under Delaware law. Second, the company states that its two largest secured creditors - the United States Maritime Administration and Guggenheim Corporate Funding, LLC - support the cases remaining in the Delaware bankruptcy court. In fact, the United States Maritime Administration quickly filed a joinder in support of Hawaii Superferry's objection. The objection also notes that MARAD holds a secured claim in excess of $136 million and Guggenheim holds a secured claim of $50 million, while the State of Hawaii asserts a disputed third-lien claim of only $1.3 million. The objection suggests that such third-lien claims are likely to be out of the money.
Finally, Hawaii Superferry challenges the assertions made by the State of Hawaii that there is a strong connection between the companies and the State of Hawaii. While that may once have been the case, according to Hawaii Superferry, the companies have ceased all operations in Hawaii and no longer maintain any significant connection to Hawaii. According to the companies, they ceased all operations in Hawaii in March following an adverse court ruling that prohibited their continuing operation, they have laid off all employees in Hawaii and none of their assets remain in Hawaii (most notably, their most significant assets - the high-speed ferries - are now docked in Alabama). Hawaii Superferry also challenges the assertion that most of its creditors are located in Hawaii, noting that less than half of its 30 largest unsecured creditors (and two of the three members of the Official Committee of Unsecured Creditors) are located outside of Hawaii. Finally, the company notes that both its retained professionals and the Creditors' Committee's retained professionals are located in Philadelphia, New York, Washington, D.C., and Wilmington.
Download copies of every document filed in this case and the bankruptcy cases of over 600 other major corporations using netDockets.
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