Billionaire owner of US's defunct Island Air lost $67mn

Billionaire Larry Ellison lost more than US$67m in his now-defunct Island Air and could be liable for US$30m more in backpay penalties, unpaid debts, and potential punitive damages, reports Hawaii News Now. Ellison was testifying last week in a jury trial in the Hawaii District Court in the 2019 case filed by bankruptcy trustee Elizabeth Kane representing creditors, and two unions representing Island Air’s employees, the Airline Pilots Association (ALPA), and the Hawaii Teamsters. The complainants charge that Island Air’s owners acted in self interest when they allowed Island Air to go bankrupt and closed down the carrier without giving its 400 employees the required 60-day notice, and withholding final pay cheques and medical aid premiums. Transcripts of court proceedings are currently withheld, but according to Hawaii News Now and Honululu Civil Beat, Oracle co-founder Ellison testified he had bought Island Air in 2013 to provide a high-quality service to his resorts on the island of Lanai. Ellison sold two-thirds of Island Air to Jack Tsui of Panda Travel in February 2016. By 2017, the airline was losing money. As reported, Island Air suspended all operations on November 11, 2017, after lessor Elix Aviation Capital decided to act against the carrier over outstanding lease payments on three DHC-8-Q400s. Ellison testified that Island Air was losing more than a million dollars a month competing with the much bigger Hawaiian Airlines, with insurance companies and lessors demanding payments. Amongst others, the airline faced multiple payroll crises during the summer of 2017. In July of that year, it had processed payroll with an US$840,000 overdraft. Ellison claimed the competitor "did everything they could to run us out of business”, including undercutting its fares.<br/>