On Oct. 30, Hawaiian Airlines received a double dose of good news after a bankruptcy court judge awarded it US$80 million in damages in its lawsuit against Mesa Airlines.

The verdict came hours after Hawaiian reported that net income for the third quarter ended Sep. 30 more than doubled to US$19.6 million from US$7.7 million in the year-ago period.

In finding for HA, US Bankruptcy Judge Robert Faris agreed with its claim that Mesa violated a confidentiality agreement and launched its low-fare inter-island airline go! based on information gleaned from documents provided by HA when Mesa was considering bidding on the carrier, which was undergoing a Chapter 11 restructuring at the time.

In his decision, Faris wrote, "Mesa breached the confidentiality agreement by failing timely to return to HA or destroy the Evaluation Material, by using the Evaluation Material for purposes other than the evaluation of the potential transaction with HA, and by using the Evaluation Material to gain a competitive advantage when Mesa decided to enter the market for Hawaii inter-island air transportation services." Furthermore, "As a natural, proximate and foreseeable consequence of Mesa's breach of the confidentiality agreement, HA has suffered compensable damages in the amount of US$80,000,000."

But the judge denied HA's request that Mesa be forced to suspend go! ticket sales for a year, stating, "In this case, the award of money damages adequately redresses the harm [HA] suffered."

HA President and CEO Mark Dunkerley hailed the legal victory as "a triumph for fair competition and ethics over dishonesty and illegal behavior."

"We are obviously very disappointed with the judgment," Mesa CEO Jonathan Ornstein said. "We believe these sanctions went too far and that an impartial appellate court will find the sanctions and this judgment should be set aside." The airline plans an appeal but it expects will have to post a bond or letter of credit as security during the appeal process. Ornstein claimed the "true motive" behind the lawsuit was to stifle competition and maintain high fares in inter-island service.

Hawaiian's operating revenue for the third quarter increased 17.5% to US$272.5 million while operating expenses rose 12.7% to US$247 million. Operating income soared 101% to US$25.5 million.