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Kauai helicopter tour company admitsliability but can't settle

PBN

Pacific Business News (Honolulu) - September 29, 2006 by Harold Nedd Pacific Business News

The families of four passengers killed in a helicopter crash on Kauai two years ago have won a potentially significant legal victory.

Lawyers for Bali Hai Helicopters Tours Inc. of Hanapepe said the company has accepted liability and agreed that the families of those who died should each receive $2 million.

But the tour company says it doesn't have the money to pay, so it is directing the families to its insurer, XL Specialty, an off-shore provider of aviation insurance, said Charles W. Crumpton, of Clay Chapman Crumpton Iwamura & Pulice, the firm representing Bali Hai.

However, the insurer is saying that the helicopter involved in the crash was not covered under the company's policy and has refused to pay, Crumpton said.

The settlement reached Sept. 14 in 1st Circuit Court allows the families to file suit against XL Specialty.

"If Bali had $8 million, we'd be done," Crumpton said. "But it doesn't."

According to Crumpton, the small company has not operated since the crash on Sept. 24, 2004, when the helicopter smashed into the side of a mountain. The company, owned by James Le, had been in business for about 18 years.

The lawsuit was filed by Cronin Fried Sekiya Kekina & Fairbanks, the Honolulu firm that represents the family members of Thomas J. Huemmer and Tamara A. Zytkowski of Ohio and Sterns & Walker, the Oakland, Calif., firm that represents the families of Heike Braun and Willy Braun of Germany.

Also killed in the crash was the pilot, Shankar Tummala.

"The dispute now is over whether someone inside the insurance company made a mistake in canceling the liability coverage or whether it was Bali's choice," Crumpton said. "Our position is, show us something that says we gave instructions to remove the liability coverage. We haven't seen it. The agent is saying it was verbal. Bali Hai is saying that couldn't be."