Island Air: Island Air files Chapter 11 bankruptcy protection as a result of legal challenges

Honolulu-based Island Air said Monday it is filing for Chapter 11 bankruptcy protection to continue normal operations while dealing with legal challenges recently presented by the airline's aircraft lessors. According to the airline, the bankruptcy filing was caused by threats of legal action to ground the aircraft and strand hundreds of passengers. The filing prevents the threatened action and allows Island Air to continue interisland service for its customers. The airline said its lessors...