For sale: Aloha Airlines' lawsuit against go! airlines.

The trustee for bankrupt Aloha Airlines said yesterday that he will auction off Aloha's potentially lucrative legal claims against the owner of go!, Mesa Air Group Inc.

In April, Mesa agreed to pay $52.5 million to settle a similar suit by Hawaiian Airlines, which alleged that Mesa misused confidential information to launch go! airline.

"A lawsuit is no different than a propeller," said James Wagner, attorney for Aloha's bankruptcy trustee Dane Field. "It's an asset and we're going to sell it."

Aloha, once the state's second largest airline, shut down its passenger service on March 31 and terminated 1,900 workers, in the largest mass layoff the state has ever seen.

The shutdown came 11 days after Aloha filed for bankruptcy for the second time in less than 3 1/2 years.

Aloha sued Mesa in federal court in January 2007, alleging that the Phoenix-based company misused confidential information to drive it out of business. The trial is scheduled for October.

The rights to the Aloha lawsuit will become one more asset to be sold to pay off Aloha's creditors. Wagner said he has "no concept" of what Aloha's legal claims would sell for.

Asset sales so far have included the $10.5 million sale of Aloha Cargo to Seattle-based Saltchuk Resources Inc. and the $2.05 million sale of Aloha's contract services division to Los Angeles-based Pacific Air Cargo.

Wagner said potential bidders for the lawsuit include Aloha's former financial backer, Yucaipa Co. Yucaipa, which is headed by California billionaire Ron Burkle, rescued Aloha during its first bankruptcy and is owed more than $100 million by the defunct carrier.

In court filings, Wagner said Yucaipa has agreed to use a portion of any recovery to create a hardship fund for laid-off employees.

GMAC Commercial Finance, Aloha's chief lender, also agreed to set aside 5 percent of any proceeds it receives from the sale of Aloha's assets to pay the airline's unsecured creditors.

Mesa also could bid on the rights to the suit, in what would result in a settlement of the lawsuit, Wagner said.

Wagner said potential bidders would have to front what could amount to several million dollars in legal bills to bring the case to trial. He noted that Aloha's expert witnesses alone have asked for a $250,000 retainer.

"It's very expensive litigation," Wagner said.

Also yesterday, U.S. District Judge David Ezra rejected a Mesa motion to dismiss the lawsuit and appointed Federal Magistrate Barry Kurren to oversee the case.