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Insurance commissioner bans discretionary clauses

State Insurance Commissioner J.P. Schmidt issued a memorandum yesterday that prohibits Hawaii Medical Service Association, Kaiser Permanente Hawaii and Hawaii Management Alliance Association from using discretionary clauses in their health insurance contracts to interpret benefits.

University Health Alliance and Summerlin Life & Health Insurance Co. already agreed to remove the clauses.

"We want to assure consumers that their insurance benefits are, in fact, guaranteed by contract, and not left solely to the discretion of the insurance company, which writes the contract in the first place," Schmidt said. "By prohibiting discretionary clauses, the consumer will get a fair interpretation."

Schmidt said he believed the clauses are a violation of the Insurance Code and that he was following the recommendation of the National Association of Insurance Commissioners.

Property Managers buys Bradley

Property Managers Ltd., a Honolulu-based property management firm, has acquired the assets of Bradley Properties Ltd.

Property Managers, headed by P.J. Moore, president and principal broker, said its acquisition, effective Dec. 1, makes it one of the largest management firms on Oahu with 650 properties. Five property managers and two support staff from Bradley Properties have transferred to Property Managers, which had 380 residential property rentals and a staff of seven before the deal.

Scott Bradley, the former owner and president of Bradley Properties, said the sale will benefit both entities and will allow him to focus more of his time on Coldwell Banker Pacific Properties, where Bradley is co-managing director.

Coldwell Banker Pacific was formed in 1995 by a merger of four real estate firms including Bradley Properties. Once a full-service real estate firm, Bradley Properties focused on residential property management following the merger.

Sale of fast-food restaurants closes

The sale of 87 quick-service restaurants by Theo H. Davies & Co.'s Hong Kong-based parent, Jardine Matheson Ltd., has closed.

The sale was expected to be completed in October, but was delayed by the volume of lease negotiations and transfers, which have now been finalized.

The Pizza Hut, Taco Bell and A&W/Long John Silver's restaurants were sold in August to TD Food Group Inc., a local management group established in Hawaii in July. It is led by long-time Theo H. Davies President Henry Katsuda and California-based private equity company Brentwood Associates.

"In Brentwood Associates, we have found an ideal partner for the next phase of the company's growth," Katsuda said.

Since the Star-Bulletin first reported the food service group was being shopped for sale in September 2003, Jardine sold the six TheoDavies Euromotors Inc. car dealerships to a mainland partnership for $100 million, and its Pacific Machinery heavy equipment division and Caterpillar franchise to California-based Hawthorne Machinery Co. for an undisclosed amount.

Kobayashi joins Hawaiian Holdings

Bert Kobayashi Jr., senior partner of the Honolulu law firm Kobayashi Sugita & Goda, has been named to the board of directors of Hawaiian Airlines' parent.

Kobayashi will serve as a member of Hawaiian Holdings Inc.'s audit committee.

Gannett may make bid for Pulitzer Inc.

Gannett Co. Chief Executive Douglas McCorkindale said his company may make a bid for Pulitzer Inc., publisher of the Garden Island daily newspaper on Kauai.

"We'd obviously be interested" in the company, he said yesterday at a conference in New York. He said the company is a disciplined buyer and wouldn't overpay for any property.

Gannett, the largest U.S. newspaper publisher and owner of the Honolulu Advertiser, was seen as a potential bidder for St. Louis-based Pulitzer, analysts such as Credit Suisse First Boston's William Drewry have said. E.W. Scripps Chief Executive Kenneth Lowe said yesterday that his company also may bid for Pulitzer.

During his remarks, McCorkindale said some companies, which he wouldn't name, were seeking prices in asset sales that were "off the charts."

Gannett, which also owns 21 television stations, is less dependent on national advertising than rivals such as New York Times Co. and Dow Jones & Co.

The company's third-quarter revenue rose 11 percent, while sales at Tribune Co., the second-largest newspaper publisher, fell 2 percent and No. 4 publisher Knight-Ridder Inc. reported a 2 percent rise.

Gannett also said that it expects fourth-quarter profit of $1.45 to $1.49 a share. The company had been expected to earn $1.49 a share, according to 18 analysts surveyed by Thomson Financial.