A U.S. district judge yesterday dismissed an environmental lawsuit against Hawai'i Superferry, clearing the way for the company to move forward on financing and other plans to begin interisland service by early 2007.

Judge Helen Gillmor dismissed the suit brought by the Sierra Club and other environmental groups seeking to require the Superferry firm to conduct lengthy environmental studies before proceeding with its plans.

"We're very pleased and excited to get through this hurdle," said John Garibaldi, Superferry chief executive. "It takes away a lot of uncertainty and allows us to complete our financing and start planning for the future."

Requiring a lengthy assessment of possible environmental impacts would have caused investors to back away, halt construction of the firm's first ferry and jeopardize the entire project, Superferry officials said. The project has been in development for several years, but was announced in 2003.

The Sierra Club, Maui Tomorrow, the Kahului Harbor Coalition and Friends of Haleakala National Park argued that the federal Maritime Administration should have required an environmental review of the project before signing off on a loan guarantee crucial to the project's success.

"I think the investors would want to know the environmental impact of the project before putting their money into it," said Isaac Hall, attorney for the environmental groups.

Superferry attorneys argued that federal law specifically excludes loan guarantees authorized by the Maritime Administration.

Hall said the exclusion was not applicable in the Superferry case. If Gillmor's still-to-be-issued written ruling in the case is based on that argument, he said, he will strongly urge his clients to pursue the case at the 9th U.S. Circuit Court of Appeals.

A lawsuit filed earlier in state court was dismissed in July by Maui Circuit Judge Joseph Cardoza, who said the groups did not have standing to challenge the project. That suit challenged an environmental exemption that the state Department of Transportation granted for the project.

Among other things, the groups are concerned about the impact the vessels will have on the Hawaiian Islands Humpback Whale National Marine Sanctuary and the possible introduction of alien species.

Hawai'i Superferry plans to begin daily service between Honolulu and Maui, Kaua'i and Hawai'i County early in 2007, with one vessel carrying up to 900 passengers and 250 vehicles. It plans to add a second ship in 2008. The ferries will be able to travel at 35 knots, about 40 mph.

The Legislature this year approved $40 million for harbor improvements to accommodate the ferry. At Maui's Kahului Harbor alone, the state plans to buy a $10 million barge and install fencing, among other things. Superferry officials say that money would be more than paid back to the state over the next 20 years through wharf fees and money the company pays in excise taxes.

Reach Mike Leidemann at mleidemann@honoluluadvertiser.com.