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November 30, 2007

NTSB Rejects Airman's EAJA Fee Request After ALJ Affirms FAA's Revocation Order

After an NTSB administrative law judge affirmed an FAA order revoking an airman's certificate, the airman applied for an award of attorney's fees under the Equal Access to Justice Act ("EAJA"). In Application of Shaffer, the airman argued that he was entitled to EAJA fees because the FAA withdrew portions of the complaint during the hearing and, thus, as to the withdrawn factual allegations and associated regulatory violations, he prevailed. The ALJ rejected the airman's argument and denied the application. The airman then appealed the ALJ's denial to the full NTSB, although he did not file his appeal on time.

On appeal, the airman repeated his argument that the FAA's withdrawal of factual allegations and associated claims of regulatory violations entitled him to an award of EAJA fees. Although the Board rejected the airman's appeal based upon his untimely filing, it also went on to address his argument. The Board observed that "the law judge’s ruling to affirm revocation (albeit on the basis of fewer factual and regulatory charges) accomplished the full purpose of the Administrator’s litigated order." It also noted that EAJA fees have never been awarded to an applicant who suffered the ultimate sanction of revocation.

The Board then cited to a number of cases that discuss the issue of when a party is considered to be a "prevailing party." Those cases indicate that a prevailing party is one who achieves a "judicially sanctioned change in the legal relationship of the parties"), who obtains "formal judicial relief, and not merely 'success,'" or who has "been awarded some relief by a court, either in a judgment on the merits or in a court-ordered consent decree." Consistent with those cases, the Board concluded that the airman had not shown that he was a prevailing party with respect to the withdrawn charges.

This is the first time I have seen an airman whose certificates were revoked apply for EAJA fees. Some may want to give the airman an "A" for effort. After all, what did he have to lose? However, it seems to me like a waste of the airman's time and energy, as well as judicial resources, in light of the Board's completely foreseeable decision. Well, at least now we have clear precedent on the issue, even though we probably did before. At a minimum, it makes for interesting reading, as always.

Posted by Greg

November 29, 2007

Pilot In Command: The Risk Of Taking Control

A recent NTSB decision presented an enforcement action against an airman arising from his assumption of the status of pilot in command during a flight in which he was initially a passenger. For a discussion of the case and the unfortunate situation in which the airman found himself, please read my latest article on the case here.

Posted by Greg

November 21, 2007

Aircraft Collision And Post-Collision Flight Without Inspection Of Aircraft Net Airman 100 Day Suspension

The NTSB recently affirmed an ALJ's decision suspending an airman's commercial pilot certificate for 100 days for FAR violations arising from an incident in which the wingtip of the airman's Cessna 182 struck the wingtip of a Beechcraft King Air, causing damage to both aircraft, and the airman then flew the Cessna 182 without having it inspected. In Administrator v. Scuderi, the FAA alleged that the airman operated his aircraft so close to the other aircraft that it created a collision hazard, and his operation of the aircraft was careless and reckless. The FAA also claimed that the airman departed without first taking corrective action, inspecting, or repairing his aircraft, that the airman operated the aircraft as pilot-in-command while he did not have a current medical certificate, and that he failed to present his pilot certificate, medical certificate, logbook, and other items in response to a reasonable request from a state trooper.

The FAA concluded that the airman's conduct during and subsequent to the incident violated FARs 61.3(c)(1) (duty to maintain airman certificate and medical in your possession when operating an aircraft), 61.51(i)(1) (presentation of certificate, logbook etc. to law enforcement for inspection upon request), 91.111(a) (prohibiting operation of aircraft so close as to cause collision hazard), 91.13(a) and (b) (careless and reckless), 91.405(a) (duty of aircraft owner/operator to have aircraft inspected and maintained in accordance with FAR Part 43), and 91.7(a) (operating an unairworthy aircraft). Based upon these allegations, the FAA issued an order suspending the airman's certificate for 180 days. The airman appealed the FAA's order and, after a hearing, an NTSB ALJ affirmed the FAA's order for all violations except the FAR 91.405(a) violation and he reduced the suspension from 180 to 100 days. The airman then appealed the ALJ's decision to the full NTSB.

On appeal, the airman primarily argued that the ALJ's finding of a violation of FAR 91.7(a) was in error, even though that finding was based upon a credibility determination to which the Board must defer unless it was arbitrary, capricious or otherwise contrary to law. He also argued that a 100-day suspension was inappropriate and should have been subject to a waiver of sanction under the Aviation Safety Reporting Program ("ASRP"). The Board determined that although the FAA had not presented evidence to prove that the airman's aircraft did not conform to its type certificate, it did show that the aircraft was not in a condition for safe operation when the airman operated the aircraft after the collision. The Board found it significant that the airman had the damage to the aircraft inspected two days after the collision and observed that the airman's "awareness of the potentially unsafe condition leads us to conclude that his operation of the aircraft resulted in a violation of § 91.7(a)."

With respect to the airman's argument regarding sanction, the Board deferred to the ALJ's finding that the airman's testimony was insufficient to justify waiver of sanction under the ASRP (apparently the airman never received the time-stamped strip back from NASA, but did receive some letter acknowledging that he had made some type of filing). The Board also noted that the record did not support a finding that the airman's violations were inadvertent and, thus, the airman did not meet his burden of showing that he was eligible for a sanction waiver under the ASRP. As a result, the Board affirmed the ALJ's decision in all aspects.

Posted by Greg

November 20, 2007

DOT Proposes New Economic Regulations For Airlines

The DOT today published two notices of proposed rulemaking ("NPRM") and one advance notice of proposed rulemaking ("ANPRM") containing new economic regulations that would be applicable to the airlines. It would appear that these proposed rules are the result of the public's, and congress's, discontent with the airlines' treatment of their customers.

Under ANPRM DOT-OST-2007-0022, DOT is asking "whether it should adopt a rule to enhance airline passenger protections in the following seven ways: require carriers to adopt contingency plans for lengthy tarmac delays and incorporate them in their contracts of carriage, require carriers to respond to consumer problems, deem operating a chronically delayed flight to be unfair and deceptive, require carriers to publish delay data, require carriers to publish complaint data, require on-time performance reporting for international flights, and require carriers to audit their compliance with their customer service plans." For more information on this ANPRM you should contact Betsy L. Wolf or Blane A. Workie, Office of the Assistant General Counsel for Aviation Enforcement and Proceedings, U.S. Department of Transportation, 1200 New Jersey Ave., SE., Washington, DC 20590, 202-366-9342, 202-366-7152 (fax), betsy.wolf@dot.gov or blane.workie@dot.gov

NPRM OST 2007-28522 is "proposing to collect additional data elements when flights are cancelled, diverted, or experience gate returns. The additional proposed data elements would fill in data gaps giving the Department, the industry, and the public a more accurate portrayal of on-ground delays after flights depart the gate but prior to the time they take off and after flights land but before they reach the gate." For more information on this NPRM, you would need to contact Bernie Stankus, Office of Airline Information, RTS-42, Research and Innovative Technology Administration, Bureau of Transportation Statistics, Telephone Number (202) 366-4387, Fax Number (202) 366-3383 or e-mail bernard.stankus@dot.gov.

Finally, NPRM DOT-OST-01-9325 is "proposing to amend the rules relating to oversales and denied boarding compensation to increase the limits on the compensation paid to 'bumped' passengers, to cover flights by certain U.S. and foreign air carriers operated with aircraft seating 30 to 60 passengers, which are currently exempt from the rule." For more information regarding this NPRM you should contact Tim Kelly, Aviation Consumer Protection Division, Office of the General Counsel, Department of Transportation, 1200 New Jersey Ave., SE., Washington, DC 20590, 202-366-5952 (voice), 202-366-5944 (fax), tim.kelly@dot.gov.

Comments to the ANPRM and the NPRMs are due no later than January 22, 2008. It will be interesting to see how many comments DOT receives, especially in light of the fact that the upcoming holiday travel season will likely result in a number of situations that the proposed rules would address. No better time to fly general aviation!

Posted by Greg

November 15, 2007

FAA Requests Comments On FARs

In a Request for Comments published today, the FAA is requesting comments from the public to identify FARs currently in effect that should be amended, removed, or simplified. The FAA first published a general request for comments on the FARs back in 1992 and published the most recent request before today's request in February, 2004. Since 1992, the FAA has received 1,350 comments to these general requests.

According to the FAA, not only is the Request required by Executive Order 12866, but it is also "a necessary element of our effort to make our regulations more effective and less burdensome." Specifically, the FAA states that its "goal is to identify regulations that impose undue regulatory burden; are no longer necessary; or overlay, duplicate, or conflict with other Federal regulations."

This isn't a request for a wholesale revamp of the FARs. Rather, the FAA is asking individuals who are submitting comments to address three issues they consider most urgent, and to list the issues in priority order. This is your chance to let the FAA know about those regulatory requirements that don't affect safety and add unnecessary burden to aircraft operations. However, "I don't like FAR X" isn't sufficient. You need to submit specific suggestions with an explanation, and specific plain-language that might be used or suggested language on how those rules should be written.

Once the comments are received, the FAA will review the issues addressed in the comments within the context of its regulatory agenda and rulemaking program efforts and then may "adjust its regulatory priorities consistent with its statutory responsibilities." When the review is complete, the FAA will publish a summary and general disposition of the comments it receives and identify how the FAA will adjust its regulatory priorities, if at all.

All comments are due no later than January 14, 2008. If you would like further information, you may contact Adrian D. Wright, Office of Rulemaking, ARM-103, Federal Aviation Administration, 800 Independence Avenue, SW., Washington, DC 20591; telephone (202) 267-3317; e-mail adrian.d.wright@faa.gov.

Posted by Greg

November 12, 2007

DOT OIG Initiates Operational Error Audit

According to an November 5, 2007 Announcement, the Department of Transportation Office of Inspector General has initiated an audit of the FAA's process for investigating and reporting operational errors. The audit is in response to concerns raised by Congressmen James F. Oberstar and Jerry L. Costello regarding a complaint alleging that DFW terminal radar approach control (TRACON) facility personnel were intentionally misclassifying operational errors as pilot deviations to deflate the number of errors attributed to the facility. The OIG's audit is intended to "(1) determine whether FAA has adequate policies and procedures in place to ensure the accuracy and consistency of operational error reporting and (2) review the roles and responsibilities of the Air Traffic Organization and FAA’s Aviation Safety line of business in reporting and investigating operational errors." If you have any questions regarding the audit or, perhaps, have information to contribute to the audit, you may contact Dan Raville, Program Director, at (202) 366-1405 or Mary E. (Liz) Hanson, Project Manager, at (404) 562-3778.

I will be curious to see the results of this audit, not only from a safety perspective, but also to see what impact the results may have on the the ongoing feud between the FAA and the NATCA controllers. If the OIG discovers any support for the complaint, that could certainly undermine NATCA's position and credibility in its negotiations with the FAA. Of course, NATCA could argue that the misclassified errors were the result of inadequate controller staffing etc. However, if this was truly the case, I would think that such errors would be reported accurately in order to bolster NATCA's negotiating position. At a minimum, if operational errors are being improperly misclassified to blame pilots, this needs to be corrected in order to ensure that appropriate actions are taken to rectify the circumstances giving rise to the operational errors.

Posted by Greg

November 09, 2007

Operational Control Violations Can Have Severe Consequences

If you follow the aviation industry news at all, you are probably aware of the FAA's recent suspension and subsequent revocation of AMI Jet Charter, Inc.'s FAR Part 135 Air Carrier Certificate. The FAA's actions resulted from its determination that operational control violations were occurring due to AMI's relationship with TAG Aviation USA, Inc.(the U.S. subsidiary of the Swiss company TAG Aviation Holding S.A.). Now, according to a June 8, 2007 Wall Street Journal article, TAG has agreed to pay a $10,000,000.00 civil penalty relating to its charter dealings with AMI. The FAA indicated that this is the largest civil penalty ever!

Between revocation of the air carrier certificate, lost business/revenue and then payment of the civil penalty, the consequences of TAG/AMI's alleged operational control violations has been not only severe, but also expensive! On average, certificate suspension/revocation is not uncommon for a pattern of operational control violations. Similarly, a civil penalty is not unusual, albeit $10,000,000.00 is definitely not the norm. And loss of business/revenue is a certainty if the air carrier's certificate is suspended or revoked and it can no longer operate aircraft charters.

Operational control is an ongoing "hot-button" for the FAA and will continue to receive intense scrutiny. All charter operators should review the available guidance on operational control and review their own processes and procedures to ensure that they are in compliance. As you can see, failure to comply can result in some very severe consequences.

Posted by Greg

November 07, 2007

Lack Of Qualification May Be Rebuttable In FAR 61.15(a) Revocation Proceeding

The FAA's revocation of an airman's certificate for violation of FAR 61.15(a) (disqualification based upon conviction of drug offense) was recently affirmed by the NTSB. In Administrator v. Robertson, the FAA issued an order revoking the airman's private pilot certificate after the airman was convicted of two federal drug offenses. The airman appealed the order to the NTSB and requested a hearing.

Prior to a hearing, the FAA moved for summary judgment and, in response, the airman argued that he no longer lacked the qualification to hold an airman certificate because he was rehabilitated as a result of his experience with the U.S. Parole Commission. Before issuing a decision on the FAA's motion, the ALJ issued an order that he would first hold a hearing to determine whether the airman's alleged rehabilitation rebutted the FAA's claim that he lacked the qualification to hold an airman certificate. However, the airman failed to attend the scheduled hearing. As a result, the ALJ granted the FAA's motion and entered an order affirming the order of revocation. The airman then appealed the ALJ's decision to the full Board.

One of the airman's contentions on appeal was that the FAA did not establish that, at the time the FAA issued its order of revocation, he lacked the qualifications necessary to hold a certificate. He argued that his military record and past career as a Federal prosecutor and municipal judge, as well as his post-incarceration volunteer work and employment established his rehabilitation. In rejecting this argument, the Board observed that the airman's federal conviction for violating two criminal statutes regarding controlled substances, and the fact that he remained on supervised release, were undisputed and did not counteract the airman's criminal convictions.

This case isn't noteworthy for the Board's decision upholding the FAA's order of revocation. Rather, it is interesting because the ALJ granted the airman a hearing on the issue of whether the airman's claim of rehabilitation rebutted the presumption of lack of qualification under FAR 61.l5(a). Thus, it appears that the presumption of lack of qualification may be rebuttable. Unfortunately, the case doesn't provide any clear guidance on what evidence would be sufficient to rebut the lack of qualification presumption. However, suffice it to say that the airman's burden of establishing his qualification is likely quite high. At a minimum, an airman's arguments of rehabilitation will certainly have to be more substantial and persuasive than they were in this case.

Posted by Greg

November 06, 2007

NTSB Affirms FAA's Right To Demand Strict Compliance With Operations Specifications

In a recent decision, the NTSB has affirmed the suspensions of six airmen's certificates for violations of FAR 119.5(1) (air carrier aircraft must be operated in compliance with air carrier's operating certificate, operating certificate, or appropriate operations specifications). The case, Administrator v. Donohue et al. arose from the FAA's allegations that each airman had acted as pilot-in-command (PIC) of scheduled flights for an air carrier and did not file flight plans for the scheduled flights, even though the air carrier's operations specifications required such flight plans. Based upon these allegations, the FAA issued orders suspending the airmen's certificates for anywhere from 30 to 60 days.

After a hearing on the consolidated cases, the administrative law judge affirmed the FAA's orders of suspension, but reduced the sanction for all but one of the airmen (one of the air carrier's co-owners) to a two day suspension. The remaining airman was assessed a 60 day suspension. All of the airmen then appealed the ALJ's decision to the full Board.

On appeal, the airmen argued they did not have the burden to prove that their failure to file flight plans was justified, because the air carrier's operations manual and operations specifications did not require them to file flight plans at all. They argued that the air carrier's use of flight locating was the company policy and replaced the flight plan requirement in the operations specifications. However, the Board rejected this argument.

The Board observed that an operator’s failure to adhere to the FAA's requirements, even where such failure might be the result of a determination that the operator had a better, faster, or easier way of operating, still results in a violation of the regulations. It further noted that an air carrier's failure to comply with established, approved procedures was unacceptable, even if the certificate holder believed the changes were an improvement. In this case, although the air carrier's operations manual containing the flight locating policy supplemented the existing operations specifications, the policy did not replace the flight plan provisions of the operations specifications with a legitimate alternative to filing flight plans.

The moral of the story here is that you are obligated to comply with your operations specifications. If you think you have a better or safer method of doing something, then talk with your principal operations inspector and try to get your operations specifications amended or updated. Otherwise, as this case shows, any use of that method will be at your own peril.

Posted by Greg

November 05, 2007

Texas Appeals Court Issues Mixed Decision In Textron Lycoming/Interstate Southwest Fraud Case

On November 1, 2007, the Texas Court of Appeals issued a decision in the Textron Lycoming v. Interstate Southwest case. If you recall, the case arose after at least 24 crankshafts forged by Interstate for Lycoming failed, resulting in a number of deaths. In the aftermath of the failures, Lycoming blamed Interstate for the failures. However, Interstate's legal team conducted testing that showed the trouble was a defect in Lycoming's own design for the crankshafts. In 2005, a jury returned a verdict holding Lycoming liable for fraud, and awarding Interstate nearly $10 million in actual damages and another $86 million in punitive damages. The jury also rejected Lycoming's $173 million counterclaim against Interstate. The trial court then entered judgment in favor of Interstate for the full $96 million.

On appeal, the Court upheld the jury's finding that the crankshaft failures were caused solely by a defect in Lycoming's design, and also held that the contract provision under which Lycoming sought indemnity from Interstate was unenforceable. However, the Court reversed the damages award. Although the jury awarded Interstate damages for its increased aviation products liability insurance premiums and the expert fees it incurred in performing its testing, the Court determined that such damages were not recoverable under Texas law. Additionally, in the absence of compensatory damages, the Court held that the punitive damage award was precluded. Finally, based upon its disposition of the issues, the Court reversed the award of attorneys' fees and remanded the case solely for consideration of the costs and reasonable, necessary, equitable, and just attorneys' fees, if any, that should be awarded to either party.

Of course both sides are touting the decision as a win. Even though its damage award was reversed, Interstate considers both the affirmation of Lycoming's fraud and defeat of Lycoming's counterclaim as wins. Lycoming, on the other hand, is focusing on the reversed damage award as a win. Hard to say whether this decision will stand or whether it will be appealed further to the Texas Supreme Court. Suffice it to say that the true winners in this case are the lawyers representing each party. Which, for an aviation attorney, isn't necessarily a bad thing.

Posted by Greg

November 02, 2007

EAA Exemption 7162 Expires

Effective at 12:01 a.m. November 1, 2007, owners of experimental aircraft will no longer be able to use EAA’s exemption No. 7162 to receive compensation for renting their aircraft to others who seek experimental aircraft-specific flight training and flight reviews. However, even though this exemption has ended, experimental aircraft owners may still be able to receive compensation for rental of their aircraft. Under FAR 91.319(h), the FAA Flight Standards District Offices ("FSDOs") has the responsibility and authority to work with experimental aircraft owners who offer their aircraft to be rented for specific flight training and flight reviews.

In order for an experimental aircraft owner to use his or her aircraft for flight training, and to receive compensation for that use, the owner will need to contact the Operations Supervisor at the local FSDO and apply for an Experimental Aircraft Flight Training Letter of Deviation as outlined in FAA Notice N 8900.15. Once issued, that letter will authorize the aircraft owner to receive compensation for the flight training use of the aircraft.

For those individuals who are building or acquiring an experimental aircraft and who would like to locate an experimental aircraft in which they may be able to obtain training, FAA Flight Standards Division and each FSDO will maintain a list of the aircraft with such letters of deviation that may be available for such training.

Posted by Greg

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