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May 25, 2006

Service Bulletins Revisited

If a manufacturer specifies that its maintenance manual includes all service bulletins, does this create an obligation under the Federal Aviation Regulations ("FARís") to comply with those service bulletins? Most aircraft mechanics would only answer "yes" if compliance with the service bulletin was mandated by an airworthiness directive. However, a recent opinion by the National Transportation Safety Board ("NTSB") says otherwise. For a discussion of this case and the potentially serious implications for both aircraft owners and aircraft mechanics please read my article on the subject here.

Posted by Greg

May 16, 2006

FAA Issues Final Rule Revising Civil Penalty Inflation Adjustment Rule And Tables

The FAA today published a Final Rule containing revisions to the civil penalty inflation adjustment rule and tables regarding certain civil monetary penalties authorized for violations of statutes and regulations enforced by the FAA. The final rule makes a variety of changes to 14 CFR part 13, subpart H, which describes the civil penalty inflation adjustment process and the civil penalties that apply to various violations. The final rule is intended to harmonize previous statutory changes impacting civil penalties and it includes three tables that reflect civil penalties for specific regulatory violations including those penalties that are receiving an inflation adjustment.

The amendments contained in the final rule become effective June 15, 2006. If you would like further information, you should review the final rule or contact Joyce Redos, Office of the Chief Counsel, Enforcement Division, AGC-300, Federal Aviation Administration, 800 Independence Avenue, SW., Washington, DC 20591; telephone (202) 267-3137; facsimile (202) 267-5106; e-mail.

Posted by Greg

May 15, 2006

FAA Revokes Air Carrier's Part 135 Certificate

In a Press Release issued last Friday, the FAA announced its revocation of American Air Network's Part 135 air carrier certificate. If you recall from my May 4, 2006 post, the Administrator previously affirmed a $7,000.00 civil penalty against the air carrier for operating a charter flight with a second-in-command pilot whose 2nd class medical certificate had expired.

In this case, the FAA issued an emergency order of revocation of American Air's air carrier certificate. The FAA based its emergency revocation upon its determination that American Air had "permitted flights for hire or compensation to be conducted on its air carrier certificate when individuals who did not hold an air carrier certificate exercised operational control of those flights." American Air appealed the emergency order of revocation, but dropped the appeal after the FAA presented its case at a hearing in December.

According to the Press Release, "[t]he FAA's action is part of a national review of air taxi operational control issues" and should send "a clear message that the FAA will act when it finds evidence that any air carrier is engaged in the franchising or rental of its air carrier certificate." The operational control issue is clearly a "hot-button" for the FAA. However, to its credit, it is currently holding operational control briefings throughout the country to educate and inform operators regarding its position on this issue. These briefings are highly recommended and, provided that the FAA's enforcement actions are consistent with the information disseminated at the briefings, they should help operator's comply with the operational control regulatory requirement of a Part 135 air carrier certificate.

Posted by Greg

May 11, 2006

FAA Seeks Comments Regarding On-Demand Flight Time And Rest Period Rules

The FAA today published a Request For Public Comments regarding the flight time and rest period rules contained in FAR's 135.263(d) and 135.267(b), (d) and (e) in response to several questions it has received for interpretation of these regulations. Although the FAA has previously issued interpretations on some, but no all, of the questions raised by these FAR's, in its response to the present questions "the FAA intends to clarify two issues on which it has previously stated an opinion, namely: (1) Whether late arriving passengers or cargo may be considered an unforeseen circumstance or circumstance beyond the certificate holder's or crewmember's control under section 135.263(d); and (2) whether the rest period under section 135.267(d) must be timely received." The FAA will also consider whether to recede from statements or suggestions in prior interpretations that late arriving passengers or cargo are an unforeseen circumstance.

The Request summarizes five scenarios and questions associated with each scenario based upon actual requests for interpretations received from on-demand charter operators. The FAA asks that in submitting comments to the scenarios/questions, that commenters address the following points: (1) What are your views on how the FAA should answer the requesters' questions stated above? (2) What are your views on how the FAA intends to address the issues about late arriving passengers or cargo being an unforeseen circumstance under section 135.263(d) and the timely receipt of section 135.267(d) rest? (3) What industry operational practices support your views (also include documentation of such practices) (4) What is the safety policy that supports your views or practices? (5) What regulatory history supports your position? (6) In your opinion, are there any prior FAA interpretations that are controlling or that are at least instructive on the matter?

Comments to the Request must be received by the FAA on or before July 10, 2006. Comments may be sent to the docket Management System, U.S. Department of Transportation, Room Plaza 401, 400 Seventh Street, SW., Washington, DC 20590-0001 or you may also electronically submit comments through the Internet to You should submit two copies of your comments and you will need to identify the docket number FAA-2005-23438. If you would like further information you can contact Constance Subadan, Regulations Division, AGC-200, Office of the Chief Counsel, 800 Independence Avenue, SW., Washington, DC 20591; telephone 202-267-3073.

This will be a great opportunity for the FAA to hopefully reconcile prior statements/interpretations and to provide some meaningful guidance for analyzing flight time/rest period issues. The timing is also interesting given that the long awaited Part 135 rewrite is supposed to be released for comment this year. It will be interesting to see whether this Request results in a standalone policy statement from the FAA or whether the interpretation will simply be included in the upcoming revisions to Part 135. The latter would seem to make the most sense from a consistency standpoint. However, if a standalone policy statement is issued, I hope it is consistent with the Part 135 rewrite. Otherwise, the FAA may not accomplish its goal of clarifying these regulations. Stay tuned.

Posted by Greg

May 09, 2006

Inspector General To Audit FAA Conversion Of Flight Service Stations

According to a May 8, 2006 Memorandum, the Department of Transportation Inspector General will audit the FAA's conversion of flight service stations to contract operations beginning this month. The IG will be assessing "whether FAA has implemented effective plans and controls to (1) transition flight service stations to contract operations, (2) achieve anticipated savings, and (3) ensure that the operational needs of users continue to be met." Since the the contract is one of the largest non-defense outsourcing efforts, it is probably a good thing that the IG will be auditing the FAA's progress early on. The FAA is predicting that it will save $1.7 billion over the 10 year term of the contract. It will be interesting to see whether the FAA's objectives can be met by consolidating 58 flight service stations into 20 remaining facilities.

Posted by Greg

May 05, 2006

Florida Court of Appeals Allows Argentinian Aircraft Owner's Breach Of Contract Action Against Signature Flight Support.

The Fourth District Court of Appeals in Florida has reversed a circuit court's dismissal of an Argentinian aircraft owner's breach of contract action against Signature Flight Support. In Medical Jet v. Signature Flight Support-Palm Beach, Medical Jet alleged that Signature had represented that it could work on the Argentinian aircraft owner's aircraft and that it had a current certification from Argentinaís national aircraft regulatory authority, the Direccion Nacional de Aeronavetabilidad ("DNA"). After Signature completed its inspection and repair of the aircraft, it returned the aircraft to Medical Jet on April 23, 1998, and Medical Jet subsequently flew it back to Argentina. On May 14, 1999, the aircraft failed to pass its annual inspection because Signature had not had a current DNA certification when it inspected and repaired the aircraft. The aircraft was then grounded.

On August 28, 2003 Medical Jet filed its complaint and on July 14, 2004 it filed its amended complaint. Signature moved to dismiss the amended complaint arguing that it was time barred by the 5-year statute of limitations for contract claims. The circuit court denied the motion to dismiss but then granted Signature's motion for judgment on the pleadings based upon the same argument. Medical Jet then appealed.

On appeal, the Court held that the statute of limitations did not bar Medical Jet's claims because its action did not accrue until May 14, 1999 when the aircraft was grounded. The Court stated that "[i]n an action for breach of contract, the action accrues when the last element giving rise to the cause of action takes place" and "[h]ad the plane never been grounded by the DNA, the plaintiff would not have sustained any damage. Thus, the actual breach, the defendant's failure to have certification at the time it inspected and repaired the aircraft, could not be the accrual date for the cause of action."

The Court reversed the circuit court and remanded the case for further proceedings. However, since the decision was issued on April 24, 2006, the time within which to appeal this decision has not yet run. Thus, the court of appeal's decision is not yet final. However, if the decision is not appealed, the case will go back to the circuit court for trial.

Posted by Greg

May 04, 2006

Administrator Upholds $7,000.00 Civil Penalty Against Part 135 Air Carrier

In In the Matter of: American Air Network, Inc. the FAA administrator has upheld an administrative law judge's assessment of a $7,000.00 civil penalty against a Part 135 air carrier for violating FAR 135.95(a). The FAA alleged that the air carrier operated a flight with a second-in-command pilot whose second-class medical certificate was expired and sought an $11,000.00 civil penalty. After a hearing, the ALJ assessed a $7,000.00 civil penalty finding that a violation had occurred but that the air carrier's prompt corrective action justified reducing the amount of the civil penalty.

On appeal to the administrator, the air carrier argued that (1) it neither intended for the second-in-command pilot to fly without current and appropriate medical certification nor did it condone the flight; (2) it instituted changes to prevent pilots from flying without current and appropriate medical certification in the future; and (3) a $7,000 civil penalty was excessive relative to its financial means. The administrator rejected the air carrier's arguments and affirmed the $7,000.00 civil penalty.

The administrator held that the assessed penalty was at the low end of the applicable maximum penalty range designated by the Sanction Guidance Table and Compliance/Enforcement Bulletin No. 92-1. Further, that the reduced sanction was appropriate in light of the air carrier's prompt corrective action. The administrator also disregarded the argument regarding the unintentional nature of the violation based upon precedent that "evidence that the violation was unintentional does not mitigate an otherwise reasonable sanction."

Finally, the administrator held that even though financial hardship may constitute grounds for reduction of a sanction, the air carrier has the burden of proof. In this case, "the evidence does not show that [the air carrier], which had a net income of $287,062.60 in 2002 and $242,404.55 in 2003, could not absorb a $7,000 civil penalty." An unfortunate result for the air carrier, but consistent with civil penalty precedent given the nature of the violation and the financial status of the air carrier.

Posted by Greg

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