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ALJ's Dismissal With Prejudice After FAA Voluntary Dismissal Satisfies EAJA "Prevailing Party" Requirement

by Greg Reigel 31. May 2012 14:00
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The United States Court of Appeals for the D.C. District recently reversed the FAA Administrator's determination that an applicant seeking attorney's fees under the Equal Access to Justice Act ("EAJA") was not a prevailing party after the FAA withdrew its complaint before hearing, even though an ALJ then entered an order dismissing the case with prejudice. In Green Aviation Management Co., LLC v. Federal Aviation Administration, the FAA filed a complaint alleging that Green Aviation operated a flight with 10 passengers when the aircraft was only approved for 9 passengers. The FAA was seeking to assess a $33,000 civil penalty against Green.

Prior to the hearing, the FAA withdrew its complaint. Based upon the FAA's withdrawal, the ALJ entered an order dismissing the case with prejudice as required by 14 C.F.R. § 13.215. Green Aviation then submitted an EAJA application for attorney's fees. Although the ALJ found that Green Aviation was a prevailing party, as required by EAJA, he nonetheless found that the FAA was substantially justified in pursuing its case and, as a result, the ALJ denied Green Aviation's EAJA application.

Green Aviation appealed the ALJ's denial to the FAA Administrator. However, contrary to the ALJ, the Administrator determined that Green Aviation was not a prevailing party. The Administrator reasoned that the ALJ's dismissal was required by the regulations and, since the ALJ had no discretion, his order did not make Green Aviation a prevailing party. Green Aviation then appealed the Administrator's decision to the D.C Circuit.

On appeal, the Court initially observed that a prevailing party in an EAJA fee case must meet two requirements: the judgment must be in favor of the party seeking the fees; and the judicial pronouncement must be accompanied by judicial relief. The Court found that the ALJ's dismissal order easily satisfied the first requirement.

With respect to the second requirement, the noted that the ALJ's dismissal order was "with prejudice", which resulted in a "res judicata effect" on the parties. That is, it protected Green Aviation from having to pay damages or alter its conduct based upon the same facts and circumstances alleged in the FAA's withdrawn complaint. The Court observed "[t]he dismissal order is thus not a mere formality or a housekeeping measure; rather it is the means by which Green Aviation can obtain res judicata protection."

The Court concluded that Green Aviation obtained sufficient judicial relief to be a prevailing party. As a result, the Court sent the case back to the FAA Administrator to determine whether the FAA's filing of its complaint against Green was substantially justified. If it was not, Green should be entitled to an award of attorney's fees under EAJA.

This is a great decision for parties facing unjustified civil penalty actions. Although it may not prevent the FAA from withdrawing a complaint on the eve of hearing, after a respondent has incurred significant fees, it does allow a respondent the opportunity to hold the FAA accountable.

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Greg Reigel

Three Reasons For Having An A&P On Staff

by David Wyndham 1. May 2012 14:31
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If you are busy, here’s the condensed version: If you operate a turbine business aircraft and reliability is a key metric, unless you have 24/7 maintenance on the airport, you need an A&P on your staff.
If there is a service center at home station and they provide quality service and are knowledgeable about your aircraft model, it can be cost effective to have the service center perform the maintenance rather than employ a full-time maintenance person. Especially if that service center operates around the clock, or close to it. If you don't fall under that scenario, here are three reasons for having an A&P on your staff.
No one knows your aircraft better than your own A&P. That person gets to know the maintenance that was performed, the issues that the aircraft may have had in the past, and who/where to get the answers when maintenance questions arise. This is important in keeping the aircraft reliable and ready for flight when needed.
The in-house A&P understands your mission. Being your employee, she is fully dedicated to keeping your aircraft airworthy and safe. You will not get a better level of service than having a great employee as your A&P. They can earn back their salary in getting one critical mission off the ground on time.
When your aircraft is in for heavy maintenance, you're A&P is also your advocate in keeping the aircraft maintenance on time and within budget. While a good service center makes every effort to get the job done on time, the personal attention from your A&P will make that much more likely to happen.
The older and more complex your aircraft, the more critical it is to have the A&P on your staff. As with any aircraft, there may be minor issues that can delay your departure. The A&P being immediately available will enable a high level of dispatch reliability. In-house maintenance staff gives you the dedicated response on your schedule and is there to serve just you.
One of our clients has a 30+ year-old twin turboprop. Their limited budget includes a skilled A&P. Their dispatch reliability is in excess of 95% and their downtime due to unscheduled maintenance is far lower than you'd expect from an old aircraft. The maintenance manuals for their plane have notes and annotations representing the years of accumulated knowledge on how to maintain their aircraft. In these and many other cases, having the A&P on staff provides a level of skill and knowledge that enables the operator to maximize the utility of their aircraft.
I've heard from a number of operators that their A&P's salary was paid for at the first major inspection. Having the A&P on staff is cheap insurance for an on time departure. This further enables the executives to conduct their business in the most efficient manner.

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David Wyndham | Maintenance



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