In The Matter Of: 

## SERVED: OCTOBER 24, 2013
U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS WASIDNGTON, DC 

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) ) ) ) ) ) DocketNo. FAA-2013-0284 AVIATION ENGINEERING CONSULTANTS, INC. Respondent Case No. 2012CE440003

ORDERDENYING RESPONDENT'S MOTION TO DISMISS AND GRANTING/DENYING OTHERRELIEF

OnJuly 16, 2013, an Order Granting the Respondent's Motion for a More Definite Statement in Part, and Granting/Denying Other Reliefwas filed. Among otherthings, this Order set a deadline ofJuly 31, 2013, for the Federal Aviation Administration ("FAA") to file a more definite statement oramended complaint, and a deadline ofAugust 30,2013, for the Respondent, Aviation Engineering Consultants, Inc. ("Respondent") to file an answerto, or motionrequesting relieffrom, the amended complaint. On July 31,2013, the FAA filed its Amended Complaint. On August 30, 2013, the Respondent filed a Motion to Dismiss for Failure to Join Indispensable Party ("Motion"). On September 13, 2013, the FAA filed Complainant's Response in Oppositionto Respondent's Motionto Dismiss for Failure to Join Indispensable Party ("Response"). On September 17, 2013, the Respondent filed Respondent's Reply to Complainant's Response in Oppositionto Respondent's Motion to Dismiss for Failure to Join an Indispensable Party and Request for Telephonic Status Conference ("Reply").



### Legal Standard
In its Motion, the Respondentprovides a legal citation only to 14 C.F.R. 

### § 218(f)(2)(ii)- a rule which allows for filing a motion to dismiss in lieu ofan answer. Itis noteworthy thatthe Respondent provided no reference to any regulatory authority orcaselaw governing the generalconcept of joinderin administrative proceedings, or any argtiment that such general concepts regarding partyjoinder should be extended to FAA civil penalty proceedings. The Rules ofPractice, 14 C.P.R. part 13, subpart G, provide for the voluntary intervention ofa partyto protect the intervener's interests. The Rules do notprovide, however, any instruction onpartyjoinder. This may be because the concept of joining indispensable parties is rarely recognized in administrative proceedings. The Supreme Courthas held that in an administrative proceeding enforcing public rights, the need tojoinparties is minimal. NationalLicorice Co. v. NLRB, 309 U.S. 350 (1940). InNationalLicoriCe, 309 U.S. 350, the Court found that the National Labor Relations Board ("Board") had the authority to prohibit an employer from engaging inunfair labor practices, withoutjoiningthe impacted employees as parties to the proceeding. 

### !d. The Court emphasized that the Board's administrative proceedings were different from litigation involving private rights. The Board "acts in a public capacity to give effect to the declared public policy of the Act." 

### !d. at 362. The only necessary party was the employer charged with an unfair labor practice. Because the Board's proceedings were "narrowlyrestricted" to the "protection and enforcement ofpublic rights," the Court found that there was "little scope orneed for the traditional rules governing thejoinder ofparties." 

### !d. at 363. However, this concept is not universal to all administrative proceedings. Indeed, in some limited circumstances, administrative tribunals have looked to Federal Rule ofCivil Procedure 19 for guidance in assessing the merits ofa motion tojoin an indispensable party in civil penalty proceedings, when the tribunal's ownrules ofpractice have not specifically provided forjoinder. See e.g., In re Carbon Injection Systems LLC, etal., DocketNo. RCRA-05-2011-0009, 2012 WL 756519 at *4, Order ofALJ (Feb. 14, 2012) (Although the EPA rules ofpractice do not provide for impleading, Fed. R. Civ. P. 19 can be used as guidance.); cfIn re Delaware Skyways, LLC, FAA OrderNo. 2005-6 at 7 fn. 12 (Mar. 18, 2005) ("Although the Federal Rules ofCivil Procedure are notbinding inthis forum, the Administrator may refer to them for guidance.") Federal Rule ofCivil Procedure 19(a) provides in relevant part: "A person who is subject to service ofprocess and whosejoinderwill not deprive the court ofsubject-matterjurisdiction must bejoined as a party if: (A) inthat person's absence, the court cannot accord complete relief among existing parties[.]" Ifa party is found to be necessary under Rule 19(a) andjoinder is feasible, i.e. it does not defeatjurisdictionorvenue, the party isjoinedto the proceeding. Ifa party is found to be necessary under Rule 19(a), butjoinderis not feasible, Rule 19(b) is used to determine whether the proceeding can continue without the party, orwhetherthe party is indispensable and the proceeding must be dismissed.

Page 2 of6Analysis The Respondent's Motion inunpersuasive, whether reviewed under theNational Licorice orthe Rule 19(a) standard. The analysis applied to the Board inNational Licorice is similarly applicable to FAA civil penalty proceedings. Inthese proceedings, the FAA acts in a public capacityto give effect to the Federal Aviation Act of 1958, as amended, and other statutes. Airport and Airway Safety and Capacity ExpansionAct of 1987, Pub. 

### L. 100-223 § 204(g), 101 Stat. 1486, 1520 (1987) (providing civil penalty authority to the Administrator). The immediate object for the FAAin bringing the enforcement action is to protectthe safety ofthe flying public in accordance with its statutory mandate. Federal Aviation Act of 1958, Pub. 

### L. 85-726, 

### § 601(a) (1958) ("The Administrator is empowered and it shall be his duty to promote safety offlight in civil air commerce[.]"). The only parties necessary to achieve this narrowly restricted goal are the FAA and the chargedrespondent, who has allegedly violated the regulations and thwarted the declared policy. In the alternative, and assuming the traditional rules governing requiredjoinderofparties are applicable inthis FAA civil penalty proceeding, the Respondent has failed to showthat its proposed additional respondent, Avantair, Inc., is a necessary party under Federal Rule ofCivil Procedure Rule 19(l:l.), let alone an indispensable party whose absence would require dismissal of the action under Rule 19(b ). For example, inthe case herein, the FAA has alleged that the Respondent, and only the Respondent, has violated the citedregulations (Am. Compl. 2; Response 1-2,**~6).** The FAAhas proposed a $44,000 civil penalty as appropriate (Am. Compl. 2). In'response, the Respondent seeks a hearing onthe record. Presumably the Respondent seeks either a finding that it didnot committhe alleged violations, orin the event that violations are found, the opportunity to present evidence in mitigation ofthe FAA's proposed civil penalty. (Req. Hr'g 1.) The Respondent's argument that it "wishes to avoid total liability and monetary damages as against the Respondent and the 'empty chair"' (Reply 2,**~6)** is unsupported bythe factsas alleged inthe Amended Complaint orthe law. The question inthis proceeding is whetherthe FAA's charges against the Respondent- inits production ofa replacement ormodification article- are in fact violations of 14 C.F.R. §§ 21.9(a)(2) and 21.9(b). Ifany violation ofpublic safety regulations is found, the Respondent is subject to a civil penalty not to exceed $11,000 per violation. 49 U.S.C. § 46301; Am. Compl. 5; Ifno violation ofpublic safety regulation is found, that the Respondent would not be subject to any civil penalty. This would remaintrue regardless ofhowmany parties arejoined as respondents.

Page 3 of6Pursuant to Rule 19(a), existing parties in this action can be accorded complete relief without thejoinderofAvantair, Inc. as a respondent. Avantair, Inc. is not a necessary party herein. 

### OtherIssues Raised by 

### the Parties 1) FAA's Allegation of"Stalling" Tactics In its Response, the FAAre-offered a Statement ofthe Case ("Statement"), which it previously filed with the Office ofHearings on June 10, 2013 as part ofits Oppositionto the Respondent's Motion for More Definite Statement. 

### Itshouldbe noted thatthis FAA Statement did not outline a summary ofthe alleged facts supporting the charged violations inthis case. Instead, it is a chronological summary oftelephone calls, emails, and meetings between the parties conducted after the FAA's March 20, 2012 Notice ofProposed Civil Penalty ("NPCP") was filed and served upon the Respondent. As part ofthe FAA's Statement's chronological summary, the FAApoints outthatthe FAA Regional Office held its first informal conference with the Respondent about the NPCP on December 6, 2012. However, between December 7, 2012 and March 11,2013, no action was taken by eitherparty onthe case. (Statement, 3). Then, on or about March 18, 2013, the parties appeared to have orally reached a settlement. However, no settlement actually occurred. (Statement, 3-4). As a result, shortly thereafter, the FAA filed its May 7, 2013 Complaint, and the case was referred to this tribunal for litigation. Itis clearthat no settlement occurred in the case. Itis also clearthatthe FAAperceives the totality ofevents after its NPCP was filed, which include both the failed settlement negotiations and the Respondent's recent motions before this tribunal, as a "stalling" tactic by the Respondent. (Response, 2-3). Public policy supports informal resolution ofdisputes, and thus, private settlement negotiations between the parties during litigation is encouraged. Because free-flowing, informal discussion is often necessary to effectuate settlement, settlement negotiations are deemed confidential. Settlementnegotiations

- even when disappointing ordisputed bythe parties

- are rarely ever proffered as evidence to the court, and only under very narrow exceptions. In particular, it is a long-standing legal policy that settlement negotiations may neverbe offered by an opposing party as evidence to prove the validity ofa claim. Federal Rule ofEvidence 408; Stephen A. Saltzburg; Michael M. Martin; Daniel J. Capra, Federal Rules ofEvidence Manual, §408.02 (May 2013). In the case herein, the FAA's Statement serves only to showthatthe parties failed to reach a settlement. There is no evidence to show that the informal conference orthe subsequent negotiations, setup and overseenbythe FAA'sRegional Office before filing a formal Page 4 of6Complaint, took an inordinate amount oftime in comparison to other cases supervised bythe FAA's Field Administrator. There is also no evidence that the Respondent's time requests were unusual. In fact, it appears that the parties worked amicably in setting mutually convenienttime periods for discussing settlement. This can hardly be considered, inretrospect, as a "stalling" tactic engagedinby only the Respondent. Subsequently, once the FAA filed a formal Complaint on May 7, 2013, the parties quickly proceeded to litigation before the Office ofHearings. The record shows thatthis case was assigned to a Judge onMay 23,2013. Fifteen days later, onJune 3, 2013, the Respondent filed a Motion for More Definite Statement. That Motion was granted, over objection, onJuly 16, 2013. Pursuant to the July 16, 2013 Order, the FAA filed an Amended Complaint onJuly 31, 2013. Thereafter, the parties informally conferred, and the FAA declined to agree to the Respondent's informal request to extend the time for filing an Answer to the Amended Complaint. (Response, 3; Reply, 2). Thus- not surprisingly- the Respondent then filed on August 30,2013, its Motion to Dismiss herein. This sequence ofevents does not appear to demonstrate "stalling" bythe Respondent. Indeed, eachparty has demonstrated in its recent filings that each is engaged in active andtimely litigation. While the FAAmay disagree withthe Respondent's particular choice ofmotion (e.g., motionto dismiss v. motion for extension oftime, etc), these are choices that are legally available to parties pursuantto the Federal Aviation Regulations, and such choices should be consideredby a party representative in consultation with his/her client. The FAA correctly notes that the Respondent's Motion to Dismiss lacks legal authority or discussion. This certainly lends credence to the FAA's argument that the Respondent's Motion should be denied. Itdoes not, however, automatically lead to the conclusionthatthe Respondent is "stalling." While there are certainly times when a party in litigationbeginsto demonstrate, through a pattern ofactions, an attempt to delay or avoid trial, the facts herein do not rise to such a pattern.

2) Respondent's Allegations ofPrejudice and Request for Telephone Conference In its Reply, the Respondent argues thatthe FAA's submission ofa newspaper clipping (FAA's Response Exhibit A), as well as the FAA's speculative arguments regarding the Respondent's motivations, are both "highlyprejudicial" and "undermine the Respondent's hope for a fair and impartial proceeding." (Reply 3.) In addition, the Respondent requests a telephone hearing, to discuss "other concerns raised." (Reply 3.) The Respondent did not, however, identify what topics needed discussion, other than ruling on the issues raised inthis Motion.

Page 5 of6It should be understood that pursuant to 14 C.F.R. §13.223, the FAA is the party with the burden ofproof. As such, it is the FAA'sburden to prove its case (absent settlement or disposition on motion) by the presentation of"reliable, probative, and substantial evidence" at a hearing. 14 C.F.R. §13.223. This administrative court will then consider such evidence, as contained in the hearing record, in orderto issue a decision. 14 C.F.R. §13.223. The Respondent may be assured that the newspaper clipping filed bythe FAA (FAA's Response Exhibit A) has notprejudiced this trier offact, or undermined the Respondent's hope for a fair and impartial hearing

.. Only ifa party moves for the admission ofthe newspaper clipping at the hearing, and such motion for admission is granted, will the hearsay information contained inthe clipping be considered as evidence. Even then, such information is limitedby weight, given its hearsay nature. 14 C.F.R. §13.222(c). Pursuant to 14 C.F.R. §13.205, §13.209 and §13.218, and after reviewing all pleadings and documents, as well as all relevant caselaw, decisions, regulation, statutory authority, and being fully advised;



### IT IS HEREBY ORDERED: 1) The Respondent's Motion to Dismiss for Failure to Join Indispensable Partyis denied. 2) The Respondent's Motionfor a telephone hearing on other issues is denied. 3) On orbefore November 

### 15,2013, the Respondent shall file an Answerto the Amended Complaint. 4) Uponreceipt ofthe Respondent's Answer, a separate order will issue directing the parties to engage in a Rule 26(f) Scheduling and Discovery Plan, as well as setting a prehearing Rule 16 Telephone Conference.

Attachment: Service List

Page 6 of6FDMS No. FAA-2013-0284 (Civil Penalty Action) SERVICE LIST- BY U.S. MAIL ORIGINAL & ONE COPY Federal Aviation Administration 800 Independence Avenue, S.W. Washington, DC 20591 Attention: Hearing Docket Clerk, AGC-430 Wilbur Wright Building-Suite 2W1000 1

Mr. Mark G. Camacho Complainant's Counsel ONE COPY

Senior Enforcement Attorney, Central Region, ACE-7 Federal Aviation Administration Room 506, DOT Building, 901 Locust St. Kansas, MO 64106-2641 TEL: 816-329-3765 FAX: 816-329-3771 Mr. Douglas 

### J. Barnard Respondent's Counsel 14695 Airport Parkway, 2ndFloor Clearwater, FL 33762 TEL: 727-259-0224 FAX: 727-259-0223 E-MAIL: dougb@planelaw.com
Judge J.E. Sullivan U.S. Administrative LawJudge Office ofHearings, M-20 U.S. Department ofTransportation 1200 NewJersey Avenue, S.E. (Ell-310) Washington, DC 20590 TEL: 202-366-2132 FAX: 202-366-7536 Mr. Kamran Rouhani Respondent Aviation Engineering Consultants, Inc., 2750 Sunset Point Road Clearwater, FL 33759

1 Service was by U.S. Mail. For service in person orby expedited courier, use the following address: Federal Aviation Administration, 600 Independence Avenue, S.W., Wilbur Wright Building-Suite 2W1000, Washington, DC 20591; Attention: Hearing DocketClerk, AGC-430.