### SERVE D MAY 20 , 201 1 ::RARTMENTO F • • .NSPORTATiO N :K£ TOPERATION S I HA Y2 3 A '=.:5 3 UNITE D STATE S DEPARTMEN T O FTRANSPORTATIO N

OFFIC E O FHEARING S WASHINGTON , D . C . FEDERA L AVIATION ADMINISTRATION ,

Complainant , V . TEXAS ARM

Y NATIONA

L GUARD , Respondent . FA A DOCKE

T No . CP09SO001 4 (Civi l Penalt

y Action )

DM S No . FAA-2009-104 5 INITIA L DECISIO N O F ADMINISTRATIV E LA W JUDG E RICHAR D C . GOODWI N Found : Responden t

i s assesse dacivi l penalty o f $30,000 . I . Backgroun d Thi s cas e originate d witl i allegation s o f Complainan t Federa l Aviatio n Administratio n ("Complainant, " "FAA, " o r"th e agency" ) tha t o n o rabou t Jul y2 , 2009 , agent s o f Responden t Texa s Arm yNationa l Guard^ ("Respondent " o r"Texa s Guard" ) offere d hazardou s material s fo rtransportatio n byai ri n violatio n o f th e Department' s Hazardou s Material s Regulation s ("HMRs") , 4 9 CF R §§171-178 . Th e Texa s Guar d ha d tendere d fou rone-gallo n can s o f paint . Pain t i s classifie d a s a hazardou s materia l ("hazmat") . Th e shipmen t ha d no t bee n declared . On e o f th e can s wa s foun d leakin g (Tr . 15 , 30) . Th e hazmats , th e agencycharged , ha d no t bee n properl ypackaged , marked , labeled , close d o ri n th e conditio n fo rshipmen t required . I t als o asserte d tha t Responden t committe d trainin g violations . Th e Complain t charge d th e Texa s Guar d wit h twenty-on e violation s o f th e HMRs , wz. : 4 9 C.F.R . §§171.2(e) , 172.200(a) , 172.202(a)(1) , 172.202(a)(2) , 172.202(a)(3) , 172.202(a)(4) , 172.202(a)(6) , 172.202(a)(7) , 172.204(a ) o r(c)(1) , 172.204(c)(2) , 172.204(c)(3) ,

' Thi s cas e was originally captioned"Executive Offic e o f the Stat e o f Texas. " A

t Respondent' s request , an dwit hthe acquiescenc e o f

Complainant , it

was changedt o the curren

t caption . See Orde

r Granting i n Par t an dDenyin g i n Par t Motion fo r Decision , servedJuly 8 , 2010 , n . 1 .172.300(a) , 172.30 1 (a) , 172.312(a)(2) , 172.400(a) , 172.600(c)(1) , 172.600(c)(2) ,

172.702(a) , 173.24(b)(1) , 173.27(d) , an d 173.173 . Se e Complain t date d Novembe r 25 , 2009 . Pursuan t t o 4 9 U.S.C . §5123 , th e agenc yasks fo ra tota l civi l penaltyo f $30,00 0 (Tr . 12) . Respondent' s Answe racknowledge d liability . Se e als o Tr . 7 ("we hav e stipulate d t o th e liabilityportio n [o f th e Complaint]") . I t too k issu e wit h th e propose d penalty . Th e Answe rassert s a s a n affirmativ e defens e tha t th e FAA' s propose d assessment , i n failin g t o not e tha t th e Texa s Guard' s actio n wa s a one-tim e transgressio n an d tha t it s procedure s fo rshippin g volatil e an d flammabl e ai rcarg o wer e promptl ychanged , i s arbitrar yan d capriciou s an d constitute s a n abus e o f discretion . Se e Respondent' s Answe rt o Complainant' s Motio n fo rDecision , p . 1 . I t als o asserte d tha t th e propose d penaltywa s "excessive " (Tr . 7 , 55) . Acivi l penalty o f $15,000 , th e Texa s Guard concluded , woul d b e "fai ran d sufficient " (Tr . 10 ; se e als o Tr . 56) . I n vie wo f Respondent' s Answer , th e hearin g wa s limite d t o th e issu e o f penalty . I t wa s hel d o n Januar y4 , 201 1 i n Austin , TX . I determine d tha t a writte n decisio n wa s reasonabl e an d appropriat e unde rth e circumstances . I fin d an d conclud e tha t th e fact s an d circumstance s warran t a n assessmen t agains t Responden t o f $30,000 . 

### II . Penalt y A . Factor s Determinatio n o f a n appropriat e civi l penaltyrequire s consideratio n o f a varietyo f factors . Th e decisionmake rmus t weig h "th e nature , circumstances , extent , an d gravit yo f th e violation[s], " and , wit h respect t o th e violator , "th e degre e o f culpability , an yhistor

yo f prio rviolations , [and ] th e abilit yt o pay " a s wel l a s "othe r matters tha t justic e requires " (4 9 U.S.C . §5123(c)) . Th e principa l element s i n thi s analysi s ar e th e natur e o f th e respondent' s conduct an d th e totalit yo f th e circumstances . Envirosolve , LLC , FA AOrde rNo . 2006- 2 (Februar y7 , 2006) , p . 13 . Th e Administrato rha s provide d policyguidanc e fo ragenc yemployee s t o follo wwhe n recommendin g a n appropriat e civi l penaltyi n hazardous-material s cases . I t ha s publishe d penaltyguidelines . Th e guidelines , containe d i n FA AOrde r 2150.3B , asses s al l relevan t statutor ycriteria , includin g mitigatin g an d aggravatin g circumstances . Th e guideline s ai d Complainant' s penaltydeterminatio n throug h a sanctio n guidanc e matrix . Th e matri xset s ou t specifi cpenaltyrange s fo reac h input , cross-referencin g suc h factor s a s th e nature o f th e responden t (fo rexample , whethe r i t i s a busines s whic h "regularly " offers hazmats ) an d th e relativ e ris k o f har m pose d byth e good s offere d (se e Exh . C-1) . Complainant' s sanctio n determinatio n nevertheles s doe s no t merel yreflect a fixe d mathematica l computation . Th e sanctio n guidanc e matri xi s intende d t o indicat e th e Administrator' s "genera l views " abou t th e civi l penaltyrange s appropriat e fo rdifferen t type s o f violations . Folsom' s Ai rService , Inc. , FA

AOrde rNo . 2008-1 1 (Novembe r6 , 2008) , 200 8 W L 4948488 , p .13 . No rar e th e guideline s binding . Eac h situation , bein g dependen t o n s o man y

variables , i s unique . Further , th e numbe ro f HM R violation s i s not i n an d o f itsel f a n importan t consideration . Warbelow' s Ai rVentures , Inc. , FA AOrde rNo . 2000- 3 (Februar y3 , 2000) , pp . 20-21 , pef . fo rreconsid . den.,Orde rNo . 2000-1 4 (Jun e 8 , 2000) . "Evaluatio n o f th e case, " th e FA Aha s emphasized , "i s base d o n th e totalit y o f th e fact s an d circumstances." ^ A n administrativ e lawjudg e ("ALJ" ) i s no t require d t o follo wthes e guidelines . The yar e intende d fo ragenc ypersonnel , an d ALJ s ar e no t agenc ypersonnel . Folsom's , supra , p . 14 . ALJ s make decision s independently , an d th e AL J determine s (subject t o agenc yreview ) whethe ra civi l penaltyi s t o b e assessed , an d i f so , i n wha t amount . Th e guideline s nonetheles s mus t b e respecte d a s a n expressio n o f agenc

ysanctio n policy . The yrepresen t a n effor t t o produc e consisten t result s i n simila rcases . Th e Administrato rha s asserte d th e powe rt o impos e th e agency' s sanctio n policyo n appea l i f a n AL J assesse s a civi l penaltytha t i s no t consisten t wit h th e policy . Warbelow' s Ai rVentures , Inc. , FA AOrde rNo . 2000- 3 (Februar

y3 , 2000) , p . 20 ; Northwes t Airlines , FA AOrde rNo . 1990-^3

7 (Novembe r7 , 1990) , pp . 8-10 . I t als o i s importan t t o not e tha t hazardou s material s i n th e strea m o f ai r transportatio n requir e particula rattention . The yar e dangerou s bythei rver ynature . Th e ris k o f hamri mus t b e kep t t o a n absolut e minimu m i n vie wo f th e possibl e grav e consequence s o f error . O n accoun t o f hazmats ' inheren t capacityfo rperil , th e HMR s provid e a we b o f protectio n t o minimiz e th e ris k fo rperson s wh o coul d b e adversel yaffecte d bysuc h materials . 

### B . Complainant' s Positio n Complainan t ha s aske d fo ra lev yo f $30,000 . I t bears th e burde n o f provin g th e appropriatenes s o f thi s amoun t b ya preponderanc e o f th e evidence . Phillips , supra , p . 8 . Complainan t argue s tha t th e pain t involve d i n thi s cas e coul d have prove n dangerous . Pain t i s a flammabl e liqui d i n packin g grou p III , wit h a flas h poin t o f 7 3 degree s (Tr . 16) . A s such , norma l roo m temperature s coul d ignit e it . Th e guideline s classifypain t a s a "Categor yB " material , whic h carrie s a "moderate " fina l aggregat e weigh t fo rassessmen t purposes. ^ Th e agencyals o considere d th e natur e o f Respondent' s business . I t determine d tha t i t i s a busines s entit ybu t no t a n entit y regularl yhandlin g hazmat s (Tr . 47) . Tha t place d th e Texa s Guard i n th e moderat e rang e o f th e penaltymatrix . Complainan t foun d seve n violatio n group s - shippin g papers , labels , marking , packaging , training , release , an d emergencyrespons e ^ Th e guideline s originall

y wer e publisheda s "[FAA] Policy o n Enforcemen

t of the Hazardou s Material s Regulations : Penalt

y Guidelines, " 6

4 Fed.Reg . 19443 , 19444 , 1999 W L 22661 0 (F.R. ) (April 21 , 1999) . The y ar e now incorporateda s Appendi x C to FA A Orde r 2150.3B , an

dma y b e foim da t the FAA' s we

b site , www.faa.gov . or , mor

e specifically , a

t www.faa.gov/documentLibrarv/media/Order/ND/2150.3B.pd f See Complainant' s Motion fo r Decision , p . 3 n . 1 . ^ Tr . 45 . Categor

y B material s ar

e material s tha

t "ma y no t pos e a n immediat

e threa t to the safet

y o f aflight, bu t ca n caus e deat

ho r injur y t o person s due to unintendedrelease s i n aircraf t cabin areas , an

dpotentia l damage t o aircraf

t structure s ove

r alonge r perio do f tim e ... " 6 4 Fed.Reg . 19449 .information . Multiplyin g th e media n figur e i n th e moderat e rang e o f th e matrix ,

$4,850 , b yseve n (on e fo reac h violatio n group ) yield s a tota l assessmen t o f $33,95 0 (Tr . 47-48) . Th e agenc

ycredite d th e Texa s Guard fo rth e trainin g i t subsequentl y implemente d b

yadjustin g it s calculate d civi l penaltydownwar d by$3,950 , t o $30,00 0 (Tr . 43) . Th e FA Amaintaine d tha t Respondent' s correctiv e actio n di d no t warran t mitigatio n becaus e Respondent' s documentation , submitte d abou t a yea r afte rth e incident , containe d n o record o f trainin g an d wa s entirel yprospective . Th e FA Aconclude d tha t th e Texa s Guard' s correctiv e actio n wa s neithe rtimely , swift , no rcomprehensiv e - thu s failin g t o mee t an yo f th e Administrator' s mitigatio n criteria . Bu t Complainan t wa s willin g t o recommen d th e lowe rfigur e o f $30,00 0 nonetheles s "a s a goo d fait h offe ro f settlement " (Complainant' s Motio n fo rDecision , pp . 3-4 ; Tr . 48-50 , 61) . 

### C. Respondent' s Positio n Responden t urge s tha t th e propose d penaltyi s disproportionat e t o th e act an d surroundin g circumstances . I t stresse d th e isolate d natur e o f th e infractio n {see , e.g. , Tr . 8) . I t als o underscore d it s reactio n t o th e incident . I t note d tha t i t undertoo k additiona l trainin g an d education . Th e Texa s Guard "initiate d a far-reachin g progra m tha t covere d th e entir e state, " i t asserte d (Tr . 8) . It s action s wer e promp t an d extensive , i t argue s (Tr . 56-57) . Complainan t faile d t o properl ycredi t th e Texa s Guard' s response . Responden t contends. " Finally , Responden t point s ou t tha t th e pain t i t tendere d di d no t ignit e (Tr . 57) . 

### D . Decisio n I hav e decide d t o asses s a tota l civi l penaltyo f $30,000 . I fin d an d conclud e tha t thi s amoun t appropriatel yreflect s th e totalit yo f th e circumstance s surroundin g th e offendin g shipmen t an d th e nature o f Respondent' s conduct bot h befor e an d followin g th e incident . An ypackag e containin g hazardou s material s whic h doe s no t confor m t o th e HMR s bring s a n unacceptable , an d possibl yperilous , elemen t int o th e strea m o f ai r commerce . A n undeclare d shipmen t i s especiall ydangerou s becaus e th e elemen t o f ignoranc e introduce s particula rvulnerabilit y(se e Tr . 53) . Th e Administrato rha s emphasize d tha t undeclare d shipment s "pos e a specia l risk. " See , e.g. , Interstat e Chemica l Company , Inc. , FA A Orde rNo . 2002-2 9 (Decembe r6 , 2002) , p . 16 . Th e likelihoo d o f injur

yi s increased . Seven' s Pain t & Wallpaper , FA AOrde rNo . 2001-6 , 200 1 W L 62938 8 (May15 , 2001) , p . 5 . Th e instan t scenari o coul d hav e seriousl y

• * Tr . 8-9 . Responden

t additionall

y assertedtha

t the agency refiise

dto attempt

t o negotiat e asettlemen

t i n goodfaith , contending tha

t Complainant' s postur

e wa s arbitrary , capricious , an

da n abus e of discretion . Thi s argimien

t i s dismissed . Inquir

y int o the characte

r of settlemen t negotiation s i s not

aprope r matte r fo r consideration by thi s Court . Afric aAi r Corporation , FA

A Orde r No . 99-5 , 1999 W

L71127 5 (August

31 , 1999) .compromise d th e safetyo f individual s o ro f th e fligh t itself . Thes e fact s an d

circumstance s warran t a significan t fine . Leakag e i s a n aggravatin g facto ri n th e civi l penaltycalculus . Phillip s Buildin g Supply , FA

AOrde rNo . 2000-20 , 200 0 W L 3312526 6 (Augus t 11 , 2000) , p . 6 . I t raise s t o unacceptabl e level s th e ris k o f dange rt o aircraft structure . Alea k als o coul d caus e advers e conseG|uence s fo rindividual s nearby . Material s whic h ar e flammabl e (suc h a s paint ) coul d caus e a fir e b ycomin g int o contact wit h a heat source . Suc h circumstance s coul d threate n th e integrityo f th e fligh t itself . Respondent' s ple a i n mitigatio n tha t i t i s a first-tim e violato rmus t b e rejected . Th e isolate d natur e o f th e inciden t canno t b e considere d a mitigatin g circumstance . Aviolation-fre e histor

yi s expecte d t o b e th e nomn . TC I Corporation , FA AOrde rNo . 92-77 , p . 2 0 (Decembe r22 , 1992) . Respondent' s action s followin g discover yo f th e nonconformin g shipmen t ar e commendable . Bu t I have t o agre e wit h Complainant' s characterizatio n o f it s response . Th e action s o f th e Texa s Guard , I find , ar e not th e kin d o f systemi co rfar reachin g change s tha t th e Administrato rrequire s i n orde rt o lowe ra n otherwis e reasonabl e assessment . See , e.g. , Seven' s Pain t & Wallpape rCo. , FA AOrde rNo . 2001-6(May16 , 2001) , p . 6 . No rca n I credi t th e fac t tha t th e pain t faile d t o ignite . Thi s i s a fortuitou s circumstance . Ignitio n woul d hav e constitute d a n aggravatin g factor , makin g a highe rsanctio n appropriat e (6 4 Fed.Reg . 19443 , 1944 5 (Apri l 21 , 1999)) . Finally , I fin d tha t th e civi l penaltylevie d i n Midtow n Neo n Sig n Corporation , FA AOrde rNo . 1996-2 6 (Augus t 13 , 1996 ) i s pertinen t t o th e detenninatio n o f penaltyhere becaus e th e circumstance s ar e fairl ysimilar . Tha t cas e involve d a n undeclare d - an d leakin g - shipmen t o f tw o 1-gallo n can s o f paint , fo rwhic h Responden t wa s fine d $25,000 . Whil e tw o can s o f pain t leake d there , on e mor e tha n i n thi s case , penaltyamount s hav e gon e u p materiall yi n th e interim . Bas e penaltyamount s have bee n raise d periodically , an d als o hav e bee n adjuste d upward t o accoun t fo rinflation . Th e maximu m civi l penaltyfo ra singl e violatio n o f 4 9 U.S.C . §5123(a) , $25,00 0 whe n th e Midtow n Neo n Sig n infraction s occurred , wa s $50,00 0 whe n th e shipmen t i n thi s cas e wa s tendered . I t ha d double d i n th e intervenin g period . (I t ha s sinc e bee n raise d t o $55,000) . Se e Tabl e followin g 1 4 C.F.R . §13.30 5 (showin g change s i n minimu m an d maximu m penaltyamounts) . Civi l penaltie s assesse d shoul d appropriatel yreflect thes e significan t upward adjustments . Midtow n Neo n Sig n suggest s tha t th e civi l penaltyComplainan t propose s her e i s reasonabl e an d fitting . I hav e considere d al l othe rargument s advance d bybot h parties . Thos e no t discusse d ar e rejecte d a s withou t merit . I n weighin g th e al l th e fact s an d circumstances , 1 fin d an d conclud e tha t a civi l penaltyassessmen t o f $30,00 0 i s warranted . Thi s amoun t appropriatel yreflect s th e nature o f th e ris k

t o ai rtransportatio n safet ypu t i n motio n byth e Texa s Guard , whil e givin g appropriat e weigh t t o othe rsalien t factors . Th e assessmen t als o i s designe dt o achiev e deterrenc e an d promot e complianc e wit h th e HMRs . I fin d tha t i t

appropriatel yaccount s fo rth e factor s th e statut e an d agenc ypolic ydirect s i n fixin g th e assessment . Responden t Texa s Arm yNationa l Guard i s hereb yassesse d a civi l penaltyo f $30,00 0 fo rviolation s o f th e HMR s 4 9 C.F.R . §§171.2(e) , 172.200(a) , 172.202(a)(1) , 172.202(a)(2) , 172.202(a)(3) , 172.202(a)(4) , 172.202(a)(6) , 172.202(a)(7) , 172.204(a) , 172.204(c)(2) , 172.204(c)(3) , 172.300(a),172.30 1 (a) , 172.312(a)(2) , 172.400(a) , 172.600(c)(1) , 172.600(c)(2) , 172.702(a) , 173.24(b)(1) , 173.27(d) , an d 173.17 3 a s describe d i n thi s Initia l Decision. ^



### administrative La

w Judg e Attachmen

t - Servic e Lis t

' Thi s decision ma

y b e appealedto the Administrato r o f the FAA . Th

e notic e o f appea l must confor mt o section s 13.210 , 13.211(e) an d13.23 3 o f the Rule s o

f Practice , whic

hrequir e tha t anotic e o f appea l 1 ) b e filednot late r tha n 1 0 day s (plu s a

n additiona

l five day s if

mailed) fromthe servic e dat e o f thi s decision , an d2 ) b e perfectedwit

hawritte n briefe r memorandu

mnot late r tha n 5 0 day s (plu s a

n additiona

l five, i f mailed) fromthe servic e dat e o f thi s decision . The notic e o

f appea l an dbrief o r memorandu

mmust eithe r b e a) mailedt o the Federa

l Aviation Administration , 80 0 Independenc e Avenue , S.W. , Washington , D C 20591 , Attn : Hearing Docke t Clerk, AGC-430 , Wilbu

r Wrigh t Building—Suit

e 2W1000 , o

r b ) delivered personall y o r vi aexpeditedcourie

r servic e t o the Federa

l Aviation Administration , 600 Independence Avenue , S.W. , Wilbu

r Wrigh t Building—Suit

e 2W1000 , Washington , D.C . 20591 , Attti : Hearing Docke t Clerk, AGC-430 . A cop

y o f th e notic e o

f appea l an dbrief or memorandu

mals o must

b e sen t to agenc y counsel . Servic e upo

n the presidingjudg e i s optional .FA A Docke t No . CP09SO001 4 (Civi l Penalt y Action ) SERVIC E LIS T ORIGINA L& ON E COP Y Federal Aviatio n Administratio n SO O Independenc e Avenue , S.W . Washington , D C 2059 1 Attention : Hearin g Docke t Clerk , AGC-43 0 Wilbu r Wrigh t Building—Suit e 2W1000 '

ON E COP Y Michae l C . Crowley , Respondent' s Counse l Environmenta l Protectio n & Administrativ e Law Divisio n P.O . Bo x 1254 8 Austin , T X 7871 1 TEL : 512-475-420 2 FAX : 512-474-106 2 Geral dA . Ellis , Complainant' s Counse l Souther n Region , ASO- 7 Federal Aviatio n Administratio n P.O . Bo x 2063 6 Atlanta , GA 3032 0 TEL : 404-305-520 0 FAX : 404-305-522 3 Th e Honorabl e Richar dC . Goodwin , Administrativ e La w Judg e Offic e o f Hearings , M-2 0 120 0 New Jerse y Avenue , S.E . Eas t Buildin g Groun dFloo r Roo mE12-32 0 Washington , D C 2059 0 TEL : Attorney-Adviso r

202-366-213 9 Legal Assistan t

202-366-512 1 FAX : 20 2 366-753 6

' Servic e wa s b y U.S . Mail . Fo

r servic e i n perso n o r b y expedite dcourier , us e th e followin g address : Federa

l Aviatio n Administration, 60

0 Independenc

e Avenue , S.W. , Wilbu

r Wrigh t Building-^Suit

e 2W1000 , Washington

, D C 20591 ; Attention : Hearin

g Docke t Clerk , AGC-430 .