AFS-14-436-E 

 

Exemption No. 11120 

 

UNITED STATES OF AMERICA 

DEPARTMENT OF TRANSPORTATION 

FEDERAL AVIATION ADMINISTRATION 

WASHINGTON, DC 20591 

 

In the matter of the petition of 

 

THE LIBERTY FOUNDATION Regulatory Docket No. FAA-2004-17662 

 

from §§ 91.315, 91.319(a)(2), 119.5(g), 

and 119.21(a) of Title 14, 

Code of Federal Regulations (14 CFR) 

 

DENIAL OF EXEMPTION 

By letter dated August 22, 2014, Mr. Stuart A. Goldstein petitioned the Federal Aviation 

Administration (FAA) on behalf of The Liberty Foundation, Inc. (hereafter “the Foundation”) for 

an extension of Exemption No. 8565, as amended. An extension of the petitioner’s exemption 

from §§ 91.315, 91.319(a)(2), 119.5(g), and 119.21(a) of Title 14, Code of Federal Regulations 

(14 CFR), if granted, would have allowed the Foundation to operate Boeing B-17 N3703G (Serial 

No. 44-83456) to carry passengers for compensation or hire on local flights for educational and 

historical purposes. The Foundation also petitioned that a Curtiss P-40 (registration N2416X) be 

removed from the exemption because the aircraft had been sold. Subsequent to the filing of the 

petitioner’s request and the filing of this answer, Exemption No. 8565, as amended, expired on 

November 30, 2014. 

The petitioner requests relief from the following regulations: 

Section 91.315 prescribes, in pertinent part, that “No person may operate a limited category civil 

aircraft carrying persons or property for compensation or hire.” 

Section 91.319(a)(2) prescribes, in pertinent part, that “ (a) No person may operate an aircraft that 

has an experimental certificate— (1) For other than the purpose for which the certificate was 

issued; or (2) Carrying persons or property for compensation or hire.” 

Section 119.5(g) prescribes, in pertinent part, that “(g) No person may operate as a direct air 

carrier or as a commercial operator without, or in violation of, an appropriate certificate and 
 2

appropriate operations specifications. No person may operate as a direct air carrier or as a 

commercial operator in violation of any No person may operate as a direct air carrier or as a 

commercial operator in violation of any deviation or exemption authority, if issued to that person 

or that person's representative. 

Section 119.21 (a) prescribes, in pertinent part, Each person who conducts airplane operations as 

a commercial operator engaged in intrastate common carriage of persons or property for 

compensation or hire in air commerce, or as a direct air carrier, shall comply with the certification 

and operations specifications requirements in subpart C of this part, and shall conduct its: 

The petitioner supports its request with the following information: 

In its petition, the Foundation notes that the reasons and purposes for continuing to operate the B17 are the same reasons and purposes that have been recognized in previous past exemptions and 

set forth in the original exemption (No. 8565, dated June 10, 2005) and continuing exemptions. 

The Foundation further states that it will continue to adhere to its Aircraft Inspection Program 

(AIP), inspection and maintenance procedures prescribed by the aircraft manufacturer, and all 

applicable military Technical Orders. The Foundation emphasizes that “the excellent safety 

record in the operation of its aircraft for more than a decade demonstrate that the very highest 

level of safety and concern for the public is paramount” and that “maintaining the very highest 

level of safety is The Foundation's primary objective.”

The FAA has determined that good cause exists for waiving the requirement for Federal Register 

publication because the exemption, if granted, would not set a precedent, and any delay in acting 

on this petition would be detrimental to the Foundation. 

The FAA's analysis is as follows: 

The FAA has reviewed the Foundation’s safety record and does not agree that it demonstrates the 

very highest level of safety, as supported by the petitioner. The FAA has safety and compliance 

concerns relevant to the Foundation’s petition for renewal of its exemption. 

On June 13, 2011, the Foundation’s Boeing B-17G "Flying Fortress" airplane (N390TH) 

experienced an in-flight fire and emergency landing near Oswego, Illinois. One passenger 

sustained a minor injury. The remaining three flight crew members and three passengers were not 

injured. The airplane was destroyed because of the post-crash fire. The day before the accident, 

while engaged in Living History Flight Experience (LHFE) education and demonstration flights, 

the aircraft experienced a fuel leak, which interrupted the scheduled flights. A mechanic 

associated with the Foundation evaluated and repaired the fuel leak and, following a final 

inspection of the repair the morning of the accident flight, returned the aircraft to service. During 

the initial climb after takeoff, an in-flight fire developed on the left wing. This necessitated the 

pilots to shut down the No. 2 engine, discharge the fire bottles, and then execute an emergency 

off-airport landing. The fire, which was not extinguished and ultimately destroyed the aircraft, 

was caused by an inadequate repair of the fuel tank that allowed the fuel leak to continue, 

ultimately resulting in an in-flight fire.1

The Foundation modified the aircraft’s fuel tank system in late February 2011. These 

modifications were not and are not described in any maintenance manual or instructions for 

 

1

 NTSB Report CEN11FA383, April 10, 2014. 
 3

continued airworthiness for the B-17. The methods, techniques, and practices used by The 

Foundation in modifying the aircraft were not submitted to the FAA for review, nor were they 

conducted in accordance with 14 CFR regulatory requirements.2

 Moreover, the aircraft was 

improperly returned to service. 

Of particular concern to the FAA is that at the time of the accident, the Foundation was required 

to operate in accordance with a number of conditions and limitations under its LHFE exemption. 

These conditions and limitations were specifically included as part of the exemption in order to 

establish an equivalent level of safety to that of the regulation being exempted from. Based on 

findings of the FAA and the NTSB accident investigation, it is likely that the petitioner did not 

comply with at least two of these conditions and limitations, Nos. 2 and 22. 

Condition and Limitation No. 2 of Exemption No. 8565C required the Foundation to maintain its 

Limited Category airplane in accordance with: 

(1) the maintenance requirements as specified in the appropriate type certificate data sheet, as 

amended; and 

(2) the FAA-approved maintenance inspection program that meets the requirements of 

§§ 91.409(e), (f)(4) and (g); and 

(3) the appropriate military technical manuals (Technical Orders). 

Based on the discussion above concerning the June 2011 accident and the unapproved 

modifications made to the aircraft, compliance with this limitation is in doubt. 

Condition and Limitation No. 22 of Exemption No. 8565C required the Foundation to notify the 

Atlanta FSDO within 24 hours of: 

(1) each in-flight fire in any system or area that requires activation of any fire suppression 

system or discharge of a portable fire extinguisher; and 

(2) except for training, each occurrence of engine shutdown or propeller feathering, and the 

reason for such shutdown or feathering; and 

(3) each failure or malfunction, of the fuel system, tanks, pumps, or valves; and 

(4) each malfunction, failure, or defect in any system or component that requires taking 

emergency action of any type during the course of any flight. 

A review of FAA records indicates that the Foundation did not report the above-mentioned 

malfunctions as required by the exemption. 

The accident led to an FAA enforcement action, which is currently in litigation. The issues 

being considered are directly related to the Foundation’s ability to safety operate the B-17. 

The June 2011 accident also brings into question the Foundation’s compliance with the 

conditions and limitation of the Exemption 8565, as amended, which directly relates to 

making an equal level of safety finding for an extension of the that exemption. There is only 

an equal level of safety when all conditions and limitations are followed. An apparent, 

inappropriate modification to the fuel system and operating the aircraft in violation of the 

 

2

 The aircraft did not conform to its type certificate or type design because it had not been restored to its original or properly 

altered condition. The aircraft did not conform to its type certificate or type design because the alteration performed was not

an approved or acceptable form of alteration. The aircraft did not conform to its type certificate or type design because the 

mechanic did not have the Inspection Authorization required to return the aircraft to service after a major alteration. The 

aircraft did not conform to its type certificate or type design because no FAA Form 337 was executed for the major 

alteration. The aircraft did not conform to its type certificate or type design because no approved technical data was used in 

performing the alteration. 
 4

specific conditions and limitations provides the FAA with sufficient reason to deny the 

Foundation’s petition to extend Exemption No. 8565, as amended. 

The FAA’s Decision: 

In consideration of the foregoing, I find that, since Exemption 8565, as amended, expired on 

November 30, 2014 and cannot be extended, a grant of a new exemption would not be in the 

public interest. Therefore, pursuant to the authority contained in 49 U.S.C. §§ 106(f), 40113, and 

44701, delegated to me by the Administrator, the petition of The Liberty Foundation, Inc. for an 

exemption from Title 14, Code of Federal Regulations (14 CFR) §§ 91.315, 91.319(a)(2), 

119.5(g), and 119.21(a) is hereby denied. 

Issued in Washington, D.C. on December 10, 2014. 

/s/ 

John Barbagallo 

Acting Director, Flight Standards Service