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UNITED STATES DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

SPIRIT AVIONICS, LTD., 

v. 

MICHAEL P. HUERTA, 

Administrator 

WASIDNGTON, D.C. 

Applicant, 

FDMS No. 2015-3309 (EAJA) 

Founerly FDMS No. 2014-0119 

Judge J.E. Sullivan 

Federal Aviation Administration, 

Respondent. 

ADMINISTRATOR'S RESPONSE TO APPLICATION FOR AWARD OF 

ATTORNEY'S FEES AND EXPENSES UNDER 

THE EQUAL ACCESS TO .JUSTICE ACT 

PAGE 02/25 

Pursuant to 14 C.F.R. §§ 14.28 and 13.233, the Respondent, the Federal Aviation 

Administration (FAA) files this response brief to the Applicant's Application for an Award of 

Attorney Fees and Other Expenses. 

INTRODUCTION 

In August 2010, Spirit Avionics, Ltd. (the Applicant), holder of Repair Station Certificate 

UOKR250X, entered into a contract with the Federal Aviation Administration (the FAA) to 

perform maintenance on a number of type certificated aircrafts owned and operated by the FAA. 

Exhibit A. The Applicant subcontracted major portions of the work to Lane Aviation. 

At some time prior to February 24, 2011, the Applicant fabricated or had fablicated at least 

twenty-two (22) brackets and twenty-two (22) lanyards. The brackets and lanyards were 

replacement or modification parts for use on the FAA aircraft. The Applicant prepared an 

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invoice, directed to Lane Aviation's Accounts Payable, which states "Lane Aviation portion of 

purchase and assembly of headliner install kits. Kits supplied to be used for the 3rd FAA aircraft 

through the 18th aircraft." Exhibit B. The invoice further represents that the an1.ount, $7,439.16, 

was paid by Lane Aviation on February 25, 2011. Exhibit B. 

During an investigation of Lane Aviation, the FAA Agent discovered undocumented parts 

that the Applicant fabricated on the work table near the vicinity of an aircraft belonging to the 

FAA and found that similar parts had been installed on other FAA aircraft without airworthiness 

release documentation. The FAA conducted an investigation and issued a Notice of Proposed 

Civil Penalty (NO PCP) on February 21,2013, asserting that the Applicant's sale offabricated 

parts to Lane Aviation was in violation of 14 C.P.R. § 21.9(b). The parties engaged in the 

informal process. During the informal process, the fAA requested that the Applicant produce 

business documents showing that the transaction was something other than a purchase of the 

parts by Lane, but the Applicant was not able to produce any documentation or evidence to 

contradict the plain language of the invoice. Exhibit C. The parties were unable to reach a 

resolution. Exhibit C. 

The FAA filed its complaint on May 8, 2014. The Applicant filed a Motion for Decision on 

June l, 2015. The Applicant argued that a "sale" did not occur because under the contract the 

FAA retained title to the parts and that the transfer oftitle is necessary to perfect a sale. This 

was the Erst time the Applicant raised this argument. Exhibit C. Telephonic oral arguments 

were held on August II, 2015. At the time of the oral arguments, there was no evidence of 

record to show that FAA money was used in the purchase of the lanyards and brackets. (See 

Transcript of Hearing on Motion for Deci.sion Dated Aug. 11,2015, p. 42-43). Judge Sullivan 

gave the Applicant leave to file a supplemental affidavit stating as su.ch. (See Transcript of 

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Hearing on Motion for Decision Dated Aug. 11,2015, p. 42-43). The Applicant subsequently 

fi.led the Affidavit of Ochs, which stated for the first ti.me that FAA money was used in the 

purchase of the lanyards and brackets. Judge Sullivan issued her decision favorable to the 

Applicant on August 27,2015. In her decision, Judge Sullivan acknowledged that "sal<::" was not 

defined by regulation, "sale" should be defined by its common definition, and that there were 

numerous different defini.tion.s that could apply. Judge Sullivan ultimately adopted the definition 

of "sale" the Applicant advocated for and as set forth in the U .C.C. On October 2, 2015, the 

Applicant filed the application currently under consideration. 

APPLICANT'S CLAIM UNDER EAJA 

The Applicant seeks the full cost of its legal representation from the time the NOPCP was 

issu.ed through its preparation of its application for attorney's fees in the amount of $19,819.90. 

ARGUMENT 

Under Equal Access to Justice Act (EAJA), even if the applicant is deemed a prevailing 

party, attorney's fees are not awarded if the agency's position was substantially justified. 

5 U.S. C. § 504(a)(l). In addition, the fees requested must be reasonable in smount. 5 U.S. C. § 

504(a)(b)( I )(A). Here, the FAA both was substantially justified and, assuming arguendo it was 

not, the fees Spirit seeks are not warranted by law and are unreasonable. 

A. Attorney's Fees Are Not Warranted Because the Agency Was Substantially .Justified 

The Agency's position is substantially justified ifthere is "a reasonable basis both in law and 

fact." Pierce v_ Underwood, 487 U.S. 552, 565 (1988); In the Matter qf Michael Edward Wendt, 

FAA Docket No. CP89GL0084; 1992 WL 1203650 I (D.O. T. 1992). "'Substantially justified' 

does 11ot mean 'justified to a high degree,' but rather has been said to be satisfied if there is a 

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'genuine dispute,' or if reasonable people could differ as to the appropriateness of the contested 

action." Stein v. Sullivan, 966 F.2d 3 J 7, 320 (7th Cir. 1992) (citing Pierce, 487 U.S. at 565, 108 

S.Ct. at 2550). See also Wendt, 1992 WL 12036501, at *1. This is a less stringent standard than 

that applied at the merits phase of the proceedings. See Pierce, 487 U.S. at 569-69 (explaining 

that substantial justification is not equivalent to the summary judgment standard). "Accordingly, 

the FAA's failure to prevail on the merits does not preclude a finding that its position was 

nonetheless substantially justified under tbe BAJA." Thomas v. Admini,vtralor, NTSB Order No. 

EA-4345 (April IS, 1995)(citing U.S. Jet v. Administrator at 3; Federal Election Commission v. 

Rose, 806 F.2d 1081, 1087 (D.C. Cir. 1986)). In fact, "[s]ubstantialjustification for bringing a 

suit does not require a subst<J-ntial expectation of victory." Everson v. FAA, FAA Docket No. 

CPOOWAOOO l; 2000 WL 34229116, *2 (D.O.T. 2000) (citing S & H Riggers & Erectors, Inc_ v. 

Occupational Safety and Health Review Commission, 672 F.2d 426 (5 Cir. J 982)). Rather, 

reasonableness involves an assessment of "whether sufficient, reliable evidence exists to pursue 

the matter." Application of Magruder, NTSB Order EA-5278 at 6 (2007). To make this 

assessment, the court must review the record in its entirety. ld. See also United States v. 

HallmarkConst. Co., 200 F.3d 1076, 1081 (7'h Clr. 2000); In the Matter of Stark Avionics, FAA 

Docket No. CP06S00034; DMS No. FAA-2006-26329; 2006 WL 3530425, *2 (2006). The 

Agency is substantially justified so long as it had '"(l) a reasonable basis in truth for the facts 

alleged; (2) a reasonable basis in law for the theory propounded; and (3) a reasonable connection 

between the facts alleged and the legal theory advanced."' Hallmark, 200 F .3d at 1080 (citing 

Phil Smidt & Son, Inc. v. NLRB, 810 F.2d 638,642 (7th Cir. 1987)); Everson v. FAA, 2000 WL 

34229116, *2 (D.O.T. 2000). 

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The Agency was substantially justified throughout the pendency of this litigation. Title 14 

C.F .R. § 21.9 states that "a person who produces a replacement or modification article for sale 

may not represent that part as suitable for installation on a type-certificated product." The 

Agency was reasonable to assert that a "sale" occurted because the Applicant gave the parts to 

Lane in exchange for $7,439.16 as was stated on the invoice created by the Applicant and sent to 

Lane. The Applicant argued during the informal process that it was not a "sale" because the 

invoice was not an accurate representation of the transaction between the Applicant and Spirit; 

rather, the invoice was created to bill for the loss the parties agreed to share for underbidding the 

contract and not for the purchase of the parts. However, throughout the informal process, the 

FAA repeatedly asked Spirit for documentation or other proof to show that the transaction with 

Lane was something other than a sale as indicated on Ute invoice. Exhibit C. Spirit produced 

nothing. Exhibit C. For most of the proceedings, the FAA had a document showing that a 

"purchase'' occurred and the self-serving, un-affirmed statement of Spirit who said that it was not 

a sale, but had no documentation to support that the transaction was anything other than a 

"purchase" by Lane. It was reasonable for the FAA to believe that a business would keep 

accurate documentation of its own transactions, particularly when such a written confirmation 

could have created liability for Spirit as will he explained below. 

In its Motion for Decision, the Applicant argued for the first time that a sale did not occur 

because under the Applicant's contract with the FAA, the FAA retained title to all parts and 

materials acquired to complete the work set forth in the contract, and a sale requires the passing 

of title. However, the Agency was reasonable to defend this motion. 

First, the Agency was substantially justified to assert that the contract did not apply to the 

parts at issue, and thus the Applicant's argument that the FAA retained title under the terms of 

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the contract was inapplicable. The contract between Spirit and FAA stated that th.e FAA retained 

title to parts and materials that were "acquired" to complete the contract, and does not refer to 

parts that were fabri.cated. See Exhibit A. Lane needed the parts to complete its portion of the 

work that it was subcontracted to do. If Spirit did not give them the parts, they would have been 

required to purchase them elsewhere. Nothing in the contract gave Spirit the right to make parts 

and to give them to Lane for a sum of money. Because the parts were made and not "acquired", 

the FAA was not tmreasonable in arguing that the parts were outside the contract between Spirit 

and the FAA, the FAA did not retain title, and the Applicant violated 14 C.F.R. § 21.9. 

Moreover, the Applicant asserted that sale requires the passing oftitle and that the FAA 

retained title because the materials used to make the parts at issue were purchased with FAA 

funds. However, the contract the Applicant and the FAA entered states that the FAA does not 

pay for the parts and materials until after they are purchased and an invoice is sent. See Exhibit 

A. And, the Applicant did not produce any evidence to show that the materials were purchased 

with FAA money until after the hearing on the motion for summary judgment. It was not until 

Ochs filed his supplemental affidavit that the record contained any evidence that FAA money 

purchased the parts. Although the FAA was not afforded an opportunity to respond to this 

allegation, its owu records show that it did not pay for the work done to the brackets until after 

the sale to Lane. See Exhibit D. Again, the Applicant did not produce this evidence until afier 

the hearing on the motions for summary judgment and was the first time any competent evidence 

was presented to support its position. Therefore, the record was devoid of any evidence 

supporting Spirit's argument prior to this statement and the FAA was substantially justified 

through this point to pursue its position, 

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The FAA also was substantially justified to assert in its response to th.e Applicant's 

Motion for Decision that a sale occurred based on the lnvoice regardless of whether the FAA 

retained title to the parts. The term "sale" was not defined by the regulation. Nor was the term 

"sale" defined by case law. The court agreed tbat the common definition applied and that there 

were numerous definitions for the term "sale". Some of these definitions state that a "sale" is the 

transfer of property for a sum of money and do not speak to the transfer oftitle. See Black's 

Law Dictionary (lOth ed. 2014); Oxford Online Dictionary, http:l!www.oxforddictionaries.com 

/us/dcfinition/american_englishfsale. Under these definitions, Spirit "sold" the parts to Lane 

when it gave Lane the parts in exchange for $7,439.16. The simple fact that the FAA's 

definition was not the successful definition does not mean that the FAA was not reasonable in 

pursuing its position. The law was not settled and there were definitions that supported the 

FAA's position. See Application of Recurrent Training Center, FAA Docket No. CPlOGLOOl 0, 

DMS No. FAA-2010-0973, 2011 WL 30280, *2 (D.O.T. 2011) (explaining that the government 

can show that it was substantially justified when the question involved was unsettled) (citing 

Washington v. Heckler, 756 F .2d 959, 961-62 (3rd Cir. ) 985); Corona v. Barnhart, 43) 

F.Supp.2d 506, 511-12 (E.D. Pa. 2006)). 

This is particularly true because under the term. "sale" that Spirit advocated for and the 

court ultimately adopted, the invoice could have served as a contract between Lane and Spirit. 

Under the U.C.C. a written confmnation can serve as a contract between merchants. "[C]ourts 

have quite consistently found that invoices sent contemporaneously with goods can qualify as 

written conflnnations under UCC § 2-207." Sudenga Indus., Inc. v. Fulton Pe~formance 

Products, Inc., 894 F.Supp. 1235, 1238 n. 3 (N.D.Iowa 1995) (collecting cases). Generally, 

when the il.woice is the first written document of the parties' agreement and contains the terms of 

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the agreement-i.e. the price, identity of the goods, etc. -the invoice can serve as a written 

confirmation of the merchants' agreement. Id..: Mtd~<;outh Packers, ln.c. v. Shon.ey's, Inc., 761 

F.2d 1 1 17 (5th Cir.l985); Altronics of Bethlehem, ln.c. v. Repco, Inc., 957 F.2d 1102, 1107 (3d 

Cir. 1992); Alarm Device Mfg. Co. v. Arnold Industries, Inc., 417 N.E.2d 1284, 1288 (Ohio 

App.l979) (explaining that an invoice setting forth the quantity and price tenus, even though not 

signed by the seller, was a written confirmation of the contract); Crown Foodservice Group, Inc. 

v. Hughes, 1999 WL 33117269 (S.D. Ohio 1999)(explaining that under the Ohio Code, invoices 

can serve as written confirmation of the parties agreement). The invoi.ce could have been an 

enforceable contra.ot between Lane and Spirit. Therefore, it was reasonable for the FAA to argue 

that the invoice was an unambiguous contract between two merchants, and because the i.nvolce 

clearly stated that Lane paid $7,439.16 for the purchase of the parts at issue, it was proof that a 

"sale" occurred even under the definition of sal.e the Applicant argued in support of. 

For these reasons, the Agency had a reasonable basis in fact to argue that a ''sale" 

occurred. The FAA Inspector observed that the parts were manufactured by Spirit and the 

Agency had a business document prepared by Spirit showing that Lane "purchased" the parts at 

issue. The Agency also had a reasonable basis in law. It was reasonable to argue that the 

transaction was outside the tenus of the contract and that the FAA did not retain title to the parts 

because the contract stated only that the FAA retained title to parts and materials purchased, and 

not to parts that were manufactured. Moreover, as explained above, the term "sale" could have 

encompassed the transaction between Spirit and Lane regardless of who retained title. In light of 

the invoice and the unsettled definition of "sale", reasonable people could have differed on the 

appropriateness of the contested action. Therefore, the Agency was substantially justified in 

pursing this matter. 

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B. Spirit Is Not Entitled To the Amount of Attorney's Fees Sought In Its Motion. 

Assuming, arguendo, that the FAA was not substantially justified in pursuing this matter, 

Spirit is not entitled to attorney's fees in the amount it seeks. Attomey's fees only may be 

granted for the prevailing party of an "adversary adjudication." The BAJA defines the term 

"adversary adjudication" as "an adjudication under [5 U.S.C.] section 554 ... in which the 

position of the United States is represented by counsel or otherwise._ .. " 5 U.S.C. § 

504(b)(l)(C). Section 554 of Title 5 applies only to adjudications "required by statute to be 

detennined on the record after opportunity for an agency hearing ... ,"' with four exceptions not 

pertinent to this case. 5 U.S.C. § 554. 'The FAA's regulations implemenl'ing the EAJA cover 

"adjudications under 5 U.S.C. § 554 in which the position of the FAA is represented by an 

attorney ... who enters an appearance and participates in the proceeding." 14 C.P.R.§ 14.02. 

The FAA's BAJA regulations provide furtber that regarding FAA civil penalty proceedings, 

"fees may be awarded only for work performed after the issuance of a complaint." 14 C.F.R. § 

14.05(e). 

Although a civil penalty action is initiated by the sending of a NO PCP by an agency 

attorney, an adversary adjudication, as tl1e term is used in the EAJA, does not begin with the 

issuance of a NPCP. In the NPCP and FNPCP, it states that based upon an investigation, it 

appears that a person has violated a statute and/or regulatiOJJS and it proposes to assess a civil 

penalty. An administrative law judge is not involved during these i.nfonn.al proceedings. The 

FAA is not required to .file either the NPCP or the FNPCP in the Hearing Docket See )4 C.F.R. 

§ l3.l6(f) and (g). ln contrast, when a complaint is filed in the Hearing Docket, a formal 

proceeding before an ALJ begins with the agency attorney representing the FAA's position that 

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violations have occurred and that a civil penalty is appropriate. The parties in an adversary 

adjudication seek resolution oftheir dispute by an adjudicative offi.cial, such as an ALT. 

PAGE 11/25 

In In the Matter of Wilson, FAA Order No. 1990-17 (April 9, 1990), the FAA 

Decisionmaker held that an applicant is not entitled to fees incurred in connection with a NPCP 

and informal conference with an agency attorney. In that case, the agency issued a NPCP and 

subsequently withdrew it after an informal conference. Wilson submitted the EATA application. 

The FAA rejected th.e application, holding that legal expenses incurred prior to the filing of the 

complaint are not incurred in connection with an adversary adjudication, and hence, were not 

reimbursabl.e under EAJA. 

Accordingly, Spirit cannot be awarded attorney's fees for the work performed prior to the 

time the FAA filed its complaint on May 12, 2014. For this reason, the request for attorney's 

fees should be reduced by $2,309.70. 

Spirit also requests an hourly rate of$275 an hour for the work perfour1ed by Jerry 

Eichenberger and $210 for the work performed by Patrick Moro. Title 5 U.S.C. § 504 states that 

"fees shall not be awarded in excess of $125 an hour unless the agency determines by regulation 

that au increase in the cost of living or a special factor, such as the limited availability of 

qualified attorneys or agents for the proceedings involved, justifies a higher fee'' This language 

"must be strictly construed in favor of the United States." Ardestani v. INS., 502 U.S. 129, J 37 

( 1991) (explaining that the "EAJA renders the United States liable for attorney's fees for which 

it would not otherwise be liable, and thus, amounts to a partial waiver of sovereign immunity"). 

The plain language ofthe statute caps attorney fees at $125 unless an agency determines 

by regulation that the cost of living or a "special factor" applies. The agency has not detennined 

by regulatlo11 that permitting EAJA applicants a higher hourly rate is justified. See Application 

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ofEmpire Airways, FAA Docket No. CP10EA0008, FDMS No. FAA-2010-0787, 2010 WL 

5066080 (D.O.T. 201 0) (explaining that the attorney's fee rate is capped at $125 because the 

agency has not determined that EAJ A applicants are not entitled to a higher reward and the 

applicant did not present any special factors warranting a higher rate). 

Nor has the Applicant made any argument that the "special factor" wan-ants a higher fee. 

By failing to address whether "special factors" apply in its initial motion, Spirit has waived any 

argument it has to the contrary" See United States v. Lopez-Medina, 461 F.3d 724, 743 n. 4 (6th 

Cir. 2006) (deeming an argument waived when it was not raised until a reply brief); Palmer v. 

Marion County, 327 F.3d 588, 597-98 (7th Cir. 2003) (explaining that arguments not raised in 

initial motion or response are waived). 

Even if the Applicant still had the opportunity to argue that a "special factor" warrants a 

higher fee, expertise in either administrative or aviation law does is not sufficient to show that a 

"special factor exists." The only "special factor" cited in the EAJA, section 504, warranting a 

fee enhancement is "the limited availability of qualified attorneys or agents for the proceedings 

involved.'" 5 U.S.C. § 504(a)(b)(l )(A). 1 The United States Supreme Court stated that this 

language: 

Must refer to attorneys qualified for the proceedings in some specialized sense, 

rather than just in their general legal competence. We think it refers to attorneys 

having some distinctive knowledge or specialized skill needful for the litigation in 

1 The United States Supreme Court has stated explicitly that 5 U.S.C. § 504 allows fees and expenses for 

administrative proceedings, while the EAJA provisions in 28 U"S.C. § 2412 govern only proceedings that come 

under the jurisdiction of the courts. Melkonyan v. Sullivan, 501 U.S. 89,94 (1991). Both provisions provide for a 

$125 fee cap. 5 U.S"C. § 504(a)(b)(I)(A); 28 U$"C § 2412(d)(2)(A)" However, only section 2412 has been 

interpreted to allow an enhanced fee based on the government's common law liability stated in section 2412(b). Sec 

Mendenhall v" NTSB, 213 F.3d 464.466-68 (9th Cir. 2000), after remand to NTSB Order No. EA-4612 at 2. By 

contrast, 5 U.S.C. § 504, applicable to administrative proceedings such as the present proceeding, has no analogous 

common law !lability provision. /d. Therefore, under section 504, fees awarded may exceed the $125 statutory cap 

only upon the finding of a "special factor"' as stated in section 504. 5 U.S.C. § 504(a)(b)(I)(A). 

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question-as opposed to an extraordinary level of the general lawyerly knowledge 

and ability useful in all litigation. 

Pierce, 487 U.S. at 572. Similarly, the difficulty or undesirability of the case, the work and 

PAGE 13/25 

ability of counsel, and the results obtained do not qualifY as "special factors" warranting fee 

enhancement under the statute. Jd. The courts of appeal have consistently applied the Court's 

decision in Pierce, finding that an. attorney cannot be awarded enhanced fees under the "special 

factor" exception based solely on expertise the attorney acquired through practice in a specific 

area of administrative Jaw. Select Milk Producers, Inc. v. Sec y of Agric., 400 F.3d 939,950-51 

(D.C. Cir. 2005) (attorney's previous experience in the dairy industry and knowledge of the 

"federal milk marketing regime," was insufficient to establish a specialized skill needful for the 

litigation in question); In reSealed Case 00-5116,254 F.3d 233,235-36 (D.C. Cir. 2001) (fee 

enhancement not justified where attorney had experience in federal election law, federal 

litigation, and was familiar with the administrative record); Estate (!(Cervin v. Comm 'r, 200 

F.3d 351, 354 (5th Cir. 2000) (attorney's expertise in tax. law, insurance law, and Texas property 

does not constitute a "special factor" justifYing fee enhancement under the EAJA); Raines v. 

Shalala, 44 F.3d 1355, 1361 (7th Cir. 1995) (fee enhancement not justified based on attorney's 

expertise in social security law). Even expertise in the particular field of administrative law, i.e. 

aviation, that is gained through experience is not sufficient to satisfy this "special factor." See In 

re Sealed Case 00-5116, 254 F .3d at 236 (explaining that expertise in election law was not a 

special factor). 

Because the agency has not determined that a higher fee is warranted by regulation and 

there is no evidence that the special factor applies, the cap of $125 an hour must be applied. 

Therefore, the fees must be reduced to $7,900 (63.2 hours x $125). 

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CONCLUSION 

The FAA was substantially justified to consider the invoice the Applicant created W3S an 

accurate business record recording the "purchase" ofthe parts at issue by Lane. This is 

particularly true because the document could have created liability for the Applicant. Moreover, 

the Agency was justified to argue that the contract between it and Spirit did not encompass parts 

that Spirit made because the contract stated that the FAA retained title only to parts and material 

"acquired", not fabricated. Even so, the exchange of goods between Lane and Spirit would have 

been a "sale" under some definitions. Moreover, there was no evidence that FAA funds were 

used in the purchase of the lanyards and brackets and that the FAA could have had title to the 

parts at issue until after the hearing on the motion for summary judgment. Therefore, the FAA 

was substantially justified in the pursuit ofthis matter at all times and the Applicant's claim 

should be denied in its entirety. Alternatively, the amount should be reduced because the 

Applicant is not entitled to fees for the work its attorneys performed pdor to the Complaint and 

because the rate charged exceeds the statutory cap. 

Respectfully submitted on this the 2nd day of November, 2015 

L~enHOyson 

Federal Aviation Administration 

Enforcement Division, Midwest Team 

2300 East Devon Avenue, Room 479 

Do;s Plaines, Illinois 60018-4696 

Phone: (847) 294-7165 

FAX: (847) 294-7498 

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Certificate of Service 

I hereby certify that the foregoing Administrator's Response to EAJA Application has been sent 

via facsi.mi.le and First Class Mail this day, to the following: 

P AA Heating Docket 

800 Independence Ave., SW 

Washington D.C. 20591 

Attn: Hearing Docket Clerk 

AGC-430, WHber Wright Building 

Suite 2W1000 

Pax: 202-267-1293 

The Honorable J.E. Sullivan 

U.S. Administrative Law Judge 

Offi.ce of Hearings, M-20 

U.S. Department of Transportation 

1200New Jersey Ave, S.E. (Ell-310) 

Washington, D.C. 20590 

Fax: 202-366-7536 

Jerry A. Eichenberger 

Patrick Moro 

Eichenberger & Associates 

6037 Frantz Road, Suite 107 

Dublin, OH 43017 

Fax: 614-798-1620 

Dated this 2"d day ofNovember, 2015. 

Legal Technician 

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11/02/2015 13:58 8472947498 

EXHIBIT A 

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11/02/2015 13:58 8472947498 FAA GLRC PAGE 17/25 

,,,...,., .. 

DTPAAC-10-P-00039 

~d 0003, 21 Sept~ 2010 

Page 3 of 35 

Reoort a11d Drawings 

CockDlt Curtain De!!lgn AOOB 

PllotfCo..PIIot Coollna Fan Design A009 

Cocko!t Downwash Master SWitch Desian & Data A009a 

Cabin Headliner Deskin A010 

Headliner Desian and Data A010a 

Cabin Lower Side Panel Oeslan A011 

I Cabin Uooer Sidewall Panel Des)gO A012 

Cabin Seatlno Da!!jgn and Data A013 

LED Uatrt!nc Oeslan and Data A014 

E LED Llahtlno Desfan and Data A014a 

; Oxvcen Mask Dlscenslna Unlls Design and Dam A015 

Total CUN Price $431.830.74 

Accep!anOI\!: CertifiCation Documentation by the Approver 

Payment upon delivery and aCCeptance 

Delivery of Services: Annually 

Acr:eptance: Evidenced by approved data package 

Cl.IN 0003 • Laber to compk!te resf:om, refurbish or replace 

assemblies, accessories. and miscetlaneous equipment In 

the alrcrnft interior as described in the PWS Jlara. 8.0. The 

CO or designated CO representative shall provlda authorization 

to proceed In advance by task order. Billing and payment 

shall comply with authorized task order at the established 

Flxcld Hourly Rate. 

FIXEDHOURLYRATE 

FAA Estimated Hours per aircraft"' 11 o hrs 

Estimated Aircraft "' 3 (prototype and two Be-300 aircraft) 

Proposed Fixed Hourly Rate $34.00 per hour 

Estimated Not-To-Exceed= $27,720.00 

CUN 0004 • Materials Acquired bY the Contractor for the 

Government- all nr.rtertals and' equipment acquired with 

government fundjng are property of the FAA and shall be 

maintained lAW G~mment Furnished Property (GFP} 

provisions of the contract. 

COST REIMBURSABLE 

A. Replacement perts or materials $6,000.00 

supporting the refurbishment . FAA Estimate 

of the Be-300 Aircraft inlerior enhancement 

' 

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11/02/2015 13:58 8472947498 FAA GLRC 

~~C-1D-D•OGC35 

Mad QODl., 4. l'wgll>lt ;!Ol.O 

Page 3l. of 35 

Gl.5 WARRANTY~ COMMERCIAL PRODUCTS AND SERVICES [JUN 2006) Cl.A.4529 

The conl!'llclor's standard commercial warranty shaft ba deeme<l to be a part of this contrec:t unless 

otherwise S)lar:llll!d. If lha contractor does not Have a smndard wanao1)', !he warrant¥ provisions of UCC 

Article 2 shan apply. 

G.6 INVOICING PROCE.OURES -GENERAL !JAN 20021 CLA.013581 

PAGE 18/25 

Cal In addition !<> tfle reaulmJ!!ents sat forth lit AMS Clause 3.3.1-17. Prompt Payment, for tM 

submlsslpn of s 1U91Jer invoiC!, tllB contractor sltan supmlt far 111 earth mont!t of parfyrmance of 

seOII~s, oodlat (2) tltose Items of J>lll!pl!t!s furnished. andfot (3) ~ ex.per!.S@t 

1:9SetJ.S:::J:t:afd11ioo~~g;@iO!Joo§efl: =~b: b~M':Ja:: the type of cpntract (onlfP'); 

m Lew! 1: Sl:lm;'ans~tatZas rolrows: 

tn Ptoreci tl a an<! _as on 

em current amagnt Invoiced 

(21 l.!:M!!2: Patallssupgortlnq the ll)furmatjon shown on Level1 as fo!lows: 

ffi 4!bpr ~ by hOU!l3, rates, !!!l!j amountl!. · 

(II} Travel reaJ(dOW!J of aQ actual trayel and p!!r f!l<i!ln gxpanses by trip and 

employee name ancl erolect Of multlgle}. 

(ill} Over and AbDYI! Materj'als spll~ot by proJect, tvoe antlfor ltal'l1§ 

purchge!L 

{31 lev~ 3; Sack up documerdaliO!! gsfo!IOI(iS: 

m Racelets ltQ!voJ. aauipmant pun;hases, ett:.l 

(c) Th!!follov(ing add!t!onal data must !Ja spitted with tfle fklaliUYolge raqarr!fe§s of 

contract type; 

MJ CO!JtriJctw's assfsnment pf l"l!fUnd. rebat:re. and credits. 

(2} COI!frncto!'S mlaase, 

{d) All con!rad;pm lnXt!leiM saMQ!'!s to !he FAA !n labor hoyrs ;iihaU maintain an file. and 

subJ.gft when ffl!!(!!lred fpT Y£lli6c!!!lon or audit, certfijad tlme !gqs. the dallY total af P!'!¥1!!~ 

hgqrs cbarged to the contrao;;t, a daHy entry for i!!IV non-prcduct!ve work:IJouf!l and gmm!a · ve 

totals fOr each pav petjg!f. · 

m P;mnent Addl'l!SS; 

FAA. Financial Operations DIYls!on (AMZ-
11/02/2015 13:58 8472947498 FAA GLRC 

(al Thl;! lllllldor shall send caplea of the ln'lpJ£e as fp!!qws: 

One copy to: 

or via &mail to the Contrl!ct!M Officer 

Ona~pyto; 

ur XI!! email to the Program Man"!9er 

DTPAhe-10-D-00039 

MDd. c DIIJ., • .ll».ggmt 21110 

11"!!e 2'2 of liS 

3.1•1 Clau~s and Provislcps lncorpnra~ed by reference (December 2005) 

This SCI1lenlog infonnatlon request (SIR) or ccntratlt, as appHcable, lncorpomlel'! by roferenm itte 

provisions or clausss fisted below \Mih;the same force and effect as if they were given In fUll text. Upon 

request, the Contract!ng Ofllll>!r wm make !lla full text ava!IBbte, or offefD!'!l and con1ractors may obtain 

!he run text via lnlernat at: 

htfp:l/conWJite.faa.go'( (on this Wlib psge, select "Sea!th and Vlew Clauses•). 

3.10.1-22 CONTRACTING OFFICER'S TECHNICAL Re!"RISSJ::NTA.TlVI: (JANUARY 20!J8} , 

PAGE 19/25 
11/02/2015 13:58 8472947498 FAA GLRC 

EXHIBIT B .3) I.OP 

'11:. .. Spirit ~lcs Ltd. 

' ~008 E.lil!l:~l'"'" · I .a! eol""'~l~Ra2.19 .... ' . •. . l/1'• Phdl1~.Nl' AQ11 Fox:S14.237.63S7 

Flll:31Ail9!5&a 

www.gpi.rin~:vion.ies.£;m:o 

lane Aviation Corp 

Atten: Ace!& Pa)'l!ble 

4389 lrrtamatlcnal Gateway 

Columbus, OH 43219 

WORII ORDER # 

1102? 

OESCFtiPTION 

TERMS 

NO! 30 

PAGE 20/25 

Invoice 

DATE INVOICE# 

Z/:241201 1 515M9 

CUSTOMER P.O. # AIRCRAfT N II 

Q1Y RA'I'E AMOUNT 

Llme A..,;allcn pOfllon cf·~u- onrt _.mbly ofhoadllnor ln!llalll<lts. !iils s..,pli<l<l ~ bo "'""lor !lto 3!t! 1 

FAA ail<:ro!t lhtoUilh th• 181~ -·It . -· .. ,. ... 7,4~>191 7,41<>91T 

""- 7.4"1&:91 

CMH: r:"e 0,30% 22:25 

~; ·' '•' 

.. •·1111 ·' 

.' 

', 

,:· 

... , 

.. J 

' ' 

I 

J!\~' \ 

Subtotal $7,439.16. 

Sales Tax {0.00) $0,00 M~ka all c.m~~ paylilbte to: 

Spitlt Av«:mi~ t.rcr. Total $7.439.16 

P'af Due .lnw1ca~J are-st~b,r.mta a 1.SO.% tale rea plar 

rnmtlh. Paym9nts/Credlts $0.00 

B~lance Due $1,~~9;16 
11/02/2015 13:58 FAA GLRC PAGE 21/25 

EXHIBIT 

In the Matter Of: 

U.S. DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D.C. 

DOCKET NO. FAA-2014-0119 

SPIRIT AVIONICS, LTD., 

) 

) 

) 

) 

CASE NO. 2012-GL-07-0056 

Respondent . 

. For an award of attorney fees and oth.er 

Expenses pursuant to the Equal Access to Justice Act 

AFFIDAVIT OF FEDERAL AVIATION ADMINISTRATION 

ATTORNEY KATE BARBER 

I, Kate Barber, hereby declare the following under the pains of penalties of perjury: 

1. I am currently an Attorney for the Federal Aviation Administration (FAA), Midwest 

Enforcement Team located at 2300 E. Devon Ave., Des Plaines, IL 60018. 

2. I have been employed as an attorney for the FAA since 2008. 

3. I have been an attorney in good standing since I have licensed to practice law in 2003-

4. I am familiar with the facts alleged in the above-captioned matter. 

5. After an extensive review of the EIR it was determined that sufficient, credible 

infono.ation. existed to proceed with legal action for the above matter. 

6. On FebJ:UatY 21, 2013, the FAA issued a Notice of Proposed Civil Penalty. 

7. After extensive discussion between the parties an agreement was not reached in the case 

and on May 8, 2014 the FAA filed a Complaint. 

8, Spirit argued that a "sale" had not occurred throughout the discussions. The Agency 

requested documentation or other evidence to show that the transaction between Spirit 

and Lan.e was something other than a purchase as indicated on the invoice but Spirit 

failed to provide any documents that detailed a credible explanation for the purchase 

orders and paid invoices indicating the sale of the parts. 

9. The first time that Spirit argued that the FAA money was used to purchase the parts in 

question. was during the oral argument that occurred on August 11,2015. At this time 

1 
11/02/2015 13:58 8472947498 FAA GLRC 

there was no evidence o:f record to show that FAA money was used to purchase these 

parts. 

PAGE 22/25 

THIS AFFIDAVIT IS SIGNED UNDER THE PAINS AND PENALTY OR PERJURY 

~ Kate Barber 

Attorney 

2 
11/02/2015 13:58 8472947498 FAA GLRC 

EXHIBITD 

.480S E. 5ft'. A1.1e. Columb\..!9., Ohio 43219 

614-237-4271 phoM 61H37·63671ax 

W'i'fW.sp\ritavlcriiC!!".l;.:!OITI 

Ffv.\ Co!rtlfled "~pair Statttm: UOKR2SOX 

Attn: Brenda Hagar 

COTR. FAAJ AVN 

Offic--e: 405-954-4514 

Fax: 40~·954-3983 

March 7, 2011 

g r ~·::·::,·.~~!- i~ .... !~ .. : .. ~C_t9_;:~ . .\J.biJ.?~~LJ~Ii-:~ ';{ 

Re: King Air 300 Avionics Upgraries: 

Ms, Hagar, 

The following proposal contains the time required to change the engi!1<>ering 

document 105014-33201·3, N75"s existil'lg bracket that this mol•nt replaces is 

quite different and requires significant changes to this drawing. Changes to this 

dr~wing will include rivet placemem, length of brackets and attachment 

hal"dware, Nates will be added lo this drawing lo hopefully cover eny additional 

changes that we may find on subsequent aircraft 

Engineering Change: 

1.) Engineering labor to change !0501 4-3:3201-3, 

labor: 4 haLJrs @ $84/ hour 

Total: 

Spitit-11-INT ·017 

$336,00 

$336.00 

1 ot 2 

PAGE 23/25 
11/02/2015 13:58 8472947498 FAA GLRC 

SPIRIT AVIONICS LTD. 

TERMS A!jD CONDIT!Qil.li 

Reierence FAA cMtrecl DTFAAC .. 1 0-0.{}0039 deled 04/07/W for curr»nt terrns ~nd cond•1ions .. 

AGREED TO AND At;CEP,T£1): 

SPIRIT AVIO~CS .. ~rp/·>< · ' 

ey: . ,~:.'~ ··/.> :'._,::. () ... '( / ,·· 

Justii'i· Hahn 1/ 

By -~-··---------

Program Manager Title: 

Pate: 03107111 Date: 

Spirit-11-INT-017 2 of 2 

PAGE 24/25 
11/02/2015 13:58 8472947498 

'~j~·' Spirit Avionics Ltd. lJfiitt 4MB E. 51h Av.ouo 

:' ·r~l!!:'.~(-~ i':. ~:: .• , G(!fumbus.j O:H 43tt9 .... -· "'' '"" - Ph:B14.237.<;m F"":~u.2r,.G3ll1 

FIN; 31-1!9956S 

\>"'\'\" ,~<op.iri l<t' i!Joi«:~.com 

f"AA AAO ACCTG OFC 

OOT/ F.AA AMZ-110 

PO Box25710 

Okll'lhoma City, OK 7S125 

WORK ORDER # I 

f'[(]Gt ', 

~-----

DgSCRIPTiON 

E!'lgkteerlog labor to r.!'a.rtg.e tDOOU-3.~1-3 

Sr!h(ol"' 

C::~nt~·uct #-. ClTfACC- l0..0·~003S 

D. O.uJ~f.; 0003 

Rt:I'I!!n:!l'l~ l.~f\!r S)>l:1l·1·l·l:llf·r117 

FAA GLRC 

Invoice 

DATE INVOICE# 

3/15!201 1 5154B2 

ToRMS CUSTOMER. P.O.# AIRCRAFT N If 

··-- Nol30 N76 

QTY RATE Al.IOUNT 

• a~.{IO ~J:J"!J.t.IOr 

JlJr:J.OQ 

G,.._ ... __ , "·' 1''''':: [Q) •c .?/fJr./JL.J 

tr1W ?J't$ f'"--

' 

Subtolal $JJ6.0D 

Ms\a aU-el'lllt;IJ;J; pl'ly:rt'lkt u·; Safes Tax (O.OD) $0.00 

Splrfl AvkJnlc...o; ~OCt 

Total ~336.00 

P?l'.:rf 01.-e tnve.i..-C$\1r~ '!l\.ll.Jjl((l( tv <J: i .00% Jttle leE!' per 

Paymonts/Cred;ts 1nt:11\h. $000 

Balance Due $336,00 

PAGE 25/25 

1209ACV406.00.WB3030.AC8JAC0000.25105.01/03/2011.12182A0090 .2E04AO 

6L;J,/ ~(18~ f 3U.~ 
11/02/2015 13:58 8472947498 FAA GLRC 

Company. --------------------~---

~F< Pages w/cover: · (A·'J 

RE: 

PAGE 01/25 

Federal Aviation 

Administration 

Region~l Counsel's Qflice,AGL-7 

2300 Eost Devon Avemue 

Des Pl<11nes, Illinois 60018 

·r 847·294- I?J/?J 

F 847-294-7498 

Facsimile 

a7J.