' . 

In The Matter Of: 

SERVED: August 27, 2015 

U.S. DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D.C. 

Docket No. F AA-20 14-0119 

SPIRIT AVIONICS, LTD. 

) 

) 

) 

) 

) 

Case No. 2012-GL-07-0056 

Respondent 

ORDER GRANTING THE RESPONDENT'S MOTION 

FOR SUMMARY JUDGMENT, CANCELLING THE HEARING, 

AND DISMISSING THE PROCEEDING 

On June 1, 2015, the Respondent, Spirit Avionics, Ltd., filed a Motion for Decision 

("Motion"). 

\ .. ,1. 

On July 1, 2015 the FAA filed a combined Response to Respondent's Motion for 

Decision ("Response") and Complainant's Motion for Decision in Favor of the Complainant 

("FAA Motion for Decision"). Six days later, on July 7, 2015, the FAA filed a Response to 

Respondent's Motion to Strike,1 in which it also requested leave to file a late Response to the 

Respondent's Motion. 

On July 13, 2015, the Respondent filed a Motion to Strike Complainant's Response to 

Respondent's Motion for Decision and Complainant's Motion for Decision. That same day, on 

July 13, 2015, the Respondent filed a Motion for Extension of Time to Respond to 

Complainant's Motion Pending the Decision of Respondent's Motion to Strike Filed on 7-1-2015 

[sic] ("Motion for Extension"}. 2 

1 As noted in the July 31, 2015 Order, the FAA filed its Response to the Motion to Strike with the Court six ( 6) days 

before the Respondent's Motion to Strike was filed. (7/31/15 Qrder, 2.) 

2 In its July 13,2015 Motion to Strike, the Respondent requested an extension oftime to file a Reply, since if its 

Motion to Strike the FAA's late Response was granted, no Reply would be necessary. (Mot. Extension, 1.) 
On July 31, 2015 an Order Granting the FAA's Motion to File a Late Response and 

Granting the Respondent's Motions for Extension and to Strike FAA Motion for Decision was 

filed. 

On August 6, 2015 the Respondent filed a Respondent's Reply to Complainant's 

Response filed July 1, 2015 ("Reply"). 

On August 11, 2015 the parties ~ppear~~ ~Y: telephone for a Motion Conference, and p ,·; • ; ! ' 

presented oral argument on the Respondent's Motion. On August 12, 2015 an Order Setting 

Deadlines for Submission of Supplemental Material was filed, which codified oral rulings made 

by the Court during the August 11, 2015 Motion Conference. 

On August 12, 2015 the FAA filed the following: 1) Exhibit A to the FAA's July 1, 2015 

Response; 2) a Notice of Co-Counsel Appearance; and 3) an Amended Complaint. 

On August 14, 2015 the Respondent filed an Answer of Respondent [to the Amended 

Complaint], and a Supplemental Declaration of Eric C. Ochs. 

A. Notice of Violation and Proposed Penalty Assessment 

On or about May 8, 2014, the Federal Aviation Administration ("FAA") Regional 

Counsel for the Great Lakes Region filed a Complaint with the U.S. Department of 

Transportation Office of Hearings, in w1tich th~ F~ generally alleged3 that on or about 

February 24, 2011, the Respondent, Spirit Avionics, Ltd., had committed a minimum often (10) 

violations4 of 14 C.F.R. § 21.9(b), when it sold 22 fabricated brackets and 22 fabricated lanyards 

to Lane Aviation, a sub-contractor of the Respondent, and represented in the sale of such articles 

that they were suitable for installation on type certificated, FAA aircraft. (Compl. 2.) The FAA 

proposed a total penalty of $11,000 for the violations. 

3 There was a general allegation because the May 8, 2014 Complaint did not specify the exact number of violations. 

4 In the Complaint, the FAA asserted that the maximum penalty for one (1) violation of 14 C.F.R. § 21.9(b) was 

$1,100. It then requested a total civil penalty of$11,000. Based on the pleading, the FAA generally alleged the 

Respondent had committed a minimum often (10) violations (i.e., $11,000/$1,100 = 10). (Compl. 2.) 

Page 2 of 16 
However, during the August 11 ~~ 20 1S Motio~ Conference, the FAA clarified its pleading, 

and stated that that it was charging a total of one (1) violation of 14 C.P.R. § 21.9(b) in its 

Complaint.5 (8/11115 Tr. 11:10-11.) One day later, on August 12,2015, the FAA filed an 

Amended Complaint, in which it asserted that the maximum penalty for one (1) violation of 14 

C.F.R. § 21.9(b) was $11,000, and proposed that the Respondent be assessed a total civil penalty 

of$11,000 for the one (1) violation.6 

B. Summary Judgment Request 

The Respondent's June 1, 2015 Motion seeks a decision on the merits regarding the one 

(1) alleged violation of the Federal Aviation Regulations ("FARs"). The Respondent asserts that 

it did not violate 14 C.F.R. § 21.9(b), because it never sold parts to its sub-contractor, Lane 

Aviation. 

C. Brief Review of Summary Judgm~~t~~~~n~ard , ' .'\,.: I 

Pursuant to 14 C.F.R. § 13.218, a party may file motions, including a motion for a 

decision on the merits, in advance of a hearing when a party asserts that there is no disputed 

material issues of fact to be heard. Pursuant to 14 C.F.R. § 13.218(±)(5), any motion for a 

decision on the merits prior to a testimonial hearing is reviewed under the same standard as a 

summary judgment motion under Rule 56 of the Federal Rules of Civil Procedure. Horizon Air 

Industries, Inc., FAA Order No. 96-24, n.3 (Aug. 13, 1996). 

The purpose of summary judgment is "to isolate, and then terminate, claims and defenses 

that are factually unsupported." Steven Baicker-McKee, et al., Federal Civil Rules Handbook, 

1122 (West Publishing 2012). 

Pursuant to Rule 56( a), a summary judgment motion may be granted if "the movant 

shows that there is no genuine dispute as to any material fact and the movant is entitled to . l \' .. }.)If; ' \ i ' ' 't ,\ 

5 As noted in the August 11, 2015 record, the Respondent objected to any amendment to the Complaint. This 

objection was reserved, and the Respondent was provided a deadline of August 18,2015 to specify its objections, 

pursuant to 14 C.F.R. § 13.214 (c). 

6 The Respondent did not did not file any written objection, on or before August 18, 2015, to the Amended 

Complaint. 

Page 3 of 16 
judgment as a matter oflaw." See Anderson v. Liberty Lobby Inc., 477 U.S. 242,247-48 (1986); 

Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Circuit 2006). 

On a summary judgment motion, the court does not rule on witness credibility or the 

weight of the evidence. See, Steven Baicker-McKee, et al., supra, at 1125. Instead, the court 

reviews the submitted record to determine ifthere i~ a genuine dispute regarding material facts. ~' \, 

~ ' ;,, . . .... A fact is "material" if it is capable of affecting~ the substantial outcome of the litigation. 

Holcomb, 433 F.3d at 895; Liberty Lobby, Inc., 477 U.S. at 248. A dispute is "genuine" if the 

evidence is such that a reasonable trier of fact could return a verdict for the non-moving party. 

See, Scott v. Harris, 550 US 372, 380 (2007); Liberty Lobby Inc., 477 US at 248; Holcomb, 433 I 

F.3d at 895. 

It is well established that on a motion for summary judgment, all evidence and inferences 

are to be viewed in light most favorable to non-moving party. However, a non-moving party 

(e.g., the FAA herein answering the Respondent's Motion) may not rest upon mere denials or 

allegations in the pleadings. Pursuant to Rule 56( c), (d), and (e), a non-moving party who wishes 

to proceed to trial must respond to the motion for summary judgment, and set forth specific facts 

sufficient to show there is a genuine issue for trial. Celotex Corp. v. Catrett, 477 US 317, 324 

(1986). See also, Citizens State Bank of Big Lake v. Transamerica Ins. Co., 815 F.Supp. 309 (D. 

Minn. 1993); Baicker-McKee, et al., su~ra, at):~~3:::.34 (a non-moving party may produce 

materials, and/or cite to materials produced or ~ot p;oduced by the movant in resisting the 

summary judgment motion). 

To raise a genuine dispute, the "caliber" and "quantity" of the evidence presented must 

"allow a rational finder of fact," to return a verdict for the nonmoving party. Liberty Lobby, Inc., 

477 U.S. at 254. A "genuine" dispute is not created by a "mere scintilla" of favorable evidence, 

or evidence that is "merely colorable ... or is not significantly probative." !d. at 249-50, 252 

(citations omitted). Therefore, while the Court may not "weigh the evidence and determine the 

truth of the matter," its "inquiry ... unavoidably asks whether reasonable jurors could find by a 

preponderance of the evidence that the plaintiff is entitled to a verdict." Liberty Lobby, Inc., 477 

U.S. at 249, 252. 

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Page 4 of 16 
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D. Admissibility of Respondent's Summary Judgment Factual Proof 

Pursuant to Rule 56( c )(1 )(A), specific facts alleged by either party may be asserted by 

submitting evidence, and/or citing to a variety of admitted pleadings or other documents in the 

record. Materials submitted during summary judgment proceedings must be capable of being 

offered at trial in an admissible form. See, Baicker-McKee, et al., supra, at 1135. 

As part of its June 1, 2015 Motion, the Respondent submitted six ( 6) Exhibits, identified 

as Respondent Exhibits A-F. The FAA did not file any objection to the admissibility of any of 

the Respondent's summary judgment Exhibits. After review, all six (6) Respondent Exhibits are 

deemed admissible for summary judgment consideration as follows: 

• Respondent Exhibit C, the Declaration of Eric C. Ochs, is admissible as testimonial ;.· 

evidence. 

• Respondent Exhibits A, D and E are admissible as documentary evidence. 

• Respondent Exhibits B and F are admissible as courtesy copies of public records. 

In addition, on August 12, 2015 (i.e., one day after the August 11, 2015 oral argument), 

the Respondent filed a Supplemental Declaration ofEric C. Ochs. Pursuant to Rule 56(e)(1), this 

Supplemental Declaration is hereby marked as Respondent Exhibit C-1, and deemed admissible 

as testimonial evidence for consideration. 

E. Admissibility of FAA's Summary Judgment Factual Proof 

As part of its July 1, 2015 Response, the FAA referenced one (1) Exhibit, identified as 

FAA Exhibit A. (Resp. 3.) However, FAA Exhibit A was not attached to the FAA's Response, 

and as of the date of the August 11, 2015 oral argument, had not been received or reviewed by . d. 

either the Court or the Respondent. i .. 

During the August 11, 2015 Motion Conference, the FAA was given a deadline of 

August 14, 2015, to file missing Exhibit A. The Respondent's oral objection to Exhibit A was 

reserved. 

On August 12, 2015 (Le., one day after the August 11, 2015 oral argument), the FAA 

filed the FAA's missing Exhibit A. Pursuant to Rule 56(e)(4), the Respondent's objection to the 

Page 5 of16 
FAA's Exhibit A is overruled, and FAA Exhibit A is deemed admissible as a courtesy copy of a 

partial webpage providing a dictionary definition of "sale." 

F. Applicable Regulation 

As noted earlier herein, the Responde:qt is alleged to have committed one (1) violation of 

14 C.F.R. § 21.9(b), which provides as follows: 

(b) Except as provided in paragraphs (a)(1) through (a)(2) of this section, 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. . 

14 C.F.R. § 21.9(b) (emphasis added). 

In addition, pursuant to 14 C.F.R. § 21.9(a)(l) and (a)(2), a person7 may not produce an 

article "reasonably likely" to be installed on a type-certificated product, unless that person has 

produced it under a type certificate or under an FAA production approval. 

G. Definition of the Words "Sale" and "Bailment" 

The parties agreed that the F ARs did not provide a definition for the word "sale'' 

contained in 14 C.F.R. § 21.9(b). It was undisputed that the word "sale" should be given its 

"ordinary, contemporary, common mefi:r;tg.:' JResJ?ri:?' citing Perrin v. United States, 444 U.S. 

37, 42 (1979)). As a result, both parties submitted common definitions of the word, utilizing 

various sources. (Motion, 5-6; Resp. 2-3.) 

When comparing the 1979 and 2009 editions of Black's Law Dictionary, it is clear that 

the definitions for types of sales have changed and grown over the last thirty (30) years. 

However, the core definition of a "sale" has consistently required the transfer of property or title 

for a price. 

Sale ... A contract between two parties, called, respectively, the "seller" (or 

vendor) and the "buyer" (or purchaser), by which the former, in consideration of 

the payment or promise of payment of a certain price in money, transfers to the 

latter the title and the possession of property. 

Black's Law Dictionary 1200(5th ed.1979). 

i>h 7 14 C.F.R. § 1.1 defines the word "person" to {nch.lde it"fi.nii[1

partnership, corporation, [or] company." 

Page 6 of16 
Sale, n. (bef.12c) 1. The transfer of property or title for a price. See UCC §2-106(1). 

Black's Law Dictionary 9th ed. (2009). 

Section 2-106(1) of the 2015 Uniform Commercial Code ("UCC") defines a "sale" as 

requiring the passing oftitle from the seller to the buyer for a price. UCC §2-106(1). In short, 

for a "sale" to occur, "absolute ownership over the subject of the transaction" must "be passed." 

67 Am.Jur.2d §16 (2015). A "sale" requires that the parties, acting as "seller" and "buyer," have 

a meeting of the minds and pass title from one to the other. (/d.). See also, UCC § 2-401(1)(a 

sale occurs when ''title to goods passes from the seller to the buyer in any manner and on any 

conditions explicitly agreed on by the parties"); 77 C.J.S. §382 (2015)(the UCC defines a sale as 

when title to goods generally passes from the seller to the buyer in any manner explicitly agreed . ·e·· 

to by the parties); 67 Am.Jur.2d §16 (2015)(Vfider·futicle 2 of the UCC, a "sale" consists of the 

passing oftitle from the seller to the buyer for a price.) 

Because of certain arguments made by the parties herein, it is important to clearly 

distinguish a "sale". from a "bailment", which is defined as follows: 

bailment (16c) 1. A delivery of personal property by one person (the bailor) to another 

(the bailee) who holds the property for a certain purpose, usu. under an express or 

implied-in-fact contract. Unlike a sale or gift of personal property, a bailment involves a 

change in possession but not in title .... "Although a bailment is ordinarily created by the 

agreement of the parties, resulting in a consensual delivery and acceptance of the 

property, such a relationship may also result from the actions and conduct of the parties 

in dealing with the property in question ... " 8A Am.Jur.2d Bailment § 1 (1997). 

Black's Law Dictionary 9th ed. (2009). 

H. Undisputed Facts I;• . :··;, . . ~~ Y:.~, ., trit(· l. ,,\ 

In its August 14, 2015 Answer to the Amended Complaint, the Respondent admitted to 

multiple factual allegations. In addition, as noted earlier herein, the Respondent submitted the 

testimonial statements of Mr. Eric C. Ochs, the CEO of Spirit Avionics, Ltd. (Mot. Exh. C and 

C-1), two February 24, 2011 Invoices (Mot. Exhs. D and E), and the main portions ofan August 

2010 Contract in which the Respondent had contracted with the FAA to perform interior work on 

Page 7 of 16 
certain FAA aircraft (Mot. Exh. A).8 Most ofthe Respondent's factual evidence was undisputed 

for purposes of the Motion, since the FAA did not submit any responsive facts to challenge or 

refute such evidence. 

For example, it was undisputedfthat th~'Rds~ondent was a holder of Repair Station 

Certificate UOKR250X. (Resp. 1.) On or about August 2010, the Respondent and the FAA 

entered into a renewable contract ("Contract"),9 where the Respondent, as the prime contractor, 

agreed to perform maintenance work on the interiors of eighteen (18) of the FAA's fleet of 

Beechcraft King Air 300 aircraft. (Motion, 1; Mot. Exhs. A 20 ~ G.3 and C; Resp. 1.) The 

Contract negotiations had been lengthy, and had involved multiple revisions. 10 (Reply, 2.) The 

Respondent's interior work on each aircraft's cabin included mounting interior panels to the 

airframe utilizing hardware kits. (Reply, 2, fn. 1.) The Contract specifically envisioned that the 

Respondent might work with subcontractors to complete the terms of the work. (Mot. Exh. A 14 

~ C.3(f).) 

Pursuant to the Contract, all materials acquired by the Respondent with government 

funding were the property ofthe FAA. (E.g., Mot. Exh. A at 3, 6, 8, and 10.) The FAA held title 

to such property, which was defined astContra9tor~A.cquired-Government Furnished Property." i '· . "·~· ~~· . 

(!d. at 14 ~ C.3 (h).) However, if the Respondent or its subcontractors obtained materials, parts, 

or supplies that were not "furnished, installed, or consumed" in the performance of the Contract, 

such items were not Government-furnished property. (Mot. Exh. A, 16 ~ C.5.) Any such acquired 

items, not used as specified by the Contract, needed to be "kept separate" from any Governmentfurnished property, would not be paid for by the FAA,· and would remain "the property" of the 

acquiring contractor. (ld.) 

8 Part Ill, Section J of the Contract identified four (4) Attachments to the Contract, none of which were included in 

the Respondent's Summary Judgment materials. The FAA did not object to the Contract as submitted. 

9 The term ofthe contract was for one (1) year option periods, subject to renewal for up to a total of five (5) years. 

(Resp. Exh. A, 2.) The first, or Base year, ran from April 7, 2010 -Apri16, 2011 (Jd.) 

10 As evidence of such revisions, multiple pages ofthe Contract contained different dates, such as December 2005 

(Mot. Exh. A, 32); April 2008 (Mot. Exh. A, 31 ); August 4, 2910 (Mot. Exh. A, 26); September 1, 2010 (Mot. Exh. 

A, 14); and September 21,2010 (Mot. Exh. A, 2). While\\:le~ny··the Contract had been modified both before and 

after August 2010, there was no dispute that Respondent's Exhibit A was an accurate copy ofthe Contract in use at 

the time of the alleged February 24, 2011 violations. 

Page 8 of 16 
In addition, the Contract specified that, in the absence of specified notice, the FAA was 

not obligated to reimburse the Respondent for any costs in excess of the total amount allotted by 

the FAA in the Contract. (/d. at 28 ,-rAMS 3.3.1 (h).) The estimated reimbursable costs, for both 

replacement parts and contractor acquired materials needed to refurbish the aircraft interiors, was 

not to exceed a total of$1,415,325.62. (/d. at 3-4 ,-r CLIN 0004.) 

At the time of the alleged violations, on or about February 24, 2011, the FAA and the 

Respondent were exercising the terms of the Contract during the first Base Year (i.e., April 7, 

2010-April6, 2011). (Mot. Exh. A, 1.) Both the Respondent and any subcontractors it hired 

were deemed "contractors" under the ~ontract, andU.Were bound by its terms. (/d. at 14 ,-r C.3(f).) :?. l,.,;\ \ , ;:., .• rl- \ 

As the prime contractor, the Respondent was respon~ible for ensuring that any subcontractors 

complied with the Contract provisions. (/d.) The Contract specifically identified Lane Aviation 

and its' plant in Columbus, Ohio, as the designated location where the FAA could inspect 

Contract materials. (Mot. Exh. A, 17 ,-r E.1(a).) The Respondent sub-contracted portions of the 

Contract work to Lane Aviation. 11 (August 14, 2015 Ans., 1 ,-r 4; Mot. Exhs. C and C-1.) 

It was undisputed that the primary terms of the Contract were adopted on or about August 

2010. Approximately six (6) months later, on February 24, 2011, the Respondent issued Invoice 

No. 515449 to Lane Aviation Corporation, for "Work Order# 11027" in the amount of 

$7,439.16 for a quantity of"l". (Mot. Exh. D.) This charge was identified on the Invoice as 

"Lane Aviation portion of purchase and assembly of headliner install kits. Kits ~upplied to be 

used for the 3rd FAA aircraft through the 18th aircraft." (/d.) That same day, on February 24, 

2011, the Respondent also issued Invoice No. 5154?0 to Tritex Corporation, for the same "Work ; ' " - J"'\# 

Order # 11 027" in the same amount of ~'$7 ,43'9'.11·6"1''for the same quantity of" 1 ". (Mot. Exh. E.) 

The charge addressed to Tritex Corporation on Invoice No. 515450 was identified as the "Tritex 

Corporation portion" of the "purchase and assembly" of the same kits, to be installed on "FAA 

aircraft" as previously identified in the Invoice addressed to Lane Aviation. (/d.) There was no 

sales tax added to either Invoice amount. (Mot. Exhs. D and E.) 

11 It should be noted that during the August 11, 2015 oral argument, the FAA asserted that no subcontractor 

arrangement had been proved during earlier, private, settlement negotiations. Typically, settlement negotiations 

remain private to encourage good faith discussions, and the parties do not reference such discussions as part of any 

subsequent disputed motion. See, e.g., Fed. R. Evid. 408. More significantly, however, the FAA did not present any 

evidence to dispute or refute the Respondent's prima facie case, where the Respondent presented testimonial fact 

evidence that it had subcontractual relationships with both Lane Aviation and Tritex Corporation. 

Page 9 of 16 
It was undisputed that the Respondent's Contract with the FAA was renewed annually, 

pursuant to its terms. On or about June 6, 2012 (i.e., approximately 1 Yz years after the February 

24, 2011 Invoices were issued) the FAA conducted an inspection of Lane Aviation. This 

inspection occurred during the Contract's se~6hd6·6n:ewed year (i.e., "Option II-Period of 

Performance"). (Mot. Exh. A, 8.) During the inspection, the FAA Inspector found parts, 

fabricated by the Respondent, on a Lane Aviation work table near the vicinity of an FAA 

Beechcraft King Air 300 aircraft. The FAA asserted that the Inspector also found other "similar 

parts" that had already been installed on FAA aircraft "without airworthiness release 

documentation." (Resp., 2.) On February 21, 2013, the FAA issued a Notice of Proposed Civil 

Penalty to the Respondent, alleging that the Respondent had "sold" fabricated aircraft parts to 

Lane Aviation on or about February 24, 2011 (the date listed on Invoice No. 515449), in 

violation of 14 C.F .R. § 21.9(b ). On April 30, 2014, the Respondent filed a Notice of Hearing 

and requested formal adjudication. 

I. Respondent's Prima Facie Case 

As noted earlier herein, the moving party in a summary judgment motion must first make ~. ~ 

a prima facie showing that summary jutlgmen'ttisfappropriate, before the burden shifts to the 

responding party. The movant's prima facie burden may be met by submitting evidence, and/or 

by "pointing out an absence of evidence in support of the non-moving party's claims." BaickerMcKee, supra, at 1134. 

In addition to the undisputed facts, Mr. Ochs testified in his Declaration that both Lane 

Aviation and Tritex Corporation12 were acting as its subcontractors, working with the 

Respondent on the FAA's fleet ofBeechcraft King Air 300 aircraft pursuant to the Respondent's 

August 2010 Contract with the FAA. (Mot. Exh. C, ~~ 3-5.) The Respondent was the named 

primary contractor in the Contract, and therefore was the sole recipient ofF AA funds for use in 

purchasing parts and materials. (Id. at~ 12.) All the parts and materials acquired by the 

Respondent for the interior work on the FAA aircraft had either been purchased or made by the 

Respondent, and had been secured and stored by the Respondent pursuant to the Contract terms 

(!d. at ~ 17). These parts included the lap yards .. E!fld :brackets referenced by the FAA in its 

B ' .. ~·:·,,·:~:·I!. 

12 NB: Tritex Corporation was not identified in either the FAA's May 8, 2014 Complaint or its August 12, 2015 

Amended Complaint. 

Page 10 of 16 
Complaint against the Respondent. (Mot. Exh. C-1, ~~ 3-4; August 14, 2015 Ans., 1 ~~5-6.) 

Mr. Ochs testified that after the August 201 0 Contract had been awarded to his company, 

it was discovered that there had been "an oversight" by Respondent and its partner 

subcontractors in "estimating the costs of parts and hardware relating to the installation of the 

headliner of the interior cabin." (Mot. Exh. C, ~ 9.) As a result, the Respondent and its two 

subcontractors, Lane Aviation and Tritex Corporation, agreed to equally share the costs of 

purchasing and installing the hardware on the FAA aircraft. (/d. at~ 10; Mot. Exh. C-1, ~ 6.) The 

Respondent's consecutively numbered feb11J.¥J 241,~::4011 Invoices to both subcontractors, for the 

identical amount of$7,416.91, represeJted th~·~q~~liy shared cost ofthe underestimated work 

that each ofthe three companies assumed. (!d.) The use of such Invoices was a common business 

practice, in order to track money relevant to the Contract. (Mot. Exh. C-1, ~ 5.) 

The totality of the Respondent's evidence, even when viewed in a light most favorable to 

the FAA (i.e., the non-moving party) demonstrated that the Respondent had met its prima facie 

burden in moving for summary judgment. 

J. FAA's Responsive Case 

Pursuant to Rule 56, once the moving party has established a prima facie case, the burden 

shifts to the non-moving party to show, by affidavit or otherwise, that a genuine dispute of 

material fact remains for the fact-finder to resolve. See, Baicker-McKee, et al., supra, at 1133-34. · 

A non-moving party (e.g., the FAA herein answering the Respondent's Motion) may not rest 

upon mere denials or allegations in the pleadlngs.'~E~J>. Pursuant to Civ. R. 56( c), (d), and (e), a 

non-moving party who wishes to proceed to trial must respond to the motion for summary 

judgment, and set forth specific facts sufficient to show there is a genuine issue for trial. Celotex, 

477 US at 324. See also, Citizens State Bank of Big Lake, 815 F.Supp. at 309; Baicker-McKee, et 

al., supra, at 1133-34 (a non-moving party may produce materials, and/or cite to materials 

produced or not produced by the movant in resisting the summary judgment motion). 

As part of its Response, the FAA produced a copy of a partial webpage providing a 

dictionary definition ofthe word "sale." (FAA Exh. A.) It then focused on one ofthe two 

Invoices submitted bythe Respondent, and argued that Lane Aviation's Invoice (Mot. Exh. D), 

taken at face value, demonstrated that a sale had occurred, in violation of 14 C.F.R. § 21.9(b). 

Page 11 of16 
The FAA argued that an Invoice was an "unambig-g?us" sales contract. (Resp. 4.) Thus, the FAA 

reasoned, the "unambiguous" sale shoWn bytlre'Ih~~lce "cannot" be "contradict[ed]" by Mr. 

Och's testimony. (Resp. 4.) The FAA also argued that Mr. Och's testimony should not be 

deemed credible, since he was a party to the proceedings, and had an interest in the outcome. 

(8/11115 Tr. 33:4-7.) 

There is no doubt, as the FAA pointed out, that the Invoice addressed to Lane Aviation 

identified physical goods (i.e., "headliner install kits"), referenced such goods as part of a 

"purchase and assembly," and listed a total price for Lane Aviation to pay, in the amount of 

$7,416.91 (Mot. Exh. D.) But the FAA's arguments ignored admitted facts, partially 

misunderstood the summary judgment standard, failed to refute the Respondent's factual 

evidence, and did not set forth specific facts sufficient to show that there was a genuine material 

issue in dispute for trial. 

For example (not inclusive), the mere use of an invoice by the Respondent does not 

demonstrate that a sale has unambigumtsly ~~·b\irr.e~CSee, e.g., Black's Law Dictionary 742 (5th 

ed.1979) (an invoice "may be as appropriate to a consignment or a memorandum shipment as it 

is to a sale"). An invoice form may be utilized in sale, but that does not mean an invoice always 

represents a sale. See, e.g., Black's Law Dictionary 9th ed. (2009)(invoice alternatively defined 

as "a bill of costs"). An "invoice" may be used for many reasons, in order to describe an itemized 

account or statement of goods with values attached. See, e.g., 19 C.P.R.§ 141.91 (invoice 

utilized as summary documentation for customs inspection sufficient to determine estimated duty 

charges and to use for statistical purposes). Thus, an invoice may be used outside of a sale, 

simply as a written list or register that specifically identifies items of value. See, e.g., Ace 

Constructors, Inc. v. US. 70 Fed. Cl. 253, 276 (Fed. Cl. 2006 (invoices used to identify not only 

costs of rental equipment but also the costs of operating owned equipment). 

It should also be noted that the FAA's assertion that the February 24, 2011 Invoice (Mot. 

Exh. D) should be deemed an "unambiguous",~o!l~:t?c,t was not legally supported. First, there is 

•i·· ! \ ~~·· tt.J ~: 

no definition in the Uniform Commercial Code ("UCC") that describes an invoice as an 

unambiguous sales contract. Indeed, a web search of the 2015 UCC definitions does not result in 

the word "invoice" even being listed in the UCC's common definitions section regarding sales 

transactions. Second, it is well established that an invoice is not a negotiated legal instrument of 

Page 12 of 16 
sale. Instead, an invoice is typically a list of items with certain value, prepared by a person or 

entity without any negotiation or third party input. The invoice may (or may not) then be sent or 

provided to some other person or entity for review. By its very nature, an invoice is a document 

generated solely by one side, which is then subject to review, interpretation, and challenge by the 

recipient. See, e.g., Amersham Corp. v. United States, 564 F. Supp. 813, 820 (Ct. Int'l Trade 

1983) ("statements in invoices neither estop nor preclude parties from showing the true character 

of merchandise"). Thus, an invoice cannot summarily be deemed an "unambiguous" legal 

contract. 13 

. ~·· ·~ ~,. :·a(· 

The FAA also ignored evidence~ in order t6 make its arguments. For example (not 

inclusive) the two Invoices submitted by the Respondent (Mot. Exh. D and E) bore consecutive 

invoice numbers (i.e., 515449 and 51450) and had been sent to both ofthe Respondent's 

subcontractor companies on the same day (i.e., February 24, 2011). They referenced an identical 

work order number (i.e., 11 027). The "quantity" in each Invoice was "1" with the "rate" of the 

"quantity" stated as "$7,416.91." (!d.) No sales tax was included in either calculation. 14 The 

description on each Invoice was identical, except for the individual company's name. Although 

the word "purchase" was contained in the Invoice description, it was used to describe both Lane 

Aviation's and Tritex's "portion" ofthe "purchase and assembly" of installation kits "supplied" 

for FAA aircraft. ((Mot. Exh. D and E.) 

The Invoice descriptions also specifically provided that the "kits supplied" were "to be 

used for the 3rd FAA aircraft through the 18th aircraft." (Mot. Exh. D and E.) Thus, as part of the 

Invoice, the Respondent gave each sub~ontractin~d~mpany specific directions regarding what it 

was to do with the installation kits the Respondent was providing (i.e., "kits supplied to be used 

for ... "). This type of direction does not indicate a passing of ownership or title. Instead, it 

demonstrates a continued, exercised "bailment" authority by the Respondent, as prime 

13 While it is certainly possible, under common law principles, to review an invoice to interpret party actions, 

statements, and intent regarding the scope of a disputed contractual arrangement, see, e.g., UCC § 2-207, Additional 

Terms in Acceptance or Confirmation of a Contract, that is far different from finding that the invoice itself is an 

unambiguous contract of sale. 

14 It should be noted that a "CMH" fee of$22.50 was added to the amount, resulting in the total of$7,439.16. (Mot. 

Exh. D.) Neither party introduced evidence regarding the "CMH" abbreviation. Given the lack of evidence 

submitted and the minimal amount of the charge (i.e., $22.50), the CMH fee is deemed to be not material to the 

issue before the court. 

Page 13 of 16 

:. ' 

'i' 
. ' \.t\.' 

contractor, over the materials "supplie&" See;t:~,'g;(8A Am. Jur. 2d Bailments, § 21 (unlike a 

sale, in a bailment, the bailee of the property does not acquire ownership and must account for 

the property.) 

In discussing the Invoices, Mr. Och testified that no "sale" or transfer of title had 

occurred, because the referenced hardware kits materials were the FAA's acquired property, 

owned and retained by the FAA for exclusive use on its aircraft. In addition, Mr. Ochs testified 

that the 22 fabricated brackets and 22 fabricated lanyards referenced in the FAA's Complaint had 

been purchased by the Respondent with FAA funds, or fabricated by the Respondent pursuant to 

14 C.F.R. § 21.9(a)(6), in compliance with the Contract terms. (Mot. Exh. C, at~~ 14-16; Exh. 

C-1, ~~ 3-4.) Thus, the 22 fabricated brackets and 22 fabricated lanyards were the property of 

the FAA (i.e., the "bailor"), and remained the FAA's property throughout the remodeling of the 

aircraft. (Mot. Exh. C, at~~ 14-16.) 

'· " .. v; 

Mr. Och's testimony was consistent with the!ierms of the Contract, which outlined both . 

the Respondent's contractual responsibilities as the prime contractor, as well as the "bailment" 

relationship the Respondent and its subcontractors had in regard to any FAA "property" acquired 

and utilized for the repairs on the FAA's aircraft. See, e.g., FAA. Mot. Exh. A at 3, 6, 8, and 10 

(all materials acquired by the Respondent with government funding were the property of the 

FAA); !d. at 14 ~ C.3 (h) (the FAA held title to such acquired property, which was defined as 

"Contractor-Acquired-Government Furnished Property). 

The factual evidence demonstrates that Respondent -as the prime contractor under the 

terms of the Contract- had exercised its mandated "bailee" oversight ofF AA property when it 

supplied the hardware kits to Lane Aviation and Tritex Corporation (Mot. Exh. C; Mot. Exh. C1, ~~ 3-4.) The Respondent utilized the two Invoices for a dual purpose: 1) to notify its 

subcontractors of their mutual "bailee" responsibilities under the Contract regarding the FAA's 

property, and 2) "bill" the subcontracto~s for tll~ir a,greed shared costs for the underestimated 

1 ' .. · tb i 

portion of the property acquisition. (/d.) The Respondent's evidence showed that the brackets 

and lanyards had not been sold to, or purchased by, either subcontractor Lane Aviation or 

subcontractor Tritex Corporation. (!d.) Instead, the materials had been provided by the 

Respondent (i.e., physical possession transferred without the passing of title) "as necessary" for 

each subcontractor to perform work on the aircraft. (Mot. Exh. C, at~~ 14-16.) 

Page 14 of 16 
The FAA did not did not dispute that the terms of the Contract were consistent with both 

Mr. Och's testimony and the language in the Invoices. The FAA also did not present any 

evidence, or point to any admitted evidence, that genuinely refuted or challenged the totality of 

the factual evidence presented by the Respondent in its admissions, the Contract, Mr. Och's 

testimony, and theJnvoices. Although the FAA asserted that Mr. Ochs was "not credible," it did 

not submit any evidence to demonstrate that ,his testimony was flawed in any way. See Baickeri . u,., •, l .. ~l.f., 

McKee, et al., supra at 1125 ("[S]imply lobbing Broad, conclusory attacks on a witness's 

credibility is not enough to defeat summary judgment.") In summary, in its Response and oral 

arguments, the FAA failed to demonstrate that a genuine dispute of material fact remained for 

the fact-finder to resolve. 

K. CONCLUSION 

Pursuant to 14 C.F.R. §13.218(±)(5) and Rule 56, all ofthe parties' admissible Exhibits 

were considered, as well as the applicable pleadings and documents. After having heard oral 

argument on the Motion, and having reviewing all relevant caselaw, decisions, regulations, 

statutory authority, motions, pleadings, and being fully advised; 

IT IS HEREBY ORDERED: 

r · .u, .. L 1 l' 

1. The Respondent has shown, by a preponderance of evidence, that it did not sell 22 

fabricated brackets and/or 22 fabricated lanyards parts to its sub-contractor, Lane 

Aviation, on or about February 24, 2011, as alleged by the FAA in its Amended 

Complaint. 

2. The Respondent has shown, by a preponderance of evidence, that it did not commit a 

violation of 14 C.F.R. § 21.9 (6) as alleged by the FAA in its Amended Complaint. 

3. There are no genuine issues of material fact in dispute regarding the one (1) charged 

violation of 14 C.F .R. § 21.9(b ), and the Respondent is entitled to judgment as a matter of 

law. 

'. f' , ., n1 •. 1 Page 15 of 16 
::I 

4. The Respondent's Motion for ri~cision·i~ ~rtlnted. 

5. The three (3) day Hearing scheduled for October 20, 2015- October 22, 2015 in 

Colwnbus, Ohio is hereby cancelled. 

6. This proceeding is dismissed. 

7. This Order will become final ten (10) days after it is served, unless either party files a 

notice of appeal within the ten (10) day period, pursuant to 14 C.P.R. § 13.233. 

Attachment: Service List 

Page 16 of 16 
Docket No. FAA-2014-0119 

(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 2W1 000 1 

ONE COPY 

Ms. Kate Barber 

Complainant's Counsel 

Federal Aviation Administration, AGL-7 

2300 East Devon A venue 

Des Plaines, IL 60018-4696 

TEL: 847-294-7862 

FAX: 847-294-7498 

Mr. Jen·y A. Eichenberger 

Respondent's Counsel 

EICHENBERGER & ASSOCIATES 

6037 Frantz Road, Suite 107 

Dublin, OH 43017 

TEL: 614-798-1600 

FAX: 614-798-1620 

Judge J.E. Sullivan 

U.S Administrative Law Judge 

Office of Hearings, M-20 

U.S. Department of Transportation 

1200 New Jersey Avenue, S.E. (E11-310) 

Washington, DC 20590 

TEL: 202-366-6941 

FAX: 202-366-7536 

Ms. Lauren Hoysen 

Complainant's Co-Counsel 

Federal Aviation Administration, AGL-7 

2300 East Devon Avenue 

Des Plaines, IL 600 18-4696 

TEL: 847-294-7862 

FAX: 847-294-7498 

Mr. Patrick J. Moro 

Respondent's Co-Counsel 

EICHENBERGER & ASSOCIATES 

6037 Frantz Road, Suite 107 

Dublin, OH 43017 

TEL: 614-798-1600 

FAX: 614-798-1620 

E-mail: pmoro@ehlawyers.com 

1 Service was by U.S. Mail. For service in person or by expedited courier, use the following address: Federal 

Aviation Administration, 600 Independence Avenue, S.W., Wilbur Wright Building-Suite 2WIOOO, Washington, 

DC 20591; Attention: Hearing Docket Clerk, AGC-430.