June 8, 2012 

The Honorable Susan L. Kurland 

Assistant Secretary for Aviation 

and International Affairs 

U.S. Department of Transportation 

1200 New Jersey S.E. 

Washington, DC 20590 

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T ?O? .Ti ~.soon 

Jonathan Blank 

D 202.661.6250 

F 202.778.9100 

jonathan.hlank@klgates.com 

Re: VIH Cougar Helicopters, Inc, Docket No. DOT-OST-2012-0022 

Dear Ms. Kurland: 

The Department currently has before it the Objections of VIH Cougar Helicopters, Inc. ("VIH 

Cougar") to the March 12, 2012 Order to Show Cause why its existing exemption authority as an 

air taxi operator should not be revoked for failure to meet U.S citizenship requirements, 1 an 

Answer to those Objections filed by Petroleum Helicopters, Inc. ("PHI''), Northern Pioneer 

Helicopters LLC and Soloy Helicopters LLC, 2 who are competitors that have been subject to 

years of unlawful competition from VIH Cougar, and VIH Cougar's rcply. 3 The matter is now 

ready for the Department to act. 

Although invited by the Department to do so, VIH Cougar has not provided any information that 

undermines the evidence the Department has amassed, and termed "overwhelming," of non-U.S 

citizen control of VIH Cougar. 4 That evidence shows that VIH Cougar is, and has always been, a 

shell company set up under the putative ownership of a foreign air carrier's regular outside 

lawyer, Richard Steeper, who contributed a nominal sum, if any, for his ownership interest, and 

who has purported to "manage" VIH Cougar's day-to-day operations of the and to "oversee" its 

strategic plans while simultaneously maintaining a wide-ranging law practice with hundreds of 

clients based in British Columbia.5 VlH Cougar is in fact under the control of Mr. Kenneth 

Norie, a Canadian citizen and helicopter operator who set up Mr. Steeper as the straw owner of 

VIH Cougar. 

1 Response and Objections ofVIH Cougar to the Department of Transportation's March 12, 2012 Show Cause 

Order, DOT-OST-2012-0022-0030 (April4, 2012). 

2 Answer of Petroleum Helicopters, Inc. et al., DOT-OST-2012-0022-0050 (May 4, 2012) ("Answer to Show Cause 

Objections"). 

'Reply in Support of VIH Cougar's Response and Objections to the March 12, 2012 Order to Show Cause, DOTOST-2012-0022-0060 (May 15, 2012) 

4 See Department's Oct 6. 2011 Letter to VIR Cougar. at I; Order 2012-03-07 ("Order to Show Cause") at 4-8. 

5 See PHI's Answer to Show Cause Objections at 10-15. 
Susan Kurland 

June 8, 2012 

Page 2 

Unable to defend its blatant violation of the U.S. control requirements, VIH Cougar's primary 

goal has been to delay these proceedings long enough to allow it to dispose of its ill-gotten gains. 

Its letter to you dated June I., 2012 is the latest such effm1. 6 

VIH Cougar states in its June lletter that it has entered into a Letter of Intent with an unnamed 

purchaser to sell Mr. Steeper's 76% "interest" in the company for an undisclosed price. 7 A 24% 

interest will continue to be held by Mr. Norie. 8 VIH Cougar states that the undisclosed purchaser 

is not affiliated with or related to Mr. Norie, but it has of course consistently made similar 

representations about Mr. Steeper's supposed independence. VIH Cougar states that the 

transaction is expected to close on or before June 30, 2012, and pronounces that the transaction 

"will fully resolve this issue and render the Show Cause proceedings moot.''9 

PHI has noted in several of its filings the need for the Department to have open and transparent 

proceedings with respect to any efforts by VIH Cougar to avoid the strictures of the Order to 

Show Cause through a purported divestiture or rcstructuring. 10 VIH Cougar's June 1, 2012letter 

reinforces the need for such an open consideration of the resolution of this public docket. PHI 

and other companies that have been subjected to unlawful competition have standing to 

participate in assessing the bonafide.\' of a transaction that purports to resolve the Department's 

concerns without affecting the participating interest of the Canadian controlling entity. 11 

The Department must also assure itself that its regulations and the statute have not been flouted 

for private gain. As PHI, Northern Pioneer, and Soloy have previously noted in their Answer to 

the Show Cause Objections, VIH Cougar does not own aircraft or other substantial assets, Mr. 

Steeper apparently contributed little if any money when he acquired his interest, and other 

interests in VIH Cougar have been transferred for very little consideration. 12 It is also reasonable 

to suppose, and VIH has not denied, that a major part of VlH Cougar's value is the IFR 

certification it pursued from 2006 to 2008- a certification that should never have been granted 

while VIH Cougar was under foreign control. 13 Proper enforcement of its regulations would 

require the Department to assess precisely what is being disposed of, where the proceeds will go, 

and who has ultimately benefited from the violations of the citizen control requirements that 

6 VIH Cougar's June 1, 2012 Letter to the Department, DOT-OST-2012-0022-0062. 

7 !d. at 1. 

s !d. 

9 !d. at 2. 

10 See, e.g., PHI's May 9, 2012 Letter to the Department, DOT-OST-2012-0022-0054, at I; Answer of PHI to VIH 

Cougar's Motion to Stay the Show Cause Order, DOT-OST -20 12-0022-003X. at 3-5. 

11 See PHI's Answer to Show Cause Objections at 6-7. 

11 See id. at 12-13, 20-22. 

13 See id. at 24. 

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Susan Kurland 

June 8, 2012 

Page 3 

have harmed PHI and other legitimate U.S. citizen companies. Civil penalties are an appropriate 

remedy in these circumstances. 14 

Failure to make a searching inquiry into all aspects of this transaction would allow VIH Cougar 

to dispose of its ill-gotten gains with impunity, and send a message to the industry that there is 

no penalty for violating the citizen control requirements, merely the opportunity to cash out one 

step ahead of the law. The Department should therefore require VIH Cougar to provide full 

information on its proposed divestiturc/restmcturing that will allow full and transparent 

consideration of its adequacy to remedy the violations identified in the Order To Show Cause, 

undertake an investigation to determine who has benefited from these violations, and impose 

penalties and require disgorgcmcnt of these unlawful benefits. 

Very truly yours. 

Jonathan Blank 

cc: Docket DOT-OST-2012-0022 

David M. Nadler, Esq. 

Dickstein Shapiro LLP 

1825 Eye Street, ~V 

Washington, DC 20006 

14 See Show Cause Order at 3 ("a violation of Part 298 is also considered a violation of 49 U.S. C. § 41 I OJ"). 

Violations of Section 4110 I arc subject to civil penalties under 49ll.S.C. § 46301 (a) of up to $25,000 per unlawful 

!light or per day of a continuing violation. VIH Cougar has been operating under its unlawful structure since at least 

February L 2007, when Mr. Steeper became the sole director and Mr. MacDonald. a Canadian citizen managing 

Cougar Helicopters, Inc., a subsidiary of Mr. Norie 's VIH Aviation Group, simultaneously assumed the role of 

General Manager of VIH Cougar to run both companies as a single operation. See PHI's Answer to Show Cause 

Objections at 12, 16-18. 

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CERTIFICATE OF SERVICE 

1 certify that I have on this gth day of June, 2012 served the foregoing Jetter upon the persons 

listed below, and have also filed it electronically in the docket ofthis proceeding: 

Susan L. Kurland 

Office of the Assistant Secretary for 

Aviation and International Affairs 

U.S. Department of Transportation 

1200 :'-Jew Jersey Avenue, SE 

Room W96-495 

Washington, DC 20590 

Susan.kurland@dot.gov 

Lauralyn Remo 

Office of the Assistant Secretary for 

Aviation and International Affairs 

U.S. Department of Transportation 

1200 New Jersey Avenue, SE 

Room W96-495 

Washington, DC 20590 

Laura.remo@dot. gov 

Peter Lynch, AGC-300 

Asst. Chief Counsel for Enforcement 

Federal Aviation Administration 

800 Independence Ave. SW 

Washington, DC 20591 

peter.lynch@faa.dot.gov 

DC-9628442 vl 

Rosalind Knapp 

Deputy General Counsel 

U.S. Department of Transportation 

1200 New J erscy SE 

Washington, DC 20590 

lindy.knapp@dot.gov 

Roy Hardie 

Aviation Safety Inspector 

Federal Aviation Administration 

1601 Lind Avenue SW, Suite 260 

Renton, W A 98057 

roy.hardie@faa.gov; 

David M. Nadler 

David Y. Yang 

Andrew E. Smith 

DICKSTEIN SHAPIRO LLP 

1825 Eye Street, NW 

Washington, DC 20006 

Telephone: (202) 420-2200 

Facsimile: (202) 420-2201 

nadlerd@dicksteinshapiro. com 

yangd@dicksteinshapiro. com 

smitha@dicksteinshapiro.com 

Counsel to V!H Cougar Helicopters, Inc 
William J. Weber 

Certification Section Manager 

FAAAFS-900 

45005 Aviation Drive Suite 131 

Dulles, VA 20166 

w.j eff. weber@ faa. dot. gov 

Damon D. Walker 

Department of Transportation 

1200 New Jersey Avenue SE 

Washington, DC 20590 

damon. walker@dot. gov 

John Longstreth 

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