UNITED STATES DEPARTMENT OF TRANSPORTATI<3^Nvi I It^ |5!: . 

FEDERAL AVIATION ADMINISTRATION * ' /\ lO o 

P 2:13 

WASHINGTON, DC 

In the Matter of; GREEN AVIATION MANAGEMENT CO.. LLC 

FAA Order No. 2011-9 

Docket No. CP07EA0003 (EAJA) 

FDMS No. FAA-2007-26989' 

Served: June 13,2011 

DECISION AND ORDER^ 

The Federal Aviation Administration ("FAA") brought a civil penalty action 

against Green Aviation Management Company, LLC, d/b/a Green Air ("Green Air") for 

allegedly violating several federal aviation regulations.^ The FAA sought a $33,000 civil 

penalty. Later, the FAA withdrew its complaint and the ALJ dismissed the case with 

prejudice in accordance with the requirement of 14 C.F.R. § 13.215. Green Air then 

applied for attorney's fees under 5 U.S.C. § 504 of the Equal Access to Justice Act 

("EAJA"). Administrative Law Judge ("ALJ") Isaac D. Benkin denied Green Air's 

' Generally, materials filed in the FAA Hearing Docket (except for materials filed in 

security cases) are also available for viewing at www.regulations.gov. 14 C.F.R. § 13.210(e)(1). 

^ The Administrator's civil penalty decisions, along with indexes of the decisions, the rules 

of practice, and other information, are available on the Internet at the following address: 

www.faa.gov/about/office_org/headquarters_offices/agc/pol_adjudication/AGC400/ 

Civil_Penalty. In addition, Thomson Reuters/West Publishing publishes Federal Aviation 

Decisions. Finally, the decisions are available through LEXIS (TRANS library) and WestLaw 

(FTRAN-FAA database). For additional information, see the Web site. 

^ Specifically, the FAA alleged that Green Air violated the following regulations: 

(1)14 C.F.R. § 119.5(1) (no person may operate an aircraft under Part 135 in violation of 

appropriate operations specifications); (2) 14 C.F.R. § 135.343 (no certificate holder may use a 

person as a crewmember unless that crewmember has completed the appropriate training); and (3) 

14 C.F.R. § 91.13(a) (no person may operate an aircraft in a careless or reckless manner so as to 

endanger the life or property of another). 
application on the ground that the agency's position was substantially justified." This 

decision holds that as a threshold matter, Green Air was not a "prevailing party" within 

the meaning of the EAJA, and therefore Green Air was not eligible for an award of 

attorney's fees. Thus, it is not necessary to reach the issue of whether the FAA was 

substantially justified in its prosecution of the case. The ALJ's denial of Green Air's 

application for fees is affirmed.^ 

I. Facts 

Green Air is an on-demand aircraft charter company that holds an air carrier 

certificate under 14 C.F.R. Part 135. It operated a charter flight from Morristown, New 

Jersey, to Nassau, Bahamas, on December 30, 2005. The aircraft's return trip on 

January 2, 2006, was from Nassau, Bahamas, to Wilmington, North Carolina, and from 

there to Morristovra, New Jersey. 

The FAA certificated the aircraft, a Challenger CL-600, to fransport not more than 

nine passengers, and Green Air's operations specifications authorized use of the aircraft 

with not more than nine passengers. The aircraft had two pilot seats and a jump seat in 

addition to nine passenger seats. During the flights, the aircraft had on board 

Captain Daly, who was the pilot-in-command, Captain DeSantis, who was the second-incommand, nine passengers, and a person whose role and status were the subject of 

dispute - i. e., Erin Daly, the daughter of Captain Daly. The FAA asserted that Ms. Daly 

"* A copy of the ALJ's order denying fees and expenses is attached. 

* Green requests that the Administrator order further proceedings if necessary for 

resolution of the case. (Applicant's Response to Order for Further Briefing at 1.) The request is 

denied. No such further proceedings are necessary. 
was either an impermissible extra passenger or an unqualified flight attendant.* 

Green Air's quote for the charter flight included an "attendant" for $1,600. The 

trip log prepared by Green Air's customer service representative listed Ms. Daly as "FA.' 

When Captain Daly transmitted a report to the U.S. Customs and Border Patrol the day 

before the flight, the report listed Ms. Daly as "crew." Finally, the customs inspector in 

the Bahamas reported that there were nine passengers and three crewmembers on board. 

II. FAA's Civil Penalty Action Against Green Air 

On February 6, 2007, the FAA filed a complaint alleging the following: 

• 

• 

On each flight. Green Air carried 10 passengers in violation of its 

operations specifications. 

The load manifests, which indicated nine passengers rather than 10, failed 

accurately to describe the number of passengers and total weight of the 

loaded aircraft. 

Green Air used the 10th passenger (Ms. Daly, Captain Daly's daughter) as 

a flight attendant even though Green Air did not have an approved flight 

attendant training program and Ms. Daly was not adequately trained. 

As a result of carrying more than the authorized niunber of passengers, 

operating without the accurate total weight of the loaded aircraft, and 

using a flight attendant who was not appropriately trained. Green Air 

operated the aircraft in a careless or reckless manner so as to endanger the 

lives and property of others. 

Green Air violated (1) 14 C.F.R. § 119.5(1) (no person may operate an 

aircraft under Part 135 in violation of appropriate operations 

specifications); (2) 14 C.F.R. § 135.343 (no certificate holder may use a 

person as a crewmember unless that crewmember has completed the 

appropriate training); and (3) 14 C.F.R. § 91.13(a) (no person may operate 

an aircraft in a careless or reckless manner so as to endanger the life or 

property of another). 

Under 49 U.S.C. § 46301(a)(5), Green Air, if a small business, is subject 

to a civil penalty of no more than $11,000 for each violation. 

The applicable regulations do not require a trained flight attendant to be on board. 
• Under the facts and circumstances of the case, a civil penalty of $33,000 is 

appropriate. 

In its answer to the complaint, dated February 9, 2007, Green Air denied that: 

• it carried 10 passengers in violation of its operations specifications; 

• the load manifest was inaccurate; 

• it used Ms. Daly as a flight attendant; 

• it operated the aircraft in a careless or reckless manner; and 

• it is subject to a civil penalty. 

Green Air asserted the following defenses: 

• It was not required to establish or maintain an approved flight attendant 

training program under Part 135 because it operated aircraft with fewer 

than 19 seats. 

• Ms. Daly was not a flight attendant during the flights and therefore 

Part 135 did not require her to be trained. 

• Ms. Daly was a non-required crewmember {i.e., cabin aide, customer 

service representative). 

• The jump seat occupied by Ms. Daly was placarded for "crew use only" -

as such, the jump seat was not a passenger seat. 

• Ms. Daly was an employee of Green Air and as such was authorized to 

occupy the jump seat under 14 C.F.R. § 135.85.^ 

• The load manifests for the flights accurately described the number of 

passengers and total weight of the loaded aircraft. 

On May 31, 2007, the FAA and Green Air agreed that, in exchange for the FAA 

^ Section 135.85 provides: 

The following persons may be carried aboard an aircraft without complying with 

the passenger-carrying requirements of this part: 

(a) A crewmember or other employee of the certificate holder .... 
withdrawing its complaint, Green Air would submit an affidavit to the FAA stating that: 

Ms. Daly was an employee of the company, no company records of her employment 

presently existed, other than pay check stubs, and no IRS or state tax records existed at 

the time concerning her employment. Green Air also agreed not to file an EAJA 

application. Green Air, however, did not submit the affidavit, and the case went forward. 

Green Air filed a motion styled, "Motion to Dismiss," on June 1, 2007. Green Air 

argued in this motion that there were no genuine issues of material fact, and it attached 

affidavits and other evidentiary items. Thus, it was actually a motion for decision under 

14 C.F.R. § 13.218(f)(5).' 

Specifically, Green Air argued in the June 1, 2007, "Motion to Dismiss" that 

Ms. Daly was a cabin aide employee of Green Air, not a passenger omitted from the 

manifest. Green Air attached as exhibits the following: 

• Two affidavits of Captain James Daly attesting that: (1) Ms. Daly was 

a cabin aide whose responsibilities were not safety-related but instead 

were to serve food and drink; and (2) Ms. Daly's weight was included 

in the load manifests. 

• An affidavit of Ms. Daly attesting that she was a non-required 

crewmember in a non-safety position, that her duties included serving 

food and drink, and that Green Air paid her. 

• Three check stubs, all to "Erin Daly," one dated December 7, 2005, 

(almost a month-before the flights), in the amount of $200.00, stating 

that it was for "2 days," another dated February 6, 2006, in the amount 

of $2,450.00, stating that it was for "Wages," and the final one dated 

April 24, 2006, in the amount of $3,150.00, stating that it was for 

' Section 13.218(f)(5) provides as follows: 

The administrative law judge shall grant a party's motion for decision if the 

pleadings, depositions, answers to interrogatories, admissions, matters that the 

administrative law judge has officially noticed, or evidence introduced during the 

hearing show that there is no genuine issue of material fact and that the party 

making the motion is entitled to a decision as a matter of law. 
"Flight Attendent (sic)." The payer was not indicated on any of the 

stubs. 

• A memorandum from the U.S. Department of Homeland Security, 

Customs and Border Protection (CBP), indicating that, according to 

the General Declaration filed by the pilots with CPB, there were three. 

crew and nine passengers on the January 2, 2006, flight. 

• NTSB Safety Recommendation A-06-66 through -69 at 7 

(November 8, 2006), stating that cabin aides were not required to 

receive safety training because they were not required crewmembers.' 

• A letter of interpretation dated March 19, 1986, from John H. Cassady, 

Assistant Chief Counsel, Regulations and Enforcement Division, 

Office of the Chief Counsel, FAA, to James W. Johnson, Air Line 

Pilots Association (ALPA), stating that "persons other than 'flight 

crewanembers' may be 'crewmembers' if they are assigned duty 

during flight time." 

The FAA filed a response to the "Motion to Dismiss" on June 16, 2007, asserting 

that material facts remained in dispute, including whether Ms. Daly was an employee, 

whether she served as a non-required crewmember, whether she occupied the jump seat, 

and whether the load manifests included her weight. The FAA argued that if Ms. Daly 

were working on the flights, it might have been as a flight attendant without proper 

training. Further, the FAA asserted, there was nothing to show that she was not simply 

flying with her father to the Bahamas for New Year's Eve, and the ALJ needed to make 

credibility determinations at a hearing. 

On June 19, 2007, Green Air filed another motion for summary disposition. This 

motion was entitled "Motion for Decision," and in it. Green Air asserted incorrectly that 

the FAA had failed to file a response to its "Motion to Dismiss." Green Air asked the 

ALJ to dismiss the FAA's complaint with prejudice due to the alleged failure to file a 

' The NTSB recommended, however, that "any cabin personnel on ... Part 135 flights 

who could be perceived by passengers as equivalent to qualified flight attendants receive basic 

FAA-approved safety training." Id. 
response. 

On June 28,2007, the ALJ denied both of Green Air's motions for summary 

disposition, ruling that the materials submitted by Green Air did not establish facts that 

would entitle Green Air to prevail. For example, the ALJ stated, the receipts showed that 

on three occasions, Ms. Daly was paid for something, but they did not demonstrate that 

she was a bona fide employee of Green Air. According to the ALJ, there remained a 

disputed issue of material fact - specifically, what was Ms. Daly's exact status during the 

flights in question. The ALJ therefore scheduled a hearing and the parties pursued 

discovery. 

On August 3, 2007, Green Air requested reconsideration of the ALJ's denial of its 

June 1, 2007, motion for summary disposition. Attached to Green Air's motion for 

reconsideration were the following exhibits: 

• An affidavit from Elaine Hunt, Green Air's customer service 

representative, in which she averred that Ms. Daly was assigned the 

duties of a cabin or flight aide to serve food and drinks to the 

passengers and flight crew and that she was not an unmanifested 

passenger. 

• An affidavit from Captain Charles DeSantis, attesting that Ms. Daly 

was a cabin attendant serving food and drink. 

• An estimate of flight charges for Green Air's customer, listing $1,600 

for an "attendant." 

• Green Air's flight schedule or "trip sheet," listing Ms. Daly as crew. 

• A CBP Electronic Advance Passenger Information System Report 

listing Ms. Daly as crew. 

• A copy of a 2005 IRS form 1099 listing Green Air as the payer and 

Ms. Daly as the recipient of "non-employee compensation" in the 

amount of $2,100. 

Green Air argued that the evidence showed that Ms. Daly was its contract employee and 
served as a cabin aide crewmember. 

In its FAA's reply to Green Air's reconsideration request, the FAA attached a 

newer affidavit from Ms. Hunt, stating that her first declaration was incomplete and that 

Ms. Daly was expected to be trained to perform safety duties, not merely to serve food 

and drinks. The FAA argued that Ms. Daly's exact status remained an issue because on 

the IRS Form 1099 submitted by Green Air, the compensation for Ms. Daly was labeled 

"non-employee compensation." 

On August 21, 2007, the ALJ issued an order denying Green Air's Motion for 

Reconsideration. The ALJ noted that the FAA's affidavit of Ms. Hunt supported the 

FAA's position and that in this affidavit, Ms. Hunt repudiated in part the earlier affidavit 

submitted by Green Air. The ALJ stated that it was "difficult to imagine a case less 

suitable for disposition by summary judgment." Order Denying Motion for 

Reconsideration at 1. He held that there remained disputed material issues of fact that 

precluded him from granting the relief Green Air sought. 

On September 18, 2007, Green Air moved to preclude Ms. Hunt's testimony at 

the hearing. Attached to its motion was an e-mail dated August 24, 2007, from Ms. Hunt 

to one of the captains. Captain DeSantis, stating: 

I said I have no idea if she [Ms. Daly] is a FA, CA or a stripper for 

that matter. And I do't (sic) care as that has nothing to do with me. I 

don't hire, train or otherwise. 

I never said she is a [Part] 135 FA. I said as far as I am concerned 

she was on board to serve food and if there is an in flight issue she would 

assist. What did you think that she would just sit there and watch? 

... And just because I assume she was there for safety, maybe she 

was not. That was my take on it. But in the company I am no one. Not 

privy to training, paychecks, or otherwise. 

I'm not taking any blame for anything to do with this. I did not fly 

the flight, i (sic) did not assign crew nor did I pick the cabin attendant. 
Motion to Preclude, Attachment 1 at 1. Green Air contended that, by her own admission, 

Ms. Hunt did not know Ms. Daly's status during the flights, and as a result, she would 

have no relevant or material testimony to offer at a hearing at which the central issue 

would concern Ms. Daly's status on the flights. 

Less than 2 weeks after Green Air filed this motion and about 2 weeks before the 

October 1, 2007, scheduled hearing date, the FAA withdrew the complaint. 

Subsequently, Green Air moved to dismiss, and the ALJ dismissed the case with 

prejudice under 14 C.F.R. § 13.215. 

III. Attorney's Fee Action 

Green Air filed an application under the EAJA arguing that the FAA was not 

substantially justified in filing the complaint. Green Air contended that it should be 

awarded its attorney's fees and expenses, which were in excess of $27,400. 

On January 16, 2008, the ALJ issued a decision denying the application for 

attorney's fees and expenses. The ALJ stated that the existence of questions of fact 

concerning Ms. Daly's role aboard the flights and her employment relationship to Green 

Air satisfied the EAJA's requirement that the agency action have a reasonable basis in 

law and fact. He further held that the legal inquiry and factual dispute were closely 

intertwined and satisfied the EAJA's requirement for a nexus between the two. 

Regarding the weight-and-balance computation, the ALJ said that it was unclear 

during the investigatory and adjudicatory phases whether Ms. Daly's weight was 

included. There was no documentary evidence listing Ms. Daly as crew for purposes of 

the computation. 

The ALJ concluded that the factual disputes regarding Ms. Daly's role, training. 
and employment status, combined with the factual dispute regarding computation of 

weight and balance, established that the FAA had substantial justification for its action. 

The ALJ rejected Green Air's argument that the dismissal compelled the conclusion that 

no substantial justification existed for the original complaint; he stated that the EAJA 

does not entitle an applicant to an award in any case where the agency drops its charges. 

The question remained whether the agency had substantial justification for going 

forward, and the ALJ found that it did. Green Air filed an appeal. 

After considering the briefs on appeal, the Administrator directed the parties to 

file additional briefs that addressed certain critical issues, including whether Green Air 

was a prevailing party in the underlying case. Green Aviation Management Co., LLC, 

FAA Order No. 2010-4 (June 14, 2010). Both parties filed addifional briefs. 

IV. Discussion 

The American rule is that parties must bear their ov/n attorney's fees unless a 

statute or contract explicifly authorizes fee-shifting. Hardt v. Reliance Standard Life Ins. 

Co., 130 S.Ct. 2149, 2156 (2010). "Numerous" federal stattites authorize the award of 

attorney's fees to the "prevailing party." Buckhannon Board and Care Home, Inc. v. 

West Virginia Dept of Health and Human Services, 532 U.S. 598, 602 (2001). The EAJA 

is one such statute that authorizes the shifting of fees to the "prevailing party." See 

5 U.S.C. § 504 and 28 U.S.C. § 2412. The EAJA provides that prevailing parties in 

certain adversarial proceedings may recover attorney's fees from the United States. The 

relevant portion of the EAJA provides as follows: 

An agency that conducts an adversary adjudication shall award, to diprevailing 

party other than the United States, fees and other expenses incurred by that party 

in connection with that proceeding, unless the adjudicative officer of the agency 

finds that the position of the agency was substantially justified or that special 

10 
circumstances make an award unjust. 

5 U.S.C. § 504(a)(1) (emphasis added).'^ Establishing "prevailing party" status is a 

threshold requirement for parties seeking fees. Hensley v. Eckerhart, 461 U.S. 424, 433 

(1983). 

The leading case regarding "prevailing party" status under fee-shifting statutes is 

the U.S. Supreme Court's decision in Buckhannon. In this case, Buckhannon, the 

operator of assisted living facilities, sued the West Virginia Department of Health and 

Human Services ("West Virginia HHS"), arguing that a new state requirement violated 

the Fair Housing Amendments Act ("FHAA") and the Americans with Disabilities Act 

("ADA"). West Virginia eliminated the requirement, and the West Virginia HHS moved 

to dismiss the case as moot. The district court granted the motion. Buckhannon then 

sought attorney's fees from the West Virginia HHS under the FHAA and the ADA. Both 

statutes permit a court to grant attorney's fees to a "prevailing party." 

The Buckhannon majority held that the term "prevailing party" does not include 

"a party that has failed to secure a judgment on the merits or a court-ordered consent 

decree," even if the party has "achieved the desired result because the lawsuit brought 

about a volimtary change in the defendant's conduct." Id. at 600. The Court explained 

that to be a "prevailing party," there must be a judicially sanctioned material alteration of 

the legal relationship of the parties and the court must have awarded some relief to the 

'° The FAA's regulations implementing the EAJA provide that: 

A prevailing applicant may receive an award for attorney fees and other 

expenses incurred in connection with a proceeding, or in a significant and 

discrete substantive portion of the proceeding, unless the position of the agency 

over which the applicant has prevailed was substantially justified. 

14 C.F.R. § 14.04(a). Although Section 14.04(a) uses the term "prevailing applicant," rather than 

"prevailing party," the regulation should be interpreted to conform to the statute that it 

implements. 

11 
party seeking fees. Id. at 604, 605. The Court noted that "[a] defendant's voluntary 

change in conduct, although perhaps accomplishing what the plaintiff sought to achieve 

by the lawsuit, lacks the necessary judicial imprimatur on the change." Id. at 605. 

According to the Court, a prevailing party includes: (1) one who has been 

awarded some enforceable judicial relief on the merits of his or her claim; and (2) one 

who has received relief through a settlement agreement enforced through a consent 

decree. In contrast, the Court stated, private settlements do not involve the judicial 

approval and oversight involved in consent decrees. Id. at 604, n.7. Private settlements, 

the Court explained, are often unenforceable unless the order of dismissal incorporates 

the settlement terms. Id. The Court rejected the "catalyst theory," under which an award 

of fees would be permitted based upon a voluntary change in conduct by the defendant 

where there is no judicially sanctioned change in the parties' legal relationship. Id. at 

609. 

The Court in Buckhannon stated that given the clear meaning of "prevailing 

party" in the fee-shifting statutes, it was not necessary to determine which way policy 

arguments cut. Id. For example, the Court declined to address policy arguments like the 

following - if the catalyst theory was not upheld, litigation could be protracted because 

parties would be less likely to move to dismiss if they believed they would have to pay 

attorney's fees for doing so. The Court concluded by affirming the lower court's 

decision that Buckhannon was not a prevailing party. 

The U.S. Court of Appeals for the District of Columbia Circuit has set forth the 

following three-part test, based on Buckhannon, for determining whether a party is a 

"prevailing party": 

12 
(1) there must be a court-ordered change in the legal relationship of the parties; 

(2) the judgment must be in favor of the party seeking fees; and 

(3) judicial relief must accompany the judicial pronouncement. 

Turner v. NTSB, 608 F.3d 12, 15 (citing District of Columbia v. Strauss, 590 F.3d 898, 

901 (D.C. Cir. 2010), and Thomas v. National Science Foundation, 330 F.3d 486, 493 

(D.C. Cir. 2003)). 

The Supreme Court in Buckhannon explained that "prevailing party" is a term of 

art, and that the Court interprets consistently the numerous federal fee-shifting statutes 

that use that terminology. Buckhannon, 532 U.S. at 602, 603, n.4. Following the 

Supreme Court's lead, the Federal circuit courts have applied the Buckhannon prevailingparty criteria to other fee-shifting statutes that use the term "prevailing party," including 

the stattite at issue in this case, the EAJA - 5 U.S.C. § 504 and 28 U.S.C. § 2412." 

Several circuit courts have held that the types of relief cited by the Supreme Court 

in Buckhannon — /.e., judgments on the merits and consent decrees - are only examples of 

the types of orders that would confer prevailing party status, assuming that sufficient 

judicial imprimatur exists. See, e.g.. Walker v. Calumet City, 565 F.3d 1031, 1034 

(7"' Cir. 2009); Citizens for Better Forestry v. U.S Dep 't of Agriculture, 567 F.3d 1128, 

1132(9^^01^2009). 

In the instant case, the FAA moved for a voluntary dismissal of its complaint. 

The ALJ dismissed the case with prejudice, as he was required to do by the FAA's rules 

" A case applying Buckhannon to 5 U.S.C. § 504 is Turner v. NTSB, 608 F.3d 12 (D.C. 

Cir. 2010). Cases applying Buckhannon to 28 U.S.C. § 2412 include: Ma v. Chertoff, 547 F.3d 

342 (2"'' Cir. 2008); Biodiversity Conservation Alliance v. Stem, 519 F.3d 1226 (10* Cir. 2008); 

Carbonell v. Immigration and Naturalization Service, 429 F.3d 894 (9* Cir. 2005); and Thomas 

V. National Science Foundation, 330 F.3d 486 (D.C. Cir. 2003). 

13 
of practice - specifically, 14 C.F.R. § 13.215. Section 13.215 provides as follows: 

§ 13.215 Withdrawal of complaint or request for hearing 

At any time before or during a hearing, an agency attorney may withdraw 

a complaint or a party may withdraw a request for a hearing without the 

consent of the administrative law judge. If an agency attorney withdraws 

the complaint or a party withdraws the request for a hearing and the 

answer, the administrative law judge shall dismiss the proceedings under 

this subpart with prejudice. 

(Emphasis added.) 

The ALJ's dismissal of the FAA's case with prejudice here met some of 

Buckhannon's "prevailing party" criteria. The Supreme Court in Buckhannon indicated 

that obtaining a favorable decision on the merits could confer "prevailing party" status. 

Some lower courts have held that a dismissal with prejudice, as in the instant case, is a 

decision on the merits because it precludes further litigation - in other words, because 

res judicata would apply. See, e.g., Michigan Surgery Inv., LLC v. Arman, 627 F.3d 572, 

576 (6"' Cir. 2010) ("[bjecause a dismissal with prejudice precludes further litigation," it 

effectively rejects the plaintiffs claim on the merits).'^ The ALJ's order of dismissal 

with prejudice effected a material alteration of Green Air's legal relationship with the 

FAA because if the FAA tried to bring the same claim in the fiiture, Green Air could rely 

successfully on a res judicata defense. Further, enforceability is required for "prevailing 

party" stattrs. In Biodiversity Conservation Alliance v. Stem, 519 F.3d 1226, 1230 (10* 

Cir. 2008), former Supreme Court Justice Sandra Day O'Connor wrote that "under 

Buckhannon, a court order must be enforceable to qualify that party for attorney's fees as 

'^ In contrast, a dismissal without prejudice is not an adjudication on the merits, "as it 

leaves the parties in the same legal position as if no suit had ever been filed." Cruz v. Louisiana 

ex rel. Dept of Public Safety and Corrections, 528 F.3d 375, 379 n. 15 (5* Cir. 2008) (quoting 

Hilbun V. Goldberg, 823 F.2d 881, 883 (5"" Cir. 1987)). 

14 
a prevailing party." Here, the ALJ's dismissal with prejudice was enforceable by the 

courts under the doctrine of res judicata. 

On the other hand. Green Air did not meet key criteria to be a "prevailing party." 

The Buckhannon Court explained that to be a "prevailing party," there must be a 

judicially sanctioned alteration of the legal relationship of the parties and the court must 

have awarded some relief to the party seeking fees. Buckhannon, 532 U.S. at 604, 605 

(emphasis added). The Buckhannon court stated that judicial imprimatur is necessary. 

M a t 605. 

Here, while the agency attorney's voluntary decision to discontinue the civil 

penalty action gave Green Air what it wanted, the ALJ's order dismissing the case lacked 

the necessary judicial imprimatur, because under Section 13.215, the ALJ had entirely no 

choice or discretion but to dismiss the case with prejudice. See, e.g.. Highway Equipment 

Co. V. FECO, Ltd, 469 F.3d 1027, 1034 (Fed. Cir. 2006), where the court emphasized that 

it was the judge's exercise of discretion that gave the dismissal with prejudice the 

necessary "judicial imprimatur'' so that the order constituted a "judicially sanctioned 

change in the legal relationship of the parties" under Buckhannon. 

In Turner, the court held that the NTSB ALJ's order dismissing the case was 

without prejudice and did not provide administrative relief The court explained that the 

ALJ's order dismissing the case was simply an "administrative housekeeping measure" 

not conferring "prevailing party" status, because the FAA did not need the ALJ's 

permission to withdraw its complaint under the rule. Turner, 608 F.3d at 16. 

Although Turner involved a dismissal without prejudice. Turner is instructive in 

this case because in both Turner and in this case, the FAA did not need the ALJ's 

15 
permission to withdraw the complaint under the applicable procedural rules. The ALJ's 

dismissal of the case against Green Air with prejudice did not reflect any substantive 

judicial imprimatur because Section 13.215 required the ALJ to dismiss the case with 

prejudice once the FAA withdrew its complaint. See, e.g., Hutchinson ex rel. Julien v. 

Patrick, — F.3d —, 2011 WL 540538, at *4 (1'' Cir. 2011) (finding it necessary to 

determine whether the order contained the sort of judicial involvement and actions 

inherent in a court-ordered consent decree); Bell v. Board of County Com'rs of Jefferson 

County, 451 F.3d 1097, 1101 (lO"' Cir. 2006) (finding that because plainfiff entered into a 

private settlement without any judicial involvement, he was not a prevailing party); Lum 

V. Mercedes Bern, 246 FRD 544, 547 (N.D. Ohio 2007) (explaining that the focus after 

Buckhannon was on '''the nature and judicial involvement in the outcome, rather than on 

the practical effects ...."; explaining that because the judge did not "determine or 

oversee" ttie dismissal, the defendant was not a "prevailing party") (emphasis added). 

V. Conclusion 

Green Air was not a "prevailing party" under the Supreme Court's key decision in 

Buckhannon because the FAA's voluntary change in conduct lacked the necessary 

judicial imprimatur. As a result, a fee award is not appropriate under 5 U.S.C. 

§ 504(a)(1). For the reasons stated above, this decision denies Green Air's appeal.'^ 

J. RANDOLPH BABBITT 

ADMINISTRATOR 

Federal Aviation Administration 

'^ Within 30 days of this determination. Green may file an appeal with an appropriate 

United States Court of Appeals. 5 U.S.C. § 504(c)(2); 14 C.F.R. § 14.29. See 49 U.S.C. § 46110 

and 14 C.F.R. §§ 13.235(a)-(c). 

16 
SERVED JANUARY 16,2008 

li^Ji J/.:v lb P 2: II 

U.S. DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D.C. 

IN THE MATTER OF THE APPLICATION OF 

GREEN AVIATION MANAGEIVIENT CO., LLC 

For fees and expenses under the 

Equal Access to Justice Act 

FAA Docket No. CP07EA0003 

(Equal Access to Justice Act Proceeding) 

DMS No. FAA-2007-26989 

ADMINISTRATIVE LAW JUDGE'S INITIAL DECISION 

DENYING APPLICATION FOR FEES AND EXPENSES 

UNDER THE EQUAL ACCESS TO JUSTICE ACT 

This proceeding arises from an application for attorney fees and 

expenses filed October 19, 2007, under the Equal Access to Justice Act, 5 

U.S.C. § 504 ("EAJA"). The EAJA application was an outgrowth of a civil 

penalty action filed by the Federal Aviation Administration ("FAA") against 

Green Aviation Management Co., LLC ("Green Air" or "Applicant") in 

Docket No. 2006EA110010. 

For the reasons set forth below, I deny Green Air's application for an 

award of attorney's fees and costs incurred in the underlying proceeding. 

Factual History 

The underlying proceeding arose from a charter flight operated by 

Green Air. It departed White Plains, New York on December 30, 2005, flew 

to the Bahamas, and returned on January 2, 2006. During two flight legs. 
the aircraft carried nine passengers. Also aboard were two pilots, Captains 

DeSantis and Daly, and Erin Daly, Captain Daly's daughter. The aircraft 

operated for the trip, a Challenger CL-600, was certificated to transport not 

more than nine passengers. Crew accommodations included two pilot seats 

and a jumpseat. 

Green Air's quote for the charter flight, dated Dec. 15, 2005, included 

a line item for an "attendant" with a price of $1,600. The total amoimt 

quoted, including the cost of an attendant, was accepted by the client. The 

trip log prepared by (jieen Air's customer service representative listed Erin 

Daly as "FA." When Captain Daly transmitted an "Electronic Advance 

Passenger Information System" ("eAPIS") report to the U.S. Customs and 

Border Patrol on the day prior to the flight, Erin Daly was listed as "crew." 

Finally, when the aircraft arrived in the Bahamas, the customs inspector 

reported nine passengers and three crewmembers were on board. 

Underlying Procedural History 

The FAA filed actions before the National Transportation Safety 

Board ("NTSB") seeking suspension of the pilot certificates of Captains 

DeSantis and Daly' in addition to the civil penalty action against Green Air. 

The parallel charges rested on alternative theories, either that Erin Daly was 

an improperly trained flight attendant occupying the aircraft jumpseat or that 

she was an un-manifested tenth passenger on an aircraft certificated for only 

nine passengers. Additionally, the FAA asserted that Erin Daly's weight 

was not included in the weight-and-balance computation for the flight. The 

FAA's civil penalty complaint sought a $33,000 penalty. Green Air 

responded with a written demand for a hearing. 

On May 31, 2007, the NTSB proceeding against Captains DeSantis 

and Daly was settled.'^ It was agreed that the charges would be dropped and 

no EAJA application would be made on behalf of the two pilots. 

Accordingly, the Administrator withdrew the action and the NTSB 

terminated the proceeding. During the settlement discussions concerning the 

pilots, it was agreed that the civil penalty case against Green Air would be 

dropped immediately upon submission of an affidavit concerning Erin 

' NTSB Docket Nos. SE-l 17927 and 19278. 

^ The sEune counsel represented Captains DeSantis and Daly and Green Air. 
Daly's employment status.^ Similarly, Green Air agreed not to pursue an 

EAJA application. 

However, the envisioned settlement of the civil penalty case did not 

hold. On June 1, 2007, Green Air moved to dismiss and, on June 6, Green 

Air wrote to FAA counsel requesting the proceeding be dropped since it 

arose from the same facts and circumstances as the settled charges against 

the two pilots. On June 16, the FAA indicated that it intended to continue 

the civil penalty case against Green Air and repeated its original charges 

from the Complaint. On June 28,2007,1 denied Green Air's motion for 

sunmiary disposition, ruling that the unresolved factual issue of Erin Daly's 

employment status required a hearing to resolve. The same order scheduled 

the hearing for October 16, 2007. Thereafter, the parties exchanged 

interrogatories and pursued discovery. 

On August 3, 2007, Green Air requested reconsideration of my 

disposition of its summary judgment motion. Attached to Green Air's 

motion were several exhibits, one of which was a copy of an IRS form 1099 

listing "nonemployee" compensation for Erin Daly in the amount of $2,100.'* 

The FAA reply to the reconsideration request pointed out that the issue of 

Erin Daly's employment status remained outstanding, since compensation 

was listed under the "nonemployee" category. 

The underlying proceeding was finally resolved when the FAA 

withdrew its Complaint on October 1, 2007. Nothing m the record indicates 

the withdrawal took place pursuant to a settlement agreement. Thereafter, 

Green Air filed a timely application for award of fees under EAJA. The 

FAA filed a response opposing the application in its entirety. 

^ Specifically the affidavit was to include first, that Erin Daly was an employee of Green Air, secondly, that 

Green Air presently had no records, other Aan pay stubs, evidencing her employment, and finally, that no 

IRS or state recorcG presently existed to substantiate her employment. 

* Line 7 of 2005 Form 1099, Exhibit 10 of Respondent's Motion for Reconsideration, filed August 3, 2007. 

The record does not show whether the 1099 existed two months earlier when counsel for Green Air 

represented that no federal or state tax forms existed as to Erin Daly's employment with Green Air. If it 

had existed, it presumably would have deepened the issue of employment status since it lists compensation 

as "nonemployee." In the circumstances, I make no ruling on the validity of the 1099, as it is immaterial b 

my view to the outcome of the pending application. 
Standards; 

The EAJA requires an agency conducting an adversary adjudication to 

award fees and other expenses to a prevailing party (other than the United 

States) unless the position of the agency was substantially justified or special 

circumstances make an award unjust. 5 U.S.C. § 504(a)(1). The FAA's 

regulations implementing the statute essentially mirror its language {see 14 

C.F.R. § 14.04). The burden of proof to show that an award should not be 

made rests with the agency. 14 C.F.R. §• 14.04(a). 

Analysis; 

Although the underlying proceedings did not conclude with a trialtype hearing, the entirety of the underlying proceedings constituted an 

"adversary adjudication" within the meaning of the EAJA and the 

regulations implementing that statute. The FAA had asserted that it was 

entitled to assess a civil penalty for violations of the Federal Aviation 

Regulations ("FAR"), Green Air disputed the FAA's charges and in the 

normal course of events, the issues in the case would have been resolved 

through a trial-type hearing under the adjudicative provisions of the 

Administrative Procedure Act. The FAA eventually withdrew its charges 

without a quid-pro-quo embodied in the settlement agreement. Agency rules 

implementing EAJA contemplate that a "voluntary dismissal" may serve as 

a basis for an EAJA claim. 14 C.F.R. § 14.20(c)(5). The FAA does not 

contest that its withdrawal of the charge established that Green Air was a 

"prevailing party." Thus, the critical question is whether the FAA's position 

was "substantially justified." 

An action is substantially justified when it has a reasonable basis in 

law and fact. Pierce v. Underwood, 487 U.S. 552, 565 (1988); 14 CFR § 

14.04(a). The charges must be justified to the degree that could satisfy a 

reasonable person. Pierce v. Underwood, ^XS^S. The agency must show, 

first, a reasonable basis in truth for the facts alleged, second, a reasonable 

basis m law for the legal theory propounded and, finally, a reasonable 

connection between the facts and its legal theory. Valley Air Services, Inc., 

FAA Order No. 95027 (December 19, 1995) at 6, reconsideration denied, 

FAA Order No. 96-15 (May 13,1996); Smith v. National Transportation 

Safety Board, 992 F.2d 849, 852 (8th Ch". 1993). 
EAJA also provides that a determination of "substantial justification" 

must be made "on the basis of the adminisfrative record, as a whole, which 

is made in the adversary adjudication ... " 5 U.S.C. § 504(a)(1). 

"Substantial justification" connotes an active,, searching inquiry into the 

quality of evidence advanced and the overall reasonableness of the agency's 

position. United Brotherhood of Carpenters and Joiners v. NLRB, 891 F.2d 

1160, 1163 (5th Cir. 1990). 

The Complaint charged Green Air with three violations. First, Green 

Air was charged with violating its air carrier operating certificate (FAR § 

119.5(1), 14 C.F.R. § 119.5), second it was charged with violating the 

requirement that no person may serve as a crewmember without training 

adequate and appropriate to the role (FAR § 135.343, 14 C.F.R. § 135.343), 

and, finally, it was charged with operating the aircraft in a careless and 

reckless manner so as to endanger the life and property of another (FAR § 

91.13(a), 14 C.F.R. § 91.13). Specifically, the proceeding turned on the 

question of Erin Daly's role aboard the aircraft and whether her weight was 

included in the weight-and-balance computation. 

Erin Daly's Role 

It was clear that Green Aur's client contracted for and paid for an 

"attendant." It was not clear whether they were getting someone who would 

simply serve drinks and attend to the passenger's comfort or whether they 

would have onboard a qualified flight attendant trained in safety procedures. 

Green Air's quotation refers to her as an "attendant;" the trip log refers to 

her as an "FA;" and the eAPIS filing refers to her as "crew." Clearly, it was 

. anticipated that Erin Daly was acting in some capacity as a representative of 

Green Air. At the time of booking the trip, Green Air's customer service 

representative ("CSR"), who provided the quotation and created the trip log, 

informed Captain Daly that if Erin Daly was going on the trip, then she 

would be expected to perform safety-related duties and must be adequately 

trained in order to do so. 

Numerous FAA regulations require that a "flight attendant" must be 

trained, knowledgeable, and competent in safety procedures concerning the 

passengers and the aircraft. (See 14 CFR §§ 135.295, 135.117, 135.122, 
135.128.) (jteen Air was unable to provide records of flight attendant 

training to the FAA during the investigation. Additionally, Green Air's 

answer to the FAA's Complaint admitted that it did not establish and 

maintain an approved flight attendant training program. However, because 

the CL-600 was certificated for fewer than nineteen passengers. Green Air 

was not required to provide a qualified flight attendant. See 14 C.F.R. § 

135.107. Thus, if Erin Daly served only as a non-required "attendant" or 

"cabin aide," there was no requirement for her to have had any kind of safety 

training at all. Because the aircraft was certificated for less than nineteen 

passengers, the issue of required flight attendant training became moot. 

Green Air asserted this point in its motion to dismiss filed on June 1, 2007. 

(Nevertheless, Captain Daly, in later affidavits, attested that he had provided 

Erin Daly with basic familiarization with safety procedures.) 

The FAA argued that because Green Air provided an attendant 

onboard, it was required to establish and conduct a flight attendant training 

program. Since Erin Daly did not receive any training, the FAA argued that 

she was not a flight attendant, and thus, must have been an un-manifested 

tenth passenger. The FAA's argument failed to allow for the possibility of a 

middle ground, that of a non-required attendant, Le^, a cabin aide or cabin 

attendant. 

However, when Green Air asserted Erm Daly required no training 

because she served only as a non-required attendant, the FAA's inquiry 

turned to the question of her employment status. Evidence of employment 

status was the key issue discussed in the settlement negotiations that 

resolved the actions against the pilots. Although this issue was discussed 

and agreed-upon in the settlement of June I, 2007, Green Air was unable to 

. produce any records of Erin Daly's employment until it provided a Form 

1099 Usting $2,100 paid to her as "nonemployee" compensation in August 

of 2007. The Form 1099 and three hand-written payment slips, at least, 

provided some evidence to suggest that she was not simply an un-manifested 

tenth passenger. Without evidence of some employment relationship, there 

was nothing of record to preclude the possibility that an additional 

passenger, just by agreeing to serve drinks and sit in the jump-seat, could 

don the disguise of a non-required attendant and easily circumvent the ninepassenger limitation applicable to the CL-600. 
The existence of these fact questions concerning Erin Daly's role 

aboard the flights and her employment relationship to Green Air satisfies the 

EAJA's requirement that the agency action have a reasonable basis in law 

and fact. Even though Green Air was not required to provide a qualified 

flight attendant, if Ms. Daly had acted as a flight attendant, then she would 

have been required to receive adequate training. If she served as a nonrequired attendant, then it would be reasonable to expect to see evidence of 

an employment relationship. In order to support Green Air's assertion that 

Erin Daly was not an un-manifested tenth passenger, it was reasonable for 

the FAA to ask for proof of an employment relationship. Green Air was 

unable, until eight months after the Complaint was filed, to provide any form 

of evidence of employment, albeit "nonemployee" employment. Green 

Air's various references to Erin Daly as "crew," "attendant," and "flight 

attendant" point to Green Air's own internal confiision as to her role and its 

compliance with training requirements. The legal inquiry and factual 

dispute are closely intertwined and satisfy the EAJA's requirement for a 

nexus between the two. 

Weight and Balance Computation 

Also unclear during the investigatory phase and adjudicatory phase 

was whether Erin Daly's weight was included in the weight-and-balance 

computation. Although Captain Daly's affidavit denied it, the FAA 

investigator reported that Captain Daly did not include her weight in the 

computation. Copies of the weight and bdEince sheets in the record list the 

names of the two pilots and include data for the nine passengers. Green Air 

asserted in various filings that Erin Daly's weight was included in the 

computation under the category of "crew." While this may in fact be the 

. case, there is no documentary evidence that lists Erin Daly as crew for 

purposes of the computation. 

Conclusion; 

The factual disputes as to Erin Daly's role, training, and employment 

status, combined with the factual dispute as to computation of weight and 

balance establish that the FAA had substantial justification for its action. It 

is not clear why the FAA voluntarily dropped the charges. Green Air argues 

that the dismissal compels the conclusion that no substantial justification 

existed for the original complaint. The EAJA does not, however, entitle an 
applicant to an award in any case where the agency drops its charges. The 

question remains whether the agency had substantial justification for going 

forward. In this case, I find that it did. 

In consideration of the foregoing, I find and determine that, subject to 

appeal to the Administrator as provided in section 14.28 of the regulations of 

the Federal Aviation Administration implementing the Equal Access to 

Justice Act of 1980, as amended, 14 C.F.R. § 14.28, the application of Green 

Aviation Management Co. must be, and it herebj^ is, DENIED. 

/ Isaac D. Benkin 

Administrative Law Judge 

[Note—This decision may be appealed to the Administrator within 30 days 

after it is issued. The Notice of Appeal and Appeal Brief must be sent to the 

Federal Aviation Administration, 800 Independence Avenue, S.W., 

Washington, D.C. 20591, Attn: Appellate Docket Clerk. A copy of the 

notice and brief should also be served on counsel for the FAA.]