BEFORE THE 

U.S. DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

Application of ) 

) 

CSI AVIATION SERVICES, INC. ) Docket OST-2009-0311 

) 

for an emergency exemption ) 

pursuant to 49 U.S.C. § 40109 ) 

and 14 C.F.R. § 302.1 1. ) 

OBJECTIONS BY 

MIAMI AIR INTERNATIONAL, INC. 

TO ORDER TO SHOW CAUSE ON CSI AVIATION SERVICES, INC. 

APPLICATION FOR AN EMERGENCY EXEMPTION 

Communications with respect to this document should be sent to: 

Ross Fischer, CEO James W. Tello 

MIAMI AIR INTERNATIONAL, INC. LAW OFFICES OF JAMES W. TELL0 

P.O. Box 660880 1025 Connecticut Avenue, NW 

Miami, FL 3266-0880 Suite 1000 

rfischer@,miamiair.com - Washington, DC 20036 

Phone: 202-399-1 91 8 

Fax: 202-478-0244 

jamestello@,earthlink.net 

Counsel for 

MIAMI AIR INTERNATIONAL, INC. 

March 19,20 10 
BEFORE THE 

U.S. DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

Application of 1 

) 

CSI AVIATION SERVICES, INC. 1 Docket OST-2009-0311 

1 

for an emergency exemption 1 

pursuant to 49 U.S.C. 5 40109 1 

and 14 C.F.R. tj 302.11. 1 

March 19,201 0 

OBJECTIONS BY 

MIAMI AIR INTERNATIONAL, INC. 

TO ORDER TO SHOW CAUSE ON CSI AVIATION SERVICES, INC. 

APPLICATION FOR AN EMERGENCY EXEMPTION 

On March 16,20 10, the Department issued by OST Order 20 10-3-2 1, an order to 

show cause tentatively granting the request of CSI Aviation Services, Inc. ("CSI") for 

exemption authority to engage in domestic and foreign indirect air transportation of 

persons, property and mail pursuant to contracts arranged under the General Services 

Administration (GSA) Schedule Special Item Number (SIN) 599-5, Air Charter ServicesBrokers. That order required that any objections be filed no later than, March 19, 201 0. 

Capital Aviation, Inc. and Capital Airways, LLC (collectively, "Capital") responded with 

objections served late March 18, 20 10 that were received by Miami Air International, Inc. 

("Miami Air") on March 19,20 10. Miami Air hereby files its objections to the order to 

show cause and its answer to the objections of Capital as follows: 
Docket OST20090311 

Page 2 of 5 

1. In the course of proceedings on the application of CSI, Miami Air voiced its 

opposition to the issuance of the emergency exemption requested by CSI on a number of 

grounds. Miami Air continues to object to issuance of that emergency exemption and 

adopts its previous arguments in support of that objection by this reference. 

2. In its filing, Capital introduced a new focus on the Department's failure to 

include the use by brokers of FAR 125 carriers in the exemption authority it proposes to 

issue. 

The brokers may only enter into agreements with air carriers that hold the 

requisite authority to engage in air transportation; [Footnote 9.1 

.... [Footnote 9.1 Brokers may not enter into agreements with carriers operating under 

14 CFR Part 125, as these carriers may not engage in common carriage operations 

in air transportation, either directly or indirectly through air charter brokers. 

OST Order 2010-3-21 (Order to Show Cause), page 5. 

To this claim, Capital argues, among other things that the Department did not 

adequately support its analysis that FAR 125 carriers could not be used by the authorized 

brokers. As we will explain, Miami Air submits that the law in this area is so clear that 

no further analysis by the Department was necessary. 

3. In its original "Application of CSI Aviation Services, Inc. for an Emergency 

Exemption," ("Application"), CSI asked that, "pursuant to 49 U.S.C. fj 40109 . . . " the 

Department grant it an "emergency exemption from 49 U.S.C. 9 41 101 and 14 C.F.R. 

parts 212 and 380, to the extent necessary to continue to perform under General Services 
Docket OST20090311 

Page 3 of 5 

Administration ("GSA") Contract GS-33F-0025V, Special Item Number ("SIN") 599-5, 

Air Charter Services-Brokers." Thus, in its concession that it is an "indirect air carrier" 

that is engaged in "air transportation" indirectly, CSI asked for authority to engage in 

common carriage. 49 USC Subsections 40 102(a)(5), (23) and (25). As a result, in 

issuing authority to an indirect air carrier by exemption from the statutory requirement 

that a certificate be required for such operations (49 USC Section 4 1 101) and from 

regulations issued in furtherance of those statutory provisions, the Department simply 

conformed to the limits both of its statutory mandate and of the specifications of the 

request made to it by the applicant. 

4. That view is also supported by the requirements of regulations cited. Only U.S. 

certificated air carriers may operate the charter forms authorized by sections 2 12.1,296.1, 

297.1 and 380.10(d). It should also be noted that wet leases to authorized air carriers 

from other authorized air carriers are the limits of the scope of that regulation (section 

212.4(b)(l)), and air carriers by definition are common carriers (49 USC Subsections 

40102(a)(2), (5), (23) and (25)). A so-called "private carrier" may not wet lease to an air 

carrier (by definition a common carrier) because that would comprise a holding out to a 

segment of the general public. 

5. It is also quite relevant that the Federal Aviation Administration limits wet 

leases to other air carriers that hold similar operations specifications under an air carrier 

certificate issued by that agency. FAR 1 19.53(b) and (e). That authority does not 
Docket OST20090311 

Page 4 of 5 

encompass operators that may only provide lift when "common carriage is not involved." 

FAR 125.1. Even Capital concedes that the "general public" may under certain 

circumstances be transported by the air carriers anticipated to transport persons under the 

tentatively proposed exemption. Capital, p. 6. That alone is sufficient to foreclose FAR 

125 operators. And the broader argument made by Capital that OST has no jurisdiction 

or need to issue an exemption at all are both too late and in contradiction to the scope of 

the CSI application itself. 

6. An examination of the insightful memo issued by the Department's 

Enforcement Office (Role of Air Charter Brokers) also does not favor the position taken 

by Capital. Review of the underlying cases cited by that memo (and many, many more) 

will show that a determination of lawful "private carriage" rests on the totality of the 

facts in particular circumstances. The rule most certainly does not allow a certain 

number of contracts to a particular customer if the "private carrier" has many other 

customers. The case law rule also has reference to the manner of "holding out" to the 

public irrespective of the number and nature of customers a "private carrier" may have, 

among other things. It is not a mechanical, bright-line rule. In any case, the 

Enforcement memo reference to a certain number of allowable contracts derives from a 

CAB proceeding that is of doubtful authority in a litigated context this many decades 

later on the facts it recites. Accordingly, the Department is not in a position to exempt 

generally all holders of FAR 125 authority without the requisite individuated 

investigation and examination of particular operators. Doing so would clearly 
Docket OST20090311 

Page 5 of 5 

contravene not only the DOT'S own precedent and the law it enforces but defeat the 

FAA's safety regulatory regime that accords to air carriers the highest level of safety and 

to all others a lesser standard. U.S. government personnel will be on these flights. Like 

those flights operated for the Department of Defense by civilian carriers, only carriers 

certificated to the highest economic and safety standards should be allowed for flights 

carrying government personnel. 

WHEREFORE, Miami Air International, Inc. hereby (1) opposes the issuance of a 

final order authorizing brokers to operate as indirect air carriers for GSA contracts or, (2) 

if the Department were to issue such authority nevertheless, Miami Air opposes the 

inclusion of FAR 125 carriers within that exemption for air transportation under the 

specified GSA schedule. 

L~FFICES OF JAMES W. TELLO 

Counsel for 

MIAMI AIR INTERNATIONAL, INC. 
CERTIFICATE OF SERVICE 

I hereby certify that on this 19~ dayof March 2010, a copy of the foregoing document was 

served by e-mail on the parties named below. 

/ / 

~6es'~. Tello 

David M. Hernandez, Esq. 

Vedder Price P.C. 

Counsel for CSI Aviation Services, Inc. 

dhernandez@vedderprice.com 

Aaron A. Goerlich 

Victor H. Smith 

Garofalo Goerlich Hainbach PC 

Counsel for Sundowner Oklahoma City, LLC 

ag;oerlich@,g;g;h-airlaw.com 

vsmith@,g;gh-airlaw.com 

John S. Fredericksen 

Vice President-General Counsel 

MN Airlines, LLC 

John.fredericksen@,suncountrv.com - 

Carl M. Smith, Esq. 

McGovern & Smith, LLC 

Counsel for Omni Air International, Inc. 

Carl.smith@,mcg;overnandsmith.com 

Ron Priddy, President 

National Air Carrier Association 

rpriddy@,naca.cc - 

Pierre Murphy 

Law Offices of Pierre Murphy 

Counsel for USA 3000 Airlines 

pmurphy@,lopmurphy.com - 
Scott Bickford, Chairman 

Jonathan Tasler, President 

David McCown, Vice President 

Air Charter Association of North America 

C/O Air Planning LLC 

sbickford@,fl yacana.org 

itasler@,flvacana.org 

dmccown@,flyacana.orq 

Mark A. Robinson 

Vice President and General Counsel 

Ryan International Airlines 

MarkRobinson@,rubloffusa.com 

Thomas J. Spulak, Esq. 

King & Spalding LLP 

Counsel for Falcon Air Express, Inc. 

tspulak~kslaw.com 

Mark W. Atwood 

Sher & Blackwell, LLP 

Counsel for TEM Enterprises d/b/a Xtra Airways 

matwood@,sherblackwell.com 

Robert Binns, Chief Executive Officer 

Global Aviation Holdings 

rbinns@,glah.com 

Gregory P. Cirillo, Esq. 

Wiley Rein LLP 

Counsel for Capital Aviation, Inc. 

gcirillo@,wile~rein.com - 

Virginia Gregasch 

General Services Administration 

Virgiilia.grebasch@,gsa. gov 

National Business Aviation Association 

Mike Nichols, VP Operations, Education, Economics 

National Business Aviation Association 

1nnich0ls@,nbaa.org 

Jonathan Dols, Esq. 

U.S. Department of Transportation 

Jonathan.dols~dot.gov - 
George Wellington 

U.S. Department of Transportation 

George.wellin~ton@,dot. gov 

Thuy Cooper 

U. S. Department of Transportation 

Thuy.Cooper@,dot.gov