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UNITED STATES DEPARTMENT OF TRANSPORTATION 

FEDERAL AVIATION ADMINISTRATION 

WASHINGTON, DC 

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

KAA Order No. 2010-4 

Docket No. CP07EA0003 (BAJA) 

FDMS No. FAA-2007-26989' 

Served: June 14,2010 

ORDER FOR FURTHER BRIEFING^ 

For the reasons set forth more fully below, the parties are directed to submit 

additional briefs on the issues described in this order. These briefs shall be submitted in 

accordance with this order and limiied to the specific issues set forth herein. 

On October 1, 2007, the FA A withdrew its complaint alleging that Green 

Aviation Management Company, LLC, d/b/a Green Air (Green Air), had violated 

14 C.F.R. §§ 119,5(1), 135,343, and 91.13(a). Subsequently, Adminisiraiive Law Judge 

(ALJ) Isaac D. Benkin granted Green Air's motion to dismiss the proceedings with 

prejudice. 

Green Air applied for attorney fees under the Equal Access to Justice Act (EAJA), 

5 U.S.C. § 504, which permits awards of attorneys fees and expenses to a prevailing party 

' Materials tiled in the h'AA Hearing Docket (except for materials filed in sccuni> cases) arc also 

available for viewing ai ihc following Internet address: www.resulalions,gov. 

^ Jhe Administrator's civil penalty decisions, along with indexes of the dcci.sions, the rules of 

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

wyvyv.faa.gov/aboul/office_org/headquariers offices/agc/polqdjvdicaHon/AGCJOO/ 

Civil Penalty. In addition, Thomjion Rcuters/Wcst Publishing publishes Federal Aviation 

Decisions. Finally, the decisions are available through LHXTS (TRANS library) and WcslLav 

(FTRAN-FAA database). For additional information, see the Web site. 
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in an adversary adjudication imless the government's position was substantially justified. 

The ALJ held that Green Air was a prevailing pany, but denied Green Air's apphcation 

on the ground that the agency -wa-s substantially justified in going forward with the ciise. 

Green Air appealed the ALJ's finding that the FAA was substantially justified. 

The threshold issue in this matter is whether Green Air is a prevailing party. In 

2001, in Biickharmon Board & Care Home. Inc. v. West Virginia Department of HeeJth 

& Human Resources. 532 U.S. 598 (2001), the Supreme Court clarified the standard that 

should be applied in determining whether an applicant is a "prevailing party." In 

Buckhatmon, the Court held that the term "prevailing party" does not include a part^^ that 

has failed to secure a judicially sanctioned change in the legal relationship of the paj-ties 

even if the litigation brought about the desired alteration in the defendant's conduct. The 

ALJ, in the instant case, did not consider whether the FAA's withdrawal of the complaint 

made Green Air a prevailing party under the test set forth by the Supreme Court in 

Buckhannon. 

^ The EAJA provides as follows: 

An agency that conducts an adversary adjudication shall award, to a prevaiUng 

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 

circumstances make an award unjust. 

5 U.S.C. § 504(a)(1), Similarly, the FAA's implementing regulationij provide that: 

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

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

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

agency over which the applicant ha.s prevailed was substantially justified. 

14 C.F.R. § 14.04(a). 
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Under 14 C.F.R. § 13.233(j)(l), the Administrator may, on his oviai initiative, 

raise any issue that is required for the proper disposition of the proceedings. The 

Administrator finds that the issue of whether Green Air is the prevailing party under rhs. 

Buckhomion standard is a preliminary issue that must be resolved for the proper 

disposition of the proceedings. As explained below, this order provides the parties with 

an opportunity to brief this threshold issue as required under 14 C.F.R. § 13.233(j)(l).'' 

In addition, in the event that Green Air is a prevailing party under the 

Buckhatmon standard, this order provides the parties with an opportunity to address 

certain issues related to the question of whether the FAA's position in the tmderlying 

litigation was ."jubstantially justified. 

A. Prevailing Party. 

In Buckliannon. the Supreme Court held that to be a prevailing parly, a party must 

show that it has been awarded some relief by the court, such as an enforceable judgment 

on the merits or a court-ordered consent decree, bringing about a material change in the 

legal relationship of the parties. Buckhannon. 532 U.S. at 604-605, Courts have held 

that the Duckhannon standard broadly applies to other federal fee shifling statutes using 

prevailing party terminology, such as the EAJA. Arononov v. Napolitano. 562 F.3d 84, 

88-89 (1'' Cir. 2009); Ma v. Chertoff. 547 F-3d 342, 344 (2d Cir. 2008). Further, the 

Buckliannon .standard has been applied by courts to administrative cases involving 

prevailing defendants. Mr. L. v. Sloan. 449 F.3d 405 (2d Cir. 2006). ^ The National 

^ This is a purely legal question, and, consequently, the Administrator is not obligated under the 

Rules of Practice to remand the case to the ALJ for further consideration, 14 C.F.R. 

§ 13.2330)(1). 

^ Mr. L was a case arising out of a dispute between a parent of a student and the local school 

board regarding the student's school placement under the Individuals with Disabilities Education 
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Transportation Safety Board has held that the Buckhannon standard applies to NTSB 

cases arising from suspensions of certificates by the FAA. Applications of Turner and 

Coonan. NTSB Order No. EA-5467 at 5 (2009). 

The Administrator has not ruled on the issue of whether a respondent is a 

prevailing party after the voluntary withdrawal of the complaint by the FAA since 1991. 

In KDS Aviation Corp.. FAA Order No. 1991-52 (October 28, 1991). the Administrator 

held that the EAJA applicant was a prevailing party when the FAA withdrew the notice 

of proposed civil penalty action (NPCP) and the complaint, and the ALJ dismissed the 

case. The Administrator noted that the FAA's rules implementing the EAJA, "obviously 

contemplate Voluntary dismissal' as a basis for an EAJA claim."* KDS Aviation Corp. 

FAA Order 1991-52 at 5. In light of Buckhannon's requirement for a judicially 

sanctioned order causing a material alteration in the legal relationship of the parties, such 

as a decision on the merits or a consent decree, it appears that the principles announced in 

KDS Aviation Corp. should be reconsidered. 

(IDEA). The school board requested tlie due process hearing before the hearing officer. After the 

parties agreed to a placement sought by the parent, the hearing officer dismissed the case without 

prejudice. The parties could not agree upon settlement language, and consequently, the ALJ did 

not incorporate the settlement details in the order of dismissal. Subsequently, the parent sought 

attorney fees under the IDEA. The Second Circuit Court held that "the rule of Buckhannon 

applies at the first step of the analysis, regardless of whether the party seeking fees is a plaintiff or 

defendant." Id, at 407. Nonetheless, the court held that the defendant parent was not a prevailing 

party because the settlement 'Svas purely private and therefore does not constitute an 

administratively sanctioned change in the legal relationship of the parties that is judicially 

enforceable." Id., at 408. 

^ The Administrator referred to 14 C.F.R. § 14.2b(c)(4) fcurrently 14 C.F.R. § 14,20(c)(5)] which 

includes the "isauancc of a final order or any other final resolution of a proceeding, such as a 

settlement or voluntary dismissal, which is not subject to a petition for reconsideration" as 

triggering the 30-day time frame for filing an EAJA application. 
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The ALJ did not consider whether Green Air was a prevailing party under a 

Buckhatmon analysis, but instead apparently relied upon the reasoning in KDS Aviation 

Corp., and the parties have not addressed this issue on appeal. 

In light of the foregoing, the Administrator requests briefs from the parties that 

address the following: 

• Did the ALJ's dismissal of the proceedings with prejudice in this case after the 

FAA withdrew its complaint result in a material alteration of the legal relationship 

olihc parties as required under Buckhannon? 

• If there was a material alteration, did the dismissal with prejudice have the 

"judicial imprimatur" required under Buckhannon? The parties should discuss 

whether a dismissal of the complaint with prejudice constitutes the judicial 

sanction required by Buckhannon, or whether the judge (or ALJ in administrative 

cases) must have more involvement in the outcome, such as in a consent decree. 

• In answering this question, the parties should consider vvhcthcr it makes any 

difference in this case that the ALJ wa.<! required to dismiss the case with 

prejudice under 14 C.F.R. § 13.215?' 

B. Substantial JustificatiOD 

The Supreme Court has held that the phrase "substantially justified" in EAJA 

means "justified in substance or in the main," "justified to a degree that could satisf>' a 

reasonable person," or having a "reasonable basis both in law and fact." Pierce j^ . 

Underwood. 487 U.S. 552, 565 (1988). 

' Section 13.215 provides, "[i]f an agency attorney withdraws the complaint..., the 

administrative law judge shall di.smiss the proceeding.s under this subpart with prejudice." 
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In this case, the FAA alleged that on flights that occurred on December 30, 2005, 

and January 2, 2006, Green Air carried 10 passengers in violation of its operations 

specifications, under which it was only permitted to fly nine passengers in its Challenger 

CL-eOO." Further, the FAA alleged that Green Air used the 10* passenger, the pilot's 

daughter, Erin Daly, as a flight attendant although Green Air did not have an approved 

flight attendant training program, and Ms. Daly was not trained adequately. Green Air 

denied that it carried 10 passengers on these flightis and that it used Ms. Daly as a flight 

attendant, arguing instead that Ms. Daly was a non-required* crewmember (i.e., cabin 

aide) who was authorized to sit in the jump seat. According to Green Air, Ms, Daly was 

not a flight attendant because she wa.s not assigned to perform any safety duties, but 

instead was only respon.sible for serving food and drinks to the passengers and pilots. 

Green Air's defense was based upon 14 C.F.R. § 135,85(a), which provides that a 

carrier operating under Part 135 may carry "a crewmember or other employee of the 

certificate holder" "without complying with the passenger-carrying requirements of this 

part." "Crewmember" is defmed in the regulations as "a person assigned to perform duty 

in an aircraft during flight time." 14 C.F.R. § 1.1 ("crewmember"). 

The parties are asked to brief the following issue: 

• Must a "crewmember" under Section 135.85 be an "employee" of the 

certificate holder? If .so, how is "employee" defined in this context? Do the 

* The December 30, 2005, charter flight was from MorrLstown, New Jersey, to Nassau, Bahamas. 

The return trip went from Nassau, Bahamas, to Wilmington, North Carolina, to Morristown, New 

Jersey. 

* Section 135,107 provides that "[n]o certificate holder may operate an aircraft that has a 

passenger seating configuration, excluding any pilot seat, of more than 19 unless there is a flight 

attendant crewmember on board the aircraft." 14 C.F.R. § 135.107. 
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regulations permit a certificate holder to transport crewmembers who are 

independent contractors or employed by independent contractors? 

C. Briefing Schedule 

The parties are directed to file'° their briefs on the above issues no later than 30 

days after tlie issuance of this order. The parties may file reply briefs no later than 20 

days after the service of the opening briefs, 'l"he parties are required to serve each otlier 

with the opening and any reply briefs. 

W . RANDOLPH BABBITT 

ADMINISTRATOR 

Federal Aviation Administration 

When filing their briefs, the panics should use the appropriate address for the Hearing Docket 

set forth in 14 C.F.R. § 13.210(a).