In The Matter Of: 

SERVED: SEPTEMBER 18, 2015 

U.S. DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, DC 

Docket No. FAA-2014-0807 

PAZ AVIATION, INC. 

) 

) 

) 

) 

) 

Case No. 2011S0190272 

Respondent 

ORDER DENYING THE RESPONDENT'S MOTIONS TO DISMISS 

On May 15, 2015, the Respondent, Paz Aviation, Inc., filed its Amended Motion to 

Dismiss and Memorandum of Law ("Amended Motion"). 

On June 5, 2015, the FAA filed a single document, containing two filings: 1) the FAA's 

Notice of Amended Complaint ("Amended Complaint") and; 2) the FAA's Response to 

Respondent's Amended Motion to Dismiss and Memorandum of Law ("Response"). 

On June 19,2015, the Respondent filed a single document, containing two filings: 1) a 

Motion to Dismiss Amended Complaint ("Motion") and; 2) a Reply Memorandum Concerning 

Respondent's Motion to Dismiss ("Reply"). 

On July 1, 2015, the parties convened by telephone for a second Motion Conference, and 

presented additional oral argument on the Respondent's Amended Motion. 

On September 8, 2015, an Order Acknowledging the FAA's Amended Complaint, 

Deeming part of the Respondent's Amended Motion Moot, and Reserving Other Requested 

Relief was filed. 

A. INTRODUCTION 

The Respondent is seeking dismissal based on three arguments: 1) The FAA's 

prosecution of eighteen ( 18) of the forty-eight ( 48) acts of improper maintenance alleged to have 

occurred before May 24, 2010 is untimely under 14 C.F.R. § 13.208(d), because the FAA failed 

to issue its Notice ofProposed Civil Penalty ("NPCP") within two years ofthe 18 alleged 
violations; 2) The FAA's civil penalty action is untimely under 49 U.S.C. § 4630l(d)(7)(C), 

because the FAA failed to file its October 7, 2014 Complaint within two years of the alleged 

violations; and 3) The Respondent should be granted dismissal under the affirmative defense of 

laches. 

In response, the FAA primarily argues that: 1) The first issue is moot, because the FAA's 

June 5, 2015 Amended Complaint did not include the eighteen (18) acts of improper 

maintenance alleged to have occurred before May 24, 201 0; 2) The FAA's prosecution of the 

remaining thirty (30) acts of alleged improper maintenance charged in the Amended Complaint 

was timely initiated under 49 U.S.C. § 46301(d)(7)(C), because the NPCP was issued within two 

years of the remaining thirty (30) alleged acts; and 3) The Respondent has failed to show that 

the FAA inexcusably delayed in bringing the action, or that as a result ofthe delay, the 

respondent is prejudiced in its defense of the action. 

B. DISCUSSION 

Because of the volume of materials, this discussion only highlights certain matters. 

However, all motions, responses, memoranda oflaw, exhibits, supplemental briefs, and all 

relevant regulations, statutes, caselaw, and arguments have been considered. The Respondent's 

arguments are each identified and separately addressed. 

1. The FAA's prosecution of eighteen (18) ofthe forty-eight (48) acts ofimproper 

maintenance alleged to have occurred before May 24, 2010 is untimely under 14 C.F.R. 

§ 13.208(d), because the FAA failed to issue its Notice ofProposed Civil Penalty 

("NPCP") within two years ofthe 18 allege,d_violation. Issue Moot . 

. '· 'l ) ~ . t ··' . 

It was undisputed that on or about May 24,2012, the FAA issued a NPCP, in which it 

alleged that the Respondent committed forty-eight ( 48) acts of improper maintenance, dating 

from July 29, 2009 through April27, 2011, in violation of five Federal Aviation Regulations. 1 

(Compl. 1-3 ~II, 2; Am. Mot. 1.) 

As the full record of this case indicates, the Respondent and the FAA filed initial 

materials on the Respondent's Motion to Dismiss between January 23,2015, and March 12, 

1 Specifically, 14 C.F.R. §§ 43.29a)(2), 43.13(a), 145.20l(b), 145.207(a), and 145.2Il(b). 

Page 2 of 13 
2015,2 based on the original allegations in the October 7, 2014 Complaint. During the April22, 

2015 Motion Conference, the parties agreed to file supplemental materials,3 which were filed 

between May 15, 2015, and June 19, 2015 (as noted supra). As part of these supplemental 

materials, the FAA filed a June 5, 2015 Amended Complaint, in which it struck eighteen (18) of 

the forty-eight (48) allegations contain~d in lts origi~al October 7, 2014 Complaint, because 

these 18 acts were alleged to have occurred before May 24, 2009-a date that was more than two 

years before the issuance of the FAA's NPCP. (Am. Compl. 4 ~II). The FAA also reduced the 

proposed civil penalty from $44,880 to $28,050. (Id at 6.) 

The Respondent is correct. 14 C.F.R. § 13.208(d) requires the FAA to initiate a civil 

penalty action by issuing a NPCP no later than two years after a violation has occurred, unless 

the FAA can show good cause for any delay beyond two years. See also, 55 Fed. Reg. 27548, 

27553 (Jul. 3, 1990) (Discussion ofFinal Rule). 

The FAA's initial prosecution of eighteen (18) of the forty-eight ( 48) maintenance 

violations, alleged to have occurred before May 24, 2009, was untimely under 14 C.F.R. § 

13 .208( d), because the FAA had failed to issue its NPCP within two years of those 18 alleged 

violations. The FAA did not allege good cause for .the·delay. Instead, it removed those 18 alleged 

' . 

violations when it filed its June 5, 2015::AmendedtComplaint. It also acknowledged in its June 5, 

2015 Response that 14 C.F.R. § 13.208(d) required filing a NPCP "within two years ofthe date 

of violation." (Resp. 7.) 

Because the FAA has filed an Amended Complaint and removed the eighteen (18) 

maintenance violations that it had alleged had occurred before May 24, 2009, the Respondent's 

Motion to Dismiss on this issue is moot. 

2 See March 6, 2015 Order Accepting Withdrawal of Respondent's Motion to Dismiss [FAA's Responsive Brief], 

Reconfirming Other Deadlines, and Providing ?irec,ti~fl:~o {!le. tarties. 

3 See April23, 2015 Order Setting Motion Conference and Deadlines for Supplemental Filings. 

Page 3 of13 
2. The FAA's civil penalty action is untimely under 49 U.S.C. § 46301(d)(7)(C), because 

the FAA failed to file its October 7, 2014 Complaint within two years of the alleged 

violations as required by the statute. Not Proven. 

As noted above, the parties agreed that 14 C.F.R. § 13.208(d) required that the FAA file a 

NPCP within two years of the date of violation. However, given the arguments of the parties on 

this second issue, a brief discussion about the history of the FAA's adoption ofthe two year 

limitation period may be helpful. 4 

a) Brief History of the FAA'~··Tw~r"Y.ealStatute of Limitations 

When the FAA promulgated the Rules of Practice in 1990, the only statute of limitations 

applicable to FAA civil penalty proceedings was found at 28 U.S.C. § 2462, which provided for 

a five (5) year limitations period: 

Except as otherwise provided by Act of Congress, an action, suit or proceeding 

for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or 

otherwise, shall not be entertained unless commenced within five years from the 

date when the claim first accrued if, within the same period, the offender or the 

property is found within the United States in order that proper service may be 

made thereon. 

28 U.S.C. § 2462 (1990) (emphasis added). 

In 1990, the FAA examined this five-year statute of limitations when· it discussed the 

adoption of its Rules of Practice. After consideration of public comments, the FAA opted to 

utilize a shorter time than five years,~~ ad~P{~~{,;~~o (2) year limitations period. 55 Fed. Reg. 

27548, 27553 (July 3, 1990) (Discussion of Final Rule) (codified at 14 C.F.R. § 13.208(d)). In 

adopting this self-imposed two (2) year limitations period, the FAA made clear that ''the critical 

event" to commence an action "which must be taken by the agency" was to issue "a notice of 

proposed civil penalty within two years from the date of the alleged violations." /d. 

Two years later, in 1992, Congress incorporated the FAA's self-imposed two (2) year 

limitations period into the organic statute by amending section 901(a)(3) of the Federal Aviation 

Act of 1958 (49 U.S.C. § 1471(a)(3)) to provide in part: "Except for good cause, a civil penalty 

4. A more detailed discussion of the FAA's two-year limitation period can also be found in In the Matter of 

Mississippi Air Express, LLC, FAA-2014-0866, Order Granting the Respondent's Motion to Dismiss Action (July 

22, 2015). 

Page 4of13 
action shall not be initiated ... after 2 years from the date the violation occurred." FAA Civil 

Penalty Administrative Assessment Act of 1992, Pub. L. 102-345, § 2(a) (Aug. 26, 1992) 

(codified at 49 U.S.C. § 1471(a)(3)(E)(iii)) (efupl}aiis added). Two years later, in 1994, Congress 

revised and recodified this statute as 49 U.S.C. § 46301(d)(7)(C). (Revision ofTitle 49, United 

States Code Annotated, "Transportation, " Pub. L. 103-272, § 1 (Jul. 5, 1994) 

Thus, in 1990, the FAA self-adopted a shorter two year limitations period in 14 C.F .R. § 

13.208(d), prior to the enactment of the enabling statute. Two years later, in 1992, Congress 

enacted a two-year statute oflimitations applicable to FAA civil proceedings. 49 U.S.C. § 

46301(d)(7)(C) (formerly 49 U.S.C. § 1471(a)(3)(E)(iii)). As noted above, the parties agreed that 

14 C.P.R. § 13.208(d), which implements 49 U.S.C. § 46301(d)(7)(C), required that the FAA file 

a NPCP within two years of the date of violation. 

b) 49 U.S.C. § 4630l(d)(7)(C) is Applicable to Enforcement Cases 

In support of its argument for dismissal, the Respondent primarily relied on three cases 

decided and dismissed as untimely, in 2005 and 2006, by U.S. Administrative Law Judge Isaac !" . _,,,(, 

L ... 1'\l~,q.:''·: 

Benkin. In both Aerocomp, Docket No.· F AA~2005-21 064 (Sept. 29, 2005), and Aviation Brake 

Service, Inc., Docket No. FAA-2005-22213 (Mar. 9, 2006), Judge Benkin found that the five (5) 

year statute of limitations in 28 U.S.C. § 2462 applied to civil penalty actions. He also found that 

28 U.S.C. § 2462 required dismissal of an FAA complaint filed more than five years after the 

alleged charges, regardless of when the FAA had previously issued its NPCP. Aerocomp, 

Docket No. FAA-2205-21064 at 5-6; Aviation Brake, Docket No. FAA-2005-22213 at 8-12. 

In In the Matter of Joseph Karl, Docket No. F AA-2005-22889 (Sept. 19, 2006), Judge 

Benkin explained that there were two distinct time limitations applicable to FAA civil penalty 

proceedings, specifically: 1) pursuant 14 C.P.R.§ 13.208(d), the FAA was required by its own 

regulation to file a complaint in a civil penalty action within two (2) years of issuing a NPCP; 

and 2) 49 U.S. C. § 2462 was applicable, and statutorily required that the FAA's complaint be 

filed no later than five (5) years after the violation occurred. !d. at 2. The parties did not pursue 

appeal in any of these three cases. 

The Respondent's reliance on these three case decisions is understandable, but erroneous. 

For example, as part of his rationale for dismissal, Judge Benkin mistakenly applied the five year 

Page 5 of 13 
limitation period of28 U.S.C. § 2462 to these administrative civil penalty proceedings, without 

recognizing that a more specific statute, 49 U.S. C. § 46301(d)(7)(C), which required a two-year 

time limitation, had been adopted and should be applied. As explained earlier herein, in 1992, 

Congress incorporated the FAA's two (2) year limitations period into its statute by amending 

section 901(a)(3) ofthe Federal Aviation Act of 1958 (49 U.S.C. § 1471(a)(3)). FAA Civil 

Penalty Administrative Assessment Act of 1992, Pub. L. 102-345, § 2(a) (Aug. 26, 1992) 

(codified at 49 U.S.C. § 1471(a)(3)(E)(iii)). In 1994, this statute was revised (NB: revisions not 

material to the issue herein) and recodified as 49 U.S.C. § 46301(d)(7)(C). Revision ofTitle 49, 

United States Code Annotated, "Transportatiorz, ·:Pub. L. 103-272, § 1 (Jul. 5, 1994). ' , .... , 

Thus, the two-year statute of limitations provided by 49 U.S.C. § 46301(d)(7)(C) 

specifically applies to the administrative enforcement proceedings, and the five year limitations 

period under 28 U.S.C. § 2462 does not apply. 5 

c) A Civil Penalty Case is "Initiated" with the Filing of a NPCP 

While the Respondent acknowledged that 49 U.S.C. § 46301(d)(7)(C) was the applicable 

statute of limitations in these administrative proceedings, it still urged this Court to adopt Judge 

Benkin's holding and rationale in the Aerocomp, Aviation Brake, and Karl cases, and find that 

"the two-year time limit set forth in 49 USCA § 46301(d)(7)(C) also requires the [FAA's] 

Complaint to be filed within two years of the alleged incidents giving rise to the alleged 

violations." (Am. Mot. 3.) 

In pursuing its request for dismissal, t4,~ Ret~pondent essentially argued that the language 

of the FAA's implementing regulation (14 C.F.R. ·§ 13.208(d)) was not a reasonable 

interpretation of Congress's enabling statute (49 U.S.C. § 46301(d)(7)(C)). In other words, the 

language of 14 C.F.R. § 13.208(d), which states that an alleged violation may not be charged 

"more than 2 years" before an agency attorney issues a "notice of proposed civil penalty," does 

not reasonably interpret the language of 49 U.S.C. § 46301(d)(7)(C}, which states that a case 

5 It should be noted, however, that the five year limitations period in 28 U.S.C. § 2462 still applies to FAA civil 

penalty actions for which the U.S. district courts have exclusive jurisdiction under 49 U.S.C. § 46301(d)(4) and 14 

C.F.R. § 13.16(a). See 49 U.S.C. § 4630l(d)(7)(C) (making two-year limitations period applicable only to actions 

"involving a penalty under this paragraph[.]" 

Page 6 of 13 

if,~},<\~.<. ' -tfpt •,' 
"may not be initiated later than 2 years after ~he viq1~tion occurs." According to the Respondent, '. : ·:·"-· i..!-,d'' 

the initiation of a case required the issuance of a complaint, not a NPCP. While the Respondent's 

argument, which followed the rationale provided by Judge Benkin in the Aerocomp, Aviation 

Brake, and Karl cases, was understandable, it was mistaken. 

For example, when the Rules of Practice were adopted in 1990, the Administrator 

explained that the "initiation" of the civil enforcement action was triggered by the issuance of a 

NPCP. See 55 Fed. Reg. 27548,27556 (Jul. 3, 1990) (Discussion ofFinal Rule) (''the FAA has 

always considered legal enforcement action to be initiated with the issuance of a notice of 

proposed civil penalty.") After the enactment ofthe enabling statute in 1992, the FAA 

Administrator has consistently interpreted the word "initiated" in 49 U.S.C. § 46301(d)(7)(C) to 

mean the issuance of a NPCP, not the issuance of a complaint. See Everson, FAA Order No. 

2004-5 at 2 (Sept. 22, 2004); Royal Avionics Systems, Inc., FAA Order No. 2002-6 at 7-8 (Apr. 

16, 2002); High Exposure, Inc., FAA Order No. 2003-7 at 8 (Sept. 12, 2003). 

Thus, the NPCP has long been established'as' the "initiating" document in FAA civil 

enforcement proceedings, in part because under the FAA Rules of Practice, the complaint is filed 

as a responsive document, wholly dependent on a respondent requesting a hearing. See 14 C.F .R. 

§ 13.16(i) ("If the person charged with a violation requests a hearing ... the original complaint 

shall be filed with the hearing docket clerk and a copy shall be sent to the person requesting the 

hearing."); 14 C.F.R. § 13.208(a) ("The agency attorney shall file ... the complaint with the 

hearing docket clerk ... not later than 20 days after receipt by the agency attorney of a request 

for hearing.") 

It should be noted that in the Aerocomp, Aviation Brake, and Karl cases, Judge Benkin 

warned that failing to "initiate" a case by filing a complaint created the risk of delayed 

adjudication. This concern is certainly legitimate in other civil cases, which may only be 

"initiated" by the filing of a complaint. However, i~itiating a civH penalty action with a NPCP, 

instead of a complaint, does not create the delayed ~~sk envisioned by Judge Benkin. 

As noted above, after the issuance of the NPCP in a civil penalty action, the "legal spur" 

that triggers the FAA's filing of a complaint is the respondent's request for hearing. Therefore, 

the respondent has control over part of the pace of the litigation. The respondent may file this 

Page 7 of 13 
request for hearing at various stages of the civil penalty action: e.g., immediately following the 

issuance of a NPCP, 14 C.P.R.§ 13.16(±)(3); or following an informal conference to discuss the 

allegations contained in the NPCP and the issuance of a final notice of proposed civil penalty, 14 

C.F .R. § 13 .16(g)(ii); or at some other time as long as the right to a hearing is properly preserved 

through compliance with 14 C.P.R. § 13.16, see Woolpert LLC, Docket No. FAA-2015-0211-

0006, Order Denying the FAA's Motion to Dismiss (June 3, 2015). 

Thus, while the FAA controls the initiation of the civil penalty action through issuance of 

the NPCP (which has a two-year limita~ions p~riod)' ,the respondent's right to receipt of a 

' ',i , .. ,. :,_.,:.ll ·'· .' 1 

complaint and an opportunity for a hearing is contro'lled and protc;:cted through the respondent's 

own actions. 6 As a result, the issuance of the NPCP, which is entirely under the control of the 

FAA, is the triggering factor for the FAA's compliance with the two year limitations period. The 

two (2) year statute of limitations runs from the date of the alleged violation to the date of the 

NPCP. 14 C.P.R.§ 13.16(±). Thus, 14 C.P.R.§ 13.208(d) reasonably interprets the language of 

49 U.S.C. § 46301(d)(7)(C) by requiring the FAA "to initiate" a civil penalty action by issuing a 

NPCP, not a complaint, no later than two years after the violation occurred, unless the FAA can 

show good cause for any delay beyond two years. 

d) 49 U.S.C. § 4630l(d)(7)(C) Does not Require the FAA to Issue a Complaint 

Within Two Years of the Alleged Violation 

The Respondent's position that 49 U.S.C. § 46301(d)(7)(C) and 14 C.P.R.§ 13.208(d) 

place different requirements on the FAA is rejected))(Am. Mot. 2, 6; Mot. & Reply 2.) Section 

' t . " '. j . I 

13.208(d) and 49 U.S.C. § 46301(d)(7)(C) ~epres~nt'the rare situation where a regulation 

precedes the statute and Congress later incorporates the agency practice into the statute. As 

discussed supra, Congress incorporated the FAA's earlier adopted two (2) year limitations 

period into its organic statute in 1992 by amending section 901(a)(3) ofthe Federal Aviation Act 

of 1958 (49 U.S.C. § 1471(a)(3)). FAA Civil Penalty Administrative Assessment Act of 1992, 

6 If, as the Respondent argues, a civil penalty action is initiated only when the FAA files a complaint, then multiple 

situations under the current regulations will arise where a respondent is liable for a civil penalty when the FAA has 

not "initiated" a civil penalty action by filing a complaint. For example, pursuant to 14 C.P.R. § 13.16(d), an order 

assessing civil penalty may be issued if a charged respondent does not request a hearing within 15 days after receipt 

of a final notice ofproposed civil penalty. Because the charged respondent does not request a hearing, the FAA 

would not file a complaint, but the respondent would nonetheless be liable for the civil penalty charged in the NPCP 

and FNPCP. 

Page 8 of13 

· .. 

•i 
Pub. L. 102-345, § 2(a) (Aug. 26, 1992) (codified,&t49 U.S.C. § 1471(a)(3)(E)(iii)). Two years 

later, in 1994, the organic statue was revised and recodified as 49 U.S.C. § 46301(d)(7)(C). 

Revision ofTitle 49, United States Code Annotated, "Transportation," Pub. L. 103-272, § 1 (Jul. 

5, 1994). 

Agency regulations implement statutes. 14 C.F.R. § 13.208(d) implements 49 U.S.C. 

§ 46301(d)(7)(C). In promulgating implementing regulations, an agency's interpretation ofthe 

organic statute is entitled to deference. Prior to the 1992 statutory enactment of the two year 

limitations period, the Administrator interpreted the term "commenced" contained in 28 U.S.C. 

§ 2462 to mean the issuance of a NPCP by an agency attorney. See 55 Fed. Reg. 27548, 27552 

(Discussion of Final Rule). When Congress chose to codify the FAA's two (2) year limitations 

period in 1992, it did so without referring to, or changing, the FAA's interpretation of 

"commenced" in the statute. Since 1992, as noted supra, the FAA has consistently interpreted 

the word "initiated" in 49 U.S.C. § 46301(d)(7)(C).to mean the commencement ofthe action by ) ., .. Ht. .. d, <~·i- ·.~. 

issuance of a NPCP, not the issuance of a complaint. 

Therefore, the FAA meets the requirements ofboth 49 U.S.C. § 46301(d)(7)(C) and 14 

C.F .R. § 13 .208( d) when it issues a NPCp no later than two years after the alleged violations 

occurred. See Werle, FAA Order No. 97-20, at 7-8 (May 23, 1997); Van Guard, Docket No. 

CP01S00029, 2002 WL 34359278, at *4 (May 7, 2002). Thus, contrary to the Respondent's 

arguments, the FAA's implementing regulation (14 C.F.R. § 13.208(d)), appears to be a 

reasonable interpretation of Congress's enabling statute (49 U.S.C. § 4630l(d)(7)(C)), and does 

not require the FAA to issue both a NPCP and a complaint within two years of the alleged 

violation(s). 

3. The Respondent should be granted dismissal, under the affirmative defense of laches, 

because of the prejudice to its case because of the passage of time. Not Proven . 

. •. ,h. 

a) Overview of the Defense of La~hes lniCivii'Penalty Cases 

The defense of laches is an equitable defense. 7 Laches is not generally available as a 

defense against the United States when it is acting in its sovereign capacity to enforce a public 

7 A similar overview on the FAA's defense oflaches may also be found in Mississippi Air Express, LLC, FAA2014-0866, Order Granting the Respondent's Motion to Dismiss Action (July 22, 2015). 

Page 9 of 13 
right or protect the public interest.8 See, e.g., St. John's General Hospital, 875 F.2d at 1071; 

Popovich, 820 F.2d at 136 (5th Cir.1987), cert. denied, 484 U.S. 976 (1987). Nevertheless, when 

the FAA adopted the Rules of Practice in 1990, the FAA decided that a limited laches defense in 

civil penalty proceedings should be allowed: 

While not unmindful of this [laches] case law, considerations of due process, and 

a fair construction of section 555 of the Administrative Procedure Act, lead the 

agency to allow for a showing of actual prejudice in an appropriate case. 1, t .. 'f~: '· t.,., .,. '\.:·:/•t \ 

55 Fed. Reg. 27548,27556 (Jul. 3, 1990) (Discussion ofFinal Rule). 

The FAA's willingness to allow a laches defense appeared to be a response to concerns 

raised by many public commentators, who urged expediency in FAA actions, and recommended 

that the FAA utilize a much shorter, six-month time period to initiate safety enforcement actions 

·with the filing of a complaint. 55 Fed. Reg. 27548, 27555 (Jul. 3, 1990) (Discussion of Final 

Rule). The FAA declined to adopt a six -month time limit for initiating an action, and also 

declined to utilize the two year limitations period as a deadline for filing a complaint. 9 However, 

the FAA acknowledged that in "rare" cases, agency delay in prosecuting an action could result in 

"actual prejudice" to a respondent's case. !d. Therefore, in such cases, dismissal of the action, or 

a portion of the action, could be requested: 

[I]t is possible that a respondent would be unable adequately to defend a civil 

penalty action because documents or.witne§ses become unavailable due solely to 

the agency's unreasonable or excessivk''dMCJ.y \in initiating a case. In such a case, 

it is possible that a respondent could make such a showing of actual prejudice and 

petition ... to dismiss ... on the basis of such prejudice. 

!d. at 27556 (emphasis added). 

8 The Federal circuits are split as to whether laches is applicable to any suits at law that are authorized under a 

legislative statute of limitations. Compare Lyons Partnership, L.P v. Morris Costumes, Inc., 243 F.3d 789,797 (4th 

Cir. 2001) (in federal copyright suit laches is not a defense to actions at law), and Ivani Contracting Corp. v. City of 

New York, 103 F.3d 257,260 (2d Cir. 1997) ("when a plaintiffbrings a federal statutory claim seeking legal relief, 

laches cannot bar that claim, at least where the statute contains an express limitation period within which the action 

is timely"), with Chirco v. Crosswinds Communities, Inc., 474 F.3d 227,234 (6th Cir. 2007) (laches can apply 

equally to claims at Jaw and equity in federal copyright suit). 

9 In adopting the Rules of Practice, the FAA explained that requiring the complaint to be filed within the two-year 

period would eliminate the FAA's ability to engage in flexible negotiations and communications after the case was 

initiated. (/d.) It would also be detrimental to the Respondent, if the agency "issue[ d) a complaint first and ask[ed] 

questions later." 55 Fed. Reg. 27548,27556 (July 3, 1990) (Discussion of Final Rule). 

:~:i.l·) 

·. b'\· t .. ·.:) 

Page 10 of 13 
~~ .ls 

In its 1990 discussion of when the def~n·s{~r laches could be raised, the FAA did not 

distinguish between actions brought by the FAA within the two-year limitations period versus 

outside the two-year limitations period. Id at 27553-56, Thus, the lach~s defense may be raised 

by a respondent in civil penalty cases where the FAA has initiated the action within the two year 

limitations period, or in those rare cases where the FAA initiates the action outside the two year 

limitations period and has proved good cause for its delay in initiating the case outside the 

limitations period. 

b) Laches: Burden of Proof and Elements 

A party that raises the affirmative defense of laches in a civil penalty proceeding bears 

the burden of proof. 14 C.P.R. § 13.225(c). Laches requires the respondent to make a showing of 

"actual prejudice" to the defense of its case. 55 Fed. Reg. 27548, 27553-56 (July 3, 1990) 

(Discussion of Final Rule). The respondent's proo~pfprejudice must show that it is "unable to 

adequately defend a civil penalty actiortL" (SS.Fed;.Reg. 27556, (Jul. 3, 1990) (Discussion of 

Final Rule). See also, Carroll, FAA Order 90-21 (Aug. 16, 1990) at 3 (the respondent must show 

"undue prejudice") (citing Armco, Inc. v. Armco Burglar Alarm Co., Inc., 693 F.2d 1155, 1161 

(5th Cir. 1982) and Gull Airborne Instruments, Inc. v. Weinberger, 694 F.2d 838, 843 (D.C. Cir. 

1982). There are two primary elements in a laches defense: 1) "inexcusable delay" by the FAA 

in bringing the claim; and 2) "undue prejudice to the other party resulting from that delay." 

Carroll, FAA Order No. 90-21, at 3; See National R.R. Passenger Corp. v. Morgan, 536 U.S. 

101, 121-22 (2002) ("a laches defense,[] bars a plaintiff from maintaining a suit ifhe 

unreasonably delays in filing a suit and as a result harms the defendant). 

c) Respondent Did Not Meet Its Burden of Proof Under Laches 

The Respondent's arguments that the FAA engaged in inexcusable delay in initiating the 

civil penalty action, and that this delay was the sol~,reason for the Respondent's loss of evidence, 

was unpersuasive. 

First, as discussed above, the Respondent is mistaken that the FAA "failed to bring this 

action within the requirements of 49 USCA §46301([d])(7)(C)" and that the FAA "delay[ed] [] 

over four years in bringing this matter to prosecution." (Am. Mot. 6.) In fact, the instant civil 

penalty action was initiated by the FAA's issuance of the NPCP on May 24, 2012-within two 

Page 11 of13 
(2) years ofthe thirty (30) acts of improper maintenance alleged in the FAA's June 5, 2015 

Amended Complaint. The FAA's prosecution of the thirty (30) acts within the regulatory and 

statutory limitations period, without any proof of dilatory or unreasonable conduct, does not 

demonstrate the "inexcusable delay" element in a laches defense. 

Second, the Respondent failed to prove the element of"undue prejudice." Although Mr. 

Allen testified that two primary witnesses have been "lost" (Am. Mot., Exh. A, 2), this testimony 

is not sufficient to establish prejudice under a laches' defense. A "lost" witness might be found, 

with reasonable diligence. A respondent asserting a laches defense in a FAA civil enforcement 

action must first demonstrate that it acted promptly to gather and preserve evidence after notice 

of the action, and that such evidence is no longer available solely because ofthe FAA's delay. 

This concept was briefly discussed by the FAA Administrator during the adoption ofthe 

Rules of Practice. As part of this discussion, the Administrator pointed out that an FAA Letter of 

Investigation ("LOI") typically preceded the NPCP and served to notify the respondent that 

evidence should be collected and preserved. 55 Fed. Reg. 27548, 27556 (July 3, 1990) 

(Discussion of Final Rule). While the Administrator recognized that an LOI did not replace the 

FAA's obligation to timely initiate the action by filing a NPCP, receipt of the LOI did "reduce ... 

the chance" that a respondent would be "prejudiced by delay, especially where legal enforcement 

action is initiated within two years." !d .. 

In the instant case, the Respond~nt did no~' ptovide any information about what efforts it 

has made (if any) to obtain and preserve evidence between June 23,2011, the date that the FAA 

issued its LOI (Am. Mot. 1; Resp. 2)- and May 24, 2012, the date that the civil penalty action 

was initiated with a NPCP. Given the lack of information on this issue, and because the 

Respondent has failed to satisfy the first element of laches, further discussion regarding its 

assertion of undue prejudice under the second element of laches is unnecessary at this time. 

C. CONCLUSION 

Based on the foregoing and after having reviewed the case file, all pleadings and motions, 

all relevant caselaw, statutes, regulations, rules, and authority, and being fully advised; 

. :r.r Page 12 of13 
IT IS HEREBY ORDERED: 

1. The Respondent's May 15,2015 Amended Motion to Dismiss is denied. 

2. The Respondent's June 19,2015 Motion to Dismiss Amended Complaint is denied. 

3. A separate order will issue shortly, setting a date for the parties to convene by telephone 

for a Litigation Scheduling Conference. 

Attachment: Service List 

Page 13 of 13 
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 2Wl 00010 

Mr. William Vines 

Complainant's Counsel 

Federal Aviation Administration 

Office of the Regional Counsel, AS0-7 

Southern Region 

1701 Columbia A venue 

College Park, GA 30337 

TEL: 404-305-5200 

FAJ(: 404-305-5223 

ONE COPY 

Docket No. FAA-2014-0807 

(Civil Penalty Action) 

Mr. David M. McDonald 

Respondent's Counsel 

McDonald & McDonald 

Attorneys at Law 

Paz Aviation Inc., Respondent 

c/o Jay Allen, President 

P.O. Box 669122 

Miami, FL 33166-9428 

TEL: 305-643-5313 

F AJ(: 305-643-4990 

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. (Ell-310) 

Washington, DC 20590 

TEL: 202-366-6941 

FAJ(: 202-366-7536 

7455 W 2nd Court 

Hialeah, FL 33014-4301 

10 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 2Wl000, Washington, 

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