SERVEDJune 19,2002
UNITED STATES DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS

WASHINGTON, DC
FAA v. MACE ADHESIVES & COATINGS CO., INC. FAADOCKETNO. CP02EA0004 (Civil PenaltyAction) DMS NO. FAA-2002--11513
ORDERASSESSING CIVILPENALTY 

### This proceeding is before me on the parties' cross-motions for decision on the written submissions.' Complainant's motion, as modified herein, is granted. Respondent's request to dismiss the complaint is denied; to the extent that it asked for a decision and a determination ofpenaltyon the record presented, its motion is granted. 

### , FINDINGS Thefacts alleged in the complaint are undisputed. On September 16, 1999, an employee ofMace

### Adhesives & 

### Coatings Co., Inc. (Respondent orMace), a manufacturing
concern located in Dudley, MA, offered to United Parcel Service (UPS) a shipment in a fiberboard box. The box contained four metal containers filled with liquid. The shipment
was loaded onto and flown on a regularly scheduled UPS flight. At UPS' sort facility in Philadelphia (the flight's destination), ground-handling personnel determined that the containers were leaking into the box. The box was emitting an odor.

I As Respondent suggests in its prolixly-titled "AnswerofMace Adhesives & Coatings Co., Inc. in Opposition to Motion ofFAA for Decision on the Pleadings and in Support ofits Motion for Final Decision aud Judgment on the2 The liquid in the containers was a flammable resin solution. A flammable resin solution is classified as a hazardous material underthe Hazardous Materials Regulations (HMRs). 

### See Hazardous Materials Tablefollowing 49 C.F.R. §172.1 01. The box had not been packaged, marked, described, or labeled properly. It also lacked other information required by the HMRs for the transport of hazardous materials. The agency charged Mace with violations ofthe following HMRs: 49 C.F.R. §§171.2(a), 172.200(a), 172.201(d), 172.202(a)(1)-(a)(5), 172.204(a), 172.204(c)(2) and (c)(3), 172.300(a), 172.301 (a), 172.400(a), 172.600(c), 173.1(b), 173.22(a)(1) and (2), 173.24(b)(1) and (2), and 173.27(d).' Complainant seeks a 

### civil penalty of $20,000. CONCLUSIONS Respondent conte.nds that it did not "knowingly" 

### violate the law, as the statute requires for liability. "Knowingly" is defined as "actual knowledge ofthe facts 

### giving rise to the 

### violation" or the knowledge that a reasonable person exercising reasonable care would 

### have. 49 U.S.c. §5123(a). Congress intended 

### civil penalties to be imposed on those who knowingly committed the act that constituted a

### violation, which boils down to knowingly tendering a shipment for carriage in air commerce. It would not be necessary to show that the 

### violator knew that his or her act constituted a

### violation. Scott H. Smalling, FAA Order No. 94-31 (October 5, 1994), p. 7; 

### Tc/ Corporation, FAA Order No. 92-77 (December 22, 1992), pp. 8-9 n. 13.

Record Presented" ofMarch 29, 2002 (Mace's Answer), its February 8, 2002 motion for suspension ofprocedural dates is moot. 

### (

2 The complainthadalso alleged thatRespondent violated §172.702(a)

- that is, thatthe companyfailed to ensure that its hazmat employees had been properlytrained

- but, notingthat Mace had since produced satisfactory training ( records for the employee in question, the agency excluded that charge in a subsequentpleading. SeeMotion for Decision (February21,2002), pp. 2-3.3 

### Respondent argues that the employee whoturned over the shipmentto UPS was suffering from clinical depression; therefore, the employee, and vicariously Respondent,' did not knowingly committhe violations with which it is charged.' This argument does not wash. Iwill assume, as Respondent's exhibits and argument assert, that this employee suffered from clinical depression at thetime ofthe incident (see Exhibits Aand M attached to Mace's Answer). But that circumstancedoes not require or inexorably warrant a finding, as Mace apparently contends, thatthe employee did not "knowingly" violate the statute or HMRs. The question ofwhetherthe employee's depression shows that the employeedid not have the statute's requisite "knowledge" is a question offact. Bender v. Department

### of Veterans Affairs, 

### 1997 U.s. App. Lexis 29897 (Fed.Cir. 1997); U.S. v. McCaffrey, 

### 1997 U.S. Dist. Lexis 6907 (N.D. III. 1997). Respondent must showthat this employee's condition absolved the employee, and thereby Mace, for responsibility for the particular incident under scrutiny. This it has utterly failed to do. Mace has provided no evidence on this point. Its mere recitation of the employee's clinical depression does not excuse it from liability. Indeed, Respondent's exhibits provide evidencethat the employee's condition had
no impact on the employee's "knowledge." A psychiatric examination ofthis employee less than three weeks after the incident

- which Respondent submitted to show the employee's condition atthetime ofthe incident

- concludes that "[tlhought content is not

3 Theemployee clearly acted within the scope ofemployment. As such, any action for which the employee is held responsible is vicariously ascribed to Mace. Warbelow'sAir Ventures. Inc., FAA OrderNo. 2000-3 (February 3, 2000), p. 5, reconsiderationdenied, FAA OrderNo. 2000-14 (June 8, 2000); see also Crook & CrookMarine Supply, 1999 FAA Lexis 418, 424-25 (Initial Decision ofJudgeKolkodatedMay 12,1999). 4 I grantthatpartofMace's motion ofFebruary 8, 2002to withhold from public disclosureunderRule 226 ofthe Rules ofPractice in FAA Civil PenaltyActions, 14 C.F.R. §13.226, the name ofthis employee andthe associated medicalrecords. The record shall be sealed to that extent.4 delusional. Perceptions are clear
... Concentration is good
. .. Insight andjudgment are intact. Competent." Exhibit M, p. 2 (emphasis supplied). These observations suggest in fact thatthe employee wasfully responsible in this matter. They showthat the employee intended to placethe shipment into air transportation, and understood the implications of
so doing. Iconclude that the employee knowingly committed the act that led to the charges. In view ofthe foregoing, Ifind the violations set out in the complaint, with the exception of §172.702(a) (see n. 2). Ifind and conclude that Respondent Mace Adhesives & Coatings Co., Inc. violated the following HMRs: 49 C.F.R.§§171.2(a), 172.200(a), 172.201(d), 172.202(a)(1)-(a)(5), 172.204(a), 172.204(c)(2) and (c)(3), 172.300(a), 172.301(a), 172.400(a), 172.600(c), 173.1(b), 173.22(a)(1) and (2), 173.24(b)(1) and (2), and 173.27(d). PENALTY The agency seeks a penalty of $20,000. Respondent argues that its employee's condition is such a significant mitigating factor that only nominal or minimal civil penalties should be assessed (Mace's Answer, p. 13). Mace also contends that its financial circumstances constitute a substantial mitigating factor. A supporting affidavit and exhibits state that the company, which employs about 15 people, operated at a loss in 2001 and 2000, and is currently operating at a loss; has exhausted available credit; and would have to borrow money to pay any civil penalties. Its debt continues to rise. It has laid offemployees (Affidavit ofMark Compagnone; Exhibits 

### 0, P and Q). Inote, however, that Mace's financial information is 

### (5 

### based on its own representations and not on an independent audit (Exhibit Pl. Additionally, Respondent has neither asserted nor shown that a civil penalty could lead to bankruptcyorotherwise affect its ability to continue as a going concern. A review of all the factors that must be considered in setting the civil penalty under the Hazardous Materials Transportation Act (the Act)

- including the nature, circumstances, extent, and gravity ofthe violation, and Respondent's degree of CUlpability, history ofviolations, and ability to pay - leads to the conclusion that a $10,000 civil penalty is warranted in this case. This figure reflects the serious nature of these violations while accounting for Respondent's difficult finances. For a civil penaltyto achieve its purpose, it must have "bite," ordeterrent effect. As the legislative history indicated, Congress intended the hazardous materials regulations to have "teeth." 120Congo Rec. 41, 410 (1974); 120 Congo Reg. 40,677- 40,679 (1974); see Toyota Motor Sales, USA, Inc., 

### FAA Order No. 94-28 (September 30, 1994). Otherwise, Congress would not have increased the maximum penalty for each violation ofthe hazardous materials regulations from $10,000 to $25,000. It is the responsibility ofthe FAA to enforce the Act vigorously. In this case, the shipmentwas "hidden"

- that is, nothing on the box informed the handlers ofthe hazardous nature ofits contents. Such shipments pose a special health risk. Toyota MotorSales, USA, Inc., 

### p. 13. The shipment, additionally, was proffered by a companyfamiliar with chemical solutions ofa type that may be hazardous, and which had tendered many similar shipments before. It is experienced6 

### in shipping such materials.' On the otherhand, Mace's financial situation (but not its employee's condition) warrants mitigation. Respondent's affidavit and exhibits, although based on unaudited statements, indicate that its finances may betenuous. And the company's situation appears to be worsening. Ifind that a civil penalty of $10,000 will have suitable "bite" without significantly affecting Mace's ability to continue in business. This amount is appropriate underthe circumstances. Ihereby assess a civil penalty of $10,000 against Respondent Mace Adhesives and Coatings Co., Inc., for violating the HMRs as set out above on p. 3. 6

# ~i.l(~ Burton S. Kolko 

### Administrative LawJudge

5Mace's web site, www.maceco.com. states that it "is aleader in polyurethane development and otTers awide variety ofwaterand solvent based products. Mace has a reputation as a Polyuretilane Specialisf' [caps in original]. 6 Anyappeal from this orderto the Administratormust be in accordance with section 13.233 ofthe Rules ofPractice, which requires 1)that a notice ofappeal be filed no laterthan 10 days (plus 5 for mailing) from the date ofthis orderand 2)thatthe appeal be perfected with a written brieformemorandum not laterthan50 days (plus 5 for mailing) from the date ofthis order. Each is to besentto the Appellate Docket Clerk, Room 924-A, Federal AviationAdministration, 800 IndependenceAvenue, Washington, DC 20591, and to agencycounsel. Service upon the presidingjudge is optional. 

### (7 FAA DocketNo. CP02EA0004 (Civil PenaltyAction) SERVICE LIST ORIGINAL & ONE COpy HearingDocket Room 924A, AGC-1O Federal Aviation Administration 800 IndependenceAvenue, SW Washington, DC 20591

Robert N. Meiser Attorney atLaw 8700Lothbury CT Fairfax, VA 22031 TEL: (703) 560-5032 fax: 703 560 5032 AnthonyJ. Molligo, Attorney**FAA,~A-7** 1Aviation PLZ

- Room 561 Jamaica, NY 11434 TEL: (718) 553-3278 FAX: (718) 995-5699 TheHonorable Burton S. Kolko Administrative LawJudge Office ofHearings, M-20, Room 5411 US Department ofTransportation 400 Seventh Street, SW Washington, DC 20590 

### ONECOPY

TEL: (202) 366-2144; law clerk 2139; secretary 2142 FAX: (202) 366-7536