JEFFREYM. HARPER FAA OFFICE OF REGIONAL COUNSEL 160I LIND AVE., SW RENTON, WASHINGTON98057 TELEPHONE: (425)227-2161 FACSIMILE: (425)227-1007 

### UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS

WASHINGTON, D.C. 

# riECEI\lED
APR

- 1 2Ci4 

## HEARING DOCKET

In the Matter of: FAA Case No. 2011NM060005 DMS No.: FAA-2012-0777 SkyWest Airlines, Inc. Honorable Richard C. Goodwin



### REBUTTAL TO RESPONDENT'S MOTION FOR DECISION Respondent asks this court to:

• Consider the minimal safety riskposedby its admitted regulatory violations in selecting a sanctioninthe minimumrange; 1


### o Which Complainant did; 2

• Select a starting point for its sanction calculation within that range, but below the middle ofthe range;3

o Even though Chapter 7,**~** 5.b.4 of FAA Order 2150.3B""' ("Sanction Guidance") requires a sanction calculation to begin in the middle of the selectedrange; 4

1Respondent's Rebuttal and Motion for Decision,"' Pages 13-14 ("Even the FAA agrees there was a low degree ofhazard related to the discrepancy and thatthe "minimum" violation category is applicable to this matter." Hyper!inks to cited documents are marked with"=>." 2 Complainant's Motion for Decision,"'Pages 10-11 ("the choice ofsanctionrange accounts for the mitigating factor ofthe relatively low degree ofhazard

...."). 3 Respondent's Rebuttal and Motionfor Decision,"' Page 10 ("Here, the appropriate starting point for the sanction calculation is belowthe midpoint of**the~**range.") 4 FAA Order 2150.3B,"' Chapter 7,**~** 5.b.4 ("When determining a specific sanction amount with a range, FAA personnel begin with an amount in the middle ofthe range....").• Mitigate the sanctionbelowthe starting point onthe basis ofthe minimal safety risk- 5 '

### o Even although Complainant's sanction calculation addressedthe minimal safety risk by selecting a sanction guidance range that is applicable to violations involving technical noncompliance, rather than a rangefor violations involving a risk to safety; 6

• Grant additional mitigation onthe basis ofits affirmative defenses taking the form ofpurportedly corrective actions;7


### o Even though Respondent has failed to meet its evidentiary burden toprove those actions, andthose actions have at besta tenuous connection to the root cause of the violationsRespondent identified; 8

• Not consider Respondent's lengthy experience as a Part 121 operator in increasing the sanction;9


### o Even though the Sanction Guidance states "Certificate holders with greater levels of experience may be heldto a higher standard "10

• Mitigate the penalty even further by treating the violations as one; 11


### o Even though statutory lawprovides that each ofRespondent'sjlights using the unairworthy aircraft constitutes a separate violation, andRespondent admits that the ranges found in its Sanction Guidance arefor single



### . 1 t' 12 vzo a zons.

5 Respondent's Rebuttal and Motion for Decision,"" Pages 9-10 ("As for the 'gravity ofviolation' factor, the FAA acknowledges there was a low degree ofhazardbecause the affected component was determined to be operational-- yet it did not decrease the penalty accordingly

..."). 6 Complainant's Motion for Decision,"' Pages 10-11 ("the choice ofsanctionrange accounts for the mitigating factor ofthe relatively low degree ofhazard

...."). 7 Respondent's Rebuttal and Motionfor Decision,"" Pages 10-13 ("C. SkyWest Should Be Credited For Its SignificantMitigation Measures."). 8 Complainant's Motion for Decision,"" Pages 9-10 (explaining why Respondent's actions do not , warrant mitigation). 9 Respondent's Rebuttal and Motion for Decision,"" Pages 9-10 ("There is no mandate that an airline be automatically assessed sanctions at the higher end ofthe range simply because it has existed for a decade or more."). 1

# °

FAA Order 2150.3B,"" Chapter 7,**~** 4.c.l. 11 Respondent's Rebuttal and Motion for Decision,"" Page 8 ("Altogether, the FAA has cited three regulations and 19 violations

- despite only one isolated andinadvertent discrepancy presentinthe matter."). 12 49 U.S.C. § 4630l(a)(2);"' Respondent's Rebuttal and Motion for Decision,"" Page 5 ("The ranges setforth inthe FAA's Sanction Guidance are for single, inadvertent violations.").
Rebuttal to Respondent's Motionfor Decision In the Matter ofSky\VestA.irlines, Inc. FAA Case No. 201 JNM060005, DMS No. FAA-2012-0777 Page 2 of I0 JEFFREY M. HARPER, FAAAT!'ORNEY TEL: (425) 227-2161; FAX: (425) 227-.1007In contrast, for the reasons discussed inits Motion for Decision, Complainant seeks a sanction of$142,500 that is consistent withboththe facts ofthis case and its published Sanction Guidance.
BecauseRespondenthas conceded the issue ofliability, this Rebuttal is limited to the question ofsanction. Respondent's Rebuttal and Motion for Decision,"" Pages 3 and 4.


### Statement of Facts Respondent concedes the question ofliability, admitting that it l) failed to perform a required once-daily verification on two days, and 2) operated the aircraft on 17 flights whenthe verification had not beentimely performed. Respondent's Rebuttal andMotion for Decision,"" Pages 3 13 and 4. 14
On October 18, 2010, a SkyWest flight crewreported a discrepancy in the maintenance logbook ofN822SK ("the aircraft"). Complaint""'\[ II.6, Answer""'\[ II.6. SkyWest deferredthe discrepancy on October 18, 20l0, using a provision ofits Minimum EquipmentList (MEL) that required SkyWestto complete a once-daily verification ofthe system and to make an entry to that effect inthe aircraft logbook. Complaint""'\['\[ II.7 and 8, Answer""'\['\[ II.7 and 8. SkyWest subsequently operated the aircraft on 17 flights
over the course oftwo days when the actions required by the MEL had not beentaken. Complaint""'\[ II.11; Respondent's Rebuttal and Motion for Decision,"" Pages 2-4; Respondent's Response to Complainant's Initial Discovery Request,"" Responses to Interrogatory No.9, Request for ProductionNo. 3, and Requests for AdmissionNos. 6-9. Respondent has the ability to pay a $142,500 civil penalty. Respondent's Response to Complainant's Initial Discovery Request,"" Response to Request for AdmissionNo. 3. In its fiscal year ending December 31, 2010, Respondent had gross revenues in excess of $100 million. Respondent's Response to Complainant's Initial Discovery Request,"" Response to Requests for AdmissionNos. 1 and 2.

13 "Still, it is important and obligatoryto follow the MEL, no matter how minor the squawk, and SkyWesthas a gap in its records

.... SkyWest has previously stipulated to the facts set forth in the Complaint

.... SkyWest acknowledged that a once-daily maintenance checkthat was required to be performed on the aircraft as a result ofa fault indication on October 18, 2010, was not completed on October 19 and 20." 14 "Subsequently, SkyWest agreed to limit the matter to the issue ofsanction

...."
Rebuttal to Respondent's Motion for Decision In the J\{atter ofSkyWest/Urlines, Jnc. FAA Case No. 2011NM060005, DMS No. FAA-2012-0777 Page 3 of 10 JEFFREY M. HARPER. FAAATTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007

### Argument Standard for Decision The FAAhas the bmden ofestablishing its proposed civil penalty is appropriate. In the Matter of Luxemburg, FAA OrderNo. 1994-18"" at 6 (June 22, 1994). The standard is based on 14 C.P.R. § 13.224(a)"" which states the bmden ofproofis onthe Agency except in the case ofan affirmative defense. However, the effect mitigating factors, such
as corrective action and financial hardship, have on a sanction calculation are affirmative defenses. In the Matter of M & R Helicopters, LLC, FAA Order No. 2013-4"" at 21 (September 5, 2013), In the Matter of Seven's Paint & Wallpaper Co., FAA Order No. 2001-6"" at 5 (May 16, 2001), In the Matter of Conquest Helicopters, FAA Order No. 1994-20"" at 3-4 (June 22, 1994). The bmdenofproving an affirmative defense is on the party asserting that defense. 14 C.P.R. § 12.224(c).""
Complainantseeks an appropriate penalty in light ofthe total number of violations in this 

### case. As Respondent acknowledges, the FAA is asserting a total of 19 violations-two violations based on Respondent's failme to accomplish a required once-daily check on two days, and 17 violations based onRespondent's operation ofthe aircraft onthose two days for 17 separate flights. Respondent argues that tllis case is one where there was a single instance of noncompliance, analogizing to In the Matter ofGoJetAirlines, LLC. Respondent's Rebuttal and Motion for Decision,""' Page 7. This case is readily distinguishable from GoJet. In GoJet, there was only one failme to abide bythe Minimum Equipment List (MEL). In the Matter ofGoJet, FAA OrderNo. 2012-5"" at 4 (May 22, 2012). Following the failmeto comply with the MEL, GoJet operated the aircraft on a single flight, after whichitretmned the aircraftto an airworthy condition. Id.
In contrast, this case presents two failmes by Respondent to comply with the MEL--{)nce
on October 19, when Respondent's personnel failed to perform the required once-daily verification, and once on October 20, when Respondent's personnel again failed to performthe required once-daily verification. Unlike GoJet, this case involves 17 flights, rather than one. Thus, this case involves 19 instances ofnoncompliance, rather than the two in GoJet. Even assmning, as Respondent argues, that 14 C.F.R. §§ 121.153(a)(2) and 121.605 are residual to§ 119.5(g), there are still19 independent actions or omissions warranting a penalty for a total of 19 violations:

• Failmeto accomplishthe required verification on October 19 (A violation of 14 C.P.R.§ 119.5(g)).
Rebuttal to Respondent's !\'lotion for Decision In the Matter ofSkyWest Airlines, Inc. FAA Case No. 2011NM060005. DI\1S No. FAA-2012-0777 Page 4 of 10 J.EFF1<.EY M. HARP.ER, FAAi\JTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007• Failure to accomplish the required verification on October 20 (A separate violation of 14 C.F.R. 

### § 119.5(g)).

• Nine operations ofthe aircraft on October 19, when the required verification was not accomplished onthat flight day (Nine separate violations of 14 C.F.R. § 119.5(1)).

• Eight operations ofthe aircraft on October 20, when the required verification was not accomplished onthat flight day (Eight separate violations of 14 C.F.R. 

### § 119.5(1)). Complainant's Motion for Decision,"" Exhibit 4. 15 Respondent asserts this case is one where there was a single instance ofnoncompliance resulting in multiple violations, citing to Chapter 6, 'j6.c ofthe Sanction Guidance to argue that Complainanthas "compoundedmultiple violations on a single inadvertent error." Respondent's Rebuttal and Motion for Decision,"" Pages 3, 5, and 7. This argument fails because it is predicated onthere being only a single error at issue, rather thantwo erroneous failures to completed the required verification and 17 erroneous flights ofanunairworthy aircraft.
Each ofthe 17 flights presented Respondent with another opportunity to review the aircraft log. Each ofthe 17 flights presented Respondent with another opportunity to recognize that the once-daily verification had notbeen completed. Each ofthe 17 flights presented Respondent with another opportunity to complete that check. Oneach ofthe 17 flights, Respondent failed to take the required action. And, statutorily, each ofthe 17 flights was a separate violation. 49 U.S.C. § 46301(a)(2)."" 16
A provision ofthe Sanction Guidance more relevant to Respondent's argument is found atParagraph 7. Under that paragraph, Complainant does grant "special consideration for
numerous multiple violations [the flights ofthe affected aircraft] resulting from an initial act or omission [the failure to perform the required verification]." Under that procedure,
an appropriate penalty for the numerous multiple violations is determined by applying

15 The MEL requires completion ofthe check "once per flight day." Respondent's Rebuttal and Motion for Decision,"' Exhibit A. A "flight day" is one during which "atleast one flight is initiated for the affected aircraft." Complaint"" 1J Il.9, Answer"" 1J II.9 The MEL does not specifY when duringthe day the check could have beenperformed. Thus, Respondent could have avoided the violations by either not operating the aircraft at all on October 19 or 20, or performing the check at any time onthe 19th or 20th-to include immediately following the last flight onthe 19th and before the first flight on the 20th. 16 "A separate violation occurs under this subsection

... for eachflight involving the violation

..."
Rebuttal to Respondent's Motion for Decision Jn theMatter ofSkyWest Airlines, Inc. FAA Case No. 2011NM060005, DMS No. FAA-2012-0777 Page 5 of 10 JEFFREY M. HARPER, FAAAlTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007Chapter 7, 

### "If 7.b-d ofthe Sanction Guidance."" Had Complainant followed that course, 17 the absolute minimum penalty for this case would be $200,000, rather than the $142,000 Complainant actually seeks. 18 Assessing a sanction based on a total of 19 violations is entirely**appropriate~that's** how many there were. Calculating the sanction inthis fashion benefited Respondent relative to an appropriate sanction under Respondent's theory ofthe case.
The FAA assessed an appropriate penaltyfor each violation. As discussed in Complainant's Motion for Decision, the FAA followed its Sanction Guidance in arriving atthe sanction in this case. Complainant's Motion for Decision,"" Pages I0-ll. Consistent with its Sanction Guidance, it did not, for various reasons, consider Respondent's actions following the receipt ofthe FAA'sLetter ofInvestigation
as mitigating. Complainant's Motion for Decision,"" Pages 8-10. Respondent's actions, for the mostpart, lacked any connection to the underlying root cause ofthe violations that Respondent identified and thus do not warrant mitigation. Id. To the minimal extent there mighthave been a connection, Respondent actions were reactions to the FAA's investigation, rather than swift and comprehensive measures to prevent future violations.
In contrast, Respondent states that the appropriate starting point for the sanction calculation inthis case is "belowthe midpoint ofthe range." Respondent's Rebuttal and Motion for Decision,"" Page 10. Respondent cites no statute, regulation, case, policy, or other authority for the proposition that the starting point for a sanction calculation is belowmidrange. While Respondent cites regularly to the Administrator's Sanction Guidance"" in making its argument, nowhere does Respondent cite to Appendix B, 

### "If 3.c,which states the "middle ofeach sanction range would be for a single violation without aggravating or mitigating factors." Nor does Respondent address Chapter 7, 

### "If 5.b.3, whichreads: "FAA enforcement personnel begin with an amount inthe middle of the range...." Respondent then claims Complainant failed to give appropriate weight to its purported corrective**action~an** affirmative defense onthe question ofsanction. See, e.g., In the Matter ofM& R Helicopters, LLC, FAA OrderNo. 2013-4"" at 21 (September 5, 2013),

17 Sincefue sanction, calculated on a per-violation basis, is less fuan $200,000, following the "special consideration" provision would arbitrarily and capriciously increase the sanction to $200,000, resulting inthe "disproportionately harsh" sanctionthat provision is intended to prevent. Sanction Guidance,"" Chapter 7,**~** 7. 18 Sanction Guidance,"" Chapter 7, Table 7-1 provides that for a Group I large business such as respondent, fue penalty range is from $200,000 to $500,000, depending onthe nature offue violation.
Rebuttal to Respondent's 1.'1otion fOr Decision Jn the Matter ofSkyWest Airlines. Inc. FAA Case No. 20l!NM060005. DMS No. FAA-2012-0777 Page 6of 10 JEFFREY M. HARPER, FA

... A_ATTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007In the Matter of Seven's Paint & Wallpaper Co., FAA OrderNo. 2001-6"" at 5 (May 16, 2001), In the Matter of ConquestHelicopters, FAA OrderNo. 1994-20"" at 3-4 (June 22, 1994) (mitigating factors offinancial hardship and corrective action are affirmative defenses whichmustbeprovedby a preponderance ofthe evidence). Respondentpledthe issue accordingly. Answer,"" Affirmative**Defenses,~** 1 (alleging the penalty is excessive); Respondent's Response to Complainant's Initial Discovery Request,"" Response to Interrogatory No.7 (Respondent took corrective action which it argues warrants mitigation). As an affirmative defense, the burden ofproofrests with Respondent to showthat its purported corrective actionwarrants a reduction in sanction. 14 C.F.R. § 13.224(c).""
In support ofits affirmative defense, itprovided a list offive measures it took as corrective action. Respondent's Rebuttal and Motion for Decision,"" Page 10. To carry its burden ofproving its corrective action warrants mitigation, Respondent must provide a preponderance of"sufficient, specific evidence ofswift or comprehensive corrective action." 14 C.F.R. 

### § 13.223; Seven's Paint & Wallpaper Co.""' at 6, citing In the Matter of Mauna Kea Helicopters, FAA Order 1997-16"" at 11 (May 23, 1997). While Complainant does not dispute that Respondent took those actions, it asserts those actions were corrective and do not warrant mitigation-anissue upon which Respondent has the burden. Respondent has failed to offer any evidence; much less a preponderance of reliable, probative, and substantial evidence; that its alleged corrective action was swift or comprehensive warranting reduction ofthe proposed penalty. Instead, Respondent relies
on conclusory statements in its briefand an inadmissible letter from its counsel dated February 8, 2012. 19 Respondent's Rebuttal and Motion for Decision,"" Pages 10-11.
Even assuming Respondent had presented evidence that its actions warrant mitigation, Complainanthas previously explained why those actions do not warrantmitigationchiefamong them being that most ofits actions bear no relation to the root cause ofthe violations that Respondent identified, and, because Federal Aviation Regulations require Part 121 carriers to have sufficient qualified personnel to ensure safety, the Respondent's actions should have beentaken before, not after, the violations. Complainant's Motion for Decision,""' Page 9. Corrective action that does nothing more than bring a violator into compliance with the regulations is not mitigating. Sanction Guidance,"" Chapter 7,**~** 4.m.

19 Opposing Counsel's letter notes that it is "forthe purposes ofsettlement." Discussions regarding settlement are "not admissible--Dn behalfofany party--eitherto prove or disprove the validity or amount ofa disputed claim." Fed. R. Evid. 408.""
Rebuttal to Respondent's Motion fOr Decision In the :r:vlatter ofSky\Vest Airlines, Inc. FAA Case No. 2011NM060005, DMS No. FAA-2012-0777 Page 7 of 10 JEFFREY M.l-IARPER, FAAATTORl,rEY TEL: (425) 227-2161; FAX: (425) 227-1007To summarize:

• Four out offive actions Respondent seeks mitigating credit for have no bearing on the root cause ofthe violations Respondent identified;

• Even ifRespondent's actions were related to the root cause ofthe violation, Respondenthas failed to present any evidence ofhowthose actions would correct the root cause;

• Even ifRespondent were to produce evidence, the effect ofthose actions onthe sanctionis limited under Complainant's Sanction Guidance as Respondent's actions were promptedby the FAA's Letter ofinvestigation; and

• Respondent was required to take many ofthose actions before the violations occurred. Undoubtedly, Respondent tookthe actions it said it did. Those actions do not warrant mitigation ofthe sanction proposedby Complainant.

The FAA considered the low risk to safety in its selection ofa sanction range from its Sanction Guidance table. Respondent argues that the FAA failed to take into account the low degree ofhazard presented by the violations in this case. Respondent's Rebuttal and Motion for Decision,"" Pages 9-10. Andyet, contradictorily, Respondent concedes that the FAAtook this factor into account when it selected the minimum rangeprovided for by the Administrator's Sanction Guidance."" Appendix B, Figures B-1-l-1 and B-l-c-2provide that the appropriate sanction for violations involving "technical non-compliance" and "technical non-conformityto [type certiftcate]" is in the "minimum" range. Had safety been an issue, Figures B-1-l-2 and B-1-c-3 would have been more appropriate. Those provisionsprovide an appropriate range where there is "likelypotential or actual adverse effect on safe operation" and "non-conformity to [type certificate] that mayhave,
orhas, adverse effect on safe operation. Both ofthose provisions provide for a "moderate to maximum" civil penalty. Thus, when choosing an appropriate sanction based onFigures B-1-l and B-1-c ofthe Sanction Guidance, Complainant must inherently consider the safety implications ofthe alleged violations. By electing to assess a sanctionbased onFigures B-1-l-l and B-l-c-2,
as Complainant did here, the mitigation warranted by the minimal safety risk ofthe violations has been accounted for.

Rebuttal to Respondent's Motion for Decision In the _l\1a.tter ofSkyWest Airlines, Inc. FAA Case No. 2011NM060005, DMS No. FAA-2012-0777 Page 8 oflO JEFFREY M. HARPER, FAA ATTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007Complainant selected a sanctionrange that accounts for the minimwn safety risk presented by these violations. Despite this fact, Respondent asks this court to give them double credit by reducing the sanctionwithinthe range for violations involving no safety risk.


### Conclusion Complainant seeks a sanction that is consistent withthe facts ofthis case and its published Sanction Guidance. Respondent seeks mitigation ofthat sanction on grounds that are withoutbasis in either law or fact. Forthe reasons stated above, the FAA respectfully requests thatthis court grantits Motion for Decision, and enter an decision finding Respondent inviolation of 14 C.F.R §§ 119.5(g), 119.5(1), 121.628(a)(5), 121.605, and 121.153(a)(2), an imposing a sanction of$142,500, as alleged inthe complaint. There are no genuine issues ofmaterial fact to be litigated. Respectfully submitted this 27th day ofMarch, 2014.

Rebuttal to Respondent'sMotion fOr Decision In the_Matter ofSky\Vest Airlines, Inc, FAA Case No. 2011NM060005, DMS No. FAA-2012-0777 Page 9 of 10 JEFFREY M. HARPER. FAJ\ ATTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007

### CERTIFICATE OF SERVICE
I hereby certify that the foregoingRebuttal to Respondent's Motion for Decisionhas been served viafacsimile and Certified Mail- Return Receipt Requested this date, to the following: The Honorable Richard C. Goodwin Office ofHearings, M-20 1200 New Jersey Avenue, S.E. (Ell-310) Washington, DC 20590 Fax: (202) 366-7536 Attn: Hearing Docket Clerk, AGC-430 Wilbur Wright Building- Suite 2Wl000 Federal Aviation Administration 800 Independence Avenue SW Washington, DC 20591 Fax: (202) 493-5142 Todd Emerson, Esq. SkyWest Airlines, Inc. 444 South River Road St. George, UT 84790 Fax: (435) 634-3505 Dated this 27thday ofMarch, 2014.

Office ofRegional Counsel (ANM-7) Federal AviationAdministration 1601 Lind Ave. SW Renton, W A 98057 (425) 227-2164

Rebuttal to Respondent's _Motion fOr Decision In the Mstter ofSkyV/est Airlines, Inc. FAA Case No. 2011N1'v1060005. DM.S No. Fi\A-2012-0777 Page 10 oflO JHTREY M, HARPER. FAA ATTORNEY TEL: (425) 227-2161; FAX: (425) 227-1007