SERVED: APRIL 8, 2013 U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS

WASHINGTON, DC
IN THE MATTER OF COLGAN AIR, INC. FAA DOCKET NO. CP09EAOO 18 (Civil Penalty Actions) FDMS NO. FAA-2009-0582 6'_.1; -t [r;;! J

ORDER OF CHIEF ADMINISTRATIVE LAWJUDGE TO SHOW CAUSE WHY DEFAULT SHOULD NOT BE ENTERED FORFAILURE TO COMPLY WITH ORDERS This proceeding arises from a Complaint served June 26, 2009, by the Regional Counsel, Eastern Region, Federal Aviation Administration ("Complainant"), 1 and a Request for Hearing by Colgan Air, Inc. ("Respondent"), dated June 15, 2009? The undersigned was assigned to this proceeding by Notice served July 15, 2009. 3 On July 13, 2011, a Prehearing Conference was held, during which Respondent was ordered to produce the following: (1) proposed factual contentions and submissions differing from those made inSturgell v. Angstadt;4 (2) a Motionto Amend the Answer to conform to admissions and positions during the Prehearing Conference; 5 (3) the report or other documents relating to the internal investigation about the flight manifest;6 (4) the load manifest allegedly preparedbyFirst Officer Coats; 7 (5) the identity ofRespondent's ChiefPilot at the time at issue; 8 (6) information

1Compl. (June 26, 2009). 2 Request for Hearing at 2 (June 15, 2009). 3 Notice ofAssignment ofProceeding at 1 (July 15, 2009). 4 Tr. ofPrehearing Conferenceat 26-27 (July 13, 2011) [hereinafter PHC Tr.]. 5 !d. at 22-23. 6/d. at 21-22. 7 !d. at 35-36. 8 !d. at47.about Mr. Schmidt's employment with Respondent;9 (7) information concerning First Officer Coats; 10 (8) a briefonthe responsibility ofRespondent for the acts ofits officers andpilots;11 and (9) a statement as to whether Respondent asserts the applicability ofthe small business provisions in 49 U.S.C. § 46301(a)(5) for computing the proposed penalty12 and, ifso, a briefexplaining how the provisions apply to Respondent and its affiliates. 13 Complainant agreed to provide the record ofSturgell v. Angstadt14 and to reply to Respondent's briefs ordered at the Prehearing Conference by August 29, 2011. 15 Respondent failed to file any ofthe documents ordered. OnJune 22, 2012, Pinnacle Airlines, Corp., filed a Notice ofAutomatic Stay, stating that
on April1, 2012, Pinnacle Airlines, Inc., along with itsaffiliate companies (including Respondent), had filed a voluntary petition for reliefunder Chapter 11 ofTitle 11 ofthe United States Code with the United States Bankruptcy Court for the Southern District ofNew York. 16 OnJune 29, 2012, thejudge issued a Show Cause Order directing Respondentto show
cause whyjudgment should notbe entered against Respondent for failure to comply with previous orders and why Respondent should be permitted to file late the required documents. 17 OnJuly 27, 2012, Respondent filed a Response to the Show Cause Order requesting an additional30 days to

·eitherreach a settlement agreement or produce the documents listed inthe Show Cause Order.

9/d. 10 !d. at 59. II fd. at 84-85. 12 !d. at 83. 13 !d. at 71. 14 /d. at 83; see NTSB Docket No. SE-18404 (2008), Pet. for Review ofan Administrative Agency Action, D.C. Cir. DocketNo. 09-1005 (2008),pet. denied, 348 F. App'x 589 (D.C. Cir. 2009). 15 i>HC Tr. at 86. Complainant and Respondent later agreed to change the reply date to September 29, 2011. Respondent's Consent Motion to Modify Briefing Schedule (Aug. 8, 2011). 16 PinnacleAirlines, Inc., FDMS No. FAA-2009-0180, Respondent's Suggestion ofBankruptcy andNotice of Automatic Stay at I (June 22, 2012), available athttp://www.regulations.gov/#!docurnentDetail;D=FAA-2009-0180- 0041; seealsoIn re PinnacleAirlines Corp., Case No. 12-11343-reg (Bankr, S.D.N.Y.). 17 Order ofChiefAdministrative Law Judge to Show Cause Why Default ShouldNotBe Entered for Failure to Comply with Orders (June 29, 2012). 

### -2-Since filing the Response to the Show Cause Order more than eight months ago, Respondent has failed to submit any documents. The Rules ofPractice provide aRespondent with the opportunity to request a formal hearing to contest an enforcement action by the Complainant. 18 Such a hearing is provided for the benefit, and at the option, ofthe Respondent. To preserve this opportunity, a Respondent must comply with the Rules ofPractice and the Judge's Orders. 19 Respondent has not complied with the Judge's Orders atthe Prehearing Conference or with the Judge's previous Show Cause Order. Although a bankruptcy filing creates an automatic stay ofadministrative actions against a debtor,20 the automatic-stayprovision does not apply to a proceeding, such as this,21 concerning .enforcement by a federal regulatory agency ofsafety and regulatory laws. 22

18 14 C.F.R. § 13.16(f)(3). 19 SeeRedfordForwarding Co., FDMS No. FAA-2001-8997, Orderto Show Cause ofChiefAdministrative Law Judge at 6 (Oct. 3, 2002), available athttp://www.regulations.gov/#!documentDetail;D=FAA-2001-8997-00I5. 20 II U.S.C. § 362(a)(l) ("[Bankruptcy filing stays] the commencement or continuation, includingthe issuance or · employment ofprocess, ofajudicial, administrative, or other action orproceeding against the debtorthat was or could

havebeen commenced before the commencement ofthe case under this title, orto recover a claim against the debtor that arose before the commencement ofthe case under this title[.]"). 21 See ContinentalAirlines, Inc., FAA OrderNo. 199I-2, Order Denying Motion for Stay at 8 (Jan. 4, I99I), available athttp://www.faa.gov/about/office
_org/headquarters _offices/age/pol_ adjudication/AGC400/Civil_ Penalty/CaseFile/view/1991/199I-2.pdf("These proceedings do not adjudicate private rights, but
... serve to enforce public policy
.... Therefore, under either the pecuniary purpose or the public policy test, the [I I U.S.C. § 362)(b)(4) exception applies."); see also Rocky Mountain Airways, Inc., FDMS No. FAA-1990-18405, Order of Administrative Law Judge at I (Feb. 28, 1991), available athttp://www.regulations.gov/#!documentDetail;D=FAAI990-I8405-0005; ContinentalAirlines, FDMS No. FAA-I989-18357, Order ofAdministrative Law Judge at 3 (Jan. 9, I99I), available athttp://www.regulations.gov/#!documentDetail;D=FAA-I989-I8357-0002 ("This proceeding seeks to fix a civil penalty and determine issues offact and law related to the FAA's regulatory functions and Respondent's regulated conduct. This proceeding does not seek to enforce or collect a moneyjudgment and there is no reason to staythese proceedings."); ContinentalAirlines, Order ofAdministrative Law Judge at 1 (Dec. I8, I990), available athttp://www.regulations.gov/#!documentDetail;D=FAA-I989-I8357-0001 (proceedings "appearto be clearly" within the definition ofII U.S.C. § 362(b)(4)). 22 Bankruptcy filing does not stay "the commencement or continuation ofan action or proceeding by a governmental unit
... to enforce such govemmentalunit's or organization's police or regulatory power[.)" II U.S.C. § 362(b)(4). See also S. Rep. No 989, 95th Cong., 2d Sess. 53, reprinted in I978 U.S. Code Cong. & Ad News 5787, 5838, which states the following: "Paragraph (4) excepts commencement or continuation ofactions and proceedings by governmental units to enforce police orregulatory powers. Thus, where a governmental unit is suing a debtor to prevent or stop violation offraud, environmental protection, consumer protection, safety, or similarpolice or regulatory laws, or attempting to fix damages for violation ofsuch a law, the action or proceeding is not stayed under the automatic stay."


### -3-

### Accordingly, IT IS ORDERED THATI. Respondent, on orbefore April29, 2013, shall file and serve a response (a) indicating (1) why the case should not be dismissed for failure to comply with the Orders of the ChiefAdministrative LawJudge and (2) why Respondent should be permitted to late file the requested documents, and (b) attaching all documents ordered atthe Prehearing Conference on July 13, 2011. 2. Absent such a filing by Respondent, the allegations ofthe Complaint shall be deemed admitted and the Complaint shall become an Order assessing a civil penalty inthe amount of$22,000. 3. A copy ofthis order shall be sent to Respondent's Counsel, to counsel for Pinnacle Airlines, Corp., and to Respondent by registered or certified mail at the addresses provided in previous filings in this case.

Attachment

- Service List

-4-SERVICE LIST 

### FAA DocketNo. CP09EA0018 (Civil Penalty Action)

ORIGINAL & ONE COPY 

### Hearing Docket Federal Aviation Administration 800 Independence Avenue, S.W. Washington, DC 20591 Attn: Hearing Docket Clerk, AGC-430 Wilbur Wright Building

- Room 2W100023 ONE COPY 

### Mark A. 

### Dombroff& 

### Charles W. Ryan, Ill,

Respondent's Counsel 

### DOMBROFF GILMORE JAQUES &



### FRENCH, P.C. 1676 International Drive- Penthouse McLean, VA 22102 TEL: 703-336-8700 FAX: 703-336-8750 W. Chris Harrison, Counsel for PinnacleAirlines, Corp. 

### In-House Counsel Pinnacle Airlines, Corp. 40 S. Main Street, 14th Floor Memphis, TN 38103 TEL: 901-348-2483 Colgan Air, Inc., Respondent 

### One Commerce Square 40 S. Main St. Memphis, TN 38103 Christian L. 

### Lewerenz, Complainant's Counsel 

### Office ofthe Regional Counsel, EAL-7 Federal Aviation Administration 1Aviation Plaza Jamaica, NY 11434 TEL: 718-553-3273 FAX: 718-995-5699 The Honorable Ronnie A. Yoder, Chief AdministrativeLawJudge 

### U.S. Department ofTransportation Office ofHearings, M-20, Room E12-320 1200 New Jersey Avenue, S.E. Washington, DC 20590 TEL: 202-366-2142 FAX: 202-366-7536

23 Service was by U.S. Mail. For service in person orby expedited courier, use the following address: Hearing Docket, Federal Aviation Administration, 600 Independence Avenue, S.W., Wilbur Wright Building- Room 2WIOOO, Washington, DC 20591, Attention: Hearing Docket Clerk, AGC-430. 

### -5-