Locair, Inc., and 

UNITED STATES OF AMERICA 

DEPARTMENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, D.C. 

Issued by the Department of Transportation 

on the 3rd day of April, 2013 

Brian L. Hall, Rory C. Crews, and Pedro E. Baez, 

individually, 

Served April3, 2013 

Violations of 14 CFR Part 374 and 49 U.S.C. § 41712 DOT -OST -2013-0065 

Enforcement Proceeding 

NOTICE OF ENFORCEMENT PROCEEDING AND 

PROPOSED ASSESSMENT OF CIVIL PENALTIES 

The attached complaint of the Office of Aviation Enforcement and Proceedings 

(Enforcement Office) alleges that Locair, Inc., (Locair) and Brian L. Hall, Chief Executive 

Officer ofLocair, Rory C. Crew, President ofLocair, and Pedro E. Baez, Vice President of 

Locair, violated 14 CFR Part 374 and 49 U.S.C. § 41712, which prohibits unfair and 

deceptive trade practices and unfair methods of competition, by failing to process credit 

card refunds for purchased air transportation within the required period of time. · 

Locair, at the time of the violations at issue, was subject to the credit card refund 

requirements of Regulation Z of the Board of Governors of the Federal Reserve System, 15 

U.S.C. §§ 1601-1693r. 12 CFR Part 226 and 14 CFR Part 374, which implement 

Regulation Z, establish that, with respect to refund requests involving airline tickets 

purchased with a credit card, a creditor-here Locair-must transmit a refund to the credit 

card issuer within seven business days of receipt of the refund request. A failure to provide 

such refunds within the stipulated time reriod also constitutes an unfair and deceptive 

practice in violation of 49 U.S.C. § 41712. 

See e.g., Paragon Air, Inc., Violations of 49 US. C.§ 41712 and 14 CFR Part 374, Order 2009-7-

17 (July 17, 2009). 
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As an air taxi operator registered with the Department under 14 CFR Part 298, Locair held 

an air carrier certificate (YLXA892U) issued by the Federal Aviation Administration 

(FAA) directing the carrier to follow the operating rules of 14 CFR Part 135. On 

November 10, 2011, the Department's U.S. Air Carrier Licensing Division cancelled 

Locair's air taxi registration pursuant to 14 CFR 298.24(a) on the basis that it had ceased 

operations and its insurance coverage had lapsed. According to FAA records, Locair 

surrendered its air carrier certificate and operations specifications on December 9, 2011. 

On December 19,2011, FAA issued an order revoking Locair's air carrier certificate on the 

grounds that it had ceased operations since June 7, 2011, it lacked required equipment for 

the operations, and it no longer had the required economic authority from the Department. 

As a result of numerous consumer complaints filed with the Department while Locair held 

authority and was operating, in March 2011, the Enforcement Office conducted an 

investigation into whether Locair was providing prompt refunds, as required by Regulation 

Z and the Department's enforcement case precedent, or providing refunds at all. The 

investigation revealed that, in January 2011, Locair unilaterally cancelled all upcoming 

flights due to mechanical issues with its aircraft. In March 2011 and while its aircraft 

remained inoperable, Locair was sold by Michael H. Lockmueller to Brian L. Hall, Rory C. 

Crews, and Pedro E. Baez, who became the company's operating officers and directors. 

Although Locair had re-accommodated some affected passengers on other air carriers' 

flights and issued refunds to others, the Enforcement Office confirmed that in at least ten 

instances, the carrier failed entirely to process credit card refunds. In response to the 

Enforcement Office's inquiry, Locair and its officers, Brian L. Hall, Rory C. Crews, and 

Pedro E. Baez, contacted the affected consumers in the ten instances and promised that 

Locair would issue refunds. However, Locair failed to fulfill its promises and in April 

2012 the carrier ceased responding to the Enforcement Office's inquiries. 

Based on the informal investigation undertaken by the Enforcement Office, there are 

reasonable grounds to believe that Locair, under the direction and control of Brian L. Hall, 

Rory C. Crews and Pedro Beaz, has violated 14 CFR Pmi 374 and 49 U.S.C. § 41712 and 

that an investigation of the alleged violations is in the public interest. Accordingly, 

pursuant to Rule 407 of the Department's Rules of Practice, 14 CFR 302.407, we institute a 

formal enforcement proceeding to investigate the allegations set forth in the attached 

complaint. 

Upon information and belief, Locair is a "small business concern" as defined in section 3 

of the Small Business Act, 15 U.S.C. § 632. As such, under 49 U.S.C. § 46301, Locair and 

Brian L. Hall, Rory C. Crews, and Pedro E. Baez, individually, may be assessed civil 

penalties of up to $2,500 for each violation of 49 U.S.C. § 41712 or of consumer protection 

regulations adopted by the Department, including 14 CFR Part 374. Under section 46301, 

each day that a violation continues is considered a separate offense subject to a civil 

penalty of up to $2,500 per day. 

The Assistant General Counsel for Aviation Enforcement and Proceedings seeks an 

assessment of civil penalties in the enforcement proceeding instituted by this notice. Under 

Rule 407(d) of the Department's Rules of Practice, 14 CFR 302.407(d), Locair and Brian 
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L. HalL Rory C. Crews and Pedro E. Beaz, individually, are notified that they may be liable 

for civil penalties of $100,000, reflecting violations of 14 CFR Part 374 and 49 U.S.C. 

§ 41712. 

This notice and the attached complaint will be served on Locair, Brian L. Hall, Rory C. 

Crews and Pedro E. Beaz. Under Rule 408 ofthe Depatiment's Rules of Practice, 14 CFR 

302.408, Locair and Brian L. Hall, Rory C. Crews and Pedro E. Beaz are required to file, 

within 15 days, an answer to the complaint admitting or denying specifically and in detail 

each allegation of the complaint, and a response to the proposed assessment of civil 

penalties, specifically presenting any matters the respondent intends to rely on in 

opposition to or in mitigation of such civil penalties. 

~l 

~~ Podberesky 

Assistant General Counsel for 

Aviation Enforcement and Proceedings 
.. ' 

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CERTIFICATE OF SERVICE 

I certify that on April 3, 2013, I served the foregoing Notice of Enforcement 

Proceeding and Proposed Assessment of Civil Penalties and the related 

Complaint on the Respondent by first class mail addressed to Locair' s address: 

382 N.E. 191 Street, Suite 87123, Miami, Florida 33179, to Brian L. Hall's address: 

1740 Hudson Bridge Road, Suite 1012, Stockbridge, GA 30281, and by electronic 

mail to Brian L. Hall's address: brian@bulldogmarine.biz, Rory C. Crew's 

address: rorycrews1@gmail.com, and Pedro E. Baez's address: 

pedro@bulldogmarine. biz. 

Samuel Podberesky 

Assistant General Counsel for 

Aviation Enforcement 

and Proceedings 

-~~£~ Clere~e ~~ . ? / 

Senior Trial Attorney 

Office of Aviation Enforcement 

and Proceedings 

(202) 366-9041 
BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D. C. 

Locair, Inc., and 

Brian L. Hall, Rory C. Crews, and Pedro E. Baez, 

Individually, 

Violations of 14 CFR Part 374 and 49 U.S.C. § 41712 

Enforcement Proceeding 

ENFORCEMENT COMPLAINT 

Served April 3, 2013 

DOT -OST -2013-0065 

1. During all times relevant to this Complaint, Locair, Inc., (Locair) was registered with the 

Department of Transportation's (Depm1ment) as an air taxi operator pursuant to 14 CFR 

Pm1298, with its principal place ofbusiness at 382 N.E. 191 Street, Suite 87123, Mimni, 

Florida 3 3179. In addition, Locair held an FAA-issued air carrier cet1ificate and 14 CFR 

Part 135 operations specifications. 

2. On March 8, 2011, Locair was sold by Michael H. Lockmueller, its previous owner and 

Chief Executive Officer, to several new owners, including Brian L. Hall, Rory C. Crews, 

and Pedro E. Baez. Beginning on that date, Locair operated under the direction and 

control ofBrian L. Hall, ChiefExecutive Officer, Rory C. Crews, President, and Pedro E. 

Baez, Vice President. 

3. On November 10, 2011, the Department's U.S. Air Carrier Licensing Division canceled 

Locair's air taxi registration because information received from the Federal Aviation 

Administration (FAA) indicated that Locair had ceased operations since June 7, 2011, 

and its aircraft liability insurance policy had expired on May 29, 2011, and was not 

renewed. 

4. According to FAA records, Locair surrendered its FAA-issued air cmTier certificate and 

operations specifications on December 9, 2011. On December 19, 2011, the FAA issued 

an order revoking Locair's air carrier certificate pursuant to 49 U.S. C. 44709, based on 

the grounds that Locair ceased its operations since June 7, 2011, it was not properly and 

adequately equipped for the certificated operations since June 7, 2011, m1d it no longer 

held the required economic authority from the Department. 
2 

5. As an air carrier, Locair was subject to the credit refund requirements of Regulation Z of 

the Board of Governors ofthe Federal Reserve System, 15 U.S.C. §§ 1601-1693r. 

6. 12 CFR Pmi 226 and 14 CFR Part 374, which implement Regulation Z, establish that, 

with respect to refund requests involving airline tickets purchased with a credit card, a 

creditor-here Locair-must transmit a credit statement for a passenger refund to the 

credit card issuer within seven business days of receipt of full documentation for the 

refund requested. 

7. 49 U.S.C. § 41712 authorizes the Department to prohibit unfair and deceptive trade 

practices and unfair methods of competition. 

8. In January 2011, Locair unilaterally cm1celled all upcoming flights due to mechanical 

issues with its aircraft. Subsequently, Locair failed in at least ten instances to process 

credit refund requests despite receiving full documentation for the refund requested. To 

date, Locair has not made these refunds which were requested months ago. 

9. Locair's failure to process credit refunds entirely or in a timely manner as required by 

Regulation Z constitutes a violations of 14 CFR Part 374 and an unfair and deceptive 

practice in violation of 49 U.S.C. § 41712. 

10. Upon information and belief, Locair is a "small business concern" as defined in section 3 

ofthe Small Business Act, 15 U.S.C. § 632. As such, under 49 U.S.C. § 46301, the 

Department may assess Locair and its principals civil penalties of up to $2,500 for each 

violation of the Department's regulations or Title 49, including 14 CFR Part 374 and 49 

U.S.C. § 41712. Each day each such violation continues is a separate violation. 

11. Under 49 U .S.C. § 41712, the Depmiment may, upon finding that an air carrier is 

engaged in m1 unfair or deceptive trade practice or unfair method of competition, issue an 

order directing the air carrier to cease and desist from such conduct. 

12. Under 49 U.S.C. § 46101(a)(4), the Depmiment may issue an order compelling 

compliance with provisions of Part A, Subtitle VII of Title 49 U.S.C. and requirements 

prescribed under that Part, including 14 CFR Pmi 374 and 49 U.S.C. § 41712. 

WHEREFORE, the Office of Aviation Enforcement and Proceedings requests the Department of 

Transportation to: 

A. Find that Locair, a former air carrier, and Brian L. Hall, Rory C. Crews, and Pedro E. 

Baez, individually, have violated 14 CFR Pmi 374 by failing to process credit refund 

requests within the period required by Regulation Z of the Board of Governors of the 

Federal Reserve System, 15 U.S.C. §§ 1601-1693r and 12 CFR Part 226; 

B. Find that Locair and Brian L. Hall, Rory C. Crews, and Pedro E. Baez, by engaging in the 

conduct described in paragraph A, above, have engaged in unfair and deceptive trade 

practices and unfair methods of competition thereby violating 49 U.S.C. § 41712; 
3 

C. Assess civil penalties against Locair and Brian L. Hall, Rory C. Crews, and Pedro E. 

Baez, jointly and severally, of $100,000 for the violations described in paragraphs A and 

B, above, and $2,500 for each similar violation revealed in the course of this 

investigation pursuant to 49 U.S.C. § 46301; and 

D. Grant such other relief as may be appropriate. 

--~ 

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Kro · 

~y ~ 

Senior Trial Attorney 

Office of Aviation Enforcement and 

Proceedings 

(202) 366-9041