Order 2010-12-23

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

On the Twentieth day of December, 2010

A-Liner-8 Aviation, Inc., Docket OST 2010-0005

Violations of 49 U.S.C. §§ 41101 and Served December 20, 2010 

41712

CONSENT ORDER

This order concerns violations of 49 U.S.C. §§ 41101 and 41712 by A-Liner-8 Aviation, 

Inc., (A-Liner-8) for engaging in air transportation without the required economic 

authority from the Department of Transportation (the Department). It directs A-Liner-8 

to cease and desist from such future unlawful conduct and assesses a compromise civil 

penalty of $20,000.

In addition to complying with applicable Federal Aviation Administration (FAA) safetyrelated requirements, in order to engage directly or indirectly in air transportation, a 

citizen of the United States1 is required to hold economic authority2

 1 A “citizen of the United States” includes a corporation organized in the United States that 1) meets 

certain specified numerical standards regarding the citizenship of its president, officers and directors, and 

holders of its voting interest and 2) is under the actual control of citizens of the United States. 49 U.S.C. 

§ 40102(a)(15). 

from the Department 

2

 Generally, the Department grants economic authority to large aircraft operators (i.e., operators of 

aircraft, such as the DC-9 aircraft operated by A-Liner-8, that were originally designed to have a maximum 

passenger capacity of more than 60 seats or a maximum payload capacity of more than 18,000 pounds) in 

the form of a certificate of public convenience and necessity issued under 49 U.S.C. § 41102 or an all cargo 

certificate issued under 49 U.S.C. § 41103. Before granting economic authority, the Department must find 

a carrier to be “fit,” which entails a determination that the carrier is owned and controlled by U.S. citizens 

and has adequate financial resources, a competent management team, and a positive compliance 

disposition. This fitness requirement is a continuing one and the Department monitors “certificated”

carriers to ensure their compliance. Certificated carriers must also meet certain Departmental economic 

rules, such as liability insurance requirements (14 CFR Part 205) and escrow requirements to protect 

charterers’ funds and expectations (14 CFR 212.8 and 380.34). In addition, certificated carriers must also

receive safety certification from the FAA and comply with the appropriate set of associated operating rules 

prescribed by that agency.

Large aircraft operators that engage in common carriage without the appropriate DOT and FAA 

authorizations harm consumers by denying them the level of protection afforded by duly licensed carriers
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pursuant to 49 U.S.C. § 41101, or an exemption from that provision. “Air transportation” 

includes the transportation of passengers or property by aircraft as a common carrier for 

compensation between two places in the United States or between a place in the United 

States and a place outside of the United States.3 Common carriage, in the context of air 

service, consists of the provision or holding out of transportation by air to the public for 

compensation or hire.4 From the standpoint of the requirements of section 41101, the 

holding out of air service, as well as the actual operation of that service, constitutes 

“engaging” in air transportation.5

 Under Department enforcement case precedent, 

violations of section 41101 also constitute unfair and deceptive practices and unfair 

methods of competition in violation of 49 U.S.C. § 41712.6

A-Liner-8 is a citizen of the United States incorporated in Michigan that operates a DC-9 

aircraft (N112PS) pursuant to 14 CFR Part 125, an FAA rule applicable to private 

carriage operations with large aircraft. A-Liner-8 has never held economic authority 

from the Department. However, on at least one occasion, A-liner-8 has operated a flight 

that the Enforcement Office determined did not comply with the restrictions inherent to 

private carriage operations by Part 125 operators, which violates 49 U.S.C. §§ 41101 and 

41712. 

In mitigation, A-Liner-8 asserts that any violation was inadvertent and inconsistent with 

the numerous safeguards which A-Liner-8 has implemented and which were in place at 

the time of such flight. A-Liner-8 states that, in order to ship auto parts, air operators 

must regularly contract with logistics companies and, as such, must rely upon 

certifications made by such logistics companies regarding the identity of the ultimate auto 

parts recipient (e.g., General Motors, Chrysler, etc.). A-Liner-8 further states that the 

long-standing safeguards implemented by the firm and enhanced by recent improvements 

as a result of the Enforcement Office’s investigation, constitute A-Liner-8’s continuing 

best efforts to ensure that such certifications are accurate, thereby allowing A-Liner-8 to 

remain in full compliance with its Part 125 responsibilities. A-Liner-8 states that it is 

fully committed to working with the Department and taking all steps necessary to ensure 

continued compliance with the Department’s requirements. 

 

that have been found fit by the Department and are complying with the proper FAA safety regulations. In 

addition, such operators, whose regulatory compliance costs are lower, place duly licensed common 

carriers at a competitive disadvantage.

3 49 U.S.C. §§ 40102(a)(5), (a)(23), and (a)(25).

4 See, e.g., Woolsey v. National Trans. Safety Bd., 993 F.2d 516 (5th Cir. 1993).

5 Prior to 1994, when Title 49 of the United States Code was recodified and simplified, 49 U.S.C. 

§ 41101 stated that no carrier could “engage” in air transportation without appropriate authority. Although 

the wording of section 41101 now states that what is prohibited is “providing” air transportation without 

authority, Congress made clear when it recodified Title 49 that in doing so it did not intend any substantive 

change to the statute. Act of July 5, 1994, Pub. L. 103-272, § 6(a), 108 Stat. 745, 1378.

6 See, e.g., Principal Air Services, LLC, and David C. Bernstein, Violations of 49 U.S.C. §§ 41101 

and 41712, Order 2006-7-13 (Jul. 11, 2006).
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The Enforcement Office has carefully considered all of the information provided by ALiner-8, and continues to believe that enforcement action is warranted. In this connection 

and in order to avoid litigation, the Enforcement Office and A-Liner-8 have reached a 

settlement of this matter. Without admitting or denying the violations described above, 

A-Liner-8 agrees to the issuance of this order to cease and desist from future violations of 

49 U.S.C. §§ 41101 and 41712 and to the assessment of $20,000 in compromise of 

potential civil penalties otherwise assessable. The Enforcement Office believes this 

compromise is appropriate in view of the nature and extent of the violations in question, 

serves the public interest, and creates an incentive for all Part 125 operators to comply 

fully with the requirements of 49 U.S.C. §§ 41101 and 41712.

This order is issued under the authority contained in 49 CFR 1.57a and 14 CFR 385.15.

ACCORDINGLY,

1. Based on the above discussion, we approve this settlement and the provisions of this 

order as being in the public interest;

2. We find that A-Liner-8 Aviation, Inc., violated 49 U.S.C. § 41101, as described 

above, by conducting common carriage air services without economic authority from the 

Department;

3. We find that, by engaging in the conduct and violations described in paragraph 2,

above, A-Liner-8 Aviation, Inc., engaged in an unfair and deceptive practice and unfair 

method of competition in violation of 49 U.S.C. § 41712;

4. We order A-Liner-8 Aviation, Inc., and all other entities owned and controlled by, or 

under common ownership and control with A-Liner-8 Aviation, Inc., and their successors 

and assignees, to cease and desist from future violations of 49 U.S.C. §§ 41101 and 

41712;

5. We assess a compromise civil penalty of $20,000 in lieu of civil penalties that might 

otherwise be assessed for the violations found in paragraphs 2 and 3 of this order. Of this 

total amount, $10,000 will become due and payable in two equal installments of $5,000. 

The first installment of $5,000 is due and payable within 30 days of the issuance date of 

this order, and the second installment of $5,000 is due and payable within 90 days of the 

issuance date of this order. The remaining $10,000 shall become due and payable if ALiner-8 Aviation, Inc., violates this order’s cease and desist provisions or the payment 

provisions within one year following the date of the issuance of this order, in which case 

the entire unpaid portion of the civil penalty shall become due and payable immediately. 

Failure to pay the penalty as prescribed below shall subject A-Liner-8 Aviation, Inc., to 

the assessment of interest, penalties, and collection charges under the Debt Collection 

Act and to possible enforcement action for failure to comply with this order; and

6. Payments shall be made by wire transfer through the Federal Reserve 

Communications System, commonly known as "Fed Wire," to the account of the U.S. 

Treasury. The wire transfers shall be executed in accordance with the instructions 

contained in the Attachment to this order.
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This order will become a final order of the Department ten days after its service unless a 

timely petition for review is filed or the Department takes review on its own initiative.

BY:

ROSALIND A. KNAPP

Deputy General Counsel

(SEAL) 

An electronic version of this document is available at

www.regulations.gov