Order 2010-6-18

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation 

on the Eighteenth day of June, 2010

Mercy Flights, Inc.

Violations of 49 U.S.C. §§ 41101 and 41712

Docket

Served

OST-2010-0005

June 18, 2010 

CONSENT ORDER

This order concerns the unlawful holding out of direct air transportation by Mercy Flights,

Inc., (“Mercy Flights”), an air taxi operator registered with the United States Department of 

Transportation (“Department”) pursuant to 14 CFR Part 298 specializing in air ambulance 

services. As described more fully herein, by holding itself out to the public as an operator of 

an aircraft that it did not operate, Mercy Flights exceeded the scope of the economic authority 

conferred by its registration as an air taxi under 14 CFR 298.21, and thus violated 49 U.S.C. 

§ 41101, the Department’s economic licensing requirement for air carriers. In addition and in 

so doing, Mercy Flights violated the statutory prohibition against unfair and deceptive 

practices in the sales of air tranportation, 49 U.S.C. § 41712. This consent order directs 

Mercy Flights to cease and desist from such further violations and assesses $30,000 in 

compromise of civil penalties against Mercy Flights.

Pursuant to 49 U.S.C. § 41101, no citizen of the United States1 may hold out or operate air 

transportation without first having been awarded a certificate of public convenience and 

necessity from the Department, or without first having been granted an exemption from this 

requirement.

2 Under 14 CFR Part 298, an on-demand air carrier3

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

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

voting interest and (2) is under the actual control of citizens of the United States. 49 U.S.C. § 40102(a)(15).

may be exempted from the 

certificate requirement of section 41101 provided, among other requirements, that it registers

with the Department a list of the specific aircraft that it operates as an air taxi, 14 CFR 

2 This requirement is separate and distinct from the safety-related licensing requirements of the Federal Aviation 

Administration.

3 The exemption provided under 14 CFR Part 298 is only available to air taxi operators that use only small 

aircraft in the performance of on-demand air service. Under this part, a “small aircraft” is defined as one 

originally designed to have a maximum passenger capacity of 60 seats or fewer or a maximum payload capacity 

of 18,000 pounds or less. 14 CFR 298.2.
2

298.21(c)(1)(v), and files with the Department proof of appropriate liability insurance, 14 

CFR Part 205 and 298.37. Whether operating under authority granted by certificate or 

exemption, an air carrier cannot hold out4

Mercy Flights is an on-demand air carrier based in Medford, Oregon, that has held out and 

provided air ambulance services to the public for more than a half century. Since 1950, it has 

owned and operated a variety of fixed-wing aircraft and provisioned these aircraft with flight 

medical staff and equipment. Mercy Flights’ current exemption authority, issued pursuant to 

14 CFR Part 298, extends to the operation of two twin-engine turbo-prop aircraft (King Air 

C90 N117MF and King Air C90B N118MF), both of which it also owns. In 1992, Mercy 

Flights purchased a ground ambulance service that held a contract to provide local 9-1-1 

response in Jackson County, Oregon. Contemporaneous with this purchase, Mercy Flights

also began to provide air medical staffing and equipment to, and to coordinate the utilization 

of, rotary-wing (helicopter) air ambulance transportation. This has been done under an 

exclusive contract with T.L. Forest Products, Inc., and its successor entity, BTS, LLC

(“BTS”), which owns and operates a 1988 Messerschmitt-Bölkow-Blohm (“MBB”) 

Bo 105CBS-5, N131AE, and which maintains a current Part 135 Air Carrier Certificate for 

the helicopter. By virtue of its contract with BTS, based on location, time and cost, Mercy

Flights has been able to select between its own ground or fixed-wing air ambulance services 

and the rotary-wing air ambulance services available from BTS, when called upon to provide 

such services.

air transportation in a manner that creates in the 

mind of a reasonable person the impression that it operates an aircraft that is operated by 

another person or entity. Such a misrepresentation violates section 41101, and constitutes an 

unfair and deceptive trade practice and unfair method of competition in violation of 49 U.S.C. 

§ 41712.

An investigation of Mercy Flights’ advertising practices by the Office of Aviation 

Enforcement and Proceedings (“Enforcement Office”) has revealed clear violations of 49 

U.S.C. §§ 41101 and 41712. Namely, Mercy Flights has recently represented to the public 

that it operates a rotary-wing aircraft (N131AE) that was not covered by its Part 135 

operations specifications, was not included on its registrations made under Part 298, and 

which it admits it has never operated.

For a period during 2009, the “Air Services” page accessed under the “Services” tab of Mercy 

Flights’ Internet homepage stated, “Mercy Flights staffs the helicopter with a pilot, registered 

nurse, and paramedic, trained and equipped to handle most critical emergencies within a 150-

mile radius of Medford, Oregon.” Further, the “Frequently Asked Questions” page of the 

Mercy Flights website makes prominent note of “[o]ur Emergency Medical Transport 

Helicopter Ambulance serves Southern Oregon ... and Northern California.” In a similar 

 4 For the purposes of section 41101, the holding out of air transportation services, as well as the actual operation 

of air transportation services, constitutes “engaging” in air transportation. When Title 49 of the United States 

Code was recodified in 1994, Congress altered the terminology of 49 U.S.C. § 41101, which had previously 

stated that no carrier could “engage” in air transportation without appropriate authority, to state that no carrier 

could “provide” air transportation without appropriate authority. At the time, Congress made clear the purpose 

of the change was purely stylistic (“for consistency”), and that it did not intend to affect any substantive change 

to the statute. Act of July 5, 1994, Pub.L. 103-272, § 6(a), 108 Stat. 745, 1378.
3

fashion, newsletters available on Mercy Flights’ website, such as a Spring 2009 newsletter 

entitled “Into the Night,” made repeated references to “our medical helicopter,” “our 

helicopter,” or “our planes,” in a manner that implied ownership and operation by Mercy 

Flights of a fleet of vehicles that included at least one rotary-wing aircraft. Indeed, many 

Mercy Flights advertisements include an image of the BTS helicopter, with the Mercy Flights

name and logo prominently emblazoned thereupon, and with no indication that the helicopter 

is, in fact, operated by an entity other than Mercy Flights. In isolation and collectively, these 

statements and images implied that Mercy Flights operated the BTS helicopter in the manner 

of a direct air carrier, and reasonably could lead consumers to conclude that Mercy Flights has 

the authority to operate its own rotary-wing aircraft.

In mitigation, Mercy Flights states that it has always intended to comply fully with all

regulations pertaining to the presentation and advertising of its services and any violations of

Department regulations were inadvertent. Furthermore, Mercy Flights points out that since 

receiving notice from the Enforcement Office, it has fully cooperated with the Enforcement 

Office to bring its advertising into compliance with Department regulations. Specifically, 

Mercy Flights asserts that it has removed from information made available to the public any 

indication that it owns a helicopter or furnishes a pilot of the helicopter. 

The Enforcement Office has carefully considered all of the information available to it, as well 

as the cooperation of Mercy Flights, Inc., but continues to believe that enforcement action is 

warranted. In order to avoid litigation, the Enforcement Office and Mercy Flights, Inc., have 

reached a settlement of this matter. Without admitting or denying the violations described 

above, Mercy Flights, Inc., agrees to the issuance of this order to cease and desist from future 

violations of 49 U.S.C. §§ 41101 and 41712. Mercy Flights, Inc., further agrees to the 

assessment of $30,000 in compromise of potential civil penalties otherwise assessable against 

it. Of this total amount, $15,000 shall be paid under the terms described below. The 

remaining $15,000 shall be paid if Mercy Flights, Inc., violates this order’s cease and desist or 

payment provisions during the 12 months following the date the first payment is due under

this order, in which case the entire unpaid amount shall become due and payable immediately 

and Mercy Flights, Inc., may be subject to further enforcement action. This compromise 

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

the public interest, and establishes a deterrent to future similar unlawful practices by Mercy 

Flights, Inc., and other direct air carriers.

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 Mercy Flights, Inc., violated 49 U.S.C. § 41101, as described above, by 

holding itself out as the operator of a rotary-wing aircraft without possessing the 

appropriate economic authority;
4

3. We find that by engaging in the conduct and violations described in ordering 

paragraph 2, above, Mercy Flights, Inc., engaged in an unfair and deceptive practice

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

4. We order Mercy Flights, Inc., and all other entities owned and controlled by or under 

the common ownership and control with Mercy Flights, Inc., and its successors and 

assignees to cease and desist from further similar violations of 49 U.S.C. §§ 41101 and 

41712;

5. We order Mercy Flights, Inc., to submit to the Office of Aviation Enforcement and 

Proceedings on the one-year anniversary of the service date of this order, copies of all 

advertising material, including paper copies of all versions of its Internet website, that 

Mercy Flights, Inc., has caused to be published since the service date of this order;

6. We assess Mercy Flights, Inc., a compromise civil penalty of $30,000 in lieu of civil 

penalties that might otherwise be assessed for the violations described herein. Of this 

total penalty amount, $15,000 shall be due and payable in twelve equal monthly 

installments of $1,250 to be paid no later than the first day of each month after the 

date this order is issued. The remaining $15,000 shall be due and payable if, within 

one year following the date the first payment is due under this order, Mercy Flights, 

Inc., violates the cease and desist provisions 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 in ordering paragraph 7, below, shall subject Mercy 

Flights, 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

7. 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.

This order will become a final order of the Department ten (10) 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