### SERVED: October 29, 2013

U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS

WASHINGTON, DC
) 

### FEDERAL AVIATION ADMINISTRATION, ) 

### Complainant, ) ) . ;--,**~** 

### ) ) 

### FAA DocketNo. CP10NM0012 (Civil Penalty Action) TGI FREIGHT, ) ) 

### Respondent. ) DMS No. FAA-2010-1079 )

INITIAL DECISION OF ADMINISTRATIVE LAWJUDGE RICHARD C. GOODWIN 

### Found: Complainant did not prove a violation. The Complaint will 

### be dismissed.

This case turns onthe nature and scope ofthe duty shippers ofhazardous materials owe to their constituents: the Federal Aviation Administration, first responders, crewmembers and the travelling public.


### I. Background The parties, Complainant Federal Aviation Administration ("Complainant," "FAA," or ''the agency") and Respondent TGI Freight ("Respondent" or "TGI"), ofAnchorage, AK, are in general agreement onthe facts. The FAAhad hired Lockheed Martin ("Lockheed") and the Parsons Corporation ("Parsons") to install under a Parsons technical-services contract a weather camera atthe Misty Fjords National Monument. The location is onNewEddystone Island, near Ketchikan, AK (Exh. C-27; Tr. 14-16,41-44, 50). Certainmaterials had to be shipped by air from Anchorage to Ketchikan. Typicallythe contractor's shipping at the originationpoint is handled by the FAA at its logistics complex at2

the Anchorage airport. 1 Parsons normally consolidates the materials, segregating known or suspectedhazardous materials ("hazmats") on separate pallets or containers. 

### Itthenturns the load overto the FAA'slogistics manager, identifying the possible hazmats. FAApolicy is to then bring the hazmats to the Respondent for manifesting and shipping (Tr. 23-24; 

### see also Tr. 51-52). Respondent moves freight and performs hazardous materials packaging and certification (Tr. 299). The product central to the instant dispute is Pro-Poxy 400 ("Pro-Poxy"). Pro-Poxy is manufacturedby a company called Unitex. It was tendered for shipment in four fiberboard boxes as part ofa six-box shipment. Each ofthe four boxes containedtwelve 9.3-ounce (275 ml) tubes ofthe material (Tr. 57-58, 200; Exhs. C-9, C-12, C-21). The writing onthe boxes' exterior describes Pro-Poxy as an epoxy acrylate anchoring gel used in concrete stone masonry 

### (see, e.g., Exh. R-8, p. 1; Tr. 315). It was to be used inthisjobto cement the base ofthe camerainto the rock (Tr. 38; 

### see also Tr. 7). The word "adhesive" also was written onthe boxes' exterior (Tr. 66-67; Exh. R-8). Parsons, in consolidating the items, determined that Pro-Poxy was a hazardous material and duly segregated it from the rest ofthe shipment (Tr. 40-41). Robert Dexheimer, FAA'slogistics manager, testified that he ships project materials for the FAA and for contractors such as Parsons and Lockheed. He customarily asks entities with whom he deals ifthey have hazmats; ifthey do, those materials are separated andtakento TGI to ship. Dexheimertookthe materials from Parsons and noticed the word "epoxy" onthe packages' exterior. He did not knowwhether ornot the product inside was hazardous. Most epoxies, he said, have onepart that is hazardous, and one that is not. When in doubthe typically brings the material to the experts, he said. He turned these packages overto TGI (Tr. 68-84; Exh. C-14, p. 1; 

### see also Tr. 140-43; Exh. C:-26).
OnFebruary 19, 2010, TGI offered the four boxes ofPro-Poxyto AlaskaAirlines ("Alaska") for shipment from Anchorage, AK, to Ketchikan,

## AK.? The air waybill, which includedthe two otherboxes inthe shipment as well, described the shipment as a whole as "miscellaneous non-hazardous tools & construction material" (Exh. C-2; Tr. 102-03, 115). The shipper initialedthe box stating "This shipment does not contain dangerous goods" (underlining in original).3
Alaska decided that further investigationwas warranted. This prompted it to obtain ProFoxy'sMaterial Safety Data Sheet ("MSDS") (Tr. 272-73; Exh. C-19). The MSDS is an Occupational Safety and Health Administration ("OSHA") document whose primarypurpose is to convey safety informationto individuals working with that material (Tr. 160-61, 179-80). 

### It is not a requirement for air shipment. But it is a quick way to identify the nature ofa product and any restrictions attached to its transportation (Tr. 99-100, 106-07, 158-59, 307). Examination of the MSDS led Alaskato conclude that Pro-Poxy was a hazardous material. The carrierheldthe

1From Ketchikan the materials travel by landing craft to New Eddystone Island. Tr. 22, 64-65. 2 Parsons was the named shipper. Exh. C-2; Tr. 118. TGI, however, affirmed thatitwas the actual offeror. Itis the "dangerous goods agent"for airshipments tendered byParsons, itstated, and ittookresponsibilityfor the shipmentand its consequences. Tr. 122-25, 271-72, 349-50; Exhs. C-22, C-23. 3 Exh. C-2; Tr. 115. Theterm "dangerous goods" as usedin the International Civil Aviation Organization ("ICAO") Technical Instructions is interchangeable withthe term "hazardous material" as defined in49 C.F.R §171.8.3

four suspect boxes at its Anchorage Airport facility (Tr. 134; Exh. C-24). Alaskanotified FAA hazardous materials specialistJeffrey Deitz ofthe situation the same day (Tr. 95-96; Exh. C-1). Deitz, as part ofhis investigation, also pulled Pro-Poxy's MSDS. He testified thatthe MSDS indicates that Pro-Poxy is a regulated, 

### i.e. hazardous, material (Tr. 108). The MSDS describes it as an epoxy resin and anepoxy acrylate blend (Exh. C-19, p. 1). Hazardous materials offered for transportation by air must comply with detailed marking, labeling, packing, and informational requirements. These requirements are spelled outinthe Hazardous Materials Regulations ("HMRs"). Underthe HMRs, hazardous materials offered in air transportation must be labeled with a shipping name. The proper shipping name for this product, Deitztestified, is "ADHESIVES, containing a flammable liquid" (Caps inoriginal). The tender also should have been accompanied by shipping papers -whichcontain a hazard class -plus appropriate marking and labeling, a UN number, and packing group and emergency response information (Tr. 107-11, 117-20, 193,244, 275-77; Exhs. C-8, C-19). The shipment, however, hadbeen undeclared (Tr. 275; Exh. C-8, p. 1). "Undeclared" means that it lacked any notice ofthe hazardous nature ofthe product within. 

### Midtown Neon Sign Corporation, FAA OrderNo. 96-26 (August 13, 1996), p. 2. Respondent, Complainant alleges, failed to observe any ofthe informational protections the HMRsrequire for such products.
The FAAthenbroughtthis action against TGI. The agency cited Respondent for the following sixteenHMRviolations: §171.2(e), in offering a hazardous material for transportation in commerce whenthe material was improperly classed, described, packaged, marked, and labeled for shipment; §172.200(a), in offering hazardous material without properly describing the material on shipping papers; §172.201(d), offering hazardous material without including an emergencyresponse telephone number; §172.202( a)(1 ), offering a hazardous material without including its proper identification number; §172.202(a)(2), offering a hazardous material without including the proper shipping name; §172.202(a)(3), offering a hazardous material without including the hazard class or division number prescribed for the material; §172.202(a)(4), offering a hazardous material when the description did not include the assigned packing group; §173.204(a) or (c)(1), in offering hazardous material withoutprinting the proper certification on the shippingpapers; §172.204(c)(2), failing to provide two copies ofthe shipper's certification; §172.204(c)(3), offering hazardous material without adding to the shipper's certification a statement declaring that all airtransport requirements were met; §§172.300 and 172.301(a), offering hazardous material in a package notmarked with the proper shipping names and identification numbers for its contents; §172.400(a), offering an improperly labeled hazardous materials package; and §§172.600(c)(1) and (c)(2), offering hazardous material when emergency response information was not immediately available. Complainanthas asked for a civil penalty under 49 U.S.C. §5123(a) and 14 C.P.R. §13.305(d) of$15,000. Respondent denied the charges.

### 4

I held a hearing inAnchorage, AK, on September 20 and 21, 2012. The parties have filed briefs and the matter is nowready for decision.4



### II. Discussion and Arguments oftheParties The statute governing this case is the Hazardous Materials Transportation Act, 49 U.S.C. §§5101-5127 (''theAct"). 

### Inpertinent partthe Actprovides that "[a]nyperson ... who is determined bythe Secretary

...to have knowingly 

### committed an act which is a violation

... ofa regulation issued under this title, shall be liable to the United States for a civil penalty." (emphasis supplied). Under §5123(a)(1), a person acts knowingly when- (A)the personhas actual knowledge ofthe facts giving rise to the violation; or (B) a reasonable person acting in the circumstances and exercising reasonable care would have thatknowledge.
A. 

### Complainant's Arguments The agency argues thatthe statute and HMRs "impose a duty on a shippertoknowwhat is in each shipment offered for transportation." It

### reiterates thatthe HMRs "placethe duty to know the contents [ofeach shipment] squarely on the shipper

..." Respondent also has a duty to inquire. And the evidence also shows, the agency continues, that Respondent breached that duty. As such it failed to exercise reasonable care. Reasonable inquiry under the circumstances warranted TGI to investigate beyond the marking and labeling onthe packages' exteriorto ascertain whether Pro-Poxy was a hazardous material, Complainant asserts. TGI may not shift that duty tothe manufacturer orto another entity. Since, the argument continues, Respondent would have learned that Pro-Poxy is a regulated material, TGI is charged with that knowledge. It violated the HMRs at issue because it failed to follow the rules' informational requirements for the tender ofsuch materials. Finally, the agency also asserts thatbecause Respondent holds itselfout as an expert in the shipment ofhazardous materials, it should be held to a higher standard thanthat ofan "ordinary shipper"

- a standard that independently compelled further inquiry and would have uncovered Pro-Poxy's hazardous status (Compl. Br., pp. 16-19; Compl. Rebut. Br., pp. 2-5).
In support ofComplainant's arguments, FAA hazmat specialist Jeffrey Deitz testified that the terms "adhesives" and "epoxy" found onthe exterior ofthe packages are ''triggerterms" (Tr. 144, 147, 158). Triggerterms, he explained, are words orphrases used in describing materials which raise the suspicion that hazardous materials might be hidden in them orthat the materials themselves might be hazardous (Tr. 143-44). Not all adhesives are regulated, he agreed, but some are. Similarly, many epoxies are hazardous, but some are not (Tr. 147, 149-58, 194; 

### see Exh. C-34). Yetthe presence ofa trigger term always warrants further inquiry (Tr. 148). Such

4 Compl. Br. 

### =Complainant's Post-Hearing Brief; Resp. Br. 

### =TGI's Post-Hearing Brief; and Compl. Rebut. Br. 

### = Complainant's Rebuttal Brief.5
inquiry, Deitz stated, would have begun either by contacting the manufacturer orby obtaining an MSDS (Tr. 148).
Deitz acknowledged that MSDS' contain mistakes. And such documents, moreover, typically contain a disclaimer about the reliability ofthe informationtherein (Tr. 175-77, 184; Exh. C-19, p. 4). 

### B. 

### Respondent's Arguments Respondent maintains that the information onthe packages did not warrant further inquiry. Itwas entitledto rely onthe manufacturer's representations, it asserts. TGI is not responsibleifthe materials therein turned outto be hazardous, Respondent maintains; it is the manufacturer which failed in its duty ofdisclosure (Tr. 13; Resp. Br., pp. 1-3). Respondent concludes that it was "entirelyreasonable underthe circumstances"to rely onthe manufacturer's representations and that it is not liable for any violations resulting (Resp. Br., pp. 4, 9-10). JeffJueneman is a warehouse manager at TGI. He received the shipment. He testified that he segregatedthe items according to their hazardous ornon-hazardous nature. He appropriately marked and labeled the hazmats. Pro-Poxy was not among them. Jueneman maintained that nothing onthe Pro-Poxy packages orthe tubes inside indicated thatthe substance was a hazmat. He sawno labels ormarkings associated with hazardous materials. Althoughthe packagings were marked "epoxy" and "adhesive," no indication onthe boxes orthe tubes suggested thatthis epoxy was a hazmat, he maintained. He processed the shipment undeclared and tendered it to Alaska Airlines (Tr. 280-86, 291-92, 295-96; 

### see Exhs. R-21, R-22). Todd Clark is the owner ofTGI. He testified that Mr. Jueneman called him to look atthe packages. Juenemanthoughtthat there were no markings to identify the materials inside as hazardous, Clarktestified, but because Pro-Poxy is an epoxy, Jueneman asked Clarkto take a look. Clark understood that some adhesives and some epoxies are hazmats and some are not (Tr. 335-36, 343-44).
Clark inspected one ofthe boxes. No labels ormarkings associated withhazmats were present, he said. He did acknowledge that the word "epoxy" is a trigger term (Tr. 343, 346). It mandated further scrutiny. So Clark looked inside a package and inspectedthe tubes. In conducting a hazmat inquiry, Respondent, Clark testified, ordinarily will look for signs that a material is corrosive, flammable, ortoxic. Typical consumer warnings that TGI looks for, according to Clark, are "Keep away from heat orflame," "Contactwith skin or eyes may cause

· burns orblindness," "Poison,keep out ofthe reach ofchildren" and similar. A depiction ofa

flame onthe tube, for example, would have warranted determination ofthe substance's flashpoint, he said. And that would have led Respondent to the MSDS (Tr. 306). Butthese tubes had no such warnings

-- save for one suggesting mild toxicity to skin inthe event oflong, repeated exposure. No other even "slightestindication" suggested that the productpresented any danger to the user, the witness testified (Tr. 300-05, 346-47; Exhs. R-13, R-21, R-22; 

### see also Exh. R-9, pp. 10, 11). Clark concluded thatno reason existed to take what in different circumstances would have beenthe next step in the inquiry, i.e. checking the MSDS (Tr. 305-06, 344, 348). Underthe immediate circumstances "wetrust[ed] what's onth[e] box" (Tr. 307).6
Moreover, he added, when he later inspected a different load ofthe shrink-wrappedpallets by which the Pro-Poxy customarily was delivered, he sawno warning onthe pallets' exteriors (Tr. 318-19, 323; see Exh. R-9). 

### Itis true that a rectangular inset onthe outside packaging states, "PerNTSB Safety Recommendations, the use ofadhesive anchors is prohibited in sustained overhead load anchoring applications," andthat the packaging shows a "T" symbol. Butthis information did not warrant a different approach, Clark maintained (Tr. 348; Exhs. C-14, p. 1 and C-15). Clark concludedthat "everythinghere indicates that it's a non-regulated item" (Tr. 348; see also Tr. 397). He insistedthat he was right to rely onthe manufacturer's representations (Tr. 319,323, 344). JackPeters, a hazardous materials consultant and instructor, testified as an expert witness for Respondent. He stated that it is properto look at the box first. To indicate a hazmat some cautionary words or statements should be present. Suchterms as "flammable," "combustible," and "causes severe burns," for example: they "throwa flag up" (Tr. 375, 377). Ifa triggerterm is present, he said, the next step is to look inside. Peters agreed with Complainantthatthe terms "epoxy" or "adhesive" are triggerterms which would compel a look inside the package (Tr. 376, 391-92).
Inthis case the innerpackaging conveyed no informationrespecting hazardous materials transportation, Peters said (Tr. 367). That suggested a non-hazardous substance. The fact that directions onthe tubes recommended waterto remove the material from one's skin additionally indicates a non-hazardous substance, he stated (Tr. 388). In sum, Peters found no indication that the packages were hazardous (Tr. 374). He concluded that it was appropriate for TGI to rely on the descriptions ofthe manufacturer (Tr. 394; see also Tr. 407-08).


### III. Decision
I find and conclude that Complainant failed to prove the allegations ofthe Complaint. The Complaint will be dismissed. Itis undisputed that Respondent had actual knowledge ofthe facts giving rise to the violations alleged. That is, it was aware that ithad offered four boxes ofUnitex Pro-Poxy 400, eachbox containingtwelve 9.3-ounce tubes ofthe substance, to Alaska Airlines for air transportation from Anchorage to Ketchikan, AK (Compl. Rebut. Br., pp. 1, 2). Ithas neither been alleged nor shown, however, that Respondent had actual knowledge that ithad offered hazardous materials. Inthis situationthe law defaults to the Act's subparagraph B: it charges Respondent withthe knowledge that reasonable inquiry would have produced. Contract Courier Services, Inc. v. Research & SpecialProgramsAdministration, 924 F.2d 112, 114 

### (ih Cir. 1991); Interstate Chemical Company, Inc., FAA OrderNo. 2002-29 (December 6, 2002), p. 14. Complainant reads the statute differently. 

### Itcontends that because a substance's nature, i.e. whether a hazmat ornot, is a question oflaw and not offact, it is not necessary to showthat the entity offering a shipment was aware thatthe shipment contained hazmats. IfRespondent knewthat ittendered four fiberboard boxes ofPro-Poxy- which, as we have seen, it did- then it

### 7
inexorably follows, Complainant contends, that TGI is liable for the HMR violations with which it is charged. The law's duty ofinquiry, the agency asserts, refers only the shipper's dutyto know what it is shipping (Compl. Br., p. 16; Compl. Rebut. Br., p. 2). This argument is rejected. It

### is not the law. The question ofa substance's nature is separate from the issue ofa shipper's responsibility. Moreover, Complainant's formulation effectively eliminates the duty ofinquiry plainly contained inthe statute. The FAA would foreclose, and render meaningless, the statute's subsection creating the shipper's duty of reasonable care in the circumstances. See 

### §5123(a)(1)(B), at

### I.D., p. 4

..The agency's analysis violates one ofthe fundamental interpretive canons ofstatutory construction

-- that "a statute shouldbe construed so that effect is given to all its provisions, so that no part will be inoperative or superfluous, void or insignificant." Corley v. U.S., 

### 556 U.S. 303, 314 (2009). This leads us to the next question: whether Respondent's inquiry into the nature ofthe shipment was reasonable under the circumstances. I find that it was. Prompted bythe trigger terms "adhesive" and "epoxy," TGI opened the exteriorpackaging and inspected the unit tendered, which was the tubes. It

### found no marking or labeling, no language or symbols, suggesting a risk offire, toxicity, corrosiveness, or similar perils ofthe kind and quality customarily associated with hazmats. To end the inquiry at thatpoint was a reasonable response, I find. TGI should not be held liable for the consequences. Complainant would have had Respondent continue its investigation further, eitherby pulling the MSDS orby contacting Pro-Poxy's manufacturer. It 

### argues that because some epoxy materials and some adhesives are in fact hazardous, Respondent did not carry its investigation far enough. Had TGI appropriately persevered, it would have discovered that Pro-Poxy was a regulated material. It

### must be held responsible for the consequences, the agency concludes. This argument also may not stand. The fact that some substances in a certain classificationprove to be hazardous does not warrant that all within that grouping compel the kind ofscrutiny necessary to uncovertheir underlying nature. The law does not place such a broad, far-reaching obligation on shippers. The agency unjustifiably enlarges the meaning of "reasonable." The evidence inthis case highlights the FAA's overreach. Respondent's ownertestified that to obtain an MSDS for significantly more boxes in its warehouse would unfairly and unreasonably burden its business (Tr. 306-07). I do not believe that Congress intended such a result. Some ofthe responsibility

- indeed, the prime responsibility

- for properly indicating the nature ofa substance when placing such an item inthe stream ofcommerce should devolve on the manufacturer. Complainant's witness Deitz agreedthat it may be appropriate for a shipperto rely on a manufacturer's statements regarding its products (Tr. 256). Inthis case, I find that it was appropriate to so rely. Finally, I cannot subscribe to Complainant's assertion that because Respondent held itself out as having particular expertise inthe transport ofhazardous materials, a greater duty ofcare devolved upon it. There is no authority for such a proposition. The statute commands that every shipper be held to the same standard ofcare - what is reasonable under the circumstances.8
Moreover, I find that Respondent's promotion ofits services simply was an effortto attract business, a way to distinguish itselffrom the competition. Such salesmanship is a part of commercial life. The more successful promoters oftheir skill or experience should not be, in effect, penalized for theirrelative success inthe marketplace.
I have carefully considered all other arguments advanced bythe parties. Those not discussed herein are dismissed as without merit.
I find and conclude that the agency failed to prove that Respondent TGI Freight knowingly offeredhazardous materials in airtransportation. As such, the Complaint is dismissed.5

Attachment

- Service List

5 Any appeal from the Initial Decision to the Administrator must be in accordance with section 13.233 ofthe Rules ofPractice, which requires 1}that a notice ofappeal be filed no later than 10 days (plus an additional5 for mailing) from the date ofthis order and 2) thatthe appeal be perfected with a written brieformemorandum not laterthan 50 days (plus 5 for mailing) from the date ofthis order. Each is to be sent to the Appellate Docket Clerk, Room 924-A, Federal Aviation Administration, 800 Independence Avenue, Washington, DC 20591, and to agency counsel. Service upon the presidingjudge is optional.

### 9

SERVICE LIST ORIGINAL & ONE COPY 

### Federal Aviation Administration 800 Independence Avenue, S.W. Washington, DC 20591 Attention: Hearing Docket Clerk, AGC-430, Wilbur Wright Building-Suite 2W1000 1
ONE COPY



### Law Offices ofHozubin & 

### Moberly, Respondent's Counsel 

### 711 M Street, Suite 2 Anchorage, AK 99501 TEL: 907-276-5297 FAX: 907-276-5291 Howard L. 

### Martin, Jr., Complainant's Counsel 

### Regional Counsel, Office ofRegional Counsel, AAL-7 Alaskan Region Federal Aviation Administration 222 W. 7th Avenue #14 Anchorage, AK 99513-7587 TEL: 907-271-5273 FAX: 907- 271-2800 The Honorable Richard C. Goodwin,Administrative LawJudge 

### U.S. Department ofTransportation Office ofHearings, M-20, 1200 New Jersey Avenue, S.E.(Ell-310) Washington, DC 20590 TEL: StaffAssistant 202-366-5121 FAX: 202-366-7536 FAA DocketNo. CP10NM0012 (Civil Penalty Action)

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