UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF HEARINGS

IN THE MATTER OF: DGD, INCORPORATED FDMS. NO. FAA-2014-0684 RESPONDENT

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TELECONFERENCE HEARING BEFORE THE HONORABLE J.E. SULLIVAN WEDNESDAY, MARCH 18, 2015 1:30 P.M. HISTORIC JORDAN SPRINGS 1160 JORDAN SPRINGS ROAD STEPHENSON, VIRGINIA 22656Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 2

1 APPEARANCES 2 ON BEHALF OF THE PETITIONER, 3 THE FEDERAL AVIATION ADMINISTRATION: 4 RASHAWN GEORGE, ESQUIRE 5 OFFICE OF REGIONAL COUNSEL, ASO-7, SOUTHERN REGION 6 1701 COLUMBIA AVENUE 7 COLLEGE PARK, GEORGIA 30337 8 TELEPHONE: 404.305.5200 9 FACSIMILE: 404.305.5223 10 11 12 13 ON BEHALF OF THE RESPONDENT, 14 DGD, INCORPORATED: 15 LUIS D. LOPEZ, PRESIDENT 16 PRO SE 17 DGD, INCORPORATED 18 1325 NORTHWEST 78TH AVENUE, SUITE 104 19 DORAL, FLORIDA 33126 20 TELEPHONE: 888.219.4544 21 FACSIMILE: 786.999.8893 22 23 24 25Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 3

1 INDEX 2 Page 3 4 (NONE EXAMINED) 5 6 7 EXHIBITS 8 Exhibit Page 9 10 (NONE MARKED) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 4

1 TELECONFERENCE HEARING 2 BEFORE J.E. SULLIVAN 3 WEDNESDAY, MARCH 18, 2015 4 1:30 P.M. 5 THE COURT: We are on the record in the 6 matter of DGD, Inc. this is Docket Number FAA-2014- 7 0684. Today is Wednesday, March 18, 2015, and the 8 parties have appeared for a second Rule 16 Litigation 9 Scheduling Conference. The FAA is represented by it's 10 attorney Ms. Rashawn George. Respondent DGD, Inc. is 11 represented by it's pro se President Mr. Luis D. 12 Lopez. 13 Ms. George I didn't ask you before we 14 went on the record, is there anyone else appearing 15 with you on your end? 16 MS. GEORGE: No, Your Honor. 17 THE COURT: Okay. And Mr. Lopez is 18 anyone with you in your car right now? 19 MR. LOPEZ: No. 20 THE COURT: Just so that we can recap, 21 we last convened on January 27, 2015 by telephone. At 22 that time the FAA was still waiting for some 23 additional documents and the parties wanted some 24 additional time to discuss settlement. Ms. George I 25 wanted to just check in with you, has there been anyHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 5

1 resolution of any of the disputed issues in this case 2 so far? 3 MS. GEORGE: No, Your Honor we did not 4 receive any documents from the respondent. 5 THE COURT: So does that mean there's 6 no resolution of any of the disputed issues? 7 MS. GEORGE: Correct. 8 THE COURT: Alright then, let's talk a 9 little bit about what issues are in dispute. Typically 10 in these kinds of cases after a complaint is filed a 11 litigant, who requests a hearing files an answer to 12 the complaint, and Mr. Lopez I do not see an answer 13 from you in this file. Have you ... 14 MR. LOPEZ: I'm, I'm working on that 15 and I am also working still because the problem we 16 currently have with the accounting aspect of it is 17 that our Hazmat business is about 3 percent of our 18 actual business services. We are mainly a trucking 19 company. And we have an accountant and auditor that is 20 separating three years of Hazmat services with actual 21 profit and loss for the purposes of Ms. George to get 22 numbers and to look at what our actual profit and loss 23 and bound sheet is. Unfortunately, we lost about a 24 month and a half of time due to the beginning of the 25 year being tax season. And the electronic bookkeepingHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 6

1 the company that is providing us the service, has been 2 working diligently on getting numbers accurate for the 3 last three years. 4 THE COURT: Well, lets talk a little 5 bit more about what an answer is and also what issues 6 are in dispute, because that might help us decide what 7 we're going to do from here on out. As I read the 8 complaint it looks like there are three violations 9 cited by the FAA alleging Hazmat shipping violations. 10 Ms. George is that true? 11 MS. GEORGE: Yes, Your Honor. 12 THE COURT: And there is also a 13 proposed fine for those three violations of a total, 14 totaling $50,000. Ms. George is that also accurate? 15 Ms. GEORGE: I am showing the complaint provided, 16 I apologize ... 17 THE COURT: And can you speak up Ma'am. 18 I can't hear you very well. 19 MS. GEORGE: I apologize Your Honor I 20 had moved away from the speaker phone. Our complaint 21 we alleged that there were, yes a $50,000 proposed for 22 the penalty for the violations cited within it. 23 THE COURT: And there are three 24 violations that I see in the complaint and that would 25 be on page three of the complaint. Are you countingHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 7

1 the violations identified in sub section 3 paragraph 2 15 b as in boy as one violation or as two? 3 MS. GEORGE: One moment Your Honor, I 4 am sorry. Counting it as two violations. 5 THE COURT: So the two regulations 6 cited in paragraph 3.15b are counted as one of two 7 violations. Is that correct? 8 MS GEORGE: Correct, Your Honor. 9 THE COURT: So, are you essentially 10 asserting that each of the two violations you're 11 accusing the respondent of committing should be 12 assessed a penalty of $25,000 totaling $50,000, or are 13 you breaking the $50,000 out in a different way? 14 MS. GEORGE: We are alleging that there 15 are two violations of the requirement to have shipping 16 papers as you have stated at $25,000 each. 17 THE COURT: So, Mr. Lopez let's turn to 18 you. Oh, I'm sorry Ms. George I have one other 19 question, is this a particular violation that you 20 consider to be a training violation, or is it simply a 21 violation of a shipping regulation? Because the way 22 the respondent's Request for Hearing read it was 23 unclear to me what he thought and what had been 24 communicated to him? 25 MS. GEORGE: No this is not a trainingHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 8

1 violation this is a, we have it categorized under our 2 smoking matrix as an intentional violation of the 3 requirement to have shipping papers accompany 4 hazardous material shipment. 5 THE COURT: Okay. 6 MS. GEORGE: I mean it is a shipping 7 violation. 8 THE COURT: Thank you for that 9 clarification. 10 THE COURT: Now, Mr. Lopez, lets talk a 11 little bit about your side of the case. On September 12 3rd, 2014, you filed a Request for Hearing and in your 13 Request for Hearing which is dated August 30, 2014 it 14 appears to me, and I may be wrong, that you agreed 15 that the violations had occurred. 16 MR. LOPEZ: That's the problem you 17 know, we're not, go ahead ... 18 THE COURT: Tell me what it is that you 19 intend to litigate in this case? 20 MR. LOPEZ: This is the problem, we're 21 not the shipper on record, we're not the shipping 22 forwarder on record, we are simply a Hazmat compliance 23 company. And my dispute with the FAA that for the 24 past 3 years has been that the issue occurred at 25 Oregon where they manufacture paper work. The onlyHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 9

1 thing that we did improperly, and when I say we 2 meaning I mean an employee of mine that was working 3 for me, was that he didn't check documentation and 4 then went ahead maliciously or unintentionally, or 5 whatever, produced a document based on our company 6 once the shipment got rejected. But we never offered 7 the shipment at air freight, cause we are not a 8 shipper. And my dispute with the FAA has been why are 9 you guys going after us and not the shipper of record. 10 We get paid $15 to just make sure that the shipment is 11 air worthy, the box is ok, you know. So for us and 12 that is the dispute that I have with Ms. George, why I 13 don't understand how we're the ones being requested to 14 pay a fine that we didn't even produce the document. 15 The document was produced originally incorrectly in 16 the middle of the United States, domestically trucked 17 for Florida, where our customer, Coordenado the 18 freight forwarder, was going to ship it out of the 19 country. 20 THE COURT: Okay. 21 MS GEORGE: May I respond to that Your 22 Honor? 23 THE COURT: No not, not right now thank 24 you. 25 THE COURT: Mr. Lopez thank you nowHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 10

1 none of that is included in your request for hearing 2 Mr. Lopez. 3 MR. LOPEZ: Okay 4 THE COURT: And where you put that, in 5 writing, is in your answer. You're suppose to answer 6 the complaint in writing. 7 MR LOPEZ: Okay then I will have to do 8 that ASAP. 9 THE COURT: Yes you will, because 10 you're in jeopardy for not having filed an answer in a 11 timely manner. 12 MR LOPEZ: Understood. 13 THE COURT: And when I say you are in 14 jeopardy, I mean you have two things you have to 15 address at this point. You have to file the answer and 16 you have to explain why you didn't file it in a timely 17 way, before I can go forward. 18 MR. LOPEZ: Okay. 19 THE COURT: And I am going to tell you 20 how much time has lapsed since you were suppose to 21 file the answer. Do you have a copy of the complaint 22 in front of you? 23 MR. LOPEZ: No, I do not. 24 THE COURT: Do you remember our 25 conversation on January, 27 2015, where I told youHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 11

1 that I needed you to be sure and have all of your 2 paperwork with you for all future conferences? 3 MR LOPEZ: I did. 4 THE COURT: I am serious when I say 5 that, because you create disadvantage for yourself, 6 when you're not looking at paperwork that the court is 7 looking at and talking about. 8 MR. LOPEZ: Understood. 9 THE COURT: So, here I go. I am 10 looking at the complaint that the FAA filed and that 11 Ms. George signed on October 6, 2014. On page three 12 of that complaint, at the very bottom of the page it 13 says in bold letters that are underlined, please note, 14 below that it says among other things, you are 15 required to file a written answer to this complaint no 16 later than 30 days after the date shown on the 17 certificate of service. So, certificate of service, 18 which is the next page, has the date of October 6, 19 2014. Under the rules, your answer in writing is due. 20 I am going to do a rough count, is due no later than 21 November 6, 2014. Now, my count may be off a day or 22 so. But that is about the thirtieth day of, if this is 23 mailed to you we can add up to five days. So, lets 24 just assume, for the sake of argument, five extra days 25 would be November 11, 2014. We're way beyond thatHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 12

1 time period. So, you have some work to do and you 2 need to do it fairly quickly. 3 MR LOPEZ: I can work on that tomorrow 4 and then mail it to Ms. George and mail it to yourself 5 and it can be in the mail, I mean I have something 6 written together already ... 7 THE COURT: Okay. 8 MR. LOPEZ: It is just a matter of ... 9 THE COURT: Yeah I am going to give you 10 some directions and I hope you have a pen and paper. 11 MR. LOPEZ: I do. I am writing 12 everything you're writing as we speak right now. 13 THE COURT: You will need to file two 14 different things. Number one, an answer to the 15 complaint. The answer should identify and respond to 16 each and every paragraph and numbered paragraph in the 17 complaint. You either agree with it, disagree with it 18 or don't have enough information to say. 19 MR. LOPEZ: Okay. 20 THE COURT: And then number two, you 21 need to file, how do I want to say this, you need to 22 file a request to accept the late complaint and 23 explain in that request why you failed to file it in a 24 timely way. What prevented you or what was the 25 problem or what was circumstance that happened in yourHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 13

1 life or that happened to result in you not filing this 2 answer on or before November 11th, 2014. Because I 3 have to make a finding of good cause for your delay. 4 MR. LOPEZ: Okay. 5 THE COURT: And then Ms. George will 6 have an opportunity to respond. She can agree that 7 your reasons for not filing an answer timely are good 8 and she doesn't want to challenge them or she can 9 disagree and say I disagree and I think his request 10 for hearing should be dismissed. If your request for 11 hearing is dismissed it means you've lost the 12 opportunity to challenge either of the alleged 13 violations or the proposed civil penalty. So it's 14 very important to do both of these things and do them 15 well. I am going to give you a deadline for filing 16 both. 17 MR. LOPEZ: Okay. 18 THE COURT: And I am going to give you 19 an opportunity to participate in setting that 20 deadline. 21 MR. LOPEZ: Okay. 22 THE COURT: You're telling me that you 23 have some time tomorrow. I'm happy to give you a 24 little more time than that because I want you to do 25 the work well, to the best of your ability, so thatHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 14

1 you feel satisfied that you have put in your best 2 product, if you will. So ... 3 MR. LOPEZ: Yeah, I don't think that 4 with the information you just gave me now that it 5 still needs a little bit of work so it can be as 6 detailed as you're asking me so I mean I think I can 7 have it done within 30 days is more than a sufficient 8 amount of time. 9 THE COURT: Well, your going to need 10 less time than that. 11 MR. LOPEZ: That's fine. How much time 12 would you like to give me? 13 THE COURT: I think you need to file 14 this no later than by the end of the month, which is 15 March 31. 16 MR. LOPEZ: No problem. 17 THE COURT: So, and when you file it I 18 am going to explain to you who you file it with and 19 the copies. 20 MR LOPEZ: Okay. 21 THE COURT: In any of the paperwork 22 that you've seen Ms. George or I submit the very last 23 page is called a service slip and it shows the name, 24 address, phone number and fax number typically of 25 everyone who is suppose to get a copy of the document.Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 15

1 MR. LOPEZ: Mm-hmm. (Indicating 2 Affirmatively) 3 THE COURT: It also shows the name and 4 address of the FAA's hearing docket clerk who keeps 5 the official record. And you mail a copy to them, to 6 her or him excuse me. So the original and one copy 7 goes to the hearing docket clerk and then a copy is 8 sent to Ms. George and a copy is sent to me. And I 9 recommend that you also fax a copy to me and if Ms. 10 George is interested in getting a faxed copy, to her 11 as well. That way you make sure that you meet your 12 deadline that I'm giving you, because the deadline I 13 give you, is the date it's suppose to be in my hand. 14 MR. LOPEZ: Understood. 15 THE COURT: Okay. 16 MR. LOPEZ: Ms. George can I get your 17 fax number? 18 THE COURT: Yes and my fax number is on 19 every single service list that I have sent, of 20 documents that I have sent you, but the fax number is 21 202-366-7536. Ms. George I'm going to turn to you, do 22 you want to have any documents faxed to you as well as 23 mailed or do you care? 24 MS. GEORGE: Yes, Your Honor we would 25 like a fax as well.Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 16

1 THE COURT: Okay. 2 MS. GEORGE: Our fax number here as it 3 appears on the service list is 404-305-5223. 4 THE COURT: Thank you. Mr. Lopez when 5 you file documents you should always file them with a 6 service list attached to the very back of the 7 document. That's your certification to everybody 8 involved that you have dotted all your I's and crossed 9 all your T's and sent everybody who deserves to get a 10 copy, a copy of your document. Does that makes sense 11 so far? 12 MR. LOPEZ: It does. 13 THE COURT: Okay. 14 MR. LOPEZ: I am just going to 15 basically follow the same procedure the FFA did on 16 their, on their documents and just respond to every, 17 do respond with an answer to every statement that was 18 given. 19 THE COURT: Every allegation in the 20 complaint must have an answer. 21 MR. LOPEZ: Understood. 22 THE COURT: If you don't answer every 23 allegation it's presumed that you agree with it. So, 24 for example, I'm just going to give an example. 25 Paragraph one of the complaint and the one is aHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 17

1 numeral, a roman numeral one, says and I am going to 2 quote "On August 27, 2014, respondent DGD, Inc. was 3 advised, through a final notice of proposed civil 4 penalty, that the FAA proposed to access civil penalty 5 in the amount of $50,000 period. On October 3rd, 2014, 6 the agency attorney received a written request for a 7 hearing from the respondent, period. It appears the 8 office of hearing received the appeal from the 9 respondent DGD, Inc. on or about September 3rd, 2014 10 period," end of quote. So, in your answer you want to 11 identify that you are answering roman numeral 12 paragraph one, and then number one. You can agree or 13 disagree with the paragraph as it is written or you 14 can agree with sentence one but not agree with 15 sentence number two, or you can say I agree with 16 sentence number one, I disagree agree with sentence 17 number two, I don't know about what happened in 18 sentence number three. I mean, you can do any number 19 of things but you have to address each and every 20 allegation and every numbered section of the 21 complaint. Does that make sense? 22 MR. LOPEZ: Yes, it does. 23 THE COURT: And that needs to filed 24 with this office on or before March 31, 2015. 25 MR. LOPEZ: Understood.Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 18

1 THE COURT: Ms. George, lets talk about 2 your answer, there's going to be an answer and then a 3 request by Mr. Lopez to accept the late answer. And 4 typically, I think you have 10 days to respond to any 5 such motion. Is that correct? 6 MS. GEORGE: I believe you're correct, 7 Your Honor. 8 THE COURT: Looking at your calendar, 9 do you need anything more than 10 days beyond March 10 31, 2015? 11 MS. GEORGE: Actually, if I could have 12 until April the 13th, 2015, which is the Monday after 13 I am scheduled to be on leave, the week of April the 14 6th. 15 THE COURT: Okay. Mr. Lopez do you 16 have any objection to that? That basically ... 17 MR. LOPEZ: No. 18 THE COURT: Then we'll have the FAA 19 response due on or before April 13, 2015 and then I 20 will need to make a ruling. Oh, I'm sorry, I do need 21 to give you a reply date Mr. Lopez. When you are 22 making a motion to the court you're basically asking 23 for relief of some kind. And when you're the moving 24 party in a motion the court can give you an 25 opportunity for final reply, or the last bite of theHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 19

1 apple. So, I am going to give a reply date of April 2 27, which is two weeks after Ms. George's response is 3 due. And in a reply, basically what you do is you 4 take a look at what the FFA has said and its response 5 to your motion. And then if you have anything you 6 would like to say about their response to clarify, to 7 disagree with, to explain, you do that in your reply. 8 And then once ... 9 MR. LEWIS: Okay. 10 THE COURT: ... if you don't want to 11 file, a reply, that's fine. You just fax a notice, to 12 all of us, and say I'm not going to file a reply. So, 13 that if you don't file one, then I can look at the 14 material, I can make a ruling on it sooner. If you do 15 file a reply, that's great, but it will be due on or 16 before April 27, 2015. And then after that I'll issue 17 a ruling, and if I decide to grant your request, I 18 will reset the Rule 16 Litigation Scheduling 19 Conference. I can also, in the alternative, set it 20 out a little ways. But, my, in these kinds of 21 situations, I think it's best just to wait, unless the 22 parties feel strongly one way or the other. Ms. 23 George what is your position? 24 MS. GEORGE: I am fine with waiting 25 Your Honor.Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 20

1 THE COURT: Mr Lopez, How about you? 2 MR. LOPEZ: I have no problem waiting. 3 THE COURT: While you're waiting, that 4 doesn't prevent you from continuing to provide 5 documentation to each other. It doesn't prevent you 6 from talking about the case, if you so choose. So, 7 and I will, of course, try to get a ruling out to your 8 as soon as I can, after April 27, 2015. If you have 9 any questions in the interim, you can always call the 10 attorney who works with me. I think you both talked 11 to him a little earlier today, when this call was 12 being setup. His name is Mr. Cody Smith. He can 13 answer general questions about procedure. He can't 14 help people with their case arguments but he can 15 always tell you deadlines and due dates and how the 16 court operates in general. I will be sending out an 17 order today, basically outlining what these deadlines 18 are and what's due for each deadline. And then that 19 order will also have attached to it a service list, 20 Mr. Lopez, so that you can see a service list sample. 21 Before we close, Ms. George, is there anything you 22 would like to discuss or clarify or talk about in 23 addition to this? 24 MS GEORGE: No, Your Honor. 25 THE COURT: Mr Lopez, on behalf of yourHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 21

1 business, is there anything you would like to talk 2 about or ask questions about before we close? 3 MR LOPEZ: Well no, I mean, our 4 ultimate goal is to do litigation directly with the 5 FAA. But I don't have any way of doing that until I 6 depend on the accounting department, that we hired, to 7 get us numbers. And our numbers are not realistic. 8 So, our goal is to get those numbers as accurately as 9 possible, so that we can then deal directly with FAA. 10 THE COURT: Well, you're welcome to 11 continue getting that information, but what I'm trying 12 to tell you, and I can't emphasize this enough, is 13 that if you do not file these documents that we've 14 talked about, your case will be tossed out. 15 MR. LOPEZ: Well, no, I mean, 16 ultimately, the first thing that we are going to make 17 an urgent matter to resolve before March 31st is the 18 answer. So that's going to happen for sure. 19 Everybody will get that before March 31st. 20 THE COURT: Well, your answer and your 21 motion for acceptance of the late answer. 22 MR. LOPEZ: Right. 23 THE COURT: Yeah. 24 MR LOPEZ: Correct. 25 THE COURT: Because, in your motion forHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 22

1 acceptance of the late answer, you are going to 2 explain, as best you can, why you did not file a 3 timely answer. Because the rules in this forum say 4 that if you do not file a timely answer, I can't go 5 forward and give you a hearing, unless there is a good 6 reason for that untimely answer. 7 MR LOPEZ: Understood. 8 THE COURT: Yeah, so, you have the 9 burden of proof to say why you didn't file an answer 10 on or before November 11, 2014, what it was that 11 prevented you, or what circumstances were that caused 12 you not to file an answer sooner. And then, we're 13 going to be talking about that and I have to make a 14 ruling on that first. So, that's absolutely critical 15 for you to get in on or before March 31, 2015. 16 MR. LOPEZ: Understood. 17 THE COURT: Very Good. Anything else 18 that I can address for you and your client DGD, Inc. 19 today, before we close, Mr. Lopez? 20 MR. LOPEZ: No, Ma'am 21 THE COURT: Then I am going to thank 22 you both very much for your time today. It appears 23 our business is complete. I'll send out an order, if 24 not this afternoon, by tomorrow morning by the latest. 25 So that you both have it in hand. I look forward toHearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 23

1 the materials that you're going to file in writing. 2 With that we can go Off The Record and I wish you all 3 a good day. Thank you. 4 MR. LOPEZ: Thank you, you too. 5 THE COURT: Bye, Bye. 6 (WHEREUPON, the Hearing concluded at 2:04 P.M.) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 24

1 STIPULATION 2 3 The foregoing matter was taken on the date, and 4 at the time and place set out on the title page 5 hereof. 6 7 It was requested that the matter be taken by the 8 reporter and that the same be reduced to typewritten 9 form. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 251 2 3 4

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**Constance Boudreau** March 2015Hearing in the Matter of: DGD, Inc March 18, 2015 VR # 1991-2 Page 26

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