Order 2010-11-1

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, D.C.

Issued by the Department of Transportation

On the 2nd day of November, 2010

City Skies, Inc., and

Ronald E. Mays Docket OST 2010-0005

 

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

and 14 CFR Part 380 Served November 2, 2010

CONSENT ORDER

This consent order concerns the unauthorized advertising, sales, and operation of charter 

air transportation by City Skies, Inc., (“City Skies”) and Ronald E. Mays (hereinafter 

collectively referred to as the “Respondents”). Specifically, in the fall of 2009, Ronald E. 

Mays, through City Skies, over which he exercised primary control and direction, 

engaged in air transportation as an indirect air carrier without economic authority from 

the Department. The unauthorized air transportation operations by the Respondents 

violated 49 U.S.C. § 41101 and the Department’s Public Charter regulations (14 CFR 

Part 380), and constituted an unfair and deceptive practice in violation of 49 U.S.C. 

§ 41712. This order directs City Skies and Ronald E. Mays, personally, to cease and 

desist from future violations and assesses Respondents, jointly and severally, a 

compromise civil penalty of $30,000. This order also prohibits Ronald E. Mays,

personally, for a period of not less than 20 months from the date of issuance of this order 

from directly or indirectly engaging in air transportation or air commerce, or both, except 

as an air travel consumer. In addition, the order prohibits Ronald E. Mays from 

involvement with an air carrier or foreign air carrier or their agents, ticket agents, and 

with any other entity directly or indirectly engaged or seeking to engage in air 

transportation or air commerce or both. 

In addition to applicable Federal Aviation Administration (FAA) safety-related 

requirements, in order to engage directly or indirectly in air transportation, citizens of the 

United States1

 

1 A “citizen” includes a person, partnership, corporation, or association. 49 U.S.C. § 40102(a) (15).

must hold economic authority from the Department, either in the form of a 

certificate of public convenience and necessity issued pursuant to 49 U.S.C. §§ 41101 

and 41102, or in the form of an exemption from the certificate requirement, such as those 

applicable to direct air carriers operating as air taxis under 14 CFR Part 298 and indirect 
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air carriers functioning as public charter operators under 14 CFR Part 380. “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.2 “Common 

carriage,” in the context of aviation, consists of the holding out or provision of 

transportation by air to the public for compensation or hire.3 A “direct air carrier” is an 

entity or person who is directly engaged in the operation of aircraft used to provide air 

transportation. Entities or persons that are not direct air carriers, but solicit in their own 

right members of the public to purchase air transportation are “indirect air carriers.”4

A person or entity that does not hold economic authority from the Department may not 

lawfully solicit and contract as a principal in its own right with a charter customer for air 

transportation and then, as a principal in its own right, solicit and separately contract with 

a direct air carrier to provide the air service that it has promised to the charter customer. 

In such instances, the unauthorized indirect air carrier is not acting as an agent for the 

operating carrier or for the charter customer. Rather, it is acting as a principal in both 

transactions and, with respect to its relationship to the charter customer, is indirectly 

engaged in air transportation without economic authority in contravention of the statutory 

and Departmental licensing requirements. 

From the standpoint of the requirements of 49 U.S.C. § 41101, the holding out of service, 

as well as the actual operation of air service, constitutes “engaging” in air transportation.5

 

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

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

In addition, Public Charter operators must comply with the requirements of 14 CFR Part 

380. Among the most important requirements of 14 CFR Part 380 are the rules designed 

to prevent economic harm to the charter passengers. These rules include the 

requirements that 1) no charter flight be sold unless there is in place an approved Public 

Charter prospectus based upon a contract between the charter operator and a direct air 

 

2

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

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

Violations of 49 U.S.C. §§ 41101 and 41712, Order 2003-12-23 (Dec. 29, 2003).

4 See, e.g., Bratton v. Shiffrin, 635 F.2 1228 (7th Cir. 1980), cert. denied, 449 U.S. 1123 (1980); 

Civil Aeronautics Board v. Carefree Travel, Inc., 513 F.2d 375 (2d Cir. 1975).

5 Prior to 1994, when Title 49 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 

§ 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.

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See, e.g., DB Air, Ltd., Violations of 49 U.S.C. §§ 41101 and 41712, Order 2004-2-21 (Feb. 23, 

2004).
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carrier covering the transportation to be sold (14 CFR 380.25(a), 380.28(a) and 

380.28(b)); 2) all payments by charter participants to charter operators be covered in full 

by a security agreement or by being placed in an escrow account (14 CFR 380.34(a) and 

380.34(b)); 3) no charter operator shall operate, sell, receive money from any prospective 

participant for, or offer to sell or otherwise advertise a charter until the Department has 

accepted a Public Charter prospectus (14 CFR 380.25(a)); 4) all solicitation materials for 

a Public Charter shall include the name of the charter operator, the name of the direct air 

carrier and a statement referring to the operator-participant contract for further 

information about conditions applicable to the charter, or the full text of the operatorparticipant contract (14 CFR 380.30(a) and (b)); and 5) the charter operator must assure 

that each prospective participant sign a copy of the operator-participant contract (14 CFR 

380.31(a) and (b)). 

City Skies is a Nevada corporation which advertises various travel-related services 

including a tour operator business and Public Charter program. The company unlawfully 

engaged in air transportation as a direct air carrier on its website at www.uflycityskies.com

by referring to itself as the “first air carrier to originate non-stop service to Cancun, post 

Hurricane Katrina, from beautiful Louis Armstrong International Airport in New 

Orleans.” In addition, City Skies held itself out as an indirect air carrier and provided air 

transportation to passengers from New Orleans to Honduras. City Skies also unlawfully 

performed a flight as an indirect air carrier by utilizing Xtra Airways as its direct air 

carrier prior to receiving authority from the Department.

Mr. Mays, through City Skies, solicited passengers for the flight from New Orleans to 

Honduras that departed on September 15, 2009. Respondents then entered into a contract 

with Xtra Airways, a direct air carrier, to operate the charter flight (the “flight”). 

Respondents performed these actions without obtaining proper authority from the 

Department. 

The Respondents’ advertising, accepting passenger funds for charter service, and 

contracting with a direct air carrier to conduct the flight, without receiving Public Charter 

authority, violated 14 CFR Part 380 and 49 U.S.C. § 41101, which prohibits a company 

from engaging in air transportation without proper economic authority. Respondents’ 

conduct also constituted an unfair and deceptive practice and unfair method of 

competition in violation of 49 U.S.C. § 41712. Pursuant to the provisions of 49 U.S.C. 

§ 46301, violations of the Department’s aviation economic requirements subjects air 

carriers and their principals7

 

7

 Individuals who organize and participate in flight offerings may themselves be regarded as 

indirect air carriers. See, e.g., Travel Group, Inc., d/b/a Republic Air Travel and Scot Spencer et. al. 

Enforcement Proceeding (Docket OST-1995-272), Order of Administrative Law Judge Denying 

Complainant’s Motion for Partial Summary Judgment and Denying Respondents’ Cross-Motion for 

Summary Judgment (June 30, 1998) at 23 citing CAB v. Carefree Travel, Inc., 513 F2d 375, 387-89 (2nd

Cir. 1975).

to the assessment of civil penalties of up to $27,500 for each 

 
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violation and $27,500 for each day each such violation continues.8 Moreover, Ronald E. 

Mays committed similar violations in 2007 that resulted in a consent order that directed 

him to cease and desist from further violations of 49 U.S.C. §§ 41101 and 41712 and 14 

CFR Part 380. See Montgomery Jet Center, Inc., Southern Skies, Inc., and Ronald E. 

Mays, Docket No. OST-2007-26820-7. Mays’ actions in the instant case also violate that 

order.

In explanation and mitigation, the Respondents state that City Skies had ceased any 

actions which might be interpreted as “holding out” as a provider of any type of tour 

operations or any related services prior to the receipt of the written notification from the 

Department. Respondents further state that City Skies’ website has been taken down, 

reviewed, and revised. Respondents also point out that they made efforts to comply with 

the applicable statutory and Departmental requirements applicable to the flight operated 

as an indirect air carrier, even though Respondents did ultimately fail to comply with the 

regulatory requirements applicable to such flight. In this regard, the Respondents note 

that certain public charter documents were submitted to the Department by the 

Respondents in connection with the flight in question; however, those documents were 

never approved and no public charter number was ever issued by the Department in 

connection with the flight. Finally, Respondents point out that they have fully cooperated 

with the Enforcement Office’s investigation of this matter.

The Enforcement Office has carefully considered all of the information in this matter, 

including that provided by the Respondents, as well as its cooperation in the investigation 

of this matter, but continues to believe that enforcement action is warranted. In this 

connection, the Enforcement Office and the Respondents have reached a settlement of 

this matter. 

The Respondents, including Ronald E. Mays personally, consent to the issuance of an 

order to cease and desist from future violations of 49 U.S.C. §§ 41101 and 41712 and 14 

CFR Part 380, and to the assessment, jointly and severally, of $30,000 in compromise of 

potential civil penalties. This order also directs City Skies, Inc., and Mr. Ronald E. Mays

to cease and desist from future violations of 49 U.S.C. §§ 41101 and 41712 and 14 CFR 

Part 380. It further directs Mr. Mays, in his individual capacity, to cease and desist for a 

period of not less than 20 months from the date of issuance of this order from directly or 

indirectly engaging in air transportation or air commerce, or both, except as an air travel 

consumer. In addition, the order prohibits Ronald E. Mays from involvement with an air 

carrier or foreign air carrier or their agents, ticket agents, and with any other entity 

directly or indirectly engaged or seeking to engage in air transportation or air commerce 

or both.

We believe that this compromise assessment is appropriate and serves the public interest. 

It represents an adequate deterrence to future noncompliance with the Department’s 

 

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The maximum civil penalty per violation per day is $2,500 if the offending entity is an individual 

or a “small business concern” as defined in 15 U.S.C. § 632.
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licensing requirements by the Respondents, as well as by other companies engaged in 

similar unlawful charter activities. 

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 City Skies, Inc., and Ronald E. Mays, personally, violated 49 U.S.C. 

§ 41101, as described above, by advertising and engaging in air transportation as an 

air carrier without appropriate economic authority;

3. We find that City Skies, Inc., and Ronald E. Mays, personally, violated 14 CFR Part 

380 by advertising and selling charter air transportation without having in place an 

approved Public Charter prospectus covering the Public Charter flight;

4. We find that City Skies, Inc., and Ronald E. Mays, personally, by engaging in the 

conduct and violations described in paragraphs 2 and 3 above, engaged in unfair 

and deceptive practices and unfair methods of competition in violation of 49 U.S.C. 

§ 41712;

5. We find that by engaging in conduct described in paragraphs 2, 3, and 4 above, 

Ronald E. Mays violated Department Order OST-2007-26820-7;

6. We find that City Skies, Inc., was at all times relevant herein under the leadership, 

direction and control of Ronald E. Mays and that Ronald E. Mays made all 

significant decisions with respect to the conduct described in ordering paragraphs 2 

and 3 above, and is therefore personally responsible for the violations found in 

ordering paragraphs 2 and 3 above; 

7. We order Ronald E. Mays, personally, and City Skies, Inc., and all other entities 

owned and controlled by, or under common ownership and control with City Skies

and their successors and assignees, as well as the owners and officers of all such 

companies to cease and desist from further violations of 14 CFR Part 380 and 49 

U.S.C. 41101 and 41712; 

8. We order Ronald E. Mays to cease and desist for a period of not less than 20 

months from the date of issuance of this order from directly or indirectly engaging 

in air transportation or air commerce, or both, except as an air travel consumer. In 

addition, we order Ronald E. Mays to refrain from involvement with an air carrier 

or foreign air carrier or their agents, ticket agents, and with any other entity directly 

or indirectly engaged or seeking to engage in air transportation or air commerce or 

both. 
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9. Ronald E. Mays, personally, and City Skies, Inc., are jointly and severally assessed 

$30,000 in compromise of civil penalties that might otherwise be assessed for the 

violations described in ordering paragraphs 2, 3, and 4 above. This penalty shall be 

due and payable as follows:

a. $15,000 shall be due and payable in five equal installments to be paid

on November 30, 2010, December 30, 2010, January 30, 2011, 

February 28, 2011, and March 30, 2011; and

b. The remaining $15,000 shall become due and payable immediately if, 

within one year following the date of issuance of this order, City Skies, 

Inc., or Ronald E. Mays violates this order's cease and desist or 

payment provisions, in which case the entire unpaid portion of the civil 

penalty shall become due and payable immediately, and City Skies, 

Inc., and Ronald E. Mays may be subject to additional enforcement 

action for failure to comply with this order;

10. 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; and 

11. Failure to pay the civil penalties as ordered shall subject Ronald E. Mays and City 

Skies, Inc., jointly and severally, to the assessment of interest, penalty, and 

collection charges under the Debt Collection Act, and possible enforcement action 

for failure to comply with this order.

This order will become a final order of the Department 10 days after its service date 

unless a timely petition for review is filed or the Department takes review on its own 

motion.

BY:

ROSALIND A. KNAPP

Deputy General Counsel

(SEAL)

An electronic version of this document is available

On the World Wide Web at

http://dms.dot.gov/general/orders/aviation.html
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