## SERVED: March 7, 2017

U.S. DEPARTMENT OF TRANSPORTATION 

## DEPARTMENT OF OFFICE OF HEARINGS 

## TRANSPORTATION WASHINGTON, DC 

## lUll MAR

_1 

## p ): )S

In The Matter Of: 

## DOCKET OPERATIONS DocketNo. FAA-2014-1116 Pacific International Skydiving Center 

### ) ) ) ) ) ) Respondent



### 1. Pertinent Procedural History Case Nos. 2014WP130012 

### & 2014WP130023



### INITIAL DECISION

OnMarch 27,2014, the Complainant served the Respondent a Notice ofProposed Civil Penalty inthe amount of$22,000 in Case No. 2014WP130012, followed by a second Notice of Proposed Civil Penalty on October 30, 2014, inthe amount of$33,000 in Case No. 2014WP130023. On December 18, 2014, the Complainant served the Respondent a Final Notice ofProposed Civil Penalty for both Case No. 2014WP130012 and Case No. 2014WP130023. OnDecember 29, 2014, the Respondent filed a Request for Hearing inboth cases. On January 7, 2015, the Complainanttimely filed its complaint, 1to which the Respondent filed a timely answer on January 13, 2015. OnJanuary 22, 2015, ChiefAdministrative LawJudge Yoder assigned this case to an Administrative LawJudge and then subsequently reassigned itto the undersignedjudge on March 26, 2016. A prehearing conference was held onMay 17, 2016. OnJuly 1, 2016, the undersignedjudgeprovided notice that a hearing would be held in Honolulu, HI, beginning onDecember 13, 2016. OnNovember 12, 2016, the Respondent requested that the undersignedjudge issue subpoenas for ten witnesses. While the undersignedjudge initially issued the requested subpoenas onNovember 16,2016, the subpoena for FAA Safety Inspector, Curtis Whaley, was subsequently quashed onDecember 1, 2016.

1 The complaint sought a $55,000 civil penalty, comprised of$22,000 for Case No. 2014WP130012 and $33,000 for Case No. 2014WP130023. See Complairtt.

### The undersignedjudge conducte4 a hearing from December 13 to 15,2016, in Honolulu, HI. Don Bobertz appeared onbehalfofthe Complainant; Robert L. Feldman appeared onbehalfof the Respondent. Atthe start ofthe hearing, the Respondent orally moved to dismiss the case due to a lack of subject matterjurisdiction. After the hearing, the parties submitted briefs regarding this issue. OnJanuary 24,2017, the undersignedjudge issued an Order Denyingthe Respondent's Motion to Dismiss.2 

### The parties submitted written posthearing briefs pursuantto 14 C.F.R. 

### § 13.231(c) on February 6, 2017. Based upon the evidence presented at the hearing and the applicable law, the undersigned judge has come to the following decision. 2. Summary ofComplainant's Allegations The Complainant alleges that the Respondent conductedparachute operations into orthrough clouds in violation of 14 C.F.R. 

### § 105.17(a)3 

### inthe vicinity ofDillingham Airfield, Waialua, Hawaii, onthe following eight occasions:
Date 12/08/2013 1/05/2014 3/22/2014 3/25/2014 Number ofFlights 1 1 3 3 Airplane Civil Registration Number N900SA N989BW N989BW N989BW

The Complainant further alleges these actions were careless orreckless, so as to endangerthe life

orproperty ofothers, in violation of 14 C.F.R. 

### § 91.13(a). 3. Standard ofProof The pertinentregulations at 14 C.F.R. 

### § 13.224(a) and (c) place the burden ofproofonthe agency, exceptinthe case ofan affirmative defense, at which time the burden shifts to the party asserting the affirmative defense.4 

### In accordance with 14 C.F.R. 

### § 13.223, the burden ofproofin

a civil penalty action is a "preponderance ofreliable, probative, and substantial evidence."

2 Also atthe start ofthe hearing, the Complainant orally moved to amend the complaint.' In particular, Complainant's counsel statedthathe ''wanted to issue an amended complaint to separate the cases back into their original form where there's two separate cases." Transcript Volume 1 at 13. The undersignedjudge's Order Denying Respondent's Motionto Dismiss rendered the Complainant's motion to amendthe complaint moot. 3 Notably, the Complainant did not allege a violation of 14 C.F.R. § 105.17(b), dealing with flight visibility and/or cloud clearance restrictions when conducting parachute operations. 4 See 14 C.F.R. §§ 13.224(a) and (c). 

### DocketNo. FAA-2014-1116 Initial Decision, page 2

### 4. Background The Respondent is the owner/operator ofthe two subject aircraft, N900SA and N989BW, whichwere used to conduct parachute operations at Dillingham Airfield. On the dates in question, the subject aircraft ascended into the skies with parachutists onboard who subsequently jumped from the aircraft and descended to the landing zone operated by Respondent at Dillingham Airfield. All personnel onboard the planes, to include the pilots, videographers and tandem instructors, were independent contractors affiliated with the Respondent or customers of the Respondent. At issue in this case is whether any ofthe parachutists descended into or through the clouds, and ifso, whether the Respondent is liable for such activity. 

### 5. Did Individuals Descend Into or Through Clouds? Pursuantto 14 C.F.R. § 105.17(a), "No person may conduct a parachute operation

... into or through a cloud." To support its allegations that parachutists descended into or through clouds

on each ofthe alleged dates, the Complainant presented testimony oftwo FAA inspectors, an expert inthe area ofskydiving, and an alleged eyewitness. The Complainant also submitted into evidence video footage filmed by the eyewitness, Frank "T.K." Hinshaw, onthe four dates in question (hereinafter referred to collectively as the "Hinshaw videos")5 and in-personvideo footage obtained from the Respondent inthe course ofdiscovery (hereinafter referred to collectively as the "Go Pro videos").6 Kyle Bartler, a principal operations inspector at the Honolulu Flight Standards District Office, investigated the alleged December 8, 2013 and January 5, 2014 violations. 7 Edward Santa Elena, who atthe time served as a principal operations inspector at the Honolulu Flight Standards District Office, investigated the alleged March 22 and 25, 2014 violations. 8 Both 

### Mr. Bartler and Mr. Santa Elena admitted that they did not personally see any parachutistsjump into orthrough a cloud onthe dates in question, but instead relied solely upon the videos and declarations provided by T.K. Hinshaw as evidence to support the allegations.9 The question of whether the parachutists did indeed skydive into or through the clouds therefore can only be resolved by examining the credibility ofthe statements ofT.K. Hinshaw (the sole eyewitness),

5 See Agency Exs. A-5, A-7, A-14 and Al5. 6 See id A-32 through 35 arid A-38. 7 See Transcript Volume 1 at 37-38. 8 Id at94. 9 /d. at 65 and 126. DocketNo. FAA- 2014-1116 Initial Decision, page 3the Hinshaw videos, and the GoPro videos.

a. Credibility ofT.K. Hinshaw's statements 

### In support ofthe Complainant's allegations, T.K. Hinshawtestified that on each ofthe alleged dates he witnessed the Respondent's plane carryparachutists into the sky and then saw those parachutists descend through the clouds. T.K. Hinshawfurther provided video footage from parachutejumpsthat occurred onthe four dates inquestion, as well as declarations to authenticate the video footage. 10 As background, T.K. Hinshawtestified thathe 

### has, inthe past, helped his father's company, Skydive Hawaii, which also operates out ofDillingham Airfield. 11 While working with Skydive Hawaii, he claimed he observed parachutists affiliated with the Respondent violating safety regulations by violating the restrictions regarding parachuting through ornear clouds. T.K. Hinshaw further testified that in 2013 he learned the FAA "wantedto crack down on skydivers jumpingthrough clouds," and he explained that he beganrecording the Respondent's parachute activities after his complaints to the Honolulu Flight Standards District Office did not stop this behavior. 12 Whenprobed, T.K. Hinshaw admitted that he based his conclusionthat parachutists went into orthrough clouds onthe fact that when looking up atthe sky, he could not see the plane through the cloud cover, but he later sawthe parachutists. 13 This conclusion, however, does notwithstand scrutiny. As discussed more below, the Respondent's expert, Tom Sanders, provided detailed testimony regarding the flaws withthe Hinshaw videos, many ofwhich apply to T.K. Hinshaw;s view from the ground. The distance betweenthe ground andthejumpers, the change in size ofthe subjectjumper during freefall versus.after parachute deployment, the angle from the ground, and the multiple layers ofclouds would allimpact the reliability ofwhat T.K. Hinshaw viewed from the ground. Regardless ofthe substance ofhis testimony, however, T;K. Hinshaw'sbias against the Respondent eviscerates the credibility ofhis declarations providedto the FAA and his testimony

10 See Agency Exs. A-6, A-8 and A-16. 11 Transcript Volume I at 140. 12 Jd at 143. 13 See id. at 292-293 for the following exchange: Judge Rawald: "So it sounds to me the central assumption you were making as you were watchingthe parachutists was that, ifyou could not see the startingpoint, the plane, and then you could see the parachutists, they must have passedthrough a cloud, is thatright?" The witness: "That's correct. Ifyou're looking straight up andyou

### can't see the aircraft andthen a parachutist appears belowthe cloud, then to methat is indicative of

..." Judge Rawald: "So when I'mwatching the video and I hearyou say, he's through the cloud, the basis for that was because you**c~uld** not see the plane butyou could see the parachutist at some point afterwards?" The witness: "Correct." DocketNo. FAA- 2014-1116 Initial Decision, page 4atthe hearing, as well as his statements as recorded inthe Hinshaw videos. Most importantly, T.K. Hinshaw's father, Frank Hinshaw, is the owner and operator ofSkydive Hawaii, which is the Respondent's main competitor at Dillingham Airfield. This close familial relationship with the Respondent's direct competitorprovides a significant impedimentto the persuasiveness of his testimony. 14 Further, the competition created animosity betweenthe two companies, which

one ofthe FAA's investigators, Mr. Bartler, acknowledged. 15 Rather

### than address these concerns, T.K. Hinshaw instead refused to discuss his hostile relationship withthe Respondent and its employees and independent contractors by asserting his Fifth Amendmentright to refrain from answering questions regarding allegations ofhis threatening behavior. Guy Banal, the owner ofPacific International Skydiving Center, explained that individuals employed bythe Respondent were compelled to file a police report after reading several Facebookposts inwhich T.K. Hinshawthreatened the employees' livelihood, as well as their safety. 16 Mr. Banal's testimony was corroborated by several otherwitnesses and a police report. 17 Darryl Green, anindependent contractor for the Respondent, discussed an incident where· T.K. Hinshawwalked pastthe Respondent's building at Dillingham Airfield while making a throat-slashing gesture directed towards everyone inthe office. 18 Feeling threatened, Mr. Green filed a report withthe Honolulu Police Department. 19 Afterreading threatening Facebook posts authored byT.K. Hinshaw, Greg Meyer, an independent contractor for the Respondent, filed a report withthe Honolulu Police Department and Dillingham airport security.20 Mr. Meyer feared for his own safety, as well as the safety ofhis roommates and his dog, because T.K. Hinshaw knewhe lived "across the street from the airport" at the time? 1

14 See In reAlphinAircraft, Inc., FAA OrderNo. I997-9 at II (Decision and Order, Feb. 20, I997) (The Administratornotedthat the Administrative Law Judge found a witness's "testimony 'inherently less persuasive' than that ofother witnesses because he [was the Respondent's President]"). 15 See Transcript Volume I at 81. 16 See Transcript Volume 2 at 2I4-219. A July 31, 20I4 declaration signed byMr. Banal, which accompanied a letterto the Honolulu Police Department, details not only the threatening Facebookposts authored by T.K. Hinshaw, but also an instance ofphysical violence by T.K. Hinshaw. See Respondent's Ex. R-I6. Excerpts from the subject Facebook posts were attached to the letter. See id 17 See RespondentEx. R-16. 18 See Transcript Volume 2 at244-46. 19 See id at246; see also Respondent's Ex. R-I6 at 31. 20 See Transcript Volume 2 at 253-254. 21 See id DocketNo. FAA-2014-1116 Initial Decision, page 5Roxanne Stanley22 also provided testimony regarding T.K. Hinshaw's threatening Facebook posts, stating that in addition to multiple threats to shut the Respondent down, T.K. Hinshaw posted a message threatening to "break into our home and

... [k]ill us and our pets, anybody who worked for Pacific Skydiving Center.'m After witnessing the throat-slashing gesture discussed by Mr. Green, Mrs. Stanley filed a report with the Honolulu Police Department.24 Bryan Stanley testified that T.K. Hinshaw's Facebookposts made him feel unsafe because he viewed T.K. Hinshaw as "extremelyunstable," detailing that he has seen him: go ontirades on the field, attack people over flying drones over our planes, flying drones at our skydivers, firing his own employees for being friends with other skydivers on Facebook, coming out onthe deck at me as I'm leaving and screaming and yelling and flipping me offand yelling obscenities at my wife?5 Regarding a Facebook post where T.K. Hinshaw referenced "already spill[ing] their blood once,"

I Mr. Stanley described an incident where both T.K. Hinshaw and his father physically pushed individuals associated with the Respondent to the ground.26 Given T.K. Hinshaw's bias against the Respondent as his father's main competitor, his history ofthreatening and aggressive behavior towards the Respondent and its personnel, his refusal to respond to questions regarding these allegations impacting his credibility, and his flawed basis for determining whether parachutists had descended through clouds, the undersignedjudge gave no weight to T.K. Hinshaw's testimony, declarations, and statements as recorded within the Hinshaw videos.27 b. The Hinshaw videos T.K. Hinshaw explained that he filmed the Respondent's parachute operations on days it appeared they were going to "jump skydivers through poor conditions," stating that he filmed most ofthese videos from Skydive Hawaii's operations area at Dillingham Airfield.28 In filming the Hinshaw videos, T.K. Hinshaw testified that he used a Sony HDR CX-150, which he

22 Following the completion ofMrs. Stanley's testimony, Mr. Frank Hinshaw, who up to this point had been seated in the courtroom listening to the proceedings, left the courtroom and directed verbal obscenities towards Mrs. Stanley. See id at 267-272. 23 Id at 257. 24 See id at 258-259. 25 !d. at 274-275. 26 See id at 275-276. 27 In contrast, the key witness in the only other skydiving case addressed bythe Administrator was found credible because he did not have an "axe to grind." In re Fedele, FAA OrderNo. 1998-3 at 4 (Decision and Order, Mar. 12, 1998). 28 Transcript Volume I at 144-148. The red "A" noted on Agency Ex. A-56 marks T.K. Hinshaw's location when filming the videos he submitted to the FAA. Docket No. FAA- 2014-1116 Initial Decision, page 6described as a small handheld camera, with a flip-out screen and a single record/stop buttonthat records in 3.1 megapixel stills·up to 1080 resolution.29 T.K. Hinshaw acknowledgedthat he did not save the video footage onthe original memory cards; instead, he copiedthe footage to his computer hard drive andthenburned CDs to submitto the FAA investigators.30 Withrespect to his filming technique, T.K. Hinshawtestified that he did not rely onthe view finder/flip screen, instead looking up atthe sky himself, withthe camera infront ofhim.31 Little weight is afforded to the footage inthe Hinshawvideos, as their value is limited in determining whetherthe parachutists actually descended into orthrough a cloud. 

### In examining this evidence, itis importantto keep in mind ·the Administrator's statement in

### Fedele thatthe evidence "mustbe examined inlight ofthe safety regulations."32 To avoid committing a regulatory violation in

### Fedele, the skydivers needed a hole inthe clouds of"atleast 4,000 feet," which was wider

### than the 3,200 foot long airport runway. 33 Examining the unbiased eye witness's testimony in

### Fedele thatthere were no patches ofblue sky over the airport in light of the regulatory requirement for a skydiverto "be surrounded, at all times, by an opening inthe clouds with a horizontal diameter ofat least 4,000 feet," the Administrator found itmore probable 

### than notthat a violation occurred.34 Inthe case athand, however, the evidence must establishthat a parachutist more likely 

### than not descended into orthrough a cloud, as opposedto failing to have the appropriate level ofcloud clearance. This then requires a greater level of specificitythatthe videos fail to provide. 

### In weighing the evidence, the undersignedjudgefirst consideredthatthe evidence itselfwas created by a personwhose extreme bias has already been discussed. T.K. Hinshaw admitted that the CDs submitted to the FAA did not containthe original footage and thatthe original footage 

### has since beenrecorded over. There is then no way to verify whether the footage, as submitted into evidence, was altered before it was provided to the FAA. More concerning, however, are the inherent limitations ofthis type ofground footage, even if

29 Transcript Volume 1 at 148-149. 30 See id. at 156-157 and 161. The undersignedjudge overruledthe Respondent's objectionto the admission of these videos underthe best evidence rule, noting that while this mayraise an issue as to the videos credibility, 14 C.F.R § 13.222 states that an "Administrative Law Judge shall-- which is mandatory-- admit any or all documentary or demonstrative evidence introducedby a party but shall

... exclude irrelevant, immaterial orunduly repetitious evidence." Id at 163-164. 31 See id. at 173-174. 32 Fedele, FAA OrderNo. 1998-3 at 5. 33 Id 34Id DocketNo. FAA- 2014-1116 Initial Decision, page 7itwas unaltered. 

### Mr. SantaElena discussed the sky conditions at thejumping altitude as recounted by one ofthe pilots, who reported thatjumps were delayed until sky·conditions cleared.35 Further, the Respondent's expert, 

### Mr. Sanders,36 provided detailed testimony regarding the flaws ofthe footage contained in the Hinshaw videos. In additionto holding an expert skydiving license and logging over 7,000 camerajumps, 

### Mr. Sanders is familiar with Dillingham Airfield from flying out ofthere almost daily and is known for his freefall skydiving

camerawork, having shot feature film skydiving for 38 years. 37 

### Mr. Sanders described the Sony CX-150 cameraused by T.K. Hinshaw as amateur and not adequate for accurately filming skydiving activities.38 

### Mr. Sanders discussed thatthe lowerquality lens and single chip contained in T.K. Hinshaw's camerawould distort the image "giv[ing] you a look ofnotbeing sharp, as ifit was out offocus orthere was something obscuring it inbetween," thus negatively impacting the detail, color, contrast and clarity ofthe footage. 39 The use ofauto-focus, giventhe distance between the camera and the objects being filmed, also affected the quality ofthe Hinshaw videos, resulting inblurry, as opposed to sharp, images.40 

### Mr. Sanders discussed the effect a camera lens zoom would have onthe image portrayed and indicated thatthe inability to see a parachutist could be due to the fact thatthe parachutistwas notinthe frame. 41 According to 

### Mr. Sanders, the moisture, salt spray and volcanic ash present inthe 

### air at Dillingham Airfield would also negatively impact the quality offootage contained inthe Hinshaw videos.42 

### Mr. Sanders explainedthat a careful look atthe Hinshawvideo footage

35 Recalling his investigation, Mr. Santa Elena stated the following: "I recall Randy saying that it

-- the weather, it was cloudy overthe field but he waited until it wasn't-- he waited until it was clear before he released thejumpers." Transcript Volume I at 127. 36 Mr. Sanders was admitted as an expert in the area ofskydiving, as well as videography ofand during skydiving. See Transcript Volume 2 at 287. 37 See id at 282, 284 and 286. The extent ofMr. Sanders's credentials can be found in his resume, which was admitted 

### as Respondent Ex. R-24. 38 See Transcript Volume 2 at 298 and 304. 39Id. at 303-304 and 307-308. 40 See id. at 344-345. 41 For an example, see the following exchange from Mr. Feldman's examination ofMr. Sanders regarding exhibit A-5 at time mark 5:48: Q: "Do you see ajumperthere?" A: "I see ablack dot, which could be ajumperunder a parachute, but I can'tconfirm that it isjust a skydiver in freefall." Q: "Well, let's backup here. Okay. At 5:47, you don't see him, do you?" A: "no." Q: "Why not?" A: "He is out of:frame." Q: "He is out of:frame? What does frame mean?" A: "He is down below and he has to tilt the camera down to pickhim up. There he is." Jd at 317- 318. 42 See id at 323. DocketNo. FAA- 2014-1116 Initial Decision, page 8reveals "alot ofblue" sky that "is not being shown as clearly" due to the poor camera quality,43 explaining that the camera "miss[ ed] a lot ofdetail" and did not pick up all the blue sky present during filming. 44 With respect to the blue sky, Mr. Sanders also noted that the inferior quality of the video monitor at the courthouse displayed more grey than when compared to what he saw when he viewed the same footage on a higher resolution monitor at home.45 The distance between the videographer onthe ground and thejumpers, as well as the change in size ofthe subjectjumper during freefall versus after parachute deployment, also decreased the reliability ofthe Hinshaw videos. Mr. Sanders explained: ifyou exit at 14,000 feet, that's almost 3 miles, you can'tjustlook up at 3 miles and see a solo skydiver falling. Youjust don't see him. They are falling 200 feet a second. They getbigger and bigger and bigger and bigger for a minute, but they don't get really biguntil they open a parachute. And that's when-- that's the only time in all ofthe ground angle view videos that I see anything is when the parachute opens.46 With respect to the angle and resulting visibility ofa parachutist during parachute deployment, Mr. Sanders stated: the fact that it is happening so high in the sky, that a skydiver in freefall shot from an angle, might only be a 2 foot high object. But during deployment, the skydiver gets pulled upright, which is going to be 5, 6 to 6 foot tall with 12 to 15 foot lines and a 300 square foot parachute. So now all ofa sudden we have something that is, you know, a mile and a halfto 3 miles up in the sky and now we can see it because it has grown in size, because the parachute got opened.47 The reliability ofthe Hinshaw videos is also decreased as a result ofthe camera angle and

zoom utilized, as well as the multiple layers ofclouds present during the subjectjumps. Mr. Sanders generally opined that the Hinshaw videos appeared to be filmed from a 30-degree angle, as opposed to straight up (which would have provided a more accurate depiction ofthe parachutists' activities). He explained that with multiple cloud layers, ground footage could

seem to portray an individual parachuting into or through a cloud, when inreality the cloud was betweenthe parachutist and the camera. Regarding cloud coverage at Dillingham Airfield, Mr. Sanders noted that on a typical day there are "clouds at every layer and they are blowing at different speeds at every layer,"48 and explained that when filming from the ground looking up: you can'ttell where the clouds are. They are stackedtogether from an angle. Ifhe is zooming in, it's not a sufficient angle tojudge when somebody is falling downward ifthey are going through

43 Id at 331. 44 Jd at 307. 45 See id at 309-310. 46 Id at 330. 47 Id at 313. 48 /d. at 311. DocketNo. FAA- 2014-1116 Initial Decision, page 9[a cloud] ornot

... They are openingtheir parachute a mile high in the sky and they start at almost 3 miles high in the sky and all we are seeing is a black dot out here. I don'tknow what is straight above him. I don't know ifthere is a cloud in front and they are falling behindthe wall in the back. I have no idea from the ground what is going on.49 

### Mr. Sanders went onto emphasize that when reviewing the Hinshaw videos: There is no way to know that they have gone through a cloud from this kind ofa shot. There isn't even any way to know that this is all the blue that is outthere. This is only from this one point of view on the ground at whatever focal length lens he has zoomed out to. It doesn't mean anything.50 Overall, 

### Mr. Sanders concluded that "[n]one ofthe ground camera angles would be accurate

... [n]one ofthem are looking straight down and that's what we are trying to find is where they

are falling," and that, inhis opinion, none ofthe videos shot from the ground depict a skydiver going into orthrough a cloud.5 1 Mr. Sanders's testimony regarding the unreliability ofthe Hinshaw videos, is supported by the GoPro videos. Comparingjumps filmed inthe GoPro videos to the samejumps filmed in the Hinshaw videos revealed patches ofblue skies, while the Hirtshaw videos appeared to depict much more cloud coverage.52 The GoPro videos vividly exhibit the limitationsinusing the Hinshaw videos to determine whether a particular parachutist went into orthrough a cloud. Admissions ofT.K. Hinshaw and the government's expert, 

### Mr. McCowan, also support the testimony ofMr. Sanders. T.K. Hinshaw admitted that weather conditions can change inthe five to seven minutes it takes to ascend to the altitude for skydiving, and that the angle ofa camera
can make it appear that a parachutist is descending into or through a cloud, when in reality they

are not.53 After viewing video footage that appeared to depict parachutists descending into or through clouds, both T.K. Hinshaw and Mr. McCowan were able to deny any descent through

49/d. at 320. 50 /d. at 321. 51 /d at 310 and 3I2. 52 For example, comparing the Hinshaw video depiction ofthe first flight and subsequent parachutejump in A-14 with GoPro video footage ofthe samejump in A-3.2 reveals patches ofblue sky amongst the clouds that was not visible in the ground footage. Compare Agency Ex. A-14 and A-32, Similarly, ground footage from A-I5 depicts jumpers that may be descending through the clouds beginning at the I:07 time mark. GoPro video footage ofthe samejump depicted in A-33 reveals several patches ofblue skies that are not visible from the ground footage in A-15. Compare Agency Ex. A-15 and A-33. 53 See Transcript Volume I at 260-26I; see id at 245-246 for the following exchange: Judge Rawald: "depending on where you're standing and the angle you're looking at, is it possible that you could look up and think that someone's going through a cloud when, in fact, they could be going through an opening, ifyour angle was suchthat it could allow that? Is that possible?" The witness: "It's possible

..." DocketNo. FAA- 2014-1116 Initial Decision, page 10clouds onthose occasions, baseduponpersonal knowledge.54 In evaluating 

### Mr. Sanders'stestimony, the undersignedjudge considered its "logic, depth, andpersuasiveness."55 

### In addition to Mr. Sanders's extensive knowledge ofthe weather and parachuting conditions atDillingham Airfield and his experience 

### as a videographer, he provided

an in-depth and logical analysis ofthe flaws with respect to the Hinshaw videos. He comprehensively discussed numerous factors that decrease the reliability ofthe Hinshaw videos. Additionally, his analysis was supported by footage from the GoPro videos, as well as admissions from T.K. Hinshaw and 

### Mr. McCowan. 

### Mr. Sanders'spersuasiveness was negatively impacted byhis long-term friendship with

### Mr. Banal, 

### as well 

### as the fact that he has skydived for free withthe Respondent for 14 years and received compensation of$500 an hour for his testimony. However, withregard to the Hinshaw videos, any limitation inMr. Sanders's persuasiveness is far outweighed bythe detailed and logical analysis he providedregarding the flaws ofthe Hinshaw videos. 

### Incontrast, the testimony ofthe government expert, 

### Mr. McCowan, does notprovide a sufficientbasis to accord the Hinshaw videos additional weight. While 

### Mr. McCowan has a great deal ofskydiving experience and was recognized 

### as an expert inthe field ofskydiving, he has not conducted a lot ofcamerajumps nor does he have expertise in the areaoffilming skydiving operations.56 J]pon viewing the Hinshaw videos, 

### Mr. McCowan testified that based upon his years ofexperience, he concluded parachutists descended into orthrough the clouds on the eight occasions alleged by the complainant.57 His opinion, however, was based uponthe fact that the video depicts images ofparachutists belowthe clouds, who were notvisible priorto that.58

.The flaws inthis analysis were highlighted by the testimony of

### Mr. Sanders and

54 See id. at268-275 for T.K. Hinshaw's explanation ofwhy the parachutists in exhibit R-12 didnotjump into or through clouds, despite the appearance they did. See Transcript Volume 2 at 108-115 for Mr. McCowan's explanationthatwhile video footage in R-25 appeared to depict him and his fellowjumpers descending through a cloud, none ofthejumpers actually wentthrough a cloud. 55Alphin, FAA OrderNo. 1997-9 at 12 (citingIn re Valley AirServices, Inc., FAA OrderNo. 1996-15 at 7 (Order Denying Reconsideration, May 3, 1996))(stating that logic, depth, andpersuasiveness are the criteria for evaluating experttestimony). 56 See Transcript Volume 2 at 5-15. In addition to owning a parachute operating center in Wilmington, OH for ten years from the mid-70s to mid-80s and logging about 10,240 parachutejumps, Mr. McCowan holds a commercial muiti-engine pilotrating, with about 3,500 flight hours. Mr. McCowan began skydiving in 1967 as a member ofthe Army airborne unit, and continues to skydive today, primarily·performing exhibitionjumps. He has never, however**~arachuted** at Dillingham Airfield. 7See id. at 16-22; 24-26; 33-37; 39-40; 45-48 and 52-55. 58 An example ofthisadmission can be found in the following exchange: Judge Rawald: "So whatcharacteristic do you see that has them coming out ofthe clouds? The fact thatthey were there whenthey weren'tthere before?" DocketNo. FAA- 2014-1116 Initial Decision, page 11unrebutted by Mr. McCowan.

c. The GoPro videos The Complainant submitted video footage obtained from the Respondent in discovery that

was filmed with GoPro cameras worn by its videographers during some ofthe parachutejumps in question.59 Great weight is afforded to the GoPro videos with respect to the videographers wearing the cameras, because the footage accurately portrays what occurred with respect to the videographers. 60 With respect to filming skydiving, 

### Mr. Sanders stated that "[y]oureally need to get in the sky,"61 and specified that "you can'ttell what somebody is falling through accurately unless you are the person doing it oryou are right above them," later clarifying that "[s]traight below would work." 62 Footage from three ofthe GoPro videos provide reliable, probative and substantial evidence to conclude that, more likely than not, the videographer in each video parachuted into orthrough a cloud. The GoPro video provided for the March 25, 2014jump ofJoel Galino depicts the videographer descending into .a cloud beginning at the 00:54 mark. 63 The GoPro camera depicts nothing but clouds at the 00:54 mark until the 00:58 mark, with moisture collecting onthe lens at the 00:56 mark. While the videographer is looking out towards the tandemjumpers for the beginning ofthe video, he appears to shift his viewmore downwards at the 00:50 time mark, at which time a large cloud is visible belowhim. After viewing this footage, Mr. McCowan, the government's expert in skydiving, opined that the videographer went through a cloud, stating: The video photographer did go through the cloud. You can see the moisture on the lens. You can see the cloud through his camera as he is going through the cloud. And he is deploying his canopy as he is coming out ofthe bottom ofit. 64 

### Mr. McCowan testified further that "[t]hat'stypical on a lens ofgoing through moisture, you will get condensation onthe lens," and stated that he was basing his opinion on "multiple videos

...

The Witness: "Again, yes, sir. They are pretty much in full flight now, so the canopies are opening and they are coming through the cloud now." Judge Rawald: "Okay. Once again, you are saying coming through the cloud, but I wantto understand what characteristic are you seeing in the image thattells you they are coming through the· cloud?" The Witness: "Again, they were not there prior." Judge Rawald: "Okay." The Witness: "Now they are." See id at48. 59 Agency Exs. A-32 through 35 and A-38. 60 Because the tandem parachutists were not wearing the GoPro cameras, the angle, distance and cloud coverage issues raisedregarding the reliability ofthe ground footage remain, thus rendering the GoPro footage ofless value when ascertaining whether or not any ofthe tandem parachutists descended into orthrough a cloud. 61 Transcript Volume 2 at 286. 62 Jd at 322 and 324. 63 Agency Ex. A-38. 64 Transcript Volume 2 at 64. DocketNo. FAA- 2014-1116 Initial Decision, page 12[he had] seen before." 65 The GoPro video provided for Bei Wu's March 25, 2014jump also depicts the videographer descending into a cloud. 66 The GoPro video depicts nothing butclouds beginning at the 00:53 mark until approximately the 1:01 mark. The videographer glances down atthe 00:51 time mark revealing the clouds below him. While the videographer glances back up at the tandemjumpers quickly, he redirects his view back downward at the 00:53 time mark, at which point the ground is blocked by clouds. The footage continues to show nothing but clouds until the 1:05 time mark. After viewing this footage, Mr. McCowan opined that "[t]he video photographer did go through the clouds," explaining that "there is a cloud below him as he is in freefall and as he gets to the cloud, he opens his main parachute, which stands him up and he continues to go through the'cloud as his mainparachute is opening."67 GoPro footage from Liyun Liu's March 25, 2014jump also depicts the videographer descending into a cloud. 68 The videographer looks straight down at the 00:48 markbased upon the view ofthe ocean and ground. Atthis point a cloud is in view, and as the video continues to the 00:50 mark, the videographer appears to descend through the cloud. In addition to opining that the videographer inthis video went into orthrough a cloud, Mr. McCowan stated that at the 00:51 mark you "can't see the ground."69 Although the GoPro video from Jonathan Fenell'sjump displayed some clouds in the sky, the footage does not depict either the videographer ortandem parachutists being filmed going into orthrough a cloud.70 While Mr. McCowan testified that the footage depicted the videographer "going

... through a cloud," 71 he admittedly relied upon ''the haze" in the footage, explaining that it is "part ofthe cloud.',n Mr. McCowan went onto testify that at the 00:47 mark "you can see the cloud all around [the videographer]," explaining that the tandem master starts "to disappear as the cameraman is going through the cloud."73 However, a review ofthe footage indicates that the videographer appears to be looking out towards the tandemjumpersuntil the

65 Id at 65. 66 Agency Ex. A-33. 67 Transcript Volume 2 at 43-44. 68 Agency Ex. A-35. 69 Transcript Volume 2 at 150-151. 70 Agency Ex. A-32. 71 Transcript Volume 2 at 96. 72 Id at 97. 73 Id at 100-101. DocketNo. FAA- 2014-1116 Initial Decision, page 1300:48 time mark, at which point the ground and ocean are visible. Giventhe fact that the videographer filming Mr. Fenell appears to first look down at the 00:48 mark, at whichtime the ground and ocean are visible, the preponderance ofthe reliable, probative and substantial evidence does not support a finding that the videographer descended into orthrough a cloud in this video. Mr. Sanders's testimony that the videographers depicted in exhibits A-33, A-35, and A-38 did not descend into orthrough the clouds is not convincing. When initially asked whether the jumperinexhibit A-33 went into orthrough a cloud, Mr. Sanders responded "[n]ot a cloud that would obscure your view ofthe ground with your eyes, no."74 When questioned about the caveat contained in his answer regarding obscuring the view ofthe ground, Mr. Sanders subsequently opined that·thejumperdid not go through a cloud, but his explanation regarding moisture in the air was not convincing.75 Mr. Sanders opined that the videographer in exhibit A-35 did not descend through a cloud, stating:There's no time that the camera looks straight down. It's always looking out in front. It's always looking out in front. It's also the tandems are clearly opening up in the drier air and they're open above. The-- the camerapeople here are opening at cloud level. So, there's lots ofmoisture on the lens as well.76 Despite Mr. Sanders assertion that the videographer never looked down, footage indicates that he looked down around the 00:49 time mark. The footage at this point depicts mostly clouds, with some ground and ocean to the right; as the footage continues, the view is ·completely obscured by clouds, indicating the videographer went into a cloud. With respect to the videographer in exhibit A-38, Mr. Sanders opined "Ibelieve they did not go through a cloud, that their lens fogged as they hit the moisture layer."77 With respect to the GoPro videos, Mr. Sanders's testimony is not logical, deep or

74 Transcript Volume 3 at 64. 75 See id. at 65-66 for the following exchange: Judge Rawald: "So, he could be going through a cloud, but it wouldn't be enough to obscure his vision?" The Witness: "No, I think there is

... there's moisture in the air." Judge Rawald: "Okay." The Witness: "And I also think that the camera is nowhere near what our eyes are." Judge Rawald: "Okay." The Witness: "And so, I think and I've hadthis happen to me many times where my ringsight will fog up, my lens will fog up, but I can see through it and there's water vapor, but I've never lost sight ofthe ground." Judge Rawald: "So, in your opinion, did he go through a cloud, or did he not go through a cloud?" The Witness: "No." 76 Id at 66. 77/d. at 67. DocketNo. FAA- 2014-1116 Initial Decision, page 14persuasive.78 Compared to the detailed explanation offlaws with the Hinshaw videos, Mr. Sanders appeared to stretch to find reasons to explain why the footage did not depict parachutists descending into orthrough clouds, relying primarily on the theory that moisture in the air can cause a camera lens to fog up and including caveats in his testimony. This attempt to stretch logic appears in large part due to Mr. Sanders's bias in favor ofthe Respondent. As previously mentioned, Mr. Sanders is a longtime friend ofMr. Banal and has been allowed to skydive for free with the Respondent for the past 14 years. He was also compensated at a rate of $500 an hour for his testimony. In the case ofthe GoPro videos, then, Mr. Sanders's bias combined withthe lack ofdepth or logic to his testimony limit the credibility ofhis testimony. Accordingly, the undersignedjudge finds that a preponderance ofthe reliable, probative, and substantial evidence supports a finding that on March 25, 2014, three parachutists affiliated with

. the Respondent descended into orthrough clouds.79 6. Is the Respondent a Responsible Party Under the Applicable Regulations? A violation of 14 C.P.R.§ 105.17(a) occurs, 

### inter alia, when a person, including a corporation,80 conducts a parachute operation "into or through a cloud." A parachute operation is defined as: the performance ofall activity for the purpose of, or in support of, a parachutejump or a parachute drop. This parachute operation can involve, but is not limited to, the following persons: parachutist, parachutist in command and passenger in tandem parachute operations, drop zone or owner or operator,jump master, certificated parachute rigger, orpilot.81 The definition ofparachute operation contained in 14 C.P.R.§ 105.3 appears to contain a typographical error, and was intended to read, "drop zone owner or operator," as opposed to "drop zone orowner or operator."82

78 Alphin, FAA OrderNo. 1997-9 at 12. 79 See Agency Ex. A-33; A35 and A-38. 80 See 14 C.F.R § 1.1. 81 14 C.F.R. § 105.3. 82 A notice ofproposed rulemaking dated April 13, 1999 proposed, inter alia, to defme previously undefined terms, including "parachute operation." Parachute Operations, 64 FR 18302 (Proposed Apr. 13, 1999) (to be codified at 14 C.F.R. Parts 65, 91, 105, 119). A briefdiscussion ofthe proposal indicated that the "term 'parachute operation' would be added and defined as any activity involving the use ofa parachute for a controlled descent to the surface," with the actual proposed amendment defining parachute operation as: "any activity that includes a parachutejump or a parachute drop. This activity involves, but is not limited to, the following persons: parachutist, tandem parachute operation, drop zone owner or operator, certificated parachute rigger, pilot, or appropriate FAA personnel." See id. The undersignedjudgerecommends that this typographical error be corrected in a future ru1emaking by removing the ·"or" between "drop zone" and "owner," so that it reads "drop zone owner oroperator." Docket No. FAA- 2014-1116 Initial Decision, page 15The Respondent is a drop zone operator at Dillingham Airfield.83 

### In support ofthis fmding, the Respondent authored a letterto the Honolulu Control Facility declaring its intent to "conduct

a series ofparachute operations at Dillingham Airfield

... from January 16, 2014 through December 16, 2015."84 When discussing his ten years as a drop zone operator, Mr. McCowan explained thathe controlled all business operations atthe drop zone, including the pilots' actions. 85 Similarly, inmaintaining an onsite office at Dillingham Airfield, where either Mr. Banal or a manger was present during all parachute activities, the Respondent controlled the drop zone, as well as communication with its pilots.86 As a drop zone operator, the Respondent is independently liable for ensuring parachute operations are conducted in accordance withthe clear language ofthe regulation. 

### Inits posthearing brief, the Respondent pointedto a National Transportation Safety Board (NTSB) case,

### Administrator v. 

### Foss, for the propositionthat liability is limitedto the parachutist and the pilot incommand. 87 Importantly, NTSB cases "are not binding onthe Administrator."88 Additionally, the NTSB's reliance upon the FAA Administrator's briefinthat case, which described a theory of"dual responsibility'' for boththe pilot andthe parachutists during skydiving operations, did not discuss the role orresponsibility ofthe otherparties referenced in the currentregulations. Ofnote, 

### Foss dealt with 14 C.F.R. §105.29,89 whichprohibited making a "parachutejump," and has since beenreplaced with 14 C.F.R. § 105.17, which, as previously discussed, prohibits conducting a "parachute operation," an actthat was defmed to include the actions ofa drop zone operator. Because 

### Foss did not address the role ofotherparties and in light ofthe change in the regulations since 

### Foss, the NTSB's decision cannot be interpreted to

83 A "drop zone" is apre-determined area where parachutists land after making an intentional parachutejump. See 14 C.F.R. § 105.3. 84 Agency Ex. A-4. 85 When asked "didyou control the pilot in any way once he took offfor a flight to drop skydivers?" Mr. McCowan replied: "Yes, we had radio communication with the pilot, with the aircraft. Ifsomething were to change on the ground, as clouds moving in or wind picking up, and mainly the wind picking up, we could call the pilot and tell him to not drop thejumpers." Transcript Volume 2 at 173-174. 86 See id at 232 for the following exchange with Mr. Banal: Q: "And Ithink you mentioned that you frequently talk to the pilots on the radio?" A: "Not frequently. Only when the manager is not around. He is in charge for that now. But, yes, I do sometimes. Itake the radio to see ifthere is any information, I will give the information what I can see from the ground, but--" Q: "And you mentioned ifyou are not arolind, there is a managerthere that could--" A: "Yes, there is a manager, yes." Q: "-- and that mai:lager, assistant manager is speaking frequently to the aircraft when you are not there?" A: "They will. We need to have aradio to communicate tothe plane all the time." 87Administratorv. Foss, NTSB OrderNo. EA-4631 (Opinion and Order, Feb. 17, 1998). 88 In re Wendt, FAA OrderNo. 1993-9 at 2 (Decision and Order, Mar. 24, 1993} (citingIn re Terry & Menne, FAA OrderNo. 1991-12 at 3 n.6 (Decision and Order, Apr. 10, 1991)). 89 See 14 C.F.R. § 105.29 (1998). DocketNo. FAA- 2014-1116 lnitial Decision, page 16stand for the propositionthatpilots and parachutists currently have "exclusive responsibility" for violations committed during a parachute operation. A look atthe relevant regulatory language governing parachute operations directs that drop zone operators, among others, have a role and responsibility to ensure regulatory compliance during parachute operations.90 Accordingly, the undersignedjudgefinds that a drop zone operator, such as the Respondent,

canbe held liable for parachute operations thatresult in a parachutist descending into orthrough

a cloud inviolation of 14 C.F.R. 

### § 105.17(a). 7. AtTmnative Defense: Personnel Were Independent Contractors
In additionto denying any violations occurred, the Respondent asserted that it cannot be held liable for the actions ofits independent contractors. Under 14 C.F.R. 

### § 13.224(c), the burden of proofshifts to the party asserting an affirmative defense.91 It is not disputed thatthe pilots, tandem instructors and videographers thatparticipated inthe subjectparachute activities were independent contractors.92 In support ofits argument, the Respondentrelied uponthe Administrator's holding in

### FederalExpress that: The general rule encompasses the notion that employers should not be heldresponsible for activities they do not control and, in many instances, lackthe knowledge and resources to direct

... The exceptions, in the main, reflect special situations where the employer is in the best positionto identify, minimize, and administerthe risks involved inthe contractor's activities.93 However, the Respondent's reliance is misplaced, as 

### FederalExpress is distinguishable from this case. In applying an agency theory ofliability in

### FederalExpress, the key question was ''whether Federal Express 

### offeredor

### acceptedhazardous materials," orwhetherthey ''were responsible for 

### Scharff's improper offer or acceptance ofhazardous materials in

### air transportation."94 In comparison, the key question inthe case at hand is whetherthe Respondent conductedparachute operations during any ofthe alleged violations, as opposed to whetherthe Respondent controlled the actions ofits independent contractors. As the drop zone operator, the Respondent conducted parachute operations during each ofthe alleged violations, thus rendering

90 See 14 C.F.R. §§ 105.3 and 105.17(a). 91 See 14 C.F.R. § 13.224(c). 92 Mr. Banal'stestimonyto this fact was supportedby 1099s, contracts and waivers. See Transcript Volume 2 at 191-192; see also Agency Exs. A-41 through**A~51.** 93 SeeIn reFederalExpress Corp., FAA OrderNo. 2002-20 at 6 (Decision and Order, Aug. 5, 2002) (findingthe Respondent was not liable for the actions ofits independent contractors because an exception to the general rule of non-liability for independent contractors was notpresented) (citing Mini Mart v. DirectSales Tire Co., 889 F.2d 182, 184 (8th Cir. 1989)). 94 FederalExpress Corp., FAA OrderNo. 2002-20 at 5. DocketNo. FAA- 2014-1116 Initial Decision, page 17it independently liable under the regulations. No evidence ortestimony presented indicates that the Respondent delegated any ofits duties as a drop zone operatorto any independent contractors. In fact, Mr. Banal admitted that eitherhimself, or a manager, were present during parachute activities, maintaining communication with the pilots.95 Accordingly, the Respondent was not absolved from its liabilityunderthe applicable regulations bythe fact that the pilots incommand andthe parachutists affiliated with the Respondent were independent contractors. 

### 8. Alleged Violations of 14 C.F.R. 

### § 91.13(a) The Complainant also alleged the Respondent committed residual violations of 14 C.F.R 

### § 91.13(a), whichprohibits the operation of"an aircraft in a careless orreckless manner so as to endangerthe life orproperty ofanother."96 While the Complainant's expert, Mr. McCowan, testified regarding the hazards ofparachuting into orthrough clouds, the undersignedjudge notes thatthe issue athand involves Part 105 violations for parachute operations, as opposed to Part 91 violations dealing withthe operation ofan aircraft. Despite the inherent dangers associated with the reckless behavior ofparachuting into orthrough clouds, there is no evidence thatthe aircraft involved inthis case were operated in a careless orreckless manner. Unlike the case athand,

cases in whichthe Administrator has upheld violations of 14 C.F.R 

### § 91.13(a) have involved clear instances ofcareless orreckless aircraft operation.97 Accordingly, the undersignedjudge finds the Complainant failed to prove by a preponderance ofthe reliable, probative, and substantial evidence that the Respondent committed any violations of 14 C.F.R 

### § 91.13(a). 

### 9. Civil Penalty Amount As previously explained, the undersignedjudgehas determined thatthe Respondent committed three violations of 14 C.F.R 

### § 105.17(a) onMarch 25, 2014. The remaining issue is

. the appropriate civil penaltyto be assessed against the Respondent for these violations.

95 See Transcript Volume 2 at 232. 96 The Complainant stated that it did not considerthese residual violations when assessing the proposed civil penalty amount. See May 19,2016Prehearing Conference Report. 97 See In reFenner, FAA OrderNo. 1996-17 (Decision and Order, May 3, 1996) (upholding a violation of 14 C.F.R. § 91.13(a) when an airplane flew too close to a helicopter, resulting in a nearmid-air collision). See also In re RushmoreHelicopters, Inc., FAA OrderNo. 2012-8 (Decision and Order, Oct. 11, 2012) (upholding a violation of 14 C.F.R. § 91.13(a) when a helicopter flew with duct tape coveringthe fuel filler port, leadingto the risk offuel contamination and fire); In re GoJetAirlines, LLC, FAA OrderNo. 2012-5 (Decision and Order, May 22, 2012) (upholding a residual violation of 14 C.F.R. § 91.13(a) after the complainant established the Respondent operated an unworthy aircraft). DocketNo. FAA- 2014-1116 Initial Decision, page 18Inits posthearing brief, the Complainant explainedthat it sought $11,000 perviolation in Case No. 2014WP130012 and $5,500 perviolation in Case No. 2014WP130023.98 The Complainant argued for the lower ciV:il penalty assessment for the alleged violations in Case No. 2014WP130023 because itviewed these violations, which allegedly occurred onMarch 22 and 25, 2014, as less egregious and dangerous thanthe alleged violations in CaseNo. 2014WP130012 due to the decreased cloud cover.99 Applying the Complainant'sproposed civil penalty of$5,500 per violation for the three established March 25, 2014 violations would result in a civil penalty of$16,500. The burden of justifying the proposed civil penalty falls upon the Complainant. 100 

### In attempting to meetthis burden, the Complainant did not, however, provide testimonial evidence about howthe proposed civil penalty amount was assessed. The Complainant did submit into evidence FAA OrderNo. 2150.3B, which, in Paragraph4 ofChapter 7, provides mitigating and aggravating factors to consider when assessing a civil penalty. 101 Other

### than describing the alleged violations as operational, reckless and possibly intentional,102 the Complainant never explained howit considered these factors in assessing its proposed civil penalty. Therefore, the Complainant'srequested civil penalty deserves no deference, but does setthe ceiling for considering the appropriate penalty inthis case. A civil penalty of$5,500 perviolation would fall within the maximum range as described in the sanction guidance. 103 In its posthearing brief, the Complainant statedthatthe civil penalty assessment focused onthe degree ofhazard associated with conducting parachute operations into

orthrough clouds. 104 Relying upon testimony providedby T.K. Hinshaw and Mr. McCowan, the Complainant contendedthat parachuting into or through a cloud poses several hazards, including colliding into anotherparachutist, glider orplane, or landing inthe nearby mountains or oceans,

98 Pursuantto49 U.S.C. §4630l(a)(5) and 14 C.F.R. § 13.305(a)(3), the Respondentis subjectto a civil penalty not to exceed $11,000 foreach ofthe alleged violations. 99 Complainant's Closing Argument at 15. 100See In re NorthwestAirlines, Inc., FAA OrderNo. 1990-37 at 7 (Decision and Order, Nov. 7, 1990) (finding the FAA bore the burden ofjustifyingthe amount ofthe civil penalty it sought). 101 See Agency Ex. A-1 at 9-14. 102 Complainant's Closing Argument at 15. 103 The civil penalty ranges contained in Appendix B ofFAA OrderNo. 2150.3B contain three different proposed ranges for minimum, moderate ormaximum violations, and specifically notes that''the middle ofeach recommended sanction range would be for a single violation without aggravating ormitigating factors." Agency Ex. A-1 at 33. The sanction range dealing with small businesses that do not hold a certificate, such as the Respondent, details a civil penaltyrange of$550-$2,199 for minimum violations, $2,200-$4,399 for moderate violations and $4,400-$11,000 for maximum violations. See id at 37. 104 Complainant's Closing Argument at 15. DocketNo. FAA- 2014-1116 Initial Decision, page 19instead ofthe designated drop zone. 105 While acknowledging that a midair collision is unlikely, the Complainant emphasizedthe high risk ofdeath or serious injury ifa collision occurred. Conversely, the Respondent argued inits posthearing briefthat the civil penalty sought by the Complainant is excessive and not supported bythe relevant guidance, because the Respondent did not act ina careless orreckless manner. 106 The Respondent asserts that ifany**pe~ty** is assessed, it should be $550 perviolation, which, inlight ofthe undersignedjudge's findings, wouldresult in a total civil penalty of$1,650. 107 To support its position, the Respondent notes its clean history, with no violations of 14 C.F.R. 

### § 105.17(a), as well as its compliance with the Complainant's investigation. The Respondent citedtothe portion ofFAA OrderNo. 2150.3B dealing with multiple violations that states: [ o]fparticular importance in determining an appropriate sanction for numerous multiple violations is the degree ofthe alleged violator's culpability for the multiple violations. A lower degree of culpability is present when the alleged violator neitherknew nor was likely to discoverthe continuing violations. 108 The Respondent focused onthe fact that it was not the pilot orparachutist during any ofthe alleged violations, reiterating the difficulties ofascertaining whether ornot a parachutist descended through the clouds from the.ground. During the hearing,.Mr. Banal statedthat due to the variable weather at Dillingham Airfield, an aircraft needs to ascend to thejumppoint altitude in orderto determine ''whether ornot to drop itsjumpers." 109 

### Inaddition to reminQing the pilots ofthe prohibition of jumping into or through clouds, bothverbally andthrough signage inthe planes, Mr. Banal testified that he has threatened to terminate the contracts ofany individuals thatbreakthe rules. 110 While Mr. Banal testified that he supports a pilot's decision to call offa run, stating thathis aircraft have descended with loads of jumpers onboard "because itwas too cloudy to conductparachutejumping operations," he reiterated his contentionthat the 

### final decision ofwhether ornottojump is between the pilot and the parachutist, more so withthe latter.m An appropriate civil penalty mustreflect the totality ofthe circumstances surrounding the

105 See Transcript Volume I at 183 and 224 and Transcript Volume 2 at 69-70. 106 Respondent's Closing Argument at 12.

. 107 A $550 civil penalty is the bare minimum contained in the FAA's Sanction Table. See Agency Ex. A-1 at 37. 108 /d. at 16. 109 Transcript Volume 2 at 192-193. 110 See id at 194-195; 204-206. 111 See id, at 206-207; 209-210. DocketNo. FAA- 2014-1116 Initial Decision, page 20violation,112 while providing enough "bite" to serve as a deterrent to boththe current violator and the industry as a whole in order to promote the goal ofsafety. 113 Paragraph 4 ofChapter 7 of FAA OrderNo. 2150.3B provides a non-exhaustive list ofmitigating or aggravating factors and elements that may be considered:

. a. nature ofthe violation; b. whether the violation was inadvertent ornot deliberate; c. certificate holder's level ofexperience; d. attitude ofthe violator; e. degree ofhazard; f. action taken by employer or other authority; g. use ofa certificate; h. violation history; i. decisional law;j. ability to absorb sanction; k. consistency ofsanction; I. whether the violation was reported voluntarily; and m. corrective action. 114 While the undersignedjudge is not expressly required to follow the provisions ofF AA OrderNo. 2150.3B, 115 it does provide guidance. 116 Further, the Administrator has stated that "similar criteria should be considered in assessing civil penalties in non-hazardous materials types of cases" 117 to the following statutorily required factors in considering a civil penalty involving hazardous materials violations: (1) the nature, circumstances, extent, and gravity ofthe violation; (2) with respect to the violator, the degree ofculpability, any history ofprior violations, the ability to pay, and any effect onthe ability to continue to do business; and (3) other matters asjustice may require. 118 The undersignedjudge considered all the pertinent factors to assess a civil penalty that will deter future violations by the Respondent and the parachuting industry as a whole. In considering the relevant factors, it is important to note that the Respondent did not raise an affirmative defense offinancial hardship regarding its ability to absorb a sanction. Also, while the Respondent emphasized its violation free history and compliance with the FAA's investigation, these behaviors are considered normal, and as such, are not mitigating factors. 119

112 SeeIn re VenturaAirServices, Inc., FAA OrderNo. 2012-12 at 26 (Decision and Order, Nov. 1, 2012); In re Folsom'sAirService, Inc., FAA OrderNo. 2008-11 at 14 (Decision and Order, Nov. 6, 2008). 113 In re Toyota Motor Sales, USA, Inc., FAA OrderNo. 1994-28 at II (Order and Decision, Sept. 30, I994); In re CharterAirlines, Inc., FAA OrderNo. I995-8 at 28 (Decision and Order, May 9, 1995). 114 See Agency Ex. A-1 at 9-14. 115 Folsom'sAirService, Inc., FAA OrderNo. 2008-11 at 14 (finding that because administrative lawjudges are not agency personnel, they are not expressly required to follow the guidance provided in FAA OrderNo. 2I50.3A). 116 In reAir Carrier, FAA OrderNo. I996-I9 at 7 (Decision and Order, June 4, I996)(citingNorthwestAirlines, Inc., FAA OrderNo. I990-37 at 8). 117 In reLuxemburg, FAA OrderNo. 1994-I8 at 6(0rder and Decision, June 22, I994) (citingNorthwestAirlines, Inc., FAA OrderNo. I990-37 at I2 n. 9). 118 49 U.S.C. § 4630I(e). See also 14 C.F.R. § 13.16(c). 119 See Toyota Motor Sales, USA, Inc., FAA OrderNo. I994-28 at 7-8 (citingIn re TCI Corp., FAA OrderNo. I992-77 at 20 (Decision and Order, Dec. 22, 1992) (fmding a violation free history to be the ''norm" that will not mitigate an otherwise reasonable civil penalty)). When discussing the "Attitude ofthe Violator," FAA OrderNo. 2I50.3B states: "[a] good compliance attitude is the norm and does not warrant a reduction in sanction." See Agency Ex. A-I at 10. Docket No. FAA- 2014-1116 Initial Decision, page 21Relying on decisional lawto ensure consistent sanctions, the undersignedjudge lookedto 

### Fedele, where the Administrator assessed a $500 civil penalty against an individual parachutist who violated the regulatory imposed cloud clearance requirements. 120 This holding supports a finding that the civil penalty assessed inthis case should fall within the applicable minimum sanction range of$550-$2,199 for each established violation, as opposed to the Complainant's request that it be withinthe maximum range. 121 · To establish the appropriate civil penalty amount withinthe minimum sanction range, the undersignedjudge weighed the relevant mitigating and aggravating factors. While the Respondent is liable under the regulations as the drop zone operator, and admittedly always had personnel present at Dillingham Airfield during parachute operations, all personnel on the plane were independent contractors. The Respondent could communicate with the pilot and parachutists viaradio, but could not forcibly prevent an illegal skydiving operation

once the plane was in the air. This then lessens theRespondent's culpability. The Respondent took steps tominimize the possibility that the parachutists would descend through the clouds by posting copies ofthe pertinent regulations in its aircraft and holding meetings to discuss regulatory compliance. Further, Mr. Banal threatened to suspend or fire any violators. However, Mr. Banal admittedly never fired or suspended anyone related to the violations that occurred on March 25, 2014. 122 Notably, case law directs that "[s]imply reviewing procedures and preexisting responsibilities with employees after an incident does not justify a reduction ofa reasonable civil penalty." 123 The violations inthe subject case were not self-reported bythe Respondent. Further, the Respondent infact advertised this type ofillegal activity as the Respondent's website contained a client testimonial that referenced parachuting through a cloud. 124 This thereby increases the

12

## ° Fedele, FAA OrderNo, 1998-3 at 1. 121 See Agency Ex. A-1 at 37. Notably, the Sanction Guidance Tables in FAA OrderNo. 2150.3B do not specify which range would apply to parachuting cases. See Ex. A-1 generally. · 122 See Transcript Volume 2 at 224-225. 123 Air Carrier, FAA OrderNo. 1996-19 at 12 (citing In reAirport Operator, FAA OrderNo. 1991-41 at 7 (Decision and Order, Oct. 31, 1991) (holding thatthe action ofreminding tenants oftheir existing responsibilities alone does not warrant a reduction in sanction)); cfIn re DetroitMetropolitan-Wayne CountyAirport, FAA Order No. 1997-23 at 5 (Decision and Order, June 5, 1997) (noting that the "Administrator has indicated that a civil penalty maybe reduced onthe basis ofcorrective action, but only where there is sufficient, specific evidence of swift orcomprehensive action that is positive in nature, such as sending employees to special training, or instituting programs to ensure compliance with the safety regulations"). 124 A customer review from Johnny Z. onthe Respondent's website includedthe following statement: "The coolest partwas falling through the cloud

..." Agency Ex. A-19 at 5. DocketNo. FAA- 2014-1116 Initial Decision, page 22Respondent's culpability. In considering the degree ofhazard ornature ofthe violation, the undersignedjudge notes that while the probability ofharm resulting from parachuting into orthrough a cloud is low, if harm did occur, itwould most certainly result in death or serious injury. 125 Withrespect to the extent ofthe violation, by committing multiple violations, the Respondent increased the probability ofthis danger occurring. In sum, the violations in the case at hand fall within the minimum civil penalty sanction range. Aggravating factors such as the risk ofdeath or serious harm, the fact that this conduct occurred onmultiple occasions, and the use ofthe illegal activity as a marketing tool, support a civil penalty towards the higher end ofthe minimum range. However, the mitigating factors, in particular the Respondent's decreased degree ofcontrol and culpability, support a civil penalty towards the lower end ofthe minimum range. Accordingly, in light ofall the circumstances, a civil penalty in the middle ofthe minimum range, in the amount of$1 ,37 5 perviolation, is appropriate. Therefore, pursuant to 14 C.F.R. § 13.205(a)(9), 

### IT IS HEREBY FOUND: 126 

### 1. OnMarch 25, 2014, the Respondent committed three violations of 14 C.F.R. § 105.17(a) by conducting parachute operations into orthrough the clouds. 2. The Complainant failed to prove by a preponderance ofreliable and probative evidence the remaining violations alleged within the complaint.

125 Similar to the testimony offered in this case, the Administrator previously stated "fj]umpingthrough ortoo near clouds is dangerous

... [s]kydivers could collide with each other orwith aircraft in the area; they could also land in water and drown." Fedele, FAA OrderNo. 1998-3 at 5. 126 Pursuant to 14 C.F.R. § 13.233(a), "A party may appeal the initial decision, and any decision notpreviously appealed pursuantto §13.219, by filing a notice ofappeal with the FAA decisionmaker. A party must file the notice ofappeal in the FAA Hearing Docket using the appropriate address listed in §13.210(a). A party shall file the notice ofappeal not later than 10 days after entry ofthe oral initial decision on the record or service ofthe written initial decision on the parties and shall serve a copy ofthe notice ofappeal on each party." DocketNo. FAA- 2014-1116 Initial Decision, page 23AND ORDERED: The Respondent shall pay a civil penalty inthe amount of$4,125. 127

Attachments: 1. Service List 2. Appendix A: Complainant's Exhibits 3. Appendix B: Respondent's Exhibits

# --~ ' DOUGLAS M. RAW ALD Administrative Law Judge

127 14.C.F.R. § 13.232(d), governing an order assessing a civil penalty states: "Unless appealed pursuant to §13.233 ofthis subpart, the initial decision issued by the administrative lawjudge shall be considered an order assessing civil penalty ifthe administrative lawjudge finds that an alleged violation occurred and determines that a civil penalty, in an amm;mt found appropriate bythe administrative lawjudge, is warranted." DocketNo. FAA- 2014-1116 Initial Decision, page 24SERVICE LIST
- BY U.S. MAIL 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 128

ONE COPY Robert 

### L. Feldman, Respondent's Counsel 8900 SW 107th Avenue, Suite 203 Miami, FL 33176 TEL: 305-598-4841 FAX: 305-598-4842
DonBobertz, Complainant's Counsel Office ofthe Regional Counsel, AWP-7 Federal Aviation Administration Western-Pacific Region P. 

### 0. Box 92007 Los Angeles, CA 90009-2007 TEL: 310-725-3454 FAX: 310-725-6816

The Honorable Douglas M. Rawald,Administrative LawJudge Office ofHearings, M-20 U.S. Department ofTransportation 1200NewJersey Avenue, S.E. (Ell-310) Washington, DC 20590 TEL: 202-366-5121 StaffAssistant FAX: 202-366-7536 DocketNo. FAA-2014-1116 (Civil Penalty Action)

128 Service was by U.S. Mail. For service in person orby 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.DocketNo. FAA-2014-1116 (Civil Penalty Action)


### Appendix A: Complainant's Exhibits A-1: FAA Order 2150.B A-2: ·N900SA Aircraft Records, Blue Ribbon Copy A-3: N989BW Aircraft Records, Blue Ribbon Copy A..;4: Pacific FAR 105.25 Notification to FAA 2-16-14 A-5: TKHinshaw Videos, 12-8-13 A-6: TKHinshaw Declaration Re 12-8-13 A-7: TKHinshawVideos, 1-5-14 A-8: TKHinshawDeclaration Re 1-5-14 A-9: N900SA In-Flight Worksheet 12-8-13 A-10: N900SA Aircraft Flight Record 12-8-13 A-11: N989BW In-Flight Worksheet 1-5-14 A-12: N989BWAircraft Flight Record 1-5-14 A-13: Hinshaw email Transmittal of3-25-14 YouTube Video to HNL FSDO A-14: TKHinshawVideos, 3-22-14 A-15: TKHinshaw Videos, 3-25-14 A-16: TKHinshawDeclaration Re 3-22-14 & 3-25-14 Flights A-17: N989BW In-Flight Worksheet 3-22-14 A-18: N989BW In-Flight Worksheet 3-25-14 A-19: Pacific Skydiving Website A-20: Discovery, Complainant's First Set ofDiscovery to Respondent served 3-13-15 A-21: Discovery, Respondent's Answers to Interrogatories served 4-13-15 A-22: Discovery, Complainant's Second Set ofDiscovery to Respondent served 5-21-15 A-23: Discovery, Response to Complainant's Second Set ofDiscovery to Respondent served 6-4-15 A-24: Subpoena & Cover Letter to Respondent dated 8-21-14 A-25: Respondent's Response to Subpoena Duces Tecum faxed 9-15-14 A-26: Respondent's Supplemental Response to SubpoenaDuces Tecum, 11-5-14 A-27: Pacific Jumper Lists, 1-5-14 A-28: Pacific Jumper Lists, 12-8-13 A-29: Jumper Lists 

### & Waivers, 3-22-14 A-30: Jumper Lists 

### & Waivers, 3-25-14 A-31: DSC06244 (3-22-14 Pacific Photo ofJonathan Fenell) A-32: 3-22-14 Pacific Video ofJonathan Fenell Jump A-33: 3-25-14 Pacific Video ofBei WuJump A-34: 3-25-14 Pacific Video ofBei WuLanding

### A-35: 3-25-14 Pacific Video ofLiyun Liu Jump A-36: GOPR2143 (3-25 Pacific Photo from Liyun Liu Photos) A-37: G0025877 (3-25-14 Pacific Photo ofGalino 1) A-38: 3-25-14 Pacific Video ofJoel Galino Jump A-39: G0065943 (3-25-14 Pacific Photo ofGalino 2) A-40: G0075952 (3-25;.14 Pacific Photo ofGalino3) A-41: Pacific 1099s A-42: Dasilva, Marcelo, Waiver, Contracts, 1099 A-43: Maynard, James, Waiver, Contract, 1099 A-44: Meyer, Greg (Colorado), Waiver, Contracts, 1099 A-45: Nascimento, Manuel Antonio (Tony), Waiver, Contracts, 1099 A-46: Pacheco, Randy, Waiver, Contracts, 1099 A-47: Rewa, Piri, Waiver, Contracts 1099 A-48: Richards, Gerry, Pilot Contract, 1099 A-49: Sovems, Reno, Waiver, Contract, 1099 A-50: Suvosrov, Victor, Waiver, Contracts, 1099 A-51: Wolfaardt, Johann, Waiver, Contracts, 1099 A-52: Resume, Expert W Paul McCowan A-53: AirNav_PHDH- Dillingham Airfield A-54: Hawaiian Islands Sectional Chart A-55: AC 105-2E A-56: Google Earth Overview ofDillingham Field

### Docket No. FAA-2014-1116 (Civil Penalty Action)
Appendix B: Respondent's Exhibits 

### R-1: 

### [Withdrawn] R-2: 

### [Withdrawn] R-3: FAA Order 8900.1 R-4: 

### [Withdrawn] R-5: 

### [Withdrawn] R-6: Jump Recap Sheets R-7: 

### [Not Offeredj R-8: 

### [Not OfferedJ R-9: 

### [Not OffiredJ R-10: 

### [Not OfferedJ R-11: 

### [Not Offiredj R-12: Video from SD HI Aircraft POV Cam R-13: 

### [Withdrawn] R-14: Deposition ofDanny Billman R-15: AWP-1-20140911-01-Deely King Pang- Dennis King- Final Response_2014_09_26 R-16: Dennis King letter to HPD R-17: EIR 2014WP130012- 2013-12-08-2014-01-05 R-18: EIR 2014WP130023- 2014-03-22-2014-03-25 R-19: Facebook Posting as of2015-05-04- See p.22 R-20: IMG 3970- Cloud Clearance Notice in Aircraft 1 R-21: IMG 3872- Cloud Clearance Notice in Aircraft 2 R-22: 

### [Withdrawn] R-23: Skydive Hawaii_Old_Skydiving_First time Jumpers- IKORS R-24: Tom Sanders Resume R-25: Paul McCowan Skydiving video R-26: Video camera manual excerpt