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• APPEARANCES: On Behalf of the Complainant: KYLE LOMAZOW, ESQ. of: FAA Office of Regional Counsel 1601 Lind Avenue SW, ANM-7 Renton, Washington 98057 (425) 227-1847 On Behalf of the Respondent: CYNTHIA CHANDLER-SNELL, ESQ. of: FedEx Express 3620 Hacks Cross Road Building B, 3rd Floor Memphis, Tennessee 38125 (901) 434-8361

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OPENING STATEMENT: PAGE On behalf of the Complainant 16 On behalf of the Respondent 17

WITNESSES: DIRECT CROSS REDIRECT RECROSS Mallory Luscher 25 119 235 251

EXHIBITS: MARKED COMPLAINANT C1 37 C2 38 C3 41 C4 44 C5 49 C6 53 C7 (Page 1) 58 C7 (Page 2) 58 C7 (Page 3 ) 58 C7 (Page 4) 58 C7 (Page 5) 58 NEAL R. GROSS COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. (202) 234-4433 WASHINGTON, D.C. 20005-3701 244

RECEIVED

38 41 43 45 93 55 62 63 63 64 65

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• 1. N D E X (Cont I d.) EXHIBITS: MARKED COMPLAINANT C7 (Page 6) 58 C7 (Pages 7 - 12) 58 C7 (Page C7 (Page C7 (Page C7 (Page C8 C9 C10 C11 C12 C13 C14 C15 C16 RESPONDENT R1

(202) 234-4433 13) 58 14) 58 15) 58 16) 58 67 70 73 74 76 86 102 106 111

150

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97 98 100 102

72 73 75 75 95 88 104 108 113

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1 

### PRO C E E DIN G S 2 

### 9:28 a.m. 3 

### JUDGE GOODWIN: Counsel, identify 4 yourself for the record, please. 5 

### MR. LOMAZOW: Kyle Lomazow for the 6 FAA. 7 

### JUDGE GOODWIN: Spell your last 8 

### name, please. 9 

### MR. LOMAZOW: L-o-m-a-z as in 10 

### "zebra" -o-w. 11 

### JUDGE GOODWIN: Counsel? 12 

### MS. CHANDLER-SNELL: Cynthia 13 Chandler-Snell for Federal Express Corporation 14 and for Corporate Airline -- Corporate Air. 15 Last name C-h-a-n-d-l-e-r hyphen -- 16 

### JUDGE GOODWIN: Chandler? 17 

### MS. CHANDLER-SNELL: Yes, sir 18 hyphen S-n-e-l-l. And for convenlence, I'll 19 respond to Ms. Chandler or Ms. Snell or 20 Counsel. 21 

### JUDGE GOODWIN: Okay. The cases 22 I've got on the docket are Federal Express NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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1 

### Corporation, FAA No. 2010-0977 and Corporate 2 

### Air 2010-0975. Are we going to -- I don't 3 care how counsel tries it. They can try it as 4 a consolidated case, one after the other, 5 

### however you want to do it. So what's your 6 pleasure? 7 

### MR. LOMAZOW: I was gOlng to try 8 it as a consolidatedcase, FedEx and Corporate 9 Air. 10 JUDGE GOODWIN: Okay. 11 

### MS. CHANDLER-SNELL: And we have 12 no objections to that, Your Honor. 13 

### JUDGE GOODWIN: All right. Then 14 

### that's what we'll do. Does anybody want a 15 rule on witnesses? 16 

### MS. CHANDLER-SNELL: As far as 17 sequestering the witnesses? 18 

### JUDGE GOODWIN: Yeah. 19 MS. CHANDLER-SNELL: Yes, Your 20 Honor. 21 MR. LOMAZOW: Yes. 22 

### MS. CHANDLER-SNELL: I think the
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### 1 parties have agreed. 2 

### MR. LOMAZOW: We have agreed to 3 sequester the witnesses. 4 

### JUDGE GOODWIN: Okay. There's 5 area out in the foyer. There's no cafeteria 6 in the building. The cafeteria, you have to 7 go outside, through security, turnright, turn 8 

### right, and it's downstairs. There's a 9 Starbucks on the other side of the street. 10 I'm going to instruct all the witnesses 11 they're not to discuss any testimony in this 12 case prior to the conclusion of the case. If 13 you have any question about whether you can 14 talk to somebody about something, talk to the 15 attorney for whichever party you're here for. 16 The FAA is allowed one technical 17 assistant at the table who mayor may not 18 testify and, consequently, the Respondent is 19 equally allowed someone. 20 

### This is -- it's much a reminder 21 because Counsel both have appeared before me, 22 

### but everything we do goes on the Internet. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 8 1 

### The transcript will go on the Internet. The 2 exhibits will all go on the Internet. So when 3 you testify, I would ask that you give your 4 business address, your business phone number, 5 

### and that you not any personal 6 information. If there comes a time where we 7 get into information that may have some 8 security issues, we'll go off the record, I'll 9 seal that portion of the record, and then 10 

### we'll go back on the open record. 11 

### I'm going to ask counsel as we go 12 

### through to review the exhibits, make sure that 13 

### we've redacted all personal cell phone 14 

### numbers, home phonenumbers, home address, and 15 

### Social Security numbers, dates of birth, or 16 

### anything else. 17 

### And my rule of thumb 1S if 1n 18 

### doubt, we'll seal it. We work in an 19 

### environment and 1n an industry where we can't 20 be too careful. 21 

### Any other preliminary matters, 22 Counsel? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 MR. LOMAZOW: Your Honor, there lS 

### 2 the preliminarymatter regarding objection to 3 

### their witnesses. I don't know if that's 4 something you want to take up now. I think

-- 5 

### JUDGE GOODWIN: Well, I think 6 we'll take that up in the course of the 7 hearing. 8 

### MR. LOMAZOW: Okay. 9 

### MS. CHANDLER-SNELL: Your Honor, 10 thematters that Federal Express andCorporate 11 Air have pending, one involves a late12 disclosed witness. Would you anticipate 13 handling that the same way? 14 

### JUDGE GOODWIN: Yeah, probably. 15 

### MS. CHANDLER

-SNELL: Okay. And we 16 have also pending a motion to dismiss on 17 behalf of Corporate Air and a motion to allow 18 testimony to be consolidated in all four 19 cases. If Your Honor would allow, I'd like to 20 speak on the motion to allow the consolidated 21 testimony first. 22 JUDGE GOODWIN: I don't

-- unless
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• 10 1 you've got rejection, Counsel, I don't have 2 anyproblems interms of expeditedproceedings 3 into consolidating the testimony. The only 4 thing we have to make sure is that the 5 reporter knows that and we'll deal with the 6 mechanics of that. 7 I understand that everybody has 8 schedules and if the two of you have a witness 9 that you want to take out of sequence in order 10 to accommodate the witness, that doesn't cause 11 me a problem. 12 MS. CHANDLER-SNELL: Thank you, 13 Your Honor. 14 JUDGE GOODWIN: I did that

-- 15 MS. CHANDLER-SNELL: We have 16 spoken

-- 17 JUDGE GOODWIN: ln the LAX 18 case. We had people coming in from allover 19 the world. And when they showed up, we'd put 20 them on the stand. And I know that both of 21 you have the same problem. So if you two are 22 amenable to something, we'll do it that way NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 11 1 and we'll just we can work around the 2 mechanics of it all. 3 MS. CHANDLER-SNELL: Thank you, 4 Your Honor. I've spoken with the court 5 reporter and counsel for the FAA, and I 6 believe the majority of them are my witnesses, 7 so I anticipate when we swear them in, to 8 clarify at that point if they're testifying ln 9 the Empire case and the Corporate case and, if 10 so, the court reporter will make note and then 11 be able to copy and cut the testimony into the 12 record. 13 JUDGE GOODWIN: Okay. What I'm 14 gOlng to ask you to do is periodically check 15 with the court reporter to make sure he's 16 onboard. 17 MS. CHANDLER-SNELL: Yes, Your 18 Honor. 19 JUDGE GOODWIN: A couple of 20 mechanical issues. Everything in this room 21 runs off of motion sensors. So if everybody 22 sits still and behaves themselves, the lights NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 may suddenly go off. It's happened to me 2 before. So though I'mnot trying to encourage 3 you to leave the rostrum, periodicallyyoumay 4 want to just move around as you're doing. 5 

### Also, I've got a 

### hearing 6 disability, so if I ask you to repeat 7 something, it'sbecause I reallyhaven't heard 8 

### you. And it's more difficult in this 9 particular environment because it's well 10 soundproofed and it's big and so it -- to the 11 extent that we're using the PA system, that's 12 helpful. 13 

### And I can't think of any other 14 preliminary things. So let's -- we'll go off 15 the record for just a couple minutes to allow 16 you to sequester the witnesses and then we'll 17 go back on the record. 18 

### MS. CHANDLER-SNELL: Your Honor, 19 regarding our motion to dismiss on behalf of 20 Corporate, would you like to hear argument on 21 that? 22 JUDGE GOODWIN: I think I'm going
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1 

### to treat that as a jurisdictional motion to be 2 

### argued at the end of the hearing. It was 3 filed at such a time the FAA hasn't had a 4 

### chance to respond. 5 

### MS. CHANDLER-SNELL: Yes, Your 6 

### Honor. 7 

### JUDGE GOODWIN: If there's a basis 8 

### for it, it's a jurisdictional motion as it is 9 

### anything else. 10 

### MS. CHANDLER-SNELL: Yes, Your 11 

### Honor. 12 

### JUDGE GOODWIN: Okay. Anything 13 

### else? And that might be a matter that you 14 

### want to address preliminarily in your briefs 15 

### because if it's jurisdictional, it's always 16 

### jurisdictional. 17 

### MS. CHANDLER-SNELL: My only 18 concern with doing that, Your Honor, is that 19 I guess would it be appropriate for Corporate 20 

### Air to have an objection on the a 21 

### preliminary objection on the record to any 22 

### testimony that's taken ln today regarding NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 Corporate Air? In other words, not waiving 2 our motion to dismiss simply because the 3 testimony about the allegations against 4 Corporate Air is coming in today? 5 

### JUDGE GOODWIN: I wouldn't treat 6 

### it as a waiver. If you enter an objection 7 

### that once you affirmatively waive the 8 objection, then it's an objection. 9 

### MS. CHANDLER-SNELL: Yes, Your 10 Honor. 11 JUDGE GOODWIN: And, of course, 12 Counsel for the FAA can always argue to the 13 contrary. But

- - all right. Let's go off the 14 record for about two minutes, allow you to 15 sequester the witnesses, do any mechanical 16 stuff. 17 I don't care whether the witnesses 18 leave the building, stay in thebuilding, stay 19 out there. That's up to Counsel. All right. 20 (Whereupon, at 9:35 a.m. off the 21 record until 9:41 a.m.) 22 JUDGE GOODWIN: Back on the
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### 1 record. Ms. Snell, I know that you would 2 probably secretly be concerned about whether 3 I had a chance to visit with my grandchildren 4 

### because we moved the venue, but I had dinner 5 

### with my two-year-old granddaughter last night 6 

### here, so you're off the hook. 7 

### MS. CHANDLER-SNELL: I'm glad to 8 

### hear that, Your Honor. I was concerned. 9 

### JUDGE GOODWIN: No. I knew that 10 

### you probably felt it would affect my 11 disposition and predisposition towards the 12 case, but I got a call at three 0'

### clock 13 yesterday afternoon and we had dinner 14 together, so it was a lot of fun. 15 

### MS. CHANDLER-SNELL: Well, I think 16 that's just testimony that your grandchildren 17 

### are better than my children. You wouldn't 18 want to be trying to avoid 'em. 19 

### JUDGE GOODWIN: Well, but, see, I 20 get to send 'em home and -- you know, two and 21 a half hours is about my limit. I had to take 22 a nap. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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1 

### MS. CHANDLER-SNELL: Me, too. 2 

### JUDGE GOODWIN: Yeah. Opening 3 statements, Counsel? 4 

### MR. LOMAZOW: Yes, Your Honor. 5 

### I'll keep it very short and simple. 6 OPENING ON BEHALF OF THE COMPLAINANT 7 

### MR. LOMAZOW: This case involves 8 three improperlymarkedpackages of hazardous 9 

### materials. You're going to hear on two 10 different dates. One package was from May 11 12th, 2008. The second package was from May 12 16th, 2008. This involves Federal Express. 13 

### Both packages all three packages were 14 

### tendered to Federal Express. They were 15 

### transferred to Corporate Air for 16 transportation. And you'll hear testimony as 17 to why these packages were in fact improperly 18 marked, and you'll also hear testimony as to 19 why the sanction that the Administrator is 20 seeking 1S 

### consistent with the Sanction 21 Guidelines. 22 

### Thank you, Your Honor. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 JUDGE GOODWIN: Ms. Snell, do you 2 want to be heard? 3 MS. CHANDLER-SNELL: Yes, Your 4 Honor. 5 OPENING ON BEHALF OF THE RESPONDENT 6 

### MS. CHANDLER-SNELL: To elaborate 7 a little more on these cases, they do involve, 8 as the FAA stated, two different sets of 9 lssues. Now, we would submit that there's the 10

-- the primary and most of the testimony that 11 you're going to hear today, and over the 12 course of the week, will be involving UN 3373, 13 biological substances Category B. 14 Your Honor, our testimony from our 15 FedExwitnesses will involve thebackgroundon 16 the packaging that was developed by Federal 17 Express for use by customers to reflect the 18 changing regulations on these types of 19 

### substances. We will have two or three 20 witnesses, some from the industry, some from 21 internal to FedEx, who will testify about the 22 changing nature of these regulations and how NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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1 

### FedEx has cooperated with the FAA 1n 2 determining how these shipments need to be 3 properly packaged and how they need to be 4 properlytransportedthrougha carriersystem. 5 

### That information 1S important 6 because the primary issue before Your Honor 7 todaywill be on the interpretationof HM226A. 8 The background of that is that is the rule 9 

### that affects these UN 3373 shipments. The 10 wording of the rule, we submit, does not lend 11 itself to the interpretation that the FAA 12 would be attempting to enforce against both 13 FedEx and Corporate Air. So we'll be giving 14 witnesses who have the background on how that 15 rule was developed, on why such wording was 16 chosen, on the general interpretation in the 17 industry of what the rule means, and we will 18 have testimony on the practical effect that 19 the FAA's interpretation of this rule will 20 have on transportation of these substances. 21 In order to give more background 22 onwhy it's important that these substances be
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1 

### transportedovernight, we will be offeringthe 2 testimonyof a medical doctor who will testify 3 regarding the types of shipments that are 4 

### involved in this in these in this 5 

### Category B. He will testify as to the far6 reaching effects that even an hour or two's 7 

### delay on these shipments can have on 8 individuals who are being diagnosed or have 9 

### been diagnosed with life-threatening 10 conditions. 11 

### All of that goes back to the 12 interpretation of the rule. Further, we will 13 present testimony from Bob Richard. The FAA 14 will have objections to that and we can deal 15 with those when they come, but we expect Mr. 16 Richard's testimony to be that he was the 17 Assistant Deputy at PHMSA, the Assistant 18 Deputy of Hazardous Materials at PHMSA when 19 this rule was ushered through. 20 While, as Your Honor well knows, 21 having read the opinion that Your Honor has 22 given on expert testimony of DOT

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### 1 employees, Mr. Richard won't be offered as an 2 expert but he will be offered to give 3 background and to glve details of how the rule 4 

### reads, plain and simple from the rule. He 5 will give explanations on that and he will 6 testify, we expect, that he had conversations 7 with FedEx during the time the rulemaking was 8 proceeding and gave representations to FedEx 9 regarding what the rule meant as a practical 10 matter for carriers. 11 The substantial majority of the 12 testimony we'll present would be on the UN 13 3373 issue. 14 Now, a secondary issue will be the 15 issue of FedEx's feeder relationship with our 16 feeder operator, CorporateAir, who we're also 17 representing here today. 18 

### Your Honor I think has some 19 background on that, but we will be submitting 20 testimony from Corporate Air to acknowledge 21 that Corporate Air was flying under their 22 flight certificate at the time that these
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### 1 items were transported. 2 Every item in this case was flown 3 on a Corporate Air plane, not a FedEx plane. 4 They were flown under Corporate Air's flight 5 certificate, not FedEx's flight certificate. 6 So the nuance on this case will be 7 whether the activities that FedExperformedin 8 inspecting these packages and loading these 9 packages was performed as an agent of 10 Corporate Air or as an independent act on 11 behalf of FedEx and under their flight 12 certificate. So some of the testimony 13 involved will contribute to that issue, which 14 of course we will follow up in briefs and 15 develop more fully. 16 Then the final issue that will be 17 before the Court in our interpretationwill be 18 a shipment that was -- had an oxidizer label. 19 The shipment was not properly marked and 20 labeled in the way that it should have been 21 when it came from the shipper. The testimony 22 we believe will come in from the FAA agent NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 22
1 that the shipment was loaded ln an 2 inaccessible position that was inappropriate 3 if the package contained an item that was 4 required to have an oxidizer label. 5 And we believe the further 6 testimony coming in through David Littlejohn 7 and through Agent Lusching

-- Luscher will be 8 that the shipment was not actuallyrequired to 9 have an oxidizer label. 10 At the end of the day, the 11 investigation revealed that it was not 12 regulated at all. 13 So the information that we 14 presented will talk about remedial measures 15 with FedEx as well, but the issues that will 16 keep floating around is whether a violation of 17 FedEx policy is a violation of the CFR. And 18 we'll establish that in more detail through 19 the testimony over the next few days. 20 JUDGE GOODWIN: Okay. One 21 suggestion is

-- well, you must remember the 22 Court does have familiarity, but I think it's NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 23 1 

### important to remember that this case stands 2 alone, so I think I would encourage both of 3 you to lay the framework and don't assume that 4 

### just because I've done a few of these, that I 5 

### know it. Make sure that you do the record 6 

### first for

-- that you complete the record in 7 

### such a way that somebody other than myself who 8 

### reviews it understands everything ln the 9 

### record. 10 And 

### as I 

### told one of your 11 

### colleagues in Chicago a number of years ago, 12 

### I can interpret what the regulations

-- I can 13 

### make decisions with respect to the 14 

### regulations, but I 

### can't change the 15 regulations and, as I suggested to him in the 16 case ln Chicago, it could be that relief 17 doesn't lie with this Courti 

### it may lie 18 elsewhere. 19 

### MS. CHANDLER-SNELL: Yes, Your 20 Honor. 21 

### JUDGE GOODWIN: If you know what I 22 mean. NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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1 

### MS. CHANDLER-SNELL: Yes, Your 2 Honor. 3 

### JUDGE GOODWIN: Sir, are you 4 ready? 5 

### MR. LOMAZOW: Call my first 6 

### witness, Your Honor? 7 

### JUDGE GOODWIN: I'm having dinner 8 

### with your predecessor tomorrow night. 9 

### MR. LOMAZOW: Oh, Mr. Morris. 10 

### JUDGE GOODWIN: Yes. Tell him I 11 

### said hi. 12 

### JUDGE GOODWIN: All right. I 13 

### don't know if you heard, Ms. Snell, Mr. Morris 14 

### is now an ALJ with the Social Security 15 

### Administration. 16 

### MS. CHANDLER-SNELL: I did. We 17 were very sorry to see him leave, Your Honor, 18 but we wish him the best. 19 

### JUDGE GOODWIN: Yeah. I knew you 20 would be. Yeah. 21 

### Call your first witness. 22 MR. LOMAZOW: Okay. Your Honor,
NEAL

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### 1 the Administrator calls Lori Luscher to the 2 stand. 3 

### JUDGE GOODWIN: Okay. While 4 you're getting here, I'll be right back. 5 (Pause.) 6 MALLORY LUSCHER, COMPLAINANT'S WITNESS, 7 SWORN 8 

### JUDGE GOODWIN: Please be seated. 9 And would you state your full name for the 10 record and spell your first and last name. 11 THE WITNESS: Okay. Mallory 12 

### Luscher, M-a-l-l-o-r-y, Luscher, 13 L-u-s-c-h-e-r. 14 

### JUDGE GOODWIN: Counsel. 15 DIRECT EXAMINATION 16 BY MR. LOMAZOW: 17 Q 

### Okay. Ms. Luscher, where are you 18 employed? 19 A 

### I am employed at the Federal 20 Aviation Administration. 21 Q 

### Okay. What's your please 22 describe your aviation background. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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1 A 

### My aviation background 1S 

### almost 2 11 

### years with the Federal Aviation 3 Administration, nineyears as a hazmat special 4 

### agent, and two years as a program analyst for 5 

### hazmat. 6 Q 

### How long have you been with the 7 

### FAA? 8 A 

### Almost 11 

### years. 9 Q 

### Okay. And what training have you 10 

### received regarding hazardous materials? 11 A 

### I've received classroom training, 12 

### on-the-job training all through the Federal 13 

### Aviation Administration. 14 Q 

### Okay. And what are your duties 15 

### and responsibilities currently? 16 A 

### Currently my duties involve 17 enforcing 49 CFR, the hazmat regulations. And 18 

### in doing so, I perform investigations, 19 

### inspections on both carriers, shippers. I 

### 20 also do a lot of outreach activities dealing 21 

### with the general public anddifferent industry 22 

### groups. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 Q 

### So your duties do involve 2 conducting investigations into violations of 3 the Hazardous Material Regulations? 4 A 

### Yes, sir. 5 Q 

### Okay. Approximately how many 6 investigations have you performed ln your 7 career? 8 A 

### Almost 300. 9 Q 

### Okay. 10 MR. LOMAZOW: Your Honor, I offer 11 Agent Luscher as an expert in the area of 12 hazardous material compliance. 13 MS. CHANDLER-SNELL: Your Honor, 14 my objection would be I don't think that she 15 was -- 16 

### JUDGE GOODWIN: You want to VOlr 17 dire her? 18 

### MS. CHANDLER-SNELL: Yes, Your 19 Honor. Well, I'd say a preliminaryobjection, 20 I don't think she was disclosed as an expert, 21 a potential expert witness in the case. She's 22 just listed as a factual witness. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 28 1 JUDGE GOODWIN: Is she offered as 2 a factual or an expert? What's her area of 3 expertise? 4 MR. LOMAZOW: Her area of 5 expertise is going to be Parts 171 through 175 6 in the Air Commerce Mode regarding hazmat 7 investigations. 8 JUDGE GOODWIN: Well, all I've 9 heard so far is a foundation for testimony

-- 10 I haven't heard anything that would suggest 11 she's an expert in anything in particular. 12 MR. LOMAZOW: Okay. 13 JUDGE GOODWIN: So at this point, 14 the objection to have her accepted as a 15 witness would be sustained. 16 MR. LOMAZOW: Okay. 17 MS. CHANDLER-SNELL: Thank you, 18 Your Honor. 19 MR. LOMAZOW: As a factual witness 20 is fine? 21 JUDGE GOODWIN: I'd assume she's 22 going to testify. NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 BY MR. LOMAZOW: 2 Q 

### Ms. Agent Luscher, please 3 describe ln a little bit more detail your 4 hazardous material investigations, the process 5

-- what type of investigations you take part 6 In. 7 A 

### I look into violations of the 8 HazardousMaterialsRegulations as itpertains 9 to air commerce, going to companies or to air 10 carrlers that report undeclared leaks or 11 spills of hazardous materials, and so I go in 12 

### and take pictures, take statements, and put 13 them altogether and create EIRs, which are 14 investigative reports. 15 Q 

### Okay. So do you investigate air 16 carriers? 17 A 

### Yes. 18 Q 

### Do you investigate other entities 19 besides air carriers? 20 A 

### Yes, shippers and also passengers. 21 Q 

### Okay. And as part of your 22 

### training, are you familiar with the Title 49
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• 30 1 

### CFR? 2 A 

### Yes, I am. 3 Q 

### Okay. And are you familiar with 4 the Hazardous Material Regulations? 5 A 

### Yes, I am. 6 Q 

### Okay. And do you apply the 7 

### Hazardous Material Regulations ln your 8 

### investigations and in your inspections? 9 A 

### Yes, I do. 10 Q 

### Okay. And when you complete an 11 

### EIR, who do you report to? 12 A 

### I report that to my supervisor. 13 Q 

### Okay. And your and, from 14 

### there, they make a decision on whether to go 15 

### forward or not? 16 A 

### Yes. 17 Q 

### Okay. Once agaln, how many 18 

### hazardous material investigations have you 19 

### been a part of? 20 A 

### Almost 300. 21 Q 

### Okay. 22 

### MR. LOMAZOW: Your Honor, once NEALR. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 31 

### 1 again, I offer Agent Luscher as an expert in 2 hazardous material investigations. 3 

### JUDGE GOODWIN: Ms. Snell? 4 

### MS. CHANDLER-SNELL: Your Honor, I 5 would

-- I guess I would renew my objection to 6 her being declared an expert without prior 7 notice to Counsel to be able to do any 8 

### background information. I've not heard 9 anything about her education, her resume, or 10 any specific

-- I guess a specific involvement 11 she's had with the regulations. As far as 12 being offered as an expert in inspection 13 for inspection purposes only, I'm not -- I 14 guess I'mnot sure about the well-defined area 15 of what she's being offered as an expert in. 16 

### JUDGE GOODWIN: Overrule your 17 

### objection. She can testify as to her 18 expertise in inspections. But anythingbeyond 19 that, we'll review at that point. 20 

### MS. CHANDLER-SNELL: Thank you, 21 Your Honor. 22 MR. LOMAZOW: Your'Honor, before I NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 32 1 

### begin, may I approach the witness? I'm just 2 going to give her the 3 

### JUDGE GOODWIN: Oh, sure. And as 4 Counsel know, I will keep the originals of the 5 

### exhibits. I'm going to mark them the 6 

### notebooks the FAA's notebook has been 7 

### marked "C." I generally paginate the 8 

### exhibits. I'll write on there "Marked for 9 identification." When they're admitted, I'll 10 strike through the "ID" and put the date on 11 

### it. And I'll do the same thing for 12 Respondent. Only ask that you not mark them 13 with identicalmarkings because it would cause 14 confusion if I had two sets of CIs and 2s and 15 so forth. 16 

### MS. CHANDLER-SNELL: So we'll 17 start with the Rl? 18 

### JUDGE GOODWIN: I don't care what 19 you use but, I mean, logically one would think 20 "R," but I don't care. Just don't use "C." 21 MS. CHANDLER-SNELL: Yes, Your 22 Honor. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 33 1 

### MR. LOMAZOW: Don't use "C." 2 

### Okay. So of course I

-- 3 

### JUDGE GOODWIN: You could do "CA," 4 but

-- 5 

### MR. LOMAZOW: Okay. I titled from 6 Cl to C20. 7 

### JUDGE GOODWIN: Right. 8 

### MR. LOMAZOW: So would you like me 9 to refer to it as something else? 10 JUDGE GOODWIN: Pardon me? 11 

### MR. LOMAZOW: For my -- you know, 12 the binder that I handed up, I titled it

-- 13 

### JUDGE GOODWIN: I'm assuming that 14 you want to mark Cl and so forth. 15 

### MR. LOMAZOW: Yes. Okay. Okay. 16 Okay. 17 BY MR. LOMAZOW: 18 Q 

### Agent Luscher, do you recall 19 conducting a surveillance of Federal Express 20 operations on May 12th, 2008 and May 16th, 21 2008? 22 A 

### Yes, I do. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 34
1 Q 

### Where were you on May 12th, 2008? 2 A 

### I was in Great Falls, Montana. 3 Q 

### And why were you there? 4 A I 

### was there to perform 5 comprehensivehazmat inspections at all of the 6 airlines there at Great Falls International 7 Airport. 8 Q 

### Okay. Is Great Falls within your 9 

### jurisdictional area of responsibility? 10 A 

### Yes, it is. 11 Q 

### Okay. And would you go there as 12 part of the normal course of your business 13 activities? 14 A 

### Yes, I would. 15 Q 

### Okay. Now, does FedEx have a 16 facility there or is there some sort of 17 facility where you were particularly located 18 at? 19 A 

### FedEx does have a facility right 20 there in the airport. 21 Q 

### Okay. Let's discuss the May 12th, 22 

### 2008 inspection first. When you arrive at NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 35
1 

### Great Falls, describe what you do as part of 2 

### your inspection what you did I'm 3 

### sorry what you did as part of your 4 inspection. 5 A 

### Okay. Okay. 6 

### JUDGE GOODWIN: Which one was 7 this?

- - April 8 

### MR. LOMAZOW: This lS 

### April

-- I'm 9 sorry -- May 12th, 2008. 10 THE WITNESS: May 12th, 2008 I 11 would have gone into the station and talked 12 with FedEx employees trained to gather 13 information about the general operation there 14 at FedEx. FedEx there has a feeder

-- feeder 15 activity there that has several aircraft

-- 16 smaller aircraft coming in from allover the 17 

### state of Montana, and so I would ask 18 information about those different flights, 19 gather information about those flights as far 20 as like their pilot notification forms to see 21 what type of hazardous materials are coming in 22 

### on each flight. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 36 1 

### BY MR. LOMAZOW: 2 Q 

### And was anyone else with you at 3 this particular inspection? 4 A 

### Yes. Actually, Thomas Kenny. 5 Q 

### And why was he with you? 6 A 

### Thomas at that time was my 7 

### supervisor. 8 Q 

### Okay. 9 A 

### And he was there to -- well, for 10 

### several reasons -- one, to make sure I'm doing 11 

### my job. Another one is to keep his skill set 12 

### current and also to help with the feeder 13 

### activity. 14 Q 

### Okay. Were you ln Great Falls 15 

### just to conduct surveillance upon FedEx? 16 A No. 

### I was there to conduct 17 

### surveillance on all of the airlines there at 18 

### that airport. 19 Q 

### Okay. As part of your 20 investigation and as a matter of course, do 21 

### you prepare an agent's statement as to the 22 

### activities that you conducted? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 37
1 A 

### I do. When I find violations, I 2 do write up an agent's statement. Yes. 3 Q 

### Okay. Would you please turn to Cl 4 

### for identification. 5 A 

### Okay. 6 Q 

### Is this the Agency statement you 7 

### prepared for the FedEx side of this case? 8 A 

### Yes, it is. 9 Q 

### Okay. And was this document made 10 at or near the time that you observed the 11 activities that you did onbothMay 12th, 2008 12 and May 16th, 2008? 13 A 

### Yes, it was. 14 Q 

### And is this prepared in the 15 ordinary course of your business activities 16 when you conduct an investigation? 17 A 

### Yes. 18 Q 

### And is ita fair and accurate 19 representation of the activities that you 20 conducted during your investigation? 21 A 

### Yes, it lS. 

### 22 Q 

### Okay. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 38
1 MR. LOMAZOW: Your Honor, I offer 2 Cl for identification as Cl. 3 MS. CHANDLER-SNELL: No 4 objections, Your Honor. 5 JUDGE GOODWIN: Complainant's 1 6 for identification is received into evidence 7 as Complainant's 1. 8 BY MR. LOMAZOW: 9 Q Please turn to C2 for 10 identification. 11 A Okay. 12 Q Do you recognize this document? 13 A I do. 14 Q And what is this document? 15 A This is my agent statement for the 16 Corporate Air flights. 17 Q Okay. So it's the same -- it's 18 the same statement but just for the Corporate 19 Air side of the case? 20 A Pretty much. Yes. 21 Q Now, were these documents made at 22 or near the time that you observed the NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 39 1 activities that you did on May 12th, 2008 and 2 May 16th, 2008? 3 A Yes. 4 Q Is this prepared in the ordinary 5 course of your business activities when you 6 conduct an investigation? 7 A Yes, Slr. 8 Q And is it a fair and accurate 9 representation of the activities that you 10 conducted during your investigation? 11 A Yes, sir. 12 Q Now, you mentioned

- - or, Agent 13 Luscher, did you acquire any -- 14 MR. LOMAZOW: I'm sorry, Your 15 Honor. I'm going to enter C2 into evidence as 16 C2. 17 JUDGE GOODWIN: Are they identical 18 statements? 19 MR. LOMAZOW: They are, with 20 the

- - yes, they are identical statements. So 21 I did that just because the cases were 22 consolidated, but they are identical
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 40
1 statements. 2 JUDGE GOODWIN: It appears that 3 the onlydifferencebetween the two statements 4 is on Cl at the very bottom, the last two 5 lines are not on C2, so beginning with 6 "Unfortunately," ending with the number "6." 7 Is that correct? 8 MR. LOMAZOW: That is correct. 9 JUDGE GOODWIN: I just want to 10 make sure I've got the proper set. 11 MR. LOMAZOW: That is correct, 12 Your Honor. And on the on C2 at the 13 bottom, it lists the docket number 14 2008NM700127, which is for Corporate Air. 15 THE WITNESS: Can I say something? 16 JUDGE GOODWIN: On the bottom? 17 MR. LOMAZOW: Yes. Yeah, the 18 second page of C2. 19 JUDGE GOODWIN: Well, but I 20 okay, but C2 is also two pages. 21 MR. LOMAZOW: Right. 22 JUDGE GOODWIN: Okay. Ms. Snell?
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 41
1 

### MS. CHANDLER-SNELL: No 2 objections, Your Honor. 3 

### JUDGE GOODWIN: Complainant's 2 4 for identification is received into evidence 5 

### as Complainant's 2. 6 

### MR. LOMAZOW: Okay. 7 BY MR. LOMAZOW: 8 Q 

### Now, Agent Luscher, during this 9 inspection, did you acquire any documents? 10 A 

### Yes, I did. 11 Q 

### Okay. Would you please turn to C3 12 for identification. 13 A 

### Okay. 14 Q 

### Do you recognize this document? 15 A I 

### do. 16 Q 

### And what is it? 17 A 

### This is the Inbound Dangerous 18 Goods Alert for Flight 7772-13 originating 19 from Bozeman, Montana, Aircraft N933FE. 20 Q 

### And who did you request this 21 information from? 22 A 

### From FedEx employees. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 42 1 Q 

### And did they provide it to you? 2 A 

### Yes, sir. 3 Q 

### And what information does the 4 Inbound Dangerous Good Alert provide you? 5 A 

### It provides me with some general 6 information about the flights, flight number, 7 legdate, origination, destination, ifthere's 8 

### hazmat onboard where on the aircraft and what 9 type of hazmat would be onboard. 10 Q 

### Okay. And just so I'm clear, the 11 tail number for this particular flight was 12 N933FE? 13 A 

### That's correct. 14 Q 

### Okay. And only one aircraft in 15 the United States can have that tail number; 16 is that correct? 17 A 

### Yes. 18 Q 

### Okay. And did you observe Flight 19 7772-13 arrive? 20 A 

### Yes, I did. 21 Q 

### Okay. And as you said, it 22 

### originated from Bozeman, Montana? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 43
1 A 

### Yes. 2 Q 

### Okay. Now, please explain to me 3 what this document told you as far as the 4 hazardous materials that had been transported 5 aboard this flight? 6 A 

### It showed that there was no hazmat 7 

### onboard. 8 

### MR. LOMAZOW: Your Honor, I offer 9 

### C3 into evidence as C3. 10 

### MS. CHANDLER-SNELL: No 11 objections, Your Honor. 12 

### JUDGE GOODWIN: Complainant's 3 13 for identification is received into evidence 14 as Complainant's 3. 15 

### MR. LOMAZOW: Okay. 16 BY MR. LOMAZOW: 17 Q 

### Agent Luscher, did you leave after 18 reviewing this document? 19 A 

### No. 20 Q 

### Why not? 21 A 

### As part of our inspections, we 22 

### want to verify that what is on the paperwork
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 44
1 

### matches what 1S 

### being pulled off of the 2 aircraft. So if we have a piece of paper that 3 says that no hazmat 1S 

### onboard, we want to 4 verify that, indeed, there is no hazmat 5 onboard. 6 Q 

### Okay. And did you check

-- did 7 you check to see if any dangerous goods were 8 actually aboard? 9 A 

### Actually, there were some 10 mismarked hazmat onboard. 11 Q 

### Okay. And did you contact the 12 

### pilot upon the landing of the aircraft? 13 A 

### I did. 14 Q 

### And what, if anything, did he tell 15 you? 16 A 

### He said that there was not any 17 hazmat onboard. 18 Q 

### And did he provide you with any 19 documents? 20 A 

### Yes, he did. 21 Q 

### Okay. Please turn to what is 22 marked as C4 for identification. What are NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 45 1 

### these documents? 2 A 

### This is the Dangerous Goods System 3 Aircraft DG Manifest that is handed to the 4 pilot upon his departure from the originating 5 station, and this shows that it is a flight 6 from Bozeman, same aircraft N933FE, also 7 

### showinghis signatureverifying that therewas 8 

### no hazmat onboard. 9 Q 

### Okay. And so these documents

-- 10 okay. So these documents indicated there was 11 no dangerous goods or any hazardous materials 12 onboard? 13 A 

### That's correct. 14 Q 

### Okay. 15 

### MR. LOMAZOW: Your Honor, I offer 16 what has been marked as C4 into evidence as 17 

### C4. 18 

### MS. CHANDLER-SNELL: No 19 objections, Your Honor. 20 JUDGE GOODWIN: Complainant's 4 21 for identification is received into evidence 22 

### as Complainant's 4. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 46
1 

### BY MR. LOMAZOW: 2 Q 

### Now, Agent Luscher, so you 3 observed packages marked or labeled as 4 hazardous materials being offloaded from this 5 aircraft? 6 A I 

### did. 7 Q 

### Okay. Now, let's talk once 8 again, we're talking about the package fromMy 9 

### 12th, 2008. What did you notice about this 10 package when you observed it? 11 A 

### This was the UN 

### 2428 package that 12 had a 5.1 oxidizer marking or label on the 13 package and it was missing a proper shipping 14 name, and it was not on the pilot 15 notification. 16 Q 

### Okay. So it's not enough to mark 17 a package with the UN 

### identification number 18 and the hazard class label; the actual 19 shipping name must be included on the package 20 as well? 21 A 

### That's correct. 22 Q 

### Okay. Does FedEx ever place any NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 47 

### 1 type of stickers on packages? 2 A 

### Yes, they do. 3 Q 

### What do they place on their 4 packages? 5 A 

### After

-- after a hazmat inspector 6 

### or they call them a DG specialist

-- looks 7 at and inspects a package, they do put a 8 little

-- it's like a little red and white 9 rectangular sticker

-- 10 

### MS. CHANDLER-SNELL: Your Honor, 11 I'd object to her testimony regarding FedEx 12 

### policy and procedures without the proper 13 foundationbeing laidthat she's familiar with 14 such. 15 

### JUDGE GOODWIN: Sustained at this 16 point. 17 BY MR. LOMAZOW: 18 Q 

### Counsel, have you ever 19 investigated Federal Express before? 20 A 

### Yes, I have. 21 Q 

### Have you -- have you inspection 22 

### them at this particular facility before? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 48
1 A 

### Yes, I have. 2 Q 

### Are you familiar with their 3 processing of hazardous materials policies, 4 how they handle that? 5 A 

### Yes, I am. 6 Q 

### Okay. And have you seen that done 7 before? 8 A 

### Yes. 9 Q 

### Have you seen packages marked with 10 a dangerous goods inspection sticker before? 11 A 

### I have. 12 Q 

### Okay. 13 

### MR. LOMAZOW: Your Honor, if I can 14 continue with those questions then? 15 

### JUDGE GOODWIN: Go ahead. 16 BY MR. LOMAZOW: 17 Q 

### Okay. Why is the fact that 18 

### there's not a dangerous goods sticker 19 important? 20 A 

### It's important for for the 21 whole operation, I guess you could say. 22 Q 

### Well, actually, let me interrupt
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 49
1 

### you. What does that indicate to you when you 2 do not see that there's a FedEx dangerous 3 goods inspection sticker on an oxidizer? 4 A 

### Okay. If there is no sticker on 5 

### there, then it leads me to believe that the 6 

### FedEx DG inspector did not inspect the 7 package. 8 Q 

### Okay. Please turn to C5 

### for 9 identification. What is this document? 10 A 

### This is an excerpt from FedEx 11 Express DG Manual dated February

-- I'm sorry 12 February 1st, 2008. 13 Q 

### Okay. How did you obtain this 14 document? 15 A 

### I received this from FedEx. 16 Q 

### Okay. Please turn to what is 17 marked at the bottom as page two of three and 18 then please read toward the top of the page 19 where it indicates the requirement for a 20 preliminary inspection. 21 JUDGE GOODWIN: Now, just for 22 clarification, what you've marked as page two NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 50
1 

### of three, the Court has marked page one of 2 

### two. So we want to make sure that when 3 somebody reviews the transcript, they won't 4 get -- 5 

### MR. LOMAZOW: Okay. Yeah. I was 6 referring to the marking at the bottom of the 7 page where it

-- 8 

### JUDGE GOODWIN: The marking at the 9 

### bottom of the right hand is lOP and then 6 

### and 10 the next line is page two of three. 11 MR. LOMAZOW: Yeah. 12 

### JUDGE GOODWIN: The Court has 13 marked Exhibit C5 one of two and then page two 14 of two. 15 BY MR. LOMAZOW: 16 Q 

### Agent Luscher, please read the 17 language next to "Preliminary Inspection." 18 A 

### Okay. 19 

### "Whoever first takes a declared 20 

### dangerous goods package from the 21 

### customer must conduct a 22 

### preliminary inspection. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 51
1 

### "If the package appears to be in 2 

### compliance, accept it on the 3 

### condition that it pass a second 4 

### inspection to be conducted by a 5 

### dangerous goods specialist. 6 

### Advise the customer that the 7 

### dangerous goods specialist/agent 8 

### will inspect the package again to 9 

### make sure that it does comply with 10 

### the FedEx Express requirements." 11 Q 

### Okay. So as per the Federal 12 Express Dangerous Goods Manual, the Federal 13 Express employee that initially takes a 14 dangerous good or a hazmat from the customer 15 must perform a preliminary inspection on the 16 package? 17 A 

### Correct. 18 Q 

### Okay. Now, please go to the 19 bottom of the page and read next to the 20 language "Complete inspection," and then in 21 parentheses "at a Federal Express location." 22 A 

### "Following the preliminary
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 52 

### 1 inspection and any required 2 

### corrections that the shipper 3 

### makes, a 

### dangerous goods 4 

### specialist/agent must inspect the 5 

### package before the package can be 6 

### accepted into the FedEx Express 7 

### transport system." 8 Q 

### Okay. So just to be clear, as per 9 

### FedEx's policy here, a dangerous good 10 specialist must inspect a hazardous materials 11 package before it can be accepted into the 12 FedEx system for transportation? 13 A 

### That's correct. 14 Q 

### And if the DG specialist does not 15 find any issues with the package, a dangerous 16 goods inspection sticker is placed on the 17 package? 18 A 

### That's correct. 19 Q 

### Okay. But there is no dangerous 20 goods inspection sticker placed on this 21 particular package? 22 A 

### That's correct. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 53
1 Q Okay. And so what does that 2 indicate to you? 3 A That it was not inspected by a 4 dangerous goods specialist. 5 Q Okay. And is it safe to say that 6 the failure to include the shipping name on a 7 hazardous materials package is something the 8 Federal Express dangerous goods specialist 9 should have caught? 10 A Oh, yes. 11 Q Okay. Please turn to what is 12 marked as C6 for identification. Do you 13 recogn1ze this document? 14 A I do. 15 Q And what is it? 16 A This 1S the shipper's declaration 17 for dangerous goods that was attached to that 18 shipment from BioScience Laboratories. 19 Q Okay. And what does this document 20 tell you? 21 A This document basically tells me 22 who the shipper, who the consignee is, the air NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 54 1 

### waybill number, and the nature andquantityof 2 the dangerous goods, such as UN number, the 3 proper shipping name, class or division, 4 packing group, etc. 5 Q 

### Okay. Now, was there anything 6 included in these shipping papers that were 7 not included on the package itself? 8 A 

### The proper shipping name was not 9 on the package. 10 Q 

### Okay. And in the top right-hand 11 corner, is that the FedEx tracking number or 12 the FedEx air waybill number? 13 A 

### Yes. The 790011313014. 14 Q 

### Okay. Please turn to the next 15 page, which will be page two. What method of 16 delivery did BioScience select? 17 A 

### They requested two-day. 18 Q 

### Okay. 19 MR. LOMAZOW: Your Honor, the 20 People offer what has been previously marked 21 for identification as C6 into evidence as C6. 22 MS. CHANDLER-SNELL: No
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 55
1 objections, Your Honor. 2 JUDGE GOODWIN: Complainant's 6 3 for identification is received in evidence as 4 Complainant's 6. 5 BY MR. LOMAZOW: 6 Q So, Agent Luscher, did you ever 7 find out what kind of hazmat, if any, was 8 inside this package? 9 A Eventually, yes, after looking at 10 the material safety data sheets and talking 11 with the -- with the shipper. It was found 12 that the solution of the what's that 13 called? sodium chlorate was mainly water. 14 Q Okay. So it was not a hazardous 15 material? 16 A That's correct. 17 Q Okay. Does that let FedEx, 18 Incorporated off the hook? 19 A No. 20 Q Okay. So an air carrier does not, 21 in effect, get lucky if a package that is 22 improperly marked later turns out not to NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 56
1 

### contain hazardous materials? 2 A 

### That's correct. 3 

### MS. CHANDLER-SNELL: Your Honor, 4 I'll object to the nature of

-- 5 

### JUDGE GOODWIN: Sustained. 6 

### BY MR. LOMAZOW: 7 Q 

### Agent Luscher, did you still write 8 

### that up as a violation of the Hazardous 9 

### Materials Regulations? 10 A 

### I did. 11 Q 

### And why is that? 12 A 

### Because they were marking 13 

### violations, marking and declaring that 14 

### something's a hazardous material when it's 15 

### not, and I 

### realize that that is a 

### 16 responsibility of the shipper, but it's also 17 the responsibility of the carrier to inspect. 18 

### MS. CHANDLER-SNELL: Your Honor, I 19 would object at this point. I believe she's 20 testifying as an expert as to what the 21 

### regulations require rather thanwhat she found 22 

### in her inspection.NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 57 

### 1 MR. LOMAZOW: Your Honor, as -- 2 what the regulations require is what she has 3 to do to do her job. 4 

### JUDGE GOODWIN: Well, I'm going to 5 sustain it because the answer is beyond the 6 scope of the question. 7 

### MR. LOMAZOW: Okay. 8 BY MR. LOMAZOW: 9 Q 

### Now, when you're

- - when you're 10 deciding what violations to write up, if you 11 have a marking violation, does that have 12 anything to do with what's ultimately inside 13 the package? 14 A 

### It does if you open up the 15 package. 16 Q 

### Okay. But are there marking 17 violations that are separate from how a 18 package lS 

### prepared? 19 A 

### Yes. 20 Q 

### Okay. Now, what do you mean when 21 you say the package had been improperly 22 stowed? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 58 1 A 

### I t was not placed as as.1 2 oxidizer, it was not placed In the proper 3 

### area, storage area, on the aircraft. It was 4 pulled out of position 3,4. 5 Q 

### Okay. And in this did this 6 

### particular aircraft have any type of fire 7 

### suppression system? 8 A 

### No, it did not. 9 Q 

### Okay. Agent Luscher, please turn 10 to what has been marked as C7 

### for 11 

### identification, and C7 

### consists of 16 

### 12 photographs. 13 A 

### Okay. 14 Q 

### Who took these photographs? 15 A 

### I did. 16 Q 

### And what are these photographs of? 17 A 

### All of these are of all three 18 shipments that were removed from that flight, 19 one being 5.1 and then the others being the 20 two UN 3373 

### packages. 21 Q 

### So these represent all three 22 packages from both two dates, May 12th, 2008 NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 59 1 

### and May 16th, 2008? 2 A 

### Yes, sir. 3 Q 

### Okay. 4 

### MR. LOMAZOW: Your Honor, I'll 5 offer what has beenmarked as C7 into evidence 6 as C7. 7 

### MS. CHANDLER

-SNELL: Your Honor, I 8 would object to one of the photographs in that 9 

### exhibit. I'm trying to count the page 10 numbers. 11 

### JUDGE GOODWIN: I'm going to use 12 the pagination on the bottom of the photos 13 because it 14 

### MR. LOMAZOW: That's what I was 15 planning on uSlng. 16 MS. CHANDLER-SNELL: Page 7 of 16 17 lS how this one is marked on the exhibit. 18 MR. LOMAZOW: Okay. 19 

### MS. CHANDLER-SNELL: And I think 20 it is the seventh page In the exhibit. I 

### 21 would object to that as to relevancy. That 22 

### appears to show the inner contents of the NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 60 1 

### package. It's not been testified to and I 2 don't believe that it is relevant considering 3 the provisions under which FedEx was cited. 4 

### MR. LOMAZOW: Your Honor, I have n 5 

### objection to that. I just included all 6 

### pictures just to have a complete set. 7 

### JUDGE GOODWIN: Well, at this 8 

### point, the only thing that's been offered is 9 

### the photographs. None of the verbiage 10 

### underneath the photographs has been offered. 11 

### MS. CHANDLER-SNELL: I guess, Your 12 

### Honor, what I'd at this point, which 13 

### perhaps may remove my objections, is the 14 

### foundation for reach of the photographs and a 15 

### description of them. I'm not sure of the 16 

### relevance of about four of them'cause I'mnot 17 

### sure what they show. I think they show the 18 

### inner contents. 19 

### JUDGE GOODWIN: Yeah. As to 20 

### foundation, I'm going to sustain the 21 

### objection. 22 MR. LOMAZOW: Okay. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 61
1 

### BY MR. LOMAZOW: 2 Q 

### Agent Luscher, please sorry. 3 Please turn to the picture

-- the photograph, 4 I 

### should say, that's labeled page 1 of 5 that's marked page 1 of 16 at the bottom. 6 

### What does this photograph 7 

### represent? 8 A 

### This photograph is Side 1 of the 9 

### shipment that shows the UN 

### 2428 marking as 10 well as the 5.1 marking. And as you can see, 11 there's no proper shipping name. And this was 12 the shipment from May 12th, 2008. 13 Q 

### So the significance is this shows 14 that there should not have been

-- or that 15 there was a missing shipping name, in other 16 words? 17 A 

### That's correct. 18 Q 

### Okay. 19 

### MR. LOMAZOW: Your Honor, I offer 20 what has been marked at the bottom as page C-1 21 of 16 into evidence as C-1 of 16. 22 

### MS. CHANDLER-SNELL: No objections.
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 62
1 JUDGE GOODWIN: Cl for I'm 2 sorry -- C7, 1 of 16, lS admitted. 3 BY MR. LOMAZOW: 4 Q Your Honor

-- I'm sorry -- Agent 5 Luscher, please turn to the next photograph 6 marked page 2 of 16 at the bottom. 7 A Okay. 8 Q What does this photograph 9 represents? 10 A This shows Side 2 of the same 11 shipment, again indicating a UN number of 12 2428, orientation arrows, and as well as the 13 consignee. And this was, again, the package 14 dated May 12th. 15 Q Okay. 16 A Or

-- May 12th. 17 Q Okay. 18 MR. LOMAZOW: Your Honor, I offer 19 what is marked as C7, page 2 of 16 into 20 evidence as C7, page 2 of 16. 21 MS. CHANDLER-SNELL: No 22 objections, Your Honor. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 63
1 

### JUDGE GOODWIN: Page 2 

### of 16 

### is 2 admitted. 3 BY MR. LOMAZOW: 4 Q 

### Agent Luscher, please turn to the 5 

### photograph marked page 3 

### of 16 

### at the bottom. 6 A 

### Okay. 7 Q 

### What does this photograph 8 

### represent? 9 A 

### This 1S Side 3 

### of the shipment, 10 

### also showing a UN 

### number of 2428 

### and also that 11 

### it meets the ISTA procedures and 1S 1n 12 

### packaging but, again, there's no proper 13 

### shipping name. 14 

### MR. LOMAZOW: Okay. Your Honor, I 15 

### offer what has been marked as C7, page 3 

### of 16 16 

### for identification into evidence as C7, page 1 7 3 

### of 16. 18 

### MS. CHANDLER-SNELL: No 19 

### objections, Your Honor. 20 

### JUDGE GOODWIN: Okay. Photograph 21 

### 3 of 16 

### is admitted. 22 

### II NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 64
1 

### BY MR. LOMAZOW: 2 Q 

### Agent Luscher, please turn to what 3 is marked as page 4 of 16. 4 A 

### Okay. 5 Q 

### What does this photograph 6 

### represent? 7 A 

### The same package. This is Side 4 8 

### showing the orientation arrows and also UN 9 

### 2428 and it's

-- there's a warning about the 10 

### insides being glass. 11 

### MR. LOMAZOW: Your Honor, I offer 12 

### what has been marked as C7, page 4 

### of 16, into 13 evidence as C7, page 4 

### of 16. 14 

### MS. CHANDLER-SNELL: No 15 objections, Your Honor. 16 BY MR. LOMAZOW: 17 Q 

### Agent Luscher, please turn to what 18 has been marked

-- 19 

### JUDGE GOODWIN: Okay. Four of 16 20 is admitted as 4 of 16. 21 

### MR. LOMAZOW: Sorry, Your Honor. 22 

### II NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 65 1 

### BY MR. LOMAZOW: 2 Q 

### Agent Luscher, please turn to what 3 has been marked as page 5 of 16. 4 A 

### Okay. 5 Q 

### What does this photograph 6 represent? 7 A 

### This 1S 

### the top of the box, the 8 same shipment, showing that it was fragile, 9 

### showing that it's compliant when packed 10 properly. Also shows a FedEx air waybill 11 number, tracking number, I guess, from May 12 12th. 13 Q 

### Okay. 14 

### MR. LOMAZOW: All right. Your 15 

### Honor I 

### the People offer or the Agency 16 offers what has been marked as C7, page 5 

### of 17 16 for identification into evidence as C7, 18 page 5 

### of 16. 19 

### MS. CHANDLER-SNELL: No 20 objections, Your Honor. 21 JUDGE GOODWIN: Photograph 5 

### of 16 22 

### is admitted as 5 of 16. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 66 1 BY MR. LOMAZOW: 2 Q Agent Luscher, please turn to the 3 photograph marked page 6 of 16. 4 A Uh-huh. 5 Q What does this photograph 6 represent? 7 A This is Side 6 of the shipment. 8 It's basically the bottom of the box, showing 9 that the box is for use with four one-gallon 10 cans and, per the manufacturer, it is in gross 11 weight and that kind of information. 12 MR. LOMAZOW: Your Honor, the 13 Agency offers what has been marked as page 14 or what has been marked as C7, page 6 of 16 15 for identification purposes into evidence as 16 C7, page 6 of 16. 17 MS. CHANDLER-SNELL: No 18 objections, Your Honor. 19 JUDGE GOODWIN: Okay. Six of 16 20 is received into evidence as 6 of 16. 21 MR. LOMAZOW: Just for the record, 22 though we included it just to have a complete NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 67 1 set of pictures, the Agency will acknowledge 2 that photograph 7 of 16 through 12 of 16 are 3 not relevant for purposes of this case and, 4 therefore, we will not allude to them, but we 5 did include them just to have a complete set 6 of the photographs. 7 (Pause.) 8 Your Honor, should I proceed? 9 JUDGE GOODWIN: Yeah. They're 10 marked for identificationbecause the Court

-- 11 thepackagebut, because they'renot admitted, 12 they won't be considered. 13 MR. LOMAZOW: Yes, Your Honor. 14 BY MR. LOMAZOW: 15 Q Agent Luscher, lS it the normal 16 course of your investigation to send out a 17 letter of investigation? 18 A Yes, it lS. 19 Q Please turn to C8 for 20 identification. What lS this document? 21 A This lS the letter of 22 investigation that I sent to Federal Express NEAL R. GROSS (202) 234·4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 68 

### 1 on June 2nd, 2008. 2 Q 

### Okay. And what 1S the purpose of 3 a letter of investigation? 4 A 

### It's basically to let the air 5 carrier know that we are conducting an 6 investigation on the violations that we had 7 found. 8 Q 

### Okay. And did you rece1ve a reply 9 to this letter of investigation in regards to 10 the improperly marked package you observed on 11 May 12th, 2008? 12 A 

### I did. 13 Q 

### Okay. 14 

### MR. LOMAZOW: Your Honor, I offer 15 C8 for

-- I offer what has been marked as C8 16 for identification into evidence as C8. 17 MS. CHANDLER-SNELL: Your Honor, I 18 have no objections to that. I do want for 19 clarification to go back to the previous 20 exhibit. 21 JUDGE GOODWIN: Yeah. Let's come 22 

### back and make sure we get the housekeeping NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 69 1 done correctly. I show photograph 1 of 16 has 2 been admitted, 2 of 16

-- what I'm going to do 3 is identify these as photograph 1 of 16 4 it's actually C7, 1 of 16; C7, 2 of 16

-- C7, 5 3 of 16 is admitted; C7, 4 of 16 is admitted; 6 C7, 5 of 16 I have as admitted; I have C6 7 I'm sorry -- C7, 6 of 16 is also admitted. Is 8 that correct? 9 THE REPORTER: That's correct. 10 JUDGE GOODWIN: And then my 11 understanding is 7 through 16 are not going to 12 be admitted in this case? 13 MR. LOMAZOW: No, Your Honor. The 14 7 through what is marked at the bottom 7 15 through 11

-- I'm sorry -- 7 through 12 is not 16 going to be admitted. I'm going to come back 17 to the final three photographs when I get to 18 that package. 19 JUDGE GOODWIN: All right. Let me 20

- - let's just get the housekeeping done first. 21 MR. LOMAZOW: Okay. 22 JUDGE GOODWIN: So what I have is
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 70
1 

### photographs 1, 2, 3, 4, 5, 6 of 16 are all 2 admitted. Seven, 8, 9, 10, 11 will be marked 3 

### for identificationbut will not be received in 4 this case. 5 

### MR. LOMAZOW: And that's the same 6 for 12 and 16, Your Honor. 7 

### JUDGE GOODWIN: So 12 will be 8 marked for identificationbut not be receivedi 

### 9 is that correct? 10 MR. LOMAZOW: Correct. 11 

### JUDGE GOODWIN: Okay. Ms. Snell, 12 did that clarify your concerns? 13 

### MS. CHANDLER-SNELL: It did, Your 14 Honor. Thank you very much. 15 

### JUDGE GOODWIN: All right, 16 Counsel. 17 BY MR. LOMAZOW: 18 Q 

### Agent Luscher, please turn to C9 19 for identification. What is this document? 20 A 

### This is the letter of response 21 from FedEx dated June 10th, 2008. 22 Q 

### Okay. Please describe FedEx's
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgrosS.com

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•

• 71
1 

### response ln regards to the package

-- the 5.1 2 oxidizer only. 3 A 

### Second paragraph, it says that, 4 "The pick-up courier mistakenly did not bring 5 this package to the attention of the dangerous 6 goods specialist for inspection." And that it 7 would have been rejected by the DG specialist 8 for the shipper's error if inspected. 9 Q 

### Okay. Now, does this response 10 provide any corrective action for the 11 violation that you observedonMay 12th, 2008? 12 A 

### It did say that the employee was 13 directed to re-take the internal initial DG 14 training and that two other employees were 15 provided counseling as well ln regards to 16 internal policy for processing DG. 17 Q 

### Okay. Is this above what would be 18 required by Title 49 CFR? 19 MS. CHANDLER

-SNELL: Your Honor, I 20 object as to the interpretation of the 21 regulations and what is required. 22 JUDGE GOODWIN: Overruled. It's
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 72
1 

### not really an interpretation. 2 

### MR. LOMAZOW: Your Honor, I would 3 

### offer what's been marked as C9 for 4 identification into evidence as C9. 5 

### MS. CHANDLER-SNELL: No 6 objections, Your Honor. 7 

### JUDGE GOODWIN: Hold on a minute. 8 Did you offer Complainant's 8? 9 

### MR. LOMAZOW: I did, Your Honor, 10 and then I believe

-- I believe 11 

### JUDGE GOODWIN: Okay. Let's go 12 back to 8. Do you have a position, Ms. Snell, 13 with respect to Complainant's 8 which is the 14 FAA letter of June 2nd? 15 

### MS. CHANDLER-SNELL: No 16 objections, Your Honor. 17 

### JUDGE GOODWIN: All right. 18 Complainant's 8 for identificationisreceived 19 into evidence as Complainant's 8. 20 Ms. Snell, with respect to 21 Complainant's 9, do you have a position? 22 

### MS. CHANDLER-SNELL: No
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 73 

### 1 objections, Your Honor. 2 

### JUDGE GOODWIN: Complainant's 9 3 for identification is received into evidence 4 as Complainant's 9. 5 Go ahead. 6 

### MR. LOMAZOW: Okay. 7 

### BY MR. LOMAZOW: 8 Q 

### Agent Luscher, please turn to CI0 9 for identification. What is this document? 10 A 

### This 1S 

### the letter of 11 investigation I sent to Corporate Air on June 12 2nd, 2008. 13 Q 

### And did you receive a response to 14 this letter of investigation from Corporate 15 Air? 16 A 

### I did. 17 

### MR. LOMAZOW: Your Honor, we offer 18 what has beenmarkedas CI0 for identification 19 into evidence as CI0. 20 MS. CHANDLER-SNELL: No 21 objections, Your Honor. 22 

### II NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 74
1 

### BY MR. LOMAZOW: 2 Q 

### Agent Luscher, please turn to C11 3 for identification. 4 A 

### Okay. 5 Q 

### What is this document? 6 A 

### This is the letter of response I 7 

### received from Corporate Air. 8 Q 

### Okay. Now, once again, just 9 focusing on the package from May 12, 2008, is 10 there anything significant about Corporate 11 Air's response? 12 A 

### It does say that the shipment was 13 not prepared properly by the shipper and it 14 

### was accepted by FedEx. It says that, 15 "Corporate Air does not accept any hazardous 16 materials shipments directly from individuals 17 

### or corporations." 18 Q 

### Okay. Did they offer any 19 significant corrective action? 20 A 

### No, they did not. 21 Q 

### Okay. Did they attach anything to 22 

### this letter of investigation? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 75 1 A 

### Yes, they did. 2 Q 

### What did they attach? 3 A 

### That would have been their manual, 4 their hazmat manual. 5 

### MR. LOMAZOW: Your Honor, we offer 6 

### what has been marked into evidence as C11

-- 7 

### I'm sorry what has been marked for 8 identification as C11 into evidence as C11. 9 

### JUDGE GOODWIN: Now, I don't show 10 that there's a date on this to differentiate 11 it from anything or that it's on letterhead; 12 is that correct? 13 

### MR. LOMAZOW: Correct, Your Honor. 14 

### MS. CHANDLER-SNELL: We have no 15 objections, Your Honor. 16 

### JUDGE GOODWIN: All right. Okay. 17 

### Complainant's 10 for identification 1S 

### 18 receivedinto evidence as Complainant's 10 and 19 

### Complainant's 11 

### for identification 1S 

### 20 received into evidence as Complainant's 11. 21 BY MR. LOMAZOW: 22 Q 

### Agent Luscher, let's now turn to NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 76
1 

### May 16th, 2008. Where were you at that time? 2 A 

### May 16th I was also at FedEx. 3 Q 

### And were you at the same station? 4 A 

### Yes, I was, in Great Falls, 5 Montana. 6 Q 

### Okay. Were you with Mr. Kenny 7 

### again? 8 A 

### No. This time I was by myself. 9 Q 

### Okay. And did you observe any 10 flights arrive? 11 A I did. 12 Q 

### Okay. And did you acquire any 13 documents before the arrival of these flights? 14 A 

### I did. I was also picking up 15 

### pilot notifications inbound from FedEx 16 employees. 17 Q 

### Okay. Please turn to what has 18 beenmarked as C12 for identification. Do you 19 recognlze this document? 20 A I 

### do. 21 Q 

### What is this? 22 A 

### This is the Inbound Dangerous
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 77
1 

### Goods Alert for Flight 7796-16 originating 2 from Wolf Point, Montana, arriving in Great 3 Falls, Aircraft N710FX. 4 Q 

### Okay. And who did you request 5 this information from? 6 A 

### From Federal Express employees. 7 Q 

### And did they provide it to you? 8 A 

### They did. 9 Q 

### And the tail number for this 10 particular flight was N710FX? 11 A 

### That's correct. 12 Q 

### And only one aircraft ln the 13 United States can have that tail number; is 14 that correct? 15 A 

### That's correct. 16 Q 

### Okay. I'm sorry. Where did this 17 flight originate from? 18 A 

### Wolf Point, Montana. 19 Q 

### Okay. And did you observe the 20 offloading of this flight? 21 A 

### I did. 22 Q 

### And what, if anything, did you NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com78 1 observe? 2 A I observed two improperly marked 3 hazmat packages being removed from the 4 aircraft. 5 Q Okay. Now, what

-- how were they 6 improperly marked? 7 A They were improperly marked UN 8 3373 packages. Basically, when you mark a 9 package UN 3373, it needs to be in a diamond10 on-point marking and it also needs to say 11 "Biological Substances Category B" if it is a 12 UN 3373 shipment. 13 Q Okay. So UN 3373 is the hazmat 14 identification number? 15 A Yes, sir. 16 Q Okay. And what kind of hazmat is 17 it? Is it a biological substance, CategoryB? 18 A Yes. That's what the UN 3373 is 19 for. 20 Q Okay. And are these

-- these are 21 regulated? 22 A Yes. They are regulated
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 79 1 infectious substances andthey'reHazardClass 2 6.2, being Category B. 3 Q Concerning it's a regulated 4 hazardous material, are carriers therefore 5 required to inspect these hazardous materials 6 prior to acceptance for air transportation? 7 MS. CHANDLER-SNELL: Your Honor, I 8 object. That goes to the very heart of what 9 the interpretation is of 173.199. She's being 10 asked to interpret the regulations. 11 JUDGE GOODWIN: Rephrase the 12 question. 13 BY MR. LOMAZOW: 14 Q Is it biological substances 15 Category B, are they a regulated hazardous 16 material? 17 A Yes, they are. 18 Q Therefore, in your opinion, are 19 air carrlers required to inspect these 20 packages prior to air transportation? 21 MS. CHANDLER-SNELL: Your Honor, I 22 renew my objections to "In your opinion." NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 80 

### 1 She's not been classified as an expert In 2 

### interpreting the regulations. She's been 3 admittedto testifyto the inspectionprocess. 4 

### JUDGE GOODWIN: Rephrase the 5 question. It

-- her interpretation of the

-- 6 even if she were an expert, the Court would 7 ignoreher interpretationof the regulation 8 

### MR. LOMAZOW: Okay. 9 

### JUDGE GOODWIN: because if

-- 10 if I allowed that, then I wouldn't have 11 anything to do. 12 MR. LOMAZOW: I understand, Your 13 Honor. 14 BY MR. LOMAZOW: 15 Q 

### Agent Luscher, does Title 49 CFR 16 require hazardous material regula-

-- require 17 hazardous materials, biological substances 18 Category B, to be regulated 19 A 

### Yes, they do. 20 Q 

### -- to be inspected, I should say? 21 I'm sorry. 22 

### MS. CHANDLER-SNELL: Your Honor,
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 81 1 I'm going to renew the objection. 2 JUDGE GOODWIN: Well, the I 3 think the question was did that particular 4 portion of the regulation require inspection. 5 She inspects. 6 MS. CHANDLER-SNELL: Oh, her 7 inspection. 8 JUDGE GOODWIN: Yes. 9 MS. CHANDLER-SNELL: I understand 10 the clarification. 11 JUDGE GOODWIN: But he changed 12 just for the record, restate the question ln 13 its proper form to allow her 14 MR. LOMAZOW: Okay. 15 BY MR. LOMAZOW: 16 Q Does TitIe 49 are biological 17 substances Category B, regulated under Title 18 49 CFR? 19 A Yes, it is. 20 JUDGE GOODWIN: She's answered 21 that. Your next question was? 22 MR. LOMAZOW: Okay. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 82 1 

### BY MR. LOMAZOW: 2 Q 

### Are air carriers

-- under Title 49 3 

### CFR, are air carriers required to inspect 4 

### biological substances Category B? 5 

### MS. CHANDLER-SNELL: I object 6 

### again, Your Honor. What he's asking is not 7 

### whether she's required to inspect as part of 8 

### her process but whether we're required to 9 

### inspect as part of the acceptance. 10 

### JUDGE GOODWIN: The question 11 

### should be, under the regulations 1S 

### she 12 

### required to inspect, which 1S 

### what she's 13 

### qualified to testify to. 14 

### MR. LOMAZOW: Okay. 15 

### BY MR. LOMAZOW: 16 Q 

### Under the regulations, under Title 1 7 49 CFR, are you required to inspect biological 18 

### substances Category B packages? 19 A 

### Yes, I am. 20 Q 

### Okay. Now, based on your 21 

### experience conducting investigations of 22 

### Federal Express, didtheDG specialist examine NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 83 1 these packages? 2 A No, they did not. 3 Q Okay. Now, are these packages 4 required to be accompanied by shipping papers 5 and listed on the 6 A No. 7 Q Okay. But does that mean they do 8 not have to be inspected? 9 A No. 10 MS. CHANDLER-SNELL: Objection, 11 Your Honor. That goes right to the very 12 question. He's trying to ask her whether 13 under the regulations alr carriers are 14 required at the point of acceptance to inspect 15 these shipments, not whether she is required 16 under her job duties to inspect. The term 17 "inspection" as she was submitted as an expert 18 here was for her inspection of hazmat 19 operations, not an interpretation of the CFR 20 as it relates to what's required for alr 21 carrler inspection at acceptance. 22 JUDGE GOODWIN: I'll sustain that
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 84 1 

### objection to the question. 2 

### MR. LOMAZOW: Right. 3 BY MR. LOMAZOW: 4 Q 

### Agent Luscher, please turn to what 5 

### has been previously marked as C5 for 6 

### identification

-- I'm sorry -- what has been 7 

### previously entered into evidence as C5. 8 A 

### Okay. 9 Q 

### Okay. I'm looking again at what 10 

### is marked as page two. Can you read again the 11 

### first line next to "Preliminary Inspection"? 12 A 

### "Whoever first takes a declared 13 

### dangerous goods package from the 14 

### customer must conduct a 15 

### preliminary inspection. 16 

### "If the package appears to be in 17 

### compliance, accept it on the 18 

### condition that it pass a second 19 

### inspection to be conducted by a 20 

### dangerous goods specialist. 21 

### Advise the customer that the 22 

### dangerous goods specialist/agent
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 85
1 

### will inspect the package again to 2 

### make sure that it does comply with 3 

### the FedEx Express requirements." 4 Q 

### Okay. So it's saying whoever 5 

### takes a dangerous a declared dangerous 6 goods package from the customer must conduct 7 

### a preliminary inspectioni right? 8 A 

### Yes. 9 Q 

### Is biological substances Category 10 

### B, a dangerous good? 11 A 

### Yes. 12 Q 

### Therefore, under this 13 

### interpretation, FedEx's own interpretation

-- 14 

### MS. CHANDLER-SNELL: Objection to 15 

### leading, Your Honor. 16 

### BY MR. LOMAZOW: 17 Q 

### should they have performed a 18 

### preliminary inspection? 19 

### JUDGE GOODWIN: Sustained. 20 

### BY MR. LOMAZOW: 21 Q 

### Agent Luscher, based on the 22 

### language next to "Preliminary Inspection," NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# • 86 1 what, if anything, shouldFedExhave done with 2 this package when it was received? 3 MS. CHANDLER-SNELL: Your Honor, 4 I'm objecting because she's being

-- she's 5 being asked to interpret a policy that's in a 6 FedEx manual on a process that she can't have 7 knowledge about. She's not being asked to 8 observe or talk about what she's seen us do, 9 what she believes unless she has actual 10 knowledge of that, she's asked to interpret 11 what our policy means for a specific 12 substance. 13 JUDGE GOODWIN: Sustained. 14 MR. LOMAZOW: Okay. 15 BY MR. LOMAZOW: 16 Q As far as you know, based on your 17 investigations, does the DG specialist for 18 FedEx look at these particular packages? 19 A No. 20 Q Okay. Please turn to what has 21 been marked as C13. 22 A Okay. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 87
1 Q 

### Okay. Do you recognize this 2 document? 3 A 

### I do. 4 Q 

### And what is this document? 5 A 

### This is an excerpt from 49 CFR, 6 

### Part 173.199. 7 Q 

### Okay. Is this a publicly8 

### available document? 9 A 

### Yes, it lS. 

### 10 MR. LOMAZOW: Your Honor, I offer 11 what has beenmarked as C13 for identification 12 into evidence as C13. 13 MS. CHANDLER-SNELL: No 14 objections, Your Honor. 15 

### JUDGE GOODWIN: Okay. Let me 16 

### point out that well, the Court has no 17 problem with you admitting this particular 18 

### portion of the CFR. The Court in any case 19 will independently review the law in force at 20 the time of any violation in any case. So the 21 Court will consider this informational, but 22 the Court will take sua sponte -- will take NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 88 1 judicial notice of the appropriate regulation 2 applicable at the time of any violation. 3 So C13 for informational purposes 4 is admitted as C13. 5 BY MR. LOMAZOW: 6 Q Agent Luscher, have you used this 7 interpretation to guide you In your 8 investigations? 9 A I do. 10 Q Okay. And this interpretation 11 before we get into it, this interpretation is 12 regarding what, what kind of hazardous 13 materials? 14 A This is in regards to Category B, 15 infectious substances. 16 Q Okay. Can you read the very first 17 sentence of the first paragraph? 18 A Sure. 19 "Category B infectious 20 substances. Except as provided in 21 this paragraph (a), Category B 22 infectious substances are excepted
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 89 1 from all other requirements of 2 this subchapter when offered for 3 transportation or transported In 4 accordance with this section." 5 Q So based on your review of the 6 of that sentence, what does that mean to you? 7 MS. CHANDLER-SNELL: Objection, 8 Your Honor. 9 JUDGE GOODWIN: Sustained. 10 BY MR. LOMAZOW: 11 Q Now, under this, are Category B, 12 infectious substances, not required to be 13 inspected? 14 MS. CHANDLER-SNELL: Objection, 15 Your Honor. The proper foundation has not 16 been 17 JUDGE GOODWIN: What was the

-- 18 restate the question. 19 BY MR. LOMAZOW: 20 Q Under this

-- under this CFR, are 21 Category B infectious substances required to 22 be inspected prior to air transportation? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 90
1 

### JUDGE GOODWIN: Sustained. 2 BY MR. LOMAZOW: 3 Q 

### You use this to guide you in your 4 

### in your investigations involving or 5 inspections involving biological substances 6 Category B? 7 A 

### Yes, I do. 8 Q 

### Okay. And that's a regulated 9 hazardous material; correct? 10 A 

### Yes. Yes, it is. 11 Q 

### Okay. Is there anything here

-- 12 

### actually, strike that. 13 

### Agent Luscher, what 1S 

### needed to 14 meet the regulation here in terms of

-- what 15 1S 

### needed to make biological substance 16 Category Bpackage a properly-markedpackage? 17 

### MS. CHANDLER-SNELL: Your Honor, 18 

### I'm objecting again. I think that's an 19 interpretation of the regulation. I think he 20 can ask what she inspects for and what she 21 

### looks for. But as far as what's needed to 22 make it comply with the statute, I think that NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 91
1 

### that goes beyond what she's been qualified to 2 testify for. 3 

### MR. LOMAZOW: Well, Your Honor, 4 

### she's a hazardous materials inspector. She 5 states that she uses this regulation in order 6 to conduct her inspections of hazardous 7 materials involving biological substances 8 

### Category B. Obviously, she's going to know 9 what the rule says. 10 JUDGE GOODWIN: That wasn't the 11 

### question. The objection to the question is 12 sustained. We're going to take a ten-minute 13 break at this point. I'm going to instruct 14 the witness not to discuss your testimonywith 15 anybody during the pendency of this hearing. 16 We're going to go off the record. I show that 17 it's 14 minutes of 11:00. We'll come back on 18 the record at about six minutes before. The 19 Court generally breaks around 12-ish for 20 lunch, and then we take an hour-and-a-half 21 break. We'll take a break around 3:00. 22 As I said in the hearing notice
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# •

•

• 92
1 and this lS true of any hearing

-- we try to 2 conclude the hearing at 4:30. The reason In 3 some courthouses, the CSOs go on overtime at 4 5:00. And if we break at 4:30, that gives you 5 time to get out of the courthouse. I don't 6 know if any of us has the budget to pay for 7 the CSOs. So that's a generic comment for 8 this thing. 9 If we had started at 9:00, I would 10 have taken a break at 10:30, so that's what 11 we'll shoot for. So we generallybreak for 15 12 minutes about this time. We'll break for ten. 13 We'll break for ten or 15 in the afternoon so 14 that we can all grab that cup of java. 15 By the way, you can't bring any 16 liquids into the building. 17 MS. CHANDLER-SNELL: We learned 18 that the hard way. 19 JUDGE GOODWIN: Unless you know 20 somebody. They even stopped my wife, so 21 we'll go off the record and we'll come back on 22 the record at five minutes of. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 93 1 (Whereupon, at 10:45 a.m. recess 2 off the record until 11:10 a.m.) 3 JUDGE GOODWIN: Back on the 4 record. 5 MR. LOMAZOW: Your Honor, I 6 understand that I forgot to enter in two of 7 the exhibits in evidence, starting C5 and 8 C12. I will offer both into evidence as 9 People's

-- as the

-- 10 JUDGE GOODWIN: I've got C5 as -- 11 I show C5 as admitted. I don't show C6 was 12 admitted. 13 MR. LOMAZOW: Then I offer C

-- 14 what has been marked as C6 for identification 15 into evidence as C6. 16 MS. CHANDLER-SNELL: No 17 objections. 18 JUDGE GOODWIN: C6 (sic) is 19 received into evidence as C6. We talked about 20 you're not going to admit photograph 7, 8, 9, 21 10, II, and 12 of 16. 22 have not been offered. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 94
1 

### MR. LOMAZOW: Right. 2 

### JUDGE GOODWIN: I show Exhibits 8 3 and 9 are admitted. I don't' show

-- I show 13 4 was admitted. I don't show anything else as 5 admitted. 6 

### MR. LOMAZOW: Your Honor, I will 7 offer what has been marked as C12 for 8 identification into evidence as C12. 9 

### JUDGE GOODWIN: I'll give you a 10 chance to look. 11 MS. CHANDLER-SNELL: On C12, Your 12 Honor, I talked to Counsel at break and he 13 agrees that the handwritten portion at the 14 bottom of C12 can be redacted. 15 

### JUDGE GOODWIN: Okay. Normally 16 what the Court does

-- and I meant to mention 17 that

-- unless there's agreement, the Court 18 normally ignores the handwritten part. So if 19 it'snot confidential material, the Court will 20 just ignore anything that is not any 21 obvious handwritten notes. 22 

### MR. LOMAZOW: Okay. There's
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 95 1 nothing there confidential. 2 MS. CHANDLER-SNELL: Okay. Thank 3 you, Your Honor. 4 MR. LOMAZOW: And just to be 5 clear, was C11

-- do you show C11 as being 6 admitted, Your Honor? 7 JUDGE GOODWIN: Hang on. All 8 right. So C12 for identification is received 9 as C12 with the caveat that we will ignore 10 anything that's obviously handwritten, which 11 is essentially the bottom half of the page. 12 C11 was admitted. And I have

-- 13 so Complainant's 10 was admitted and 14 Complainant's 11 was admitted. And that's 15 where I am at this point. 16 BY MR. LOMAZOW: 17 Q Agent Luscher, please turn back to 18 C7, which is the photographs. And turn to the 19 photograph that is marked page 13 of 16 at the 20 bottom. 21 A Okay. 22 Q What does this photograph
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 96 1 represent? 2 A This is a -- the front side of a 3 Priority Overnight shipment that was found to 4 be not in compliance with 49 CFR 173.199 and 5 what side that was, the UN 3373 was not in the 6 diamond-on-point marking nor did it have a 7 biological substance Category B proper 8 shipping name on it. 9 Q And just to be clear, if the 10 package does have a biological substances 11 Category B, does that have to be near the 12 UN 3373 or can it be anywhere else on the 13 package? 14 A It lS supposed to be adjacent to 15 the UN 3373 marking. 16 Q Okay. And just so I understand 17 what you said, the UN 3373 as per 173.199 has 18 to be a diamond enclosed marking; is that the 19 best way to put it? 20 A Yes, it does. 21 Q Okay. 22 MR. LOMAZOW: Your Honor, I offer
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 97 1 into evidence what has beenmarked as C7, page 2 13 of 16. 3 MS. CHANDLER-SNELL: No 4 objections, Your Honor. 5 BY MR. LOMAZOW: 6 Q Agent Luscher, please turn to the 7 next 8 JUDGE GOODWIN: Okay. Exhibit 7, 9 3 of

-- 13 of 16 is admitted. Go ahead. 10 MR. LOMAZOW: Sorry, Your Honor. 11 BY MR. LOMAZOW: 12 Q Agent Luscher, please turn to the 13 next photograph, which is markedpage 14 of 16 14 at the bottom. 15 A Okay. 16 Q What does this photograph 17 represent? 18 A This is the back side of the same 19 package and it also shows that it was not 20 marked as a biological substance Category B, 21 even when the front had indicated that it was 22 a UN 3373. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 98
1 

### MR. LOMAZOW: Okay. Your Honor, 2 

### People or the Agency offers what has been 3 marked as C7, 

### page 14 of 16 for identification 4 into evidence as C7, 

### page 14 of 16. 5 

### MS. CHANDLER-SNELL: No 6 objections, Your Honor. 7 

### JUDGE GOODWIN: Complainant's 7, 8 14 of 16 is admitted as Complainant's 6, 14 of 9 

### 16. 10 BY MR. LOMAZOW: 11 Q 

### Agent Luscher, just real briefly 12 

### turn back to the photograph marked page 13 of 13 16. 14 A 

### Okay. 15 Q 

### Who is the

-- was there a shipper 16 indicated for this package? 17 A 

### Yes. Checker's, Inc. out of 18 Sidney, Montana. 19 Q 

### Okay. And-- 20 A 

### They were the shipper. 21 Q 

### -- is there some kind of tracking 22 

### number associated with this package? NEAL

### R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 99
1 A 

### Yes, it is. It's 8647 4191 6794. 2 Q 

### And what is that tracking number 3 associated with? 4 A 

### That 1S 

### associated with this 5 package and the movement of this package. 6 It's a number assigned for FedEx. 7 Q 

### Is that a FedEx tracking number? 8 A 

### Yes. 9 Q 

### Okay. Agent Luscher, please turn 10 to what is marked as page 15 of 16 at the 11 bottom. 12 A 

### Okay. 13 Q 

### What is the significance of this 14 photograph? 15 A 

### This was the second package from 16 Checker's, Inc. also noticed on the same day, 17 titled Overnight Saturday delivery shipment. 18 That had the same issue the improper 19 marking of the UN 3373 without the proper 20 marking and without the proper shipping name 21 of biological substances Category 22 B . NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 100 1 Q And for the what was wrong, 2 once again, with the for this particular 3 package, what was the what was wrong with 4 the UN 3373? 5 A It is not a proper diamond-shaped 6 label marking. 7 Q Okay. Is that per 173.199? 8 A Yes, it is

-- 173.199(a) (5). 9 Q Okay. 10 MR. LOMAZOW: Your Honor, I offer 11 what has been marked as C7, page 15 of 16 for 12 identification into evidence as C7, page 15 of 13 16. 14 MS. CHANDLER-SNELL: No 15 objections, Your Honor. 16 JUDGE GOODWIN: C7, 15 of 16 is 17 received. 18 MR. LOMAZOW: Thank you. 19 BY MR. LOMAZOW: 20 Q Agent Luscher, please turn to the 21 last photograph, which is markedpage 16 of 16 22 at the bottom. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 101
1 A Okay. 2 Q What does this photograph 3 represent? 4 A This is the back side of the same 5 shipment from Checker's, Inc., FedEx tracking 6 number 8548 5793 6503. It is

-- I just took 7 a picture of the back of this showing that, 8 again, there's no markings of it as being a 9 biological substance Category B even though 10 that the front had indicated that it was a UN 11 3373. 12 Q And UN 3373, is that a hazmat 13 identification number? 14 A Yes, it is. 15 Q And that indicates the presence of 16 what kind of hazmat? 17 A A Category 6.2 biological 18 substance Category B. 19 MR. LOMAZOW: Your Honor, I offer 20 what has been marked as C7, page 16 of 16 for 21 identification into evidence as C7, page 16 of 22 16. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 102
1 

### MS. CHANDLER-SNELL: No 2 objections, Your Honor. 3 

### JUDGE GOODWIN: C7, 16 of 16 1S 

### 4 received. 5 

### MR. LOMAZOW: Okay. 6 BY MR. LOMAZOW: 7 Q 

### Agent Luscher, please turn to what 8 has been marked as C14 for identification. 9 A 

### C14? 10 Q 

### Yes. 11 A 

### Okay. 12 Q 

### What 1S 

### this document? 13 A 

### This was an interp. by the 14 Pipeline and Hazardous Materials Safety 15 Administration, Reference No. 07-0087. This 16 was provided to me by FedEx in their letter of 17 response. 18 Q 

### Okay. Please read the last 19 sentence at the bottom of this page beginning 20 

### with "A carrier is not required 

## " 21 A 

### "A carrier is not required to 22 question the offeror on whether or NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE.. N.W. WASHINGTON. D.C. 20005-3701 www.nealrgross.com

# •

• 103 1 not a package marked 'DIAGNOSTIC 2 SPECIMEN' contains a Division 6.2 3 materiali however, it may be in 4 the carrier's best interest to do 5 so to ensure he or she is not 6 inadvertentlytransporting an item 7 meeting the definition of a 8 hazardous material." 9 Q Diagnostic specimen, is that 10 currently regulated? 11 A No. 12 Q Is "Diagnostic Specimen" marked on 13 these two packages that you observed? 14 A No. 15 Q What was marked on these two 16 packages that you observed? 17 A UN 3373. 18 Q Does that indicate the presence of 19 a regulated hazardous material? 20 A Yes. 21 Q Okay. 22 MR. LOMAZOW: Your Honor, I offer
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 104 

### 1 what has been marked as C14 for purposes of 2 identification into evidence as C14. 3 

### MS. CHANDLER-SNELL: No 4 objections, Your Honor. 5 

### JUDGE GOODWIN: C14 for 6 identification is received into evidence as 7 C14. 8 BY MR. LOMAZOW: 9 Q 

### Agent Luscher, please turn to what 10 has previously been entered into evidence as 11 C9, which is the FedEx response to the letter 12 

### of investigation. 13 A 

### Okay. 14 Q 

### Did Federal Express respond to -- 15 in your letter of investigation, did Federal 16 Express respond to these particular packages 17 marked

-- 18 

### A Yes. 19 Q - - UN 

### 3373? 20 

### A Yes, they did. 21 Q 

### What was the general response? 22 A General response 1S 

### that they
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 105 1 don't

-- these types of shipments do not need 2 a shipper's declaration, label, specification, 3 packagemarking, ornotificationto thepilot4 in-command. 5 Q Okay. And do they provide any 6 corrective measures? 7 A They said that they had provided 8 an updated some updated updated 9 informationontheirwebsite regarding UN 3373 10 shipments. 11 Q Is that above what Title 49 would 12 require? 13 A No. 14 Q Okay. Agent Luscher, please turn 15 to what has previously been entered into 16 evidence as C11, and this is Corporate Air's 17 response to the letter of investigation. 18 A Okay. 19 Q Did Corporate Air address these 20 two packages marked UN 3373 in their response? 21 A No, they did not. 22 Q Okay. Agent Luscher, did you NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 

# • 12 13 14 15 16 17 18 19 20 21 22 106 

### ultimately put together an EIR, enforcement investigation report, for your -- for

-- did you ultimately put together an enforcement investigation report for this case? A Yes. Q 

### Okay. And once you prepare an enforcement investigation report, where does it go? A It goes to my supervisor for review and approval. Q 

### Okay. And do you make the ultimate determination of a sanction that is proposed in any given case? A Not the ultimate, no. Q 

### Okay. And as part of your training, are you required to be familiar with the Administrator's Sanction Guidance? A Yes. Q 

### Okay. Please turn to what 1S 

### marked as CIS for identification. What is this document? A This is an excerpt from FAA Order
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# •

•

• 107
1 2150.3B. It's dated October 1st, 2007. It's 2 the Appendix C, which is the Sanction Guidance 3 for the Hazardous Materials Enforcement. 4 Q Is this a publicly-available 5 document? 6 A Yes, it is. 7 MR. LOMAZOW: Your Honor, I ask 8 that what has been marked for identification 9 as C15 be entered into evidence as C15. 10 MS. CHANDLER-SNELL: No 11 objections, Your Honor. 12 JUDGE GOODWIN: Okay. The Court 13 generally takes judicial notice of 2150.3B. 14 I'm aware that Mr. Morris and a lot

-- and 15 most of the FAA attorneys like to admit them. 16 It doesn't make any difference to me. I'll 17 take judicial notice but, again, I have the 18 same caveat that I did before. The Court will 19 take judicial notice of the Hazardous 20 Materials Enforcement Regulations in force at 21 the time of the applicable violation. 22 The other comment I make about
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•

• 108
1 2150 is it makes the file thicker, but I fully 2 understandwhy the FAA attorneys like to admit 3 them, and the Court doesn't care either way. 4 I'll admit Complainant's 15 as Complainant's 5 15 being the Sanction Guidance dated October 6 1st, 2007. 7 MR. LOMAZOW: Thank you, Your 8 Honor. 9 BY MR. LOMAZOW: 10 Q Agent Luscher, to the best of your 11 knowledge or belief, did the Agency follow 12 this Sanction Guidance? 13 A Yes. 14 Q And just so we understand, does 15 this Sanction Guidance go through an analysis 16 to determine what an appropriate sanction is? 17 A It does. 18 Q Okay. And has the Administrator 19 put out three categories of or three 20 categories of risk categories? 21 A Yes, it has. 22 Q Okay. Please turn to -- at the
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•

• 109
1 bottom of C2

-- I'm going to refer to page 2 numbers as just 1, 2, 3, 4, 5, 6, 7. 3 JUDGE GOODWIN: Okay. 4 BY MR. LOMAZOW: 5 Q Please turn to page 17. 6 A Okay. 7 Q What is the risk category for the 8 Class 5.1 package you observed on May 12, 9 2008? 10 A For the 5.1, it falls under 11 Category A, Maximum Weight. 12 Q Okay. And is that because the 13 shipper listed it as a Packing Group lIon the 14 shipping papers? 15 A Yes. That's correct. 16 Q And what is the risk category for 17 the UN 3373 packages? 18 A It falls under Category B, 19 Moderate Weight. 20 Q Okay. So in this case, there are 21 three improper acceptance violations, one for 22 the Class 5.1 and two for the UN 3373 NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 110
1 

### packages? 2 A 

### Yes. 3 Q 

### Okay. And are there also three 4 improper inspection violations for the same 5 packages as well? 6 A 

### Yes. 7 Q 

### Okay. Please turn to the matrix 8 

### for air carrier violations on C-13. 

### Under 9 this matrix, what group a1r carrier would 10 

### FedEx be considered? 11 A 

### FedEx 1S a Group I air carrier. 12 Q 

### Okay. And is that not only by the 13 

### number of aircraft but by the size of their 14 

### revenue? 15 A 

### Yes. 16 Q 

### As a Group I a1r carrier, what 1S 17 

### the sanction range for improper acceptance 18 

### violations? 19 A 

### Five thousand to 32,500. 20 Q 

### Okay. And what is the sanction 21 

### range for improper inspections? 22 A 

### Ten thousand to 32,500. NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 111
1 Q Okay. And under the same matrix, 2 what is the sanction range for improper 3 storage of hazmat aboard an aircraft? 4 A For improper storage, it's 10,000 5 through 32,500. 6 Q Okay. And, last, under the 7 matrix, what is the sanctionrange for failure 8 to provide notice to the pilot-in-command? 9 A That would be 5,000 through 10 16,200. 11 Q Okay. And before we continue on 12 with this Sanction Guidance, please turn to 13 C16 for identification. What is this 14 document? 15 A Under C16? 16 Q Yes. 17 A This is a record review of Federal 18 Express's violation history for some more 19 violations. 20 Q So in 2008, how far did you go 21 back? 22 A I went back five years. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 112
1 Q 

### Okay. And why only five years? 2 A 

### It kind of gives us a general idea 3 of what's been their violation history in the 4 

### last five years and it's also per our 5 

### procedures. 6 Q 

### Okay. And did you consider those 7 

### in determining the sanction against FedEx? 8 A 

### Yes. 9 Q 

### Okay. Agent Luscher, I'm going to 10 have you turn back to C15 and to the matrix 11 guidelines under C13

-- actually, I'm sorry. 12 MR. LOMAZOW: Judge, what lS 

### 13 marked as C16 for identification, I'mgoing to 14 ask that it be entered into evidence as C16. 15 JUDGE GOODWIN: Did you move to 16 admit C15 or we already did? 17 

### MR. LOMAZOW: I think we already 18 admitted it but, if not, I'll ask that it be 19 admitted as well. 20 

### JUDGE GOODWIN: I didn't hear the 21 last part of that. 22 

### MR. LOMAZOW: I'm sorry. I think
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• 113 1 I did ask for C15 to be admitted. 2 JUDGE GOODWIN: Yeah. C15 was 3 admitted. 4 MR. LOMAZOW: Yeah. And I'm going 5 to ask for C16 to be admitted as well. 6 JUDGE GOODWIN: Oh, I'm sorry 7 16. 8 MR. LOMAZOW: Yes. 9 MS. CHANDLER-SNELL: No 10 objections, Your Honor. 11 JUDGE GOODWIN: Complainant's 16 12 for identification is received into evidence. 13 MR. LOMAZOW: Okay. 14 BY MR. LOMAZOW: 15 Q Okay. Now, based on all the 16 factors, is there a totality of the 17 circumstances type of analysis done? 18 A Yes, there lS. 19 Q Okay. So, in other words, there's 20 no mathematical formula but there's a range 21 that the Administratorprovides in exercising 22 theAdministrator'sjudgmenti is that correct?
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•

• 114 1 A That's correct. 2 Q Okay. And to reiterate, In this 3 case, slnce we have three lmproper 4 acceptances, the sanction range would be a 5 total of 15,000 to 97,500; is that correct? 6 A Yes. 7 Q Okay. And since there are three 8 improperinspections, the sanctionrangewould 9 be 30,000 10 MS. CHANDLER-SNELL: I object to 11 leading, Your Honor. 12 JUDGE GOODWIN: Yes. Sustained as 13 leading. 14 MR. LOMAZOW: Okay. 15 BY MR. LOMAZOW: 16 Q All right. Based on the total 17 sanctions based on the sanctions for 18 improper inspections and improper

-- improper 19 acceptance, where does 45,000 fallon the 20 sanction range? 21 A Pretty much at the bottom, low 22 range. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 115
1 Q And did you prepare an EIR for 2 Corporate Airlines using the same Sanction 3 Guidance? 4 A I did. 5 Q Okay. Under the Sanction 6 Guidance, what type of alr carrler lS 7 Corporate Air? 8 A They are a Group II air carrier. 9 Q Once again, is that by virtue of 10 their pilots and number of aircraft? 11 A Yes. 12 Q Okay. And is there any difference 13 in the calculations for a Group I as compared 14 for a Group II as compared to a Group I air 15 carrier? 16 A No. 17 Q Okay. So the same analysis was 18 done? 19 A Yes. 20 Q Okay. And, once again, where does 21 45,000 fallon the sanction range? 22 A Very low range. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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### 1 Q 

### Okay. 2 

### MR. LOMAZOW: Your Honor, no 3 further questions. 4 

### JUDGE GOODWIN: Let me ask you 5 this: How long do you think your cross will 6 take? 7 MS. CHANDLER-SNELL: Frankly, Your 8 Honor, I'm very long-winded. I would expect 9 a while. 10 JUDGE GOODWIN: Why don't we - - 11 then why don't we take a break now for lunch. 12 MS. CHANDLER-SNELL: That would be 13 fine with me, Your Honor. 14 

### JUDGE GOODWIN: And come back. 15 It's now 11:30. Since we're going to have to 16 leave the building and come back in through 17 security, let's be back

- - try to be back 18 about 1:00. Once we get everybodyback, we'll 19 start. I'm going to instruct the witness that 20 you're not to discuss your testimony with 21 anybody during the pendency of the hearing. 22 

### You're under oath and you're in the middle of NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 117 

### 1 your testimony, and the next thing that will 2 happen is Ms. Snell will have an opportunity 3 to ask you some questions. So it's important 4 that you not discuss anything. I don't care 5 if you talk about baseball games, football 6 games, or anything else, but you cannot talk 7 about your testimony in this case. 8 

### So we're going to go off the 9 record. One of us will be

-- either the court 10 reporter or I will be in the hearing room, so 11 feel free to leave whatever you want to here. 12 

### MS. CHANDLER-SNELL: Thank you, 13 

### Your Honor. Your Honor, may I clarify one 14 issue on 15 

### JUDGE GOODWIN: Sure. 16 

### MS. CHANDLER-SNELL: who Ms. 17 

### Luscher can speak with. Does that include 18 that she cannot confer with the FAA attorney 19 because she is still under oath and on the 20 stand? 21 

### JUDGE GOODWIN: She's under oath. 22 She shouldn't talk with anybody about
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 118 1 anything. 2 MS. CHANDLER-SNELL: Thank you, 3 Your Honor. 4 JUDGE GOODWIN: She shouldn't talk 5 with anybody about her testimony, what she 6 said or what she may potentially say. 7 MS. CHANDLER-SNELL: Yes, Your 8 Honor. Thank you. 9 JUDGE GOODWIN: Okay. We're off 10 the record. 11 (Whereupon, at 11:32 a.m. off the 12 record for a lunch break until 1:00 p.m.) 13 14 15 16 17 18 19 20 21 22 NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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1 

### AFTERNOON SESSION 2 1:05 

### p.m. 3 

### JUDGE GOODWIN: Back on the 4 record. Remind the witness that you're still 5 

### under oath. 6 

### Counsel. 7 

### MR. LOMAZOW: Yes, Your Honor. 8 

### We're done with our questioning. 9 

### JUDGE GOODWIN: Okay. 10 

### MS. CHANDLER-SNELL: May I begin 11 

### cross, Your Honor? 12 

### JUDGE GOODWIN: Yes. 13 

### MALLORY LUSCHER, COMPLAINANT'S WITNESS, 14 

### PREVIOUSLY SWORN 15 

### CROSS EXAMINATION 16 

### BY MS. CHANDLER-SNELL: 17 Q 

### Remind me again of your last name. 18 

### Is it Luscher or Lusching? 19 A 

### Luscher. 20 Q 

### Okay. 21 A 

### Do you want me to spell that? 22 Q 

### No. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 120 1 A 

### Okay. 2 Q 

### No. The court reporter may, but 3 

### I've got it. In going through the exhibits 4 today, In my cross-examination of you, I 5 

### intend to attempt to go in the same order that 6 the FAA attorney did as much as possible. 7 A 

### Okay. 8 Q 

### Now, go back to -- and you have 9 

### the exhibits, I believe -- Exhibit Cl. 10 A 

### Yes. 11 Q 

### Now, I believe in your testimony 12 

### you had stated that you had noticed a package 13 that was inappropriately stowedas the offload 14 procedure was going oni 

### is that correct? 15 A 

### That's correct. 16 Q 

### But In your -- In your statement, 17 you actually state that Agent Kenny was the 18 

### one who first noticed the package. Do you 19 recall who noticed it first? 20 A 

### He did. 21 Q 

### Okay. Were you both watching the 22 

### offload at the same time? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 121
1 A Yes. I was up towards the front 2 of the aircraft talking with the pilot. 3 Q Okay. And so when you were 4 talking with the pilot, was that shipment 5 already being offloaded? 6 A That was coming off. I could see 7 it coming down the belt. 8 Q Okay. And did Agent Kenny call 9 you over or did you notice at that point that 10 there was a problem? 11 A He called me over and made sure 12 that I got the inbound or the pilot 13 notification form. 14 Q Okay. Now, looking through those 15 exhibits at C3,

-- 16 A Okay. 17 Q that aircraft that's noted 18 there, N933FE, that is the only aircraft that 19 you noted any DG discrepancies in the case 20 that we're on here today; correct? 21 A For May 12th, yes. 22 Q For May 12th. Okay. And on that
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 122
1 flight, the notification to pilot said that 2 there was no DG onboard the flight; is that 3 correct? 4 A That 1S what it says. Yes. 5 Q Now, you agree that a UN 3373 6 shipment wouldn't have been declared on that 7 NOPIC anyway; correct? 8 A Are we talking about the 3373 or 9 the 2428? 10 Q The 3373. 11 A Okay. That wouldn't have been on 12 this on that flight. 13 Q That wasn't on that flight to 14 begin with? 15 A Huh-uh. 16 Q Okay. 17 A No. 18 Q It was a different day? 19 A Right. 20 Q Okay. So the only one that you 21 are alleging should have been included on the 22 exhibit 1n C3 is the oxidizer shipment; is NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 123 

### 1 that right? 2 A 

### Yes, ma'am. 3 Q 

### Okay. The oxidizer shipment, who 4 did you say the shipper was for that shipment? 5 A 

### BioScience Laboratories. 6 Q 

### Okay. And you had contact with a 7 

### woman, I 

### believe Shayla Cox, at that 8 laboratory? 9 A 

### Yes, I 

### did. 10 Q 

### Okay. So you did your own follow11 up with the shipper in addition to what FedEx 12 may have done; is that right? 13 A 

### Absolutely. 14 Q 

### And In your conversations with 15 her, she provided the MSDS that's also been 16 entered as an exhibit? 17 A 

### Actually, I 

### believe it was In the 18 shipment. 19 Q 

### Okay. Did you look at the MSDS 20 then when you had the shipment in front of 21 you? 22 A 

### After -- after we had opened it
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 124
1 

### all up and was looking at everything, yes, 2 Q 

### Okay. And at that point, were you 3 able to basicallyverify that the shipment did 4 

### not contain a regulated commodity? 5 A 

### That's what the MSDS said, but 6 

### then I had wanted to have the conversations 7 

### with Ms. Cox so that we could clarify it. 8 Q 

### Okay. And in relation to the time 9 

### that you were at the ramp actually noting this 10 

### violation, how long was it until you spoke 11 

### with Ms. Cox at the laboratory? 12 A 

### It was either that night or the 13 

### next day. I don't have that file in front of 14 

### me. 15 Q 

### Okay. Pretty shortly thereafter? 16 A 

### Oh, yes. 17 Q 

### Okay. 18 A 

### Yes. 19 Q 

### And you feel confident, based on 20 your conversation with her and the MSDS, that 21 

### the commodity was not required to be 22 

### regulated; is that right? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 125
1 A 

### From what I could tell. I'm 2 not -- I don't classify

-- I don't classify 3 hazmat. 4 Q 

### Okay. Well, are you familiar with 5 

### any - - any citation or letter of investigation 6 

### that was issued to the shipper? 7 A 

### Yes. 8 

### MR. LOMAZOW: Objection, Your 9 

### Honor. That's not relevant here. 10 

### JUDGE GOODWIN: Overruled. 11 

### BY MS. CHANDLER-SNELL: 12 Q 

### And did you yourself lssue that 13 

### letter of investigation to the shipper? 14 A 

### I did. 15 Q 

### Okay. In that letter of 16 investigation, did you cite

-- if you recall, 17 did you cite any provisions in the CFR that 18 deal with not properly marking and labeling a 19 shipment that was required to have a hazard 20 label? 21 A 

### Yes. 22 Q 

### Okay. Is it also a violation for
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 126
1 

### a shipper to put is it a violation for a 2 shipper to put a hazard label on something 3 

### that is does not require one? 4 A 

### That is correct. Yes. 5 Q 

### Okay. Did you -- In your letter 6 of investigation, did you also cite the 7 

### shipper under that provision? 8 A 

### Yes. 9 Q 

### Okay. Do you recall at the 10 

### conclusion of your investigation in dealings 11 

### with the shipper if it was decided upon which 12 

### type of violation had occurred? 13 

### MR. LOMAZOW: Objection, Your 14 

### Honor. That's a completely separate case. 15 

### It's not relevant to the facts at issue here. 16 

### MS. CHANDLER-SNELL: Well-- 17 

### JUDGE GOODWIN: Overruled. 18 

### MS. CHANDLER-SNELL: Thank you, 19 

### Your Honor. 20 

### THE WITNESS: I'm sorry. Repeat 21 

### it. 22 

### II NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 127 

### 1 BY MS. CHANDLER-SNELL: 2 Q 

### In your when you eventually 3 ended your investigation of the shipper and 4 

### settled that matter, did you conclude that 5 

### they should be cited

-- was the conclusion of 6 

### the case that they were cited for putting a 7 

### non-hazardous material with a hazard label on 8 

### it, or were they cited for improperly 9 declaring a hazardous good? 10 A 

### They were cited for trying to ship 11 a hazmat shipment that was not hazmat and that 12 they did they did mark it, label it, 13 classify it, and declare it as such, even 14 though it was not. 15 Q 

### Okay. So at the end of the day 16 with your dealing with the shipper, what they 17 were cited for was putting a item that didn't 18 have to be regulated with a hazard label? 19 A 

### Correct. 20 Q 

### Okay. And you agree that the 21 determination is on the shipper as to whether 22 

### something is hazmat or is not hazmat? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 128
1 A I do agree. 2 Q Okay. So if you'll look at the 3 MSDS and, actually, I think there are two 4 MSDSs in Exhibit C6, both of those show that 5 the item shipped did not require any hazard 6 label, and that's consistent with your 7 conclusion of the investigation and case 8 against the shipper, that the item shipped did 9 not require a hazard label? 10 A That's correct. 11 Q And particularly the label on this 12 package was an oxidizer label; right? 13 A Yes. 14 Q But the item that was shipped did 15 not require an oxidizer label? 16 A That's correct. 17 Q If you will look at the pictures 18 under C7, please. 19 A Okay. 20 Q For C7, picture 1 of 16, the only 21 thing visibly wrong with that picture is that 22 there was no proper shipping name on the side NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 129 

### 1 of the box; is that correct? 2 A 

### That's correct. 3 Q 

### Okay. And that proper shipping 4 name should have been listed near the UN 5 

### number; is that right? 6 A 

### Yes. 7 Q 

### Okay. Now, if you'll turn to in 8 the same exhibit C7 1

-- I'm sorry -- 2 of 16. 9 

### Now, that picture depicts the UN 10 number on the top right-hand portion of that 11 side of the box. But given that picture 1 12 shows that it had the UN number on that side, 13 there wasn't a requirement that the UN number 14 be on this side; is that right? 15 A 

### That's correct. 16 Q 

### Okay. And there is no requirement 17 for the glass label that's on that side; 18 correct? 19 A 

### That's correct. 20 Q 

### The arrows are required for 21 shipping this; is that correct? 22 A 

### For shipping liquid, yes. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 130
1 Q 

### Okay. And was this determined 2 well, it was determined to be a liquid. 3 A 

### Yes. 4 Q 

### And, again, now move to C7, page 3 5 of 16. 6 A 

### Okay. 7 Q 

### In that picture, it shows yet 8 anotherUNmarking, the top right-handcorner, 9 which is not required to be there; correct? 10 A 

### Correct. 11 Q 

### Okay. And then you have the words 12 

### "ULineHazardousMaterialsPackaging." That's 13 not a regulatory requirement in any way, is 14 it? 15 A No. 

### 16 Q 

### Okay. And then at the bottom 17 left-hand side, you have a UN with a circle 18 around it. What does that mean? 19 A 

### That shows that it 1S 

### a UN 20 specification packaging. 21 Q 

### Okay. Now, 

### UN specification 22 packaging can be used for hazardous materials NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 131 1 and for non-hazardous materialsi correct? 2 A Correct. 3 Q So the fact that you see that 4 marking on a boxyou agree doesn't necessarily 5 indicate that the contents are haz? 6 A Correct. 7 Q Okay. And then you have the words 8 "Meets ISTA Procedure lA Requirements." Do 9 you know what that means? 10 A It meets some international

-- I 11 don't know what ISTA means specifically, no, 12 but it does supposed to meet their 13 Procedure lA requirements. 14 Q Okay. So that's not something 15 that's required under U.S. hazmat 16 A No. 17 Q -- regulations? 18 A No. 19 Q Okay. So that's

-- on that side 20 of the box then

-- strike that. 21 If you'll move to C7, page 4 of 16 22 or Exhibit 4 of 16. Again, you've got the UN NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 132
1 number that's not required on that side of the 2 box; correct? 3 A That's correct. 4 Q You have the orientation arrows 5 that are required only if the contents are 6 liquid; correct? 7 A Correct. 8 Q But orientation arrows can be used 9 whether you have hazmat or not; correct? 10 A Correct. 11 Q Okay. And the glass label, which 12 isn't required by any 

### u.s. regulations? 13 A That's correct. 14 Q On C7, page 5 of 16, on this 15 portion of

-- on this side of the box you see 16 the emblem "Fragile." That's not required 17 under any

### u.S. regulation for hazmat; correct? 18 A Correct. 19 Q Okay. And you've got "This Side 20 up, " which lS not required under the 21 regulations either; correct? 22 A Correct.
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 133
1 Q 

### Okay. And then you have "UN 4G 

### 2 Compliant Only When All Parts of Combination 3 Packaging are Used and Assembled Properly." 4 

### Now, is that required to be on 5 

### there by regulation? 6 A 

### Not if it's not a hazardous 7 

### material. No. 8 Q 

### If it is a hazardous material, is 9 

### that phrase required to be on there? 10 A 

### No. 11 Q 

### Okay. And when it says UN 4G, 12 

### that's not a UN shipping number; right? 13 A 

### No. 14 Q 

### Even though it says UN 4G 

### kind of 15 

### in the way that those other UN numbers were 16 

### listed on the other side of the box. 17 A 

### No. Usually UN numbers have the 18 two letters UN and then four numbers. 19 Q 

### Okay. 20 A 

### As a numerical, so there's 21 

### there's not any letters after any number. 22 Q 

### So when

-- if this shipment didn't
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 134 1 have the

-- if there were -- if there were a 2 brown box that had the UN 46 compliant 3 language that's on this C7, page 5 of 16, if 4 there were a brown box that had that language 5 on there, that would in no way indicate that 6 there was haz inside; correct? 7 A Personally, it would make me think 8 that there was. 9 Q Okay. But the box could be used 10 with that language on there even if it wasn't? 11 A That's correct. 12 Q Okay. And the reason it would 13 make you think that is because it contains the 14 UN reference

-- 15 A Uh-huh. Yes. 16 Q -- which is sometimes considered 17 an indicator perhaps. 18 A Yes. 19 Q Okay. But in this case, that UN 20 isn't actually referencing a UNnumber at all. 21 It's referencing packaging standards. 22 A Correct. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 135
1 Q 

### Okay. And UN packaging standards 2 are good for haz and not haz? 3 A 

### Correct. 4 Q 

### Okay. Exhibit C7, page 6 of 16, 5 

### there's a lot of information on the bottom of 6 that box. Can you tell me if any of that is 7 required under the U.S. regs. for hazmat? 8 A 

### No. 9 Q 

### Okay. So some of that language 10 that is important, some of it says "Used for 11 4 - 1 Gallon Can Shipper," and then some of it 12 

### actually has I think another spot where "IN" 13 maybe is referenced

- - it may be "UN"

- - 

### but 14 none of that is required for shipping haz? 15 A 

### No. 16 Q 

### Okay. Let's go to Exhibit 17 well, I'll tell you what. We'll just stick 18 with that exhibit, C7, and let's go to page 13 19 of 16; okay? 20 A 

### Okay. 21 Q 

### Now, in that picture, it shows UN 

### 22 3373 handwritten on the front of the clinical NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 136 1 

### pak; correct? 2 A 

### Correct. 3 Q 

### And the UN 3373 is not surrounded 4 

### by a diamond label; is that correct? 5 A 

### That is correct. 6 Q 

### If this shipment had that

-- if it 7 

### was exactly the same but had a hand-drawn 8 diamond around those letters, that UN 3373 9 

### that's already on there, would that be

-- in 10 

### your course of inspection, would that be 11 

### something that you would pullout? 12 A 

### Yes. 13 Q 

### Okay. And why would you do that? 14 A 

### Because there's certain 15 

### specifications in 49 CFR 

### 173.199 that 16 discusses the approximate size of the diamond. 17 So if it was the exact size, then it would be 18 fine. 19 Q 

### Okay. But so what you're 20 saying is you would check it and actually 21 

### measure the diamond to see if it was the exact 22 

### size as required? NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 137
1 A If I did

-- if I did see this and 2 it did have a handwritten, yes, I would. I do 3 carry a measuring tape with me. 4 Q Okay. Now, it lists the I 5 believe you said the shipper of this one was 6 Checker's, Inc. i lS that right? 7 A That's correct. 8 Q And you conducted

-- as part of 9 your investigation, youcontactedthat shipper 10 to determine what the contents of the package 11 were? 12 A I did. 13 Q Okay. And did that shipper verify 14 that it was indeed a UN 3373 shipment? 15 A No. 16 Q Okay. What did they indicate to 17 you? 18 A They indicated that they used the 19 wrong packaging. 20 Q So lS it your testimony then that 21 the contents of this shipment weren't actually 22 a regulated substance? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 138
1 A 

### My testimony is that it was 2 improperly marked. 3 Q 

### I understand. What did they 4 

### indicate to you that this

-- the substance was 5 

### inside of this? 6 A 

### They did not. They indicated that 7 

### it wasn't regulated and that they needed to 8 

### use a different pak. 9 Q 

### Did you write a 

### letter of 10 investigation to Checker's? 11 A 

### I did. 12 Q 

### Okay. And ln that letter of 13 investigation, did you cite them for

-- did 14 you cite them for improperly marking and 15 labeling

-- or improperly marking a UN 3373 16 biological shipment? 17 A 

### I cited them for not being ln 18 compliance with 49 CFR 173.199, that they 19 offered

-- they did not offer a package that 20 was in compliance with 173.199. 21 Q 

### Okay. But at the conclusion of 22 your investigation, you determined, based on NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 139 1 

### what they had told you, that the substance 2 

### inside this particular shipment wasn't 3 required to be shipped under

-- 4 A 

### Right. 5 Q 

### Yes under 173.199. Okay. 6 

### Let's go to C7, page 14 of 16. Now, I know 7 that that print is really small, but do you 8 

### recall or can you tell if the words 9 

### "Biological Substance, Category B" are 10 actually on that shipment? 11 A 

### In the middle of the package, 12 

### there lS 

### a box and to the right of that in 13 orange writing there does mention something 14 about biological substances Category B. 15 Q 

### Okay. And would you agree that it 16 says "Mark this box if your shipment meets the 17 definition of 'Biological Substance Category 18 B'''? 19 A 

### There is

-- I'm trying to read it 20 

### yes. 21 Q 

### Okay. Okay. And

-- now, In this 22 

### exhibit, it looks like there's sort of a NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 140 

### 1 little black mark in that box, but I think 2 your testimonywas that it wasn't marked

-- it 3 didn't appear that that box had been checked; 4 is that right? 5 A 

### Right. That little black mark is 6 actuallywhere a portion of the white had been 7 scraped off during shipping. 8 Q 

### Okay. 9 A So there was no actual marking on 10 there. No. 11 Q 

### All right. So from you looking at 12 this, it did not appear that the customer had 13 said, Yes, this is a UN 3373 biological 14 substances shipment? 15 A 

### That's why I took a picture of the 16 back of it because I needed to become clear 17 whether it was or whether it wasn't. But as 18 far as I'm looking at it, it's

-- it's not 19 marked properly. 20 Q 

### Right. Well

-- you mean the box 21 is not marked properly. 22 A 

### The whole package was not marked
NEALR. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 141 

### 1 properly. 2 Q 

### Right. So based on your testimony 3 then, the only thing on this entire shipment 4 that couldhave indicatedto anyone looking at 5 it that it might contain anything regulated 6 was the UN 

### 3373 on the front part of the 7 package; right? 8 A 

### Correct. Yes. That's what 9 flagged me. 10 Q 

### Okay. But the

-- you agree that 11 the UN 

### 3373 on the front of the shipment in no 12 way actuallycompliedwith theprovisions that 13 you check for when you're looking for

-- when 14 you're inspecting for 173.199? 15 A 

### I do look for proper marking. 16 Yes. 17 Q 

### Okay. But that's not the proper 18 mark. 19 A 

### No. But it does have a UN 

### number 20 which is something that is on the package that 21 indicates that there's a hazardous material 22 

### inside. It is a unique transportationmarking. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 142
1 Q 

### Well, it's unlque when it has four 2 numbers after it, not when it has a number and 3 a letter after it. 4 A 

### Correct. 5 Q 

### 'Cause if it had UN 4G, 

### that would 6 

### just travel through the system, whether it had 7 

### haz in it or not; right? 8 A 

### Correct. 9 Q 

### Okay. And, in fact, there's other 10 

### UN packaging that it could have on there; 11 

### right? There are other different UN groups? 12 A 

### Sure. 13 Q 

### Right. How many are there? Do 14 

### you know? 15 A 

### I do not know. 16 Q 

### Okay. I mean, several? 17 A 

### Yes. 18 Q 

### So the only thing really

-- do any 19 of those UN spec markings for boxes or for 20 packaging, say, have more than one number and 21 

### one letter? 22 A 

### Not that I'm aware of.
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 143
1 Q 

### Okay. 2 A 

### Well, let me rephrase that. I 

### 3 would see like a UN lAl, but it wouldn't be 4 

### it wouldn't be all letters. A UN number is 5 four letters

-- four numbers after the UN. 6 Q 

### Okay. And when you refer to UN 7 number, you mean a regulated commodity that 8 has a UN number assigned to it? 9 A 

### Yes. 10 Q 

### A UN identification number. 11 A 

### Yes. 12 Q 

### So the UN specification packaging 13 numbers that we've talked about would also 14 have a number but wouldprobably only have one 15 number and one letter? 16 A 

### Correct. 17 Q 

### But UN identificationnumbers have 18 four numbers? 19 A 

### Correct. 20 Q 

### Do they all have four? 21 A 

### As far as my knowledge, yes. 22 Q 

### Okay. Might some of them have
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# •

• 144 1 three? 2 A Not that I'm aware of. 3 Q Okay. Let's move to C7, page 15 4 of 16, please. 5 A Okay. 6 Q Okay. And on that shipment as 7 well, it has the UN 3373 marked at the top. 8 A Correct. 9 Q No

-- no diamond drawn around it 10 or printed around it? 11 A No. 12 Q Okay. So it's not properly marked 13 for a UN 3373 shipment? 14 A Correct. 15 Q Okay. 16 A That's what flagged me. 17 Q You investigated this shipment as 18 well with Checker's? 19 A Yes. 20 Q Okay. And what conclusion was 21 reached about this shipment? Did it contain 22 a regulated commodity? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 145
1 A 

### It was the same as the first. 2 Q 

### Okay. So the content of the 3 second shipment marked UN 3373 at the top 4 

### identified ln C7, 

### page 15 of 16, was not 5 

### actually a regulated commodity? 6 A 

### After the investigation, I found 7 

### out that it was not. 8 Q 

### Okay. And moving on to C7, 

### page 9 

### 16 of 16, on the back portion of that 10 

### shipment, you agree it has that same language 11 

### that we referenced earlier on the first 12 

### shipment regarding "Mark this box if this 13 

### package contains UN 3373 biological 14 

### substances"? 15 A 

### Yes, I 

### do. 16 Q 

### Okay. And that one did not 17 have the shipper did not mark that box 18 either; correct? 19 A That's correct. 20 Q 

### Okay. 21 A 

### And even if they had, it would 22 

### still not be in compliance with 48 CFR NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 146
1 

### 173.199. 2 Q 

### Right. If they had marked that 3 box

-- if they had marked that box, would you 4 consider that something important ln your 5 inspection? 6 A 

### Yes. 7 Q 

### Okay. And that would be important 8 because that boxbeing checkedwouldhave been 9 a clue to FedEx that that shipment actually 10 contained a regulated substance? 11 A 

### I would have thought that the UN 12 3373 would have clued FedEx that it was a 13 regulated substance as well. 14 Q 

### I understand that. 15 A 

### Uh-huh. 16 Q 

### But you believe that if that box 17 were marked, that would be significant to a 18 carrier, any carrier basically? 19 A If they looked at 'em. 20 Q 

### Right. 21 A Yes. 22 Q 

### Okay. But ln this case, it wasn't
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•

• 147
1 

### marked? 2 A 

### That's correct. 3 Q 

### The fact that it wasn't marked 4 also carries some significance, doesn't it? 5 A 

### It still is an improperly marked 6 

### package. 7 Q 

### I understand. But the fact that 8 

### they the shipper did not mark that as 9 

### declaring it that it had a regulated substance 10 

### ln there, that bears some weight, doesn't it? 11 A 

### No, because the original marking 12 

### on the front is still not properly marked. 13 Q 

### I understand. But you consider 14 

### more than one factor when you're looking at a 15 

### shipment, don't you? 16 A 

### Yes. 17 Q 

### Okay. And so in addition to the 18 UN 3373 that's on the front part of that 19 package, you would consider that the fact that 20 the shipper did not mark this spot on the 21 

### package as something to consider in the 22 

### overall scheme of things as to whether this
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•

• 148
1 

### should have been recognized as a regulated 2 commodity? 3 A 

### It does ralse questions, which is 4 another reason why a letter of investigation 5 

### was opened. 6 Q 

### Raises questions for the

-- 7 A 

### Whether or not it was regulated. 8 Q 

### Okay. But, agaln, that's 9 

### considering the front part that had the UN 10 3373 

### on there; right? 11 A 

### Right. It was an improperly12 

### marked package. That's why it was -- it was 13 

### separated from the others. 14 Q 

### Okay. For the purposes of your 15 

### testimony here today, let's lock away the 16 

### knowledge you have of the other pictures and 17 

### just look at C7, 

### page 16 

### of 16. 18 A 

### Okay. 19 Q 

### You agree that there's no 20 indication on that side of the package that 21 

### this shipment contained anything that was 22 regulated? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 149 1 A Well, the orange writing does 2 suggest that there might be something. 3 Q So your testimony is that the fact 4 that there's a box on there that says "Mark 5 this if you're shippinga biological substance 6 Category B" indicates that anything in that 7 shipment could be haz? 8 A It makes me look at the box a 9 little bit more closely. 10 Q Right, but I'm not talking about 11 you. I'm talking about for the purposes of an 12 inspection and for looking for violations. 13 The fact that there's even that statement on 14 there that says mark if it has this in there, 15 that brings it to mean you should investigate 16 further? 17 A See, actually, I can't really 18 answer that question because when I saw it, I 19 saw the UN 3373 first. So I can't really

-- 20 Q Okay. 21 A -- answer that if it was just the 22 back. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 150
1 Q So you can't answer, sitting here 2 in court today, if you looked at C7, page 16 3 of 16, if you saw that shipment, you can't 4 tell the Court whether or not there's any 5 indication that that shipment might contain 6 dangerous goods? 7 A I would think there would be but, 8 again, I can't erase the fact that I do know 9 that the front had the UN 3373 marking on it, 10 so I can't ignore that that was on it. 11 (Pause.) 12 MS. CHANDLER-SNELL: Your Honor, 13 have an exhibit marked Rl that I would like to 14 approach 15 JUDGE GOODWIN: Sure. 16 MS. CHANDLER-SNELL: for 17 identification. 18 BY MS. CHANDLER-SNELL: 19 Q Now, I've handed you an item 20 that's marked Rl for the purposes of 21 identification. Have you ever seen an item 22 that looked similar to that? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 151
1 A Yes. 2 Q Okay. Would you agree that that's 3 a pretty good reflection of the picture we 4 were just looking at in C7, page 16 of 16? 5 A No. This 1S the front side. 6 Q Okay. Let's turn it over to the 7 back. Would you agree that that indicates a 8 pretty good representation of the item that 9 you were looking at in C7, page 16 of 16? 10 A Sure. 11 Q Okay. Now, when you see the back 12 side of Rl, do you see any indication on there 13 that should trigger further inspection as to 14 whetherit containsdangerous goods, hazardous 15 materials? 16 A Well, as an inspector, I would 17 flip it over to look at the front. I'd look 18 at the sides. I'd look to see what's going on 19 1n between 'cause it's clear here, so that's 20 what I do. 21 Q Okay. So on that exhibit that 22 I've handed you, you agree there's no NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 152 1 indication anywhere on that that exhibit 2 contains any type of hazardous materials 3 that's regulated? 4 A Not this one. No. 5 Q Okay. And you agree that the only 6 difference between this one and the one we 7 were talking about in C7, page 15 of 16 and 16 8 of 16 is the front side UN 3373 written in 9 black marker at the top? 10 A Yes. 11 Q Okay. 12 MS. CHANDLER-SNELL: Your Honor, I 13 actually will ask that this be admitted as 14 evidence probably later with someone who will 15 testify about -- 16 JUDGE GOODWIN: Okay. It's marked 17 for ID. Let me see it. I just want to look 18 at this and identify does it have a 19 FedEx -- 20 MS. CHANDLER-SNELL: I don't know. 21 We refer to it as the orange package, the 22 orange clinical pak. NEALR. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 153
1 

### THE REPORTER: Orange what? 2 

### MS. CHANDLER-SNELL: Clinical pak. 3 

### JUDGE GOODWIN: See, when you work 4 with the Government, everything has a part 5 number. 6 

### MS. CHANDLER-SNELL: Usually FedEx 7 does, too, and I would imagine there is one. 8 I don't know if it's

-- I would imagine I've 9 got a few guys in the hall who could tell me 10 what it is, but I don't think it's named on 11 here. 12 JUDGE GOODWIN: That's close 13 enough. 14 

### MS. CHANDLER-SNELL: Thank you. 15 BY MS. CHANDLER-SNELL: 16 Q 

### I'd like to turn your attention 17 now to Exhibit C8, which you indicatedearlier 18 was the letter of investigation you sent to 19 David Littlejohn at FedEx for the FedEx 20 portion of this case; is that correct? 21 A 

### Yes, it is. 22 Q 

### Okay. Now, let me take a step NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 154 

### 1 back. When you are preparing to go out in the 2 field and conduct an investigation, is there 3 a manual that the FAA uses to prepare you and 4 

### for you to reference in deciding how to do 5 your inspections and how to propose penalties 6 and that kind of thing, recommend penalties? 7 A 

### So you're saying investigation or 8 

### inspection? I'm sorry. I didn't hear what 9 you said. 10 Q 

### I'm sorry. When you are preparing 11 to do an inspection for the FAA, do you have 12 a manual that you use to prepare you to do 13 those inspections? 14 A 

### I have 2150 that I go by. 15 Q 

### Okay. And in 2150, that is a 16 rather large manual; right? 17 A 

### Yes. 18 Q 

### And a portion of that has been 19 entered as an exhibit, the portion that deals 20 with Appendix C, Sanction Guidance. 21 A 

### Correct. 22 Q 

### C15; right? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 155
1 A 

### Vh-huh. 2 Q 

### Okay. Now, I know it's a big 3 manual, but you're pretty familiar with the 4 

### whole thingi right? 5 A 

### Not the entire thing, but it's 6 

### like reading the Bible. You have to keep 7 

### referencing it. 8 Q 

### Right. And so anytime you have a 9 

### question, you go back to that field

-- is it 10 called a field manual? 11 A 

### Oh, no. That's the FAA Order 12 2150. We also have the hazmat regulations in 13 49 

### CFR that we refer to. 14 Q 

### Okay. But when you have questions 15 about what your Agency requirements are, you 16 go to 2150? 17 A 

### That's it has the general 18 things that are set out for us. Yes. 19 Q 

### And that actually has the Sanction 20 Guidance in therei right? 21 A 

### Yes. 22 Q 

### And then it has other things

-- NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# • 156 1 other general things about the way you're 2 supposed to conduct your business? 3 A Yes. 4 Q Okay. And you will agree that in 5 that manual, it states that the FAA's central 6 mission is to promote safety; is that right? 7 A That's correct. 8 Q Okay. And that's well-known to 9 you and every other agent, whether it's 10 written in the manual or not -- that's sort of 11 your mission; right? 12 A That is. Yes. 13 Q Okay. In 2150, it also calls for 14 the Agency and its agents to exercise fairness 15 and reasonableness, doesn't it? 16 A Oh, absolutely. 17 Q Okay. It requires you to be 18 timely in your investigations, doesn't it? 19 A Yes. 20 Q And it requlres the Agency at 21 large, everyone in the FAA, to respond to 22 inquiries and things that matter to safety in
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•

• 157
1 a timely manner? 2 A Yes. 3 Q Okay. Now, the standard for 4 timeliness canvary, depending on what what 5 you're having to do; right? 6 A Right. 7 Q Okay. But you'll agree that 8 timeliness 1n responding, particularly if 9 safety 1S important, if safety is at issue, 10 the timeliness

-- it means quick; right? 11 A Yes. 12 Q It means you do it as quickly as 13 you can. You respond to -- whether it's an 14 inquiry, an investigation, a violated 15 procedure, if it matters for safety, then it 16 rises to the top of your list of things to do? 17 MR. LOMAZOW: Objection, Your 18 Honor. 19 THE WITNESS: Yes. 20 MR. LOMAZOW: That's going to 21 depend on a case-by-case basis. We're making 22 a generalization as to any investigation but, NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 158
1 

### once again, that's gOlng to depend on what 2 exact circumstances of what particular case 3 

### you are referring to, what particular 4 investigation you're referring to. 5 

### MS. CHANDLER-SNELL: Your Honor, I 6 

### think

-- 7 

### JUDGE GOODWIN: Overruled. 8 

### MS. CHANDLER-SNELL: Thank you, 9 

### Your Honor. 10 

### BY MS. CHANDLER-SNELL: 11 Q 

### You were nodding your head. Did 12 

### you answer yes to that last question? 13 A 

### I did. Yes. 14 Q 

### Okay. In 2150, 

### it says that -- it 15 

### talks about FAA 

### investigative personnel. I'm 16 

### not sure if I put the emphasis right on that 17 

### word. But are you familiar with that phrase, 18 

### "investigative personnel"? 19 A 

### Yes. 20 Q 

### Is it investigative or 21 

### investigative? 22 A I 

### like to use the word
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•

• 159
1 

### investigatory, but I know that's not really a 2 word. 3 Q 

### Okay. Well, we'll use those three 4 interchangeably for the purposes of this, 5 

### regardless of the accent on which syllable. 6 

### You agree that 2150 says that the 7 FAA investigatory or investigative personnel 8 

### recommend initially the appropriate type of 9 

### response to address a violation? 10 A 

### We are - - we are the inspectors 11 

### who go out, but then we do come back and 12 discuss with our supervisors, so 13 Q 

### Okay. Well, so does the 14 investigative personnel, does that include 15 inspectors and supervisors? Is that sort of 16 a -- 17 A 

### Oh, absolutely. 18 Q 

### -- grouping? 19 A 

### 'Cause they are investigators as 20 well. 21 Q 

### Okay. And

-- and I should have 22 known

-- in 2150, I think it probably has a NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 160
1 

### definition that you've sort of described 2 

### there. Do you agree that FAA investigative 3 

### personnel means inspectors, special agents, 4 aviation safetytechnicians, and anyotherFAA 5 

### personnel who conduct regulatory enforcement 6 

### investigations? 7 A 

### Yes. 8 Q 

### All right. So it's kind of a 9 

### broad way to encompass everyone who goes out 10 

### and does investigations or makes 11 

### recommendations prior to it going to the

- - to 12 

### Counsel's Office? 13 A 

### Yes. We have a big agency. 14 Q 

### Okay. All right. And the 15 

### investigative personnel are the ones who 16 

### recommend initially the appropriate type of 17 

### response to address a violation, according to 18 2150. 19 A 

### Can you repeat that again for me, 20 

### please? 21 Q 

### Okay. And I 

### may try to rephrase 22 

### it. According to 2150, 

### the investigative NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 161 

### 1 personnel are the ones who initiallyrecommend 2 the appropriate type of response for any 3 violation they find? 4 A 

### We do have some some leeway, 5 but we do have some direction from our 6 supervisors. 7 Q 

### Okay. Well, when they say the 8 "appropriate type of response" there, do you 9 agree with me that when you're deciding an 10 appropriate type of response, you're deciding 11 warning letter or no warning letter or 12 

### proposing a civil penalty? Are those the 13 

### responses you do in response to your 14 investigation? 15 A 

### Those are -- that's all part of an 16 enforcement decision process that we use. 17 And, 

### actually, when we go through that 18 process, that helps us to decide what is the 19 appropriate action to take

-- 20 Q 

### Okay. 21 A 

### -- to end the investigation. 22 Q 

### Well, but you would agree, NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 162 

### 1 wouldn't you, that a warning letter is 2 different than a legal enforcement action; 3 right? 4 A 

### Sure. 5 Q 

### Okay. 6 A 

### Sure. 7 Q 

### If only a if only a warning 8 letter is issued, do youmake that decision or 9 do you andyour supervisormake that decision, 10 or do you always have to consult counsel 11 before coming to a determination? 12 A 

### For a warnlng letter? warning 13 letters, that's from the supervisor and the 14 enforcement decision process that we use. 15 Q 

### Okay. So basically with a warning 16 letter, it's resolved before you get to the 17 legal enforcement action? 18 A 

### It actually does not go to our 19 legal counsel if it is a warning notice. 20 Q 

### Okay. And part of that is because 21 there's no sanction involved with a warning 22 letter; right? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com163 1 A Actually, there would be a 2 sanction. 3 Q To clarify then, you can issue a 4 warning letter and have a monetary sanction 5 attached to that? 6 A Not a sanction, but there would be 7 a violation associated with it. So In our 8 record, it would show the violator and it 9 would show what the violation was of. So it 10 would have the list of the violations that 11 were regulated. 12 Is that what you're asking? 13 Q Yes. I think that so, to 14 clarify, you have a warning letter and that 15 may say -- it mayor may not -- well, it would 16 say. Okay. Strike all of that. 17 You have a warning letter and it 18 says a violation occurred of X provision. 19 A Correct. 20 Q But a warnlng letter can never 21 have a monetary penalty attached. 22 A It does not. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 164
1 Q Okay. If it goes to legal 2 enforcement, then you end up -- well, that's 3 the time you basically turn it over to counsel 4 and your involvement becomes more as a witness 5 and less as a decisionmaker? 6 A There actually, I tend to 7 follow my cases till they're completely done. 8 Q Okay. So you continue then to 9 have input as to what sanction would be 10 allowed, what monetaryamount wouldbe settled 11 for, that kind of thing? 12 A I give a general recommendation at 13 the beginning. 14 Q Okay. You give a general 15 recommendation at the beginning when you turn 16 it over to legal, but do you continue to 17 advise anddetermine what's appropriate for 18 A Not on the sanction, no. 19 Q Okay. Not on the sanction amount. 20 A No. 21 Q You give an initial recommendation 22 and then your role as a participant is cut NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 165 

### 1 back? 2 A 

### As far as that, yes. 3 Q 

### Okay. Now, if you determine that 4 either no violation occurred or that a 5 violation occurred and a warning letter is 6 sufficient, you can do that without going 7 anywhere past your supervisor who at the time 8 was Mr. Kenny? 9 A 

### Correct. 10 Q 

### Okay. But you agree that the 11 investigation you did of FedEx and of 12 

### CorporateAir in this case was not resolved at 13 that level and it was sent on for

-- 14 A 

### That's correct. 15 Q 

### -- legal enforcement? Okay. 16 A 

### 'Cause the violations were still 17 occurring. 18 Q 

### You say the violations were still 19 occurrlng. Did you go back out and look? 20 A 

### Oh, I still go out and look. Yes. 21 Q 

### But you don't cite? 22 A 

### I'm waiting to find out what's
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•

• 166 

### 1 going on with this case here. 2 Q 

### Okay. So you agree you've been 3 put on notice by FedEx and you have personal 4 knowledge that UN 3373 shipments are still 5 

### traveling every day on aircraft under 6 CorporateAir's flight certificateandFedEx's 7 flight certificate that are not inspected and 8 are citeable offenses? 9 A 

### I agree. 10 Q 

### Okay. Have you ever performed an 11 audit where you saw UN 3373 shipments that 12 were not in compliance for other carriers? 13 A 

### Yes. 14 Q 

### Okay. Have you cited those 15 carriers for those? 16 A 

### Yes. 17 Q 

### Okay. And are those cases still 18 pending? 19 A No. 20 Q 

### Were those cases dismissed or 21 settled as a violation? 22 

### MR. LOMAZOW: Objection, Your
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• 167 

### 1 Honor. Those other cases have nothing to do 2 with this case at hand. 3 

### JUDGE GOODWIN: Sustained. 4 (Pause.) 5 BY MS. CHANDLER-SNELL: 6 Q 

### For the

-- for any carriers other 7 than FedEx and Corporate Air, have you seen 8 violations since this case began? 9 

### MR. LOMAZOW: Objection, Your 10 

### Honor. We're not talking about other 11 carriers. We're talking about FedEx and 12 Corporate Air for this particular case. 13 

### MS. CHANDLER-SNELL: Your Honor, 14 and I'll explain the reason why I think it's 15 significant

-- is, first of all, we've heard 16 Agent Lusching

-- Luscher, Lusching 17 

### THE WITNESS: Luscher. 18 

### MS. CHANDLER-SNELL: testify 19 that CorporateAir's response intheir follow20 up was not sufficient and that FedEx's 21 response In their follow-up was not above and 22 beyond. So I think it is relevant then what NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 168 

### 1 other carriers have done on this issue for 2 their follow-up that might be seen as 3 significant because the things we've done 4 

### haven't. 5 

### In addition, I 

### think it's 6 important to know whether the FAA is aware of 7 continuing violations not onlywithin FedEx's 8 system and Corporate Air's system, but in 9 other systems where these shipments are not 10 being inspected and they decided not to cite. 11 I think it goes to the argument that I believe 12 they're putting forth, which is that this is 13 a safety concern. 14 

### JUDGE GOODWIN: Yeah, but doesn't 15 the FAA have prosecutorial discretion? 16 MS. 

### CHANDLER-SNELL: I think 17 they

-- 18 

### JUDGE GOODWIN: If three people 19 rob three different banks and the state's 20 attorney decides to prosecute one, why isn't 21 it fair to prosecute the other two defendants 22 to the first person? NEAL R. GROSS (202) 2344433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 169
1 

### MS. CHANDLER-SNELL: Your Honor, I 2 think it goes to the credibility of their 3 testimony that these are safety risks. And I 4 

### think that, ln addition, that it goes to -- I 5 

### don't think I asked

-- and, if I did, I don't 6 

### think I meant to -- whether they were being 7 

### cited. I asked whether they had changed the 8 

### way they were handling and whether they were 9 

### recurring. So I will - - I will acknowledge or 10 

### I'11 

### withdraw the question about whether they 11 

### were cited, but I would like to explore 12 

### whether in response to any inquiry from the 13 FAA 

### they have changed the way they handle 14 

### these shipments. 15 

### And I would also like to clarify 16 

### whether they have continued to be inquired 17 

### about and followed up on. 18 

### MR. LOMAZOW: Judge, if I may, 19 

### once agaln I will object. I'll use the 20 

### robbing the bank metaphor. Here, the only 21 

### question is was there a violation on this 22 particular date. Did they violate 49 CFR NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 170 

### 1 173.199 and were the regulations citedor not? 2 What's going on with other air carriers 3 regarding other inspections is not relevant. 4 The only thing that should be at issue here is 5 the violation that was on -- that was at issue 6 on May 12th, 2008 and May 16th, 2008. 7 

### MS. CHANDLER-SNELL: Well, and, 8 Your Honor, yes, there's the question of 9 whether a violation occurred or not, but 10 there's also the question of mitigating 11 circumstances, which is part of or 12 mitigating remedial actions, remedial measures 13 taken afterwards, which the 

### FAA has already 14 argued we didn't do or we didn't do enough of. 15 

### So I 

### think that goes to the 16 credibility and the weight of whether these 17 are real violations and of paramount concern 18 to safety. Because if they're not dangerous 19 on some other airline, I 

### think we have the 20 reason to know why they're a danger in this 21 situation and not in others. 22 And then, In addition, I 

### think
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# • 22 171 that it is of concern and a matter of public policy whether the follow-up for one carrier is the same or similar to the follow-up on another carrler. I mean, that goes to the robbing the bank, Your Honor. If otherpeople are being around to rob a bank and the law is not being enforced, then I do think that that's a valid reason to pursue why this matter is different from those matters. JUDGE GOODWIN: I don't think that lS. I believe that comes under the area of prosecutorial discretion. There may be an argument on mitigation if two carriers are treated differently. But a lot of the other is I think just speculative testimony. If I were to find a violation and assess a fine, while the SanctionGuidance is advisory to the Court and I'm not bound by it, an argument couldbe made that, in a similar circumstance, 

## x fine was applied and that would

- - shouldbe applied in this case or not applied. From that standpoint, the
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• 172 

### 1 testimony I think is relevant, but I think 2 whether or not they've gone after Carrier A 3 

### for similar violations that are before me 4 

### here, I 

### think that comes within the normal 5 

### prosecutorial discretion, and I 

### don't think 6 

### that the Court has the power to inquire into 7 

### a discretionary

- - in that part of discretion. 8 

### It's from the public policy 9 standpoint, we might not agree with it, but 10 the practicality is that this system -- this 11 enforcement systemand the criminal systemare 12 not perfect and the prosecutor the FAA 13 enforcement attorney is equivalent of a 14 prosecutor -- and they have some discretion 15 and theymay choose to go after one carrier or 16 not, and I don't think it's the province of 1 7 the Court to inquire as to why they did 18 

### something, you know tried to enforce 19 take an enforcement action in this case and 20 not another one. 21 I think if there's a disparity in 22 treatment, that's a mitigation argument and NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 174
1 

### MR. LOMAZOW: Your Honor, I would 2 be all for a five-minute break. 3 

### JUDGE GOODWIN: Okay. Sounds to 4 me like the vote is a five-minute break. 5 

### MS. CHANDLER-SNELL: Thank you, 6 Your Honor. 7 

### JUDGE GOODWIN: So we'll take a 8 five-minute break. Again, my same admonition 9 to the witness. 10 THE WITNESS: Gotcha. 11 

### (Whereupon, at 1:56 p.m. off the 12 record until 2:13 p.m.) 13 JUDGE GOODWIN: Back on the 14 record. The witness is still under oath. 15 BY MS. CHANDLER-SNELL: 16 Q 

### Agent, I'd like to go back to 17 2150. I think we already established you're 18 familiar with it. It's a large document, that 19 

### you're generally familiar with the 20 requirements. 21 Are you familiar then also with 22 the fact that in 2150, it addresses the need
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### 1 for cooperation between agencies? 2 

### MR. LOMAZOW: Objection, Your 3 Honor. This has nothing to do with this case. 4 

### MS. CHANDLER-SNELL: Your Honor, I 5 think that that's

-- first of all, I think 6 that

-- 7 

### JUDGE GOODWIN: Restate your 8 question. 9 BY MS. CHANDLER-SNELL: 10 Q 

### Are you familiar with the fact 11 that ln 2150, the manual addresses the need 12 for cooperation between agencies? 13 

### JUDGE GOODWIN: Overruled. 14 BY MS. CHANDLER-SNELL: 15 Q 

### Are you familiar with that? 16 A 

### Which agencies are you referring 17 to? 18 Q 

### In the manual, I believe it 19 references the Department of Transportation 20 and the cooperation between agencies in the 21 Department of Transportation. 22 A 

### Okay. Yes. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 176
1 Q 

### Okay. And 

### do you have 2 interactions with the people in the other 3 agencies? 4 A 

### Not usually. 5 Q 

### Okay. Well, in some of your 6 outreach that you talked about earlier that's 7 part of your position, do you attend maybe 8 semlnars or conferences wheremembers of other 9 agencies are present? 10 A 

### Yes, I do. 11 

### MR. LOMAZOW: Objection, Your 12 Honor. What does this have to do with the 13 violations at issue in this case? 14 

### JUDGE GOODWIN: Overruled. 15 

### THE WITNESS: Yes. PHMSA puts on 16 a seminar on occasion and I do attend those. 17 BY MS. CHANDLER-SNELL: 18 Q 

### Okay. As part of your public 19 

### outreach also, you mentioned I 

### think 20 involvement with others inthe industry, other 21 carrlers, manufacturers probably sometimes, 22 people like that? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 177
1 A Yes. 2 Q Okay. If you will look at Exhibit 3 C8. That lS your letter of investigation to 4 FedEx in this case. In your letter of 5 investigation, you include the sections of 49 6 CFR that you believe have been violated or 7 that you believe you've found violations in; 8 is that correct? 9 A Correct. Those are preliminary. 10 Yes. 11 Q Okay. And then in the course of 12 your investigation

-- and, actually, when an 13 entity responds, they're looking at the 14 violations you put out in your letter of 15 investigation and they're responding to those 16 as written; correct? 17 A Correct. 18 Q Okay. Now, in the letter of 19 investigation to FedEx, you reference 175.3, 20 175.30(a) (3), 175.33(a), and 175. 501(a) ; 21 correct? 22 A Correct. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 178
1 Q 

### All right. Are you familiar with 2 the complaint that was filed against FedEx in 3 the case we're here today on? 4 A 

### Yes. 5 Q 

### Okay. And in the official court 6 document, are you aware that the provisions 7 that were cited to FedEx are not consistent -- 8 

### I shouldn't say consistent they're not 9 exactly the ones you reference. Did you know 10 that? 11 A 

### Correct. Yes. May I comment on 12 that? 13 Q 

### Yes. 14 A 

### On page two of the same exhibit, 15 if you look down at the very bottom of the 16 page, it says, "Please be advised that the 17 

### allegation contained herein does not 18 necessarily include all deficiencies that may 19 be subsequently discovered during the course 20 of this investigation," so it does allow a 21 little flexibility there. 22 Q 

### Okay. So then according to that
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• 179 

### 1 Exhibit C8, 

### anything that wasn't listed there 2 on the front page would have been something 3 that was subsequently discovered during the 4 course of your investigation; right? 5 A 

### Yes. 6 Q 

### Something that wasn't immediately 7 available to you at the time you did the 8 initial inspection? 9 A 

### Right. So these were preliminary. 10 Q 

### Okay. Now, do you make the final 11 determination as to what's included in the 12 

### complaint or does that

- - is that reserved for 13 counsel? 14 A 

### That's counsel. 15 Q 

### Okay. In looking at the 16 provisions that you listed in your letter of 17 investigation, it's clear to me that 18 175.501(a) was for the shipment that had an 19 oxidizer label on it. 20 A 

### That's correct. 21 Q 

### Is that right? Okay. Now, in 22 going back to the top of that, in 175.3, NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 180 

### 1 accepting a 

### hazardous material for 2 transportationnotpreparedinaccordancewith 3 Subchapter C, which of the shipments were you 4 meaning that to apply to when you raised that 5 provision? 6 A 

### All three of 'em. 7 Q 

### Okay. And when you referenced 8 theretheacceptinghazardousmaterialpackage 9 for transportation, you're talking about the 10 initial inspection performed by the FedEx 11 dangerous goods specialist; correct? 12 A 

### Both the pre1iminary and the final 13 inspection by the specialist. 14 Q 

### Well, and let's

-- okay. Let's 15 talk about that for a second. Let's go back 16 to Exhibit C5. And when you talk about the 17 preliminaryandthenthe secondaryinspection, 18 you are referencing C5 which is FedEx Express 19 DG Manual for Inspecting Dangerous Goods. Is 20 that right? 21 A 

### That's right. 22 Q 

### Okay. And you'll agree, though,
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• 181 1 

### won't you that this is FedEx's way that FedEx 2 

### does the acceptance, the primary and 3 secondary. That's not a requirement under CFR 4 anywhere; right? 5 A 

### There 1S a requirement for a 6 inspection, yes. 7 Q 

### Okay. So an inspection. But when 8 we talk about primary and secondary, those 9 words aren't actually listed in CFR at all. 10 A 

### That's correct. 11 Q 

### Okay. In fact, that goes about 12 

### I'd venture to say beyond what CFR requires 13 

### 'cause we're saying inspection inspection and 14 

### CFR says inspection. 15 A 

### If that were actually happening, 16 

### yes. 17 Q 

### Okay. So you're not at all trying 18 

### to say that it didn't work the first time, 19 

### didn't work the second time. You're just 20 say1ng it wasn't inspected according to the 21 

### regulations in your opinion? 22 A 

### Yeah. I'm saying that all three
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• 182 1 

### of them were not -- were not inspected. 2 Q 

### Okay. So you would agree having a 3 

### preliminary inspection and a secondary 4 inspection is better than just having one; 5 

### right? 6 A 

### Yes. 7 Q 

### Okay. And even though it's not 8 

### required by law, that's what it says in FedEx 9 

### policy and procedure, in our manual; right? 10 A 

### Correct. 11 Q 

### Okay. Okay. Now, your 12 

### understanding of this shipment as well is that 13 it was inspected by FedEx DG specialists, or 14 not inspected, in your case. You're saying it 15 was not inspected by a specialist and FedEx 16 put it on Corporate Air's aircraft; is that 17 right? 18 A 

### Which one are we talking about? 19 Which shipment. 20 Q 

### All three of 'em. 21 A 

### All three of 'em? Yes. I know 22 

### that the DG specialists do not look at the NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 183
1 

### items in the clinical pak, the UN 3373s, but 2 

### they do would normally look at a 5.1. 3 Q 

### Okay. And you know that FedEx DG 

### 4 specialists don't do that because FedEx told 5 you they don't train to do that; right? 6 A 

### They don't train to do what? 7 Q 

### To inspect the 3373 shipments when 8 they come In. 9 A 

### That's correct. 10 Q 

### Okay. And I think you made the 11 statement for both FedEx's mitigation and 12 

### CorporateAir'smitigationthat theydidn't do 13 anything that wasn't required by 49 CFR; is 14 that right? 15 A 

### Right. 16 Q 

### Okay. Now, tell me -- do you know 17 what provisionyou're referencingwhenyou say 18 they didn't do anything more than what was 19 required by 49 CFR? 20 A 

### I'm sorry? 21 Q 

### What specific provision ln 49 CFR 22 

### are you looking at to see if they did just NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 184 

### 1 what was required for mitigation or if they 2 went above and beyond? 3 A 

### I don't understand your question. 4 I'm sorry. 5 Q 

### Okay. In your testimony about 6 

### FedEx's response to your letter of 7 investigation, I believe the FAA attorney had 8 asked you what they did to follow up; 9 basically, what remedial measures were taken, 10 what mitigating factors are there. 11 A 

### Right. They retrained. 12 Q 

### And your response was that's 13 nothing more than what's required under 49 14 CFR. 15 A 

### Right. 16 Q 

### Okay. Where

-- what provision in 17 49 CFR deals with remedial measures or 18 mitigation? 19 A 

### I would not know

-- do not know. 20 Q 

### Okay. When you said that, were 21 you just saying that training is part of the 22 requirement anyway? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 185
1 A 

### Yes. 2 Q 

### But you'll agree that retraining 3 before your initial training is due is not 4 

### required by 49 

### CFR? 5 A 

### Correct. 6 Q 

### Okay. So the fact that FedEx 7 

### retrained their personnel involved, that 8 

### actually is going above and beyond what's 9 

### required by 49 

### CFR, isn't it? 10 A 

### If you want to say it is. 11 Q 

### No. I'm asking you. 12 A 

### I don't I don't see it. If 13 somebody didn't have the knowledge of those 14 regulations that they're supposed to have 15 knowledge of and then theyhad to be retrained 16 on 'em because there was an issue, to me, I 17 

### don't think that that's mitigating. That's 18 just my opinion. 19 Q 

### Well, let me ask you: If FedEx 20 hadn't retrained those employees, would you 21 have cited them for those employees not being 22 

### trained? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 186
1 A No. 2 Q 

### Okay. Because they already 3 complied with 49 CFR. 4 A 

### Correct. 5 Q 

### Okay. So the retraining

-- before 6 the retraining was due was not required under 7 49 CFR? 8 A 

### Correct. 9 Q 

### Okay. It's good practice. 10 A 

### Sure. 11 Q 

### Let's look at David Littlejohn's 12 response in C9. And I believe do you 13 recall what you testified when the FAA 14 attorney asked you what FedEx did to follow up 15 on both of these shipments? 16 A 

### Yes, that the with the 5.1, 17 that actually they had admitted that the 18 couriermistakenlydidn'tbringthepackage to 19 the attention of the DG specialist, that they 20 did retrain, and then they also counseled two 21 other employees regarding internal policy. 22 Q 

### Okay. Please go to the second
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• 187 

### 1 paragraph of David Littlejohn's letter. 2 A 

### Okay. 3 Q 

### Okay. And you also said there: 4 

### "BZN management held a safety 5 

### meeting with all employees as a 6 

### result of this error." 7 

### Right? 8 A 

### I'm sorry. The second paragraph 9 or the third paragraph? 10 Q 

### Second. "BZN management" 11 that's how it begins

-- "BZN management" 12 

### I'm sorry, third. 13 A 

### Oh, the third. Okay. Sorry. 14 Q 

### There's a short one at the front. 15 A 

### Okay. I'm sorry. Okay. 16 

### "BZN management held a safety 17 

### meeting with all employees as a 18 

### result of this acceptance error." 19 

### Okay. 20 Q 

### Okay. So that's something that 21 

### you didn't include initially; right? when 22 

### you testified for in response to Mr. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 188
1 Lomazow's question? 2 A No, I did not. 3 Q Okay. So there was a station 4 meeting with all employees, not just DG 5 employees

-- all employees; right? 6 A Right. 7 Q Okay. Then we say, "Proper 8 handling and the proper procedures for 9 acceptance were addressed in the meeting," so 10 that tells the substance of that meeting. 11 Then it says, "All employees were 12 issued a memo outlining the importance of 13 proper DG acceptance." 14 Now, you didn't testify to that 15 when you were asked the question earlier 16 either, did you? 17 A No. 18 Q Okay. "Each employee was provided 19 and directed to review our internal FAA20 approved DG Handling Job Aid to assist In 21 preventing further acceptance issues of this 22 type." NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 189
1 

### Right? That's one more thing? 2 A 

### Okay. 3 Q 

### "In addition, ourDG International 4 Analysts (IDGA) for this area conducted an 5 audit at this location on 5/19/08." So that's 6 

### another meeting and a visit from an internal 7 

### FedEx person; right? 8 A 

### Okay. 9 Q 

### Okay. 10 "Theproperprocedures for pick-up 11 

### and inspection and acceptance of DG shipments 12 

### were reviewed." 13 

### Okay. So that's a 

### further 14 meeting; right? 15 A 

### I can't say that that was a 16 further meeting, but I do see there's talk 17 about it. 18 Q 

### Okay. Well, so ln addition to 19 what you testified to on direct with the FAA 20 attorney, there was a station meeting for all 21 

### employees of the entire station. There was a 22 

### memo issued to all employees. There was a NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 190 1 follow-up with giving all employees the DG 2 Handling Job Aid. And there was a visit by 3 our FedEx DG International Analyst, the IDGA 4 for that area, who had an audit of the 5 location to look for further errors; right? 6 A Okay. 7 Q All right. Any of that required 8 by 49 CFR? 9 A No. 10 Q Okay. So would you agree that 11 goes above and beyond what's required by 49 12 CFR? 13 A Sure. 14 Q Okay. And then look at the next 15 paragraph, which would be the fourth

-- I can 16 count this time. David Littlejohn says he 17 personally contacted the shipper and spoke 18 with Shayla Cox. Right? 19 A Uh-huh. Yes. 20 Q And he informed her of the error 21 and discussed it with her, that he determined 22 that the material was not actually regulated, NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 191 1 that the MSDS was provided to us to confirm 2 that it wasn't regulated, and then David gave 3 her Mr. Littlejohn gave her additional 4 information about public dangerous goods 5 seminars andprovidedhis telephone number for 6 future assistance, if needed. 7 Okay. And, of course, that's not 8 required in 49 CFR. 9 Now, look on the second page of 10 C9, the second paragraph that begins, 11 "Concerning the UN 3373 shipment." 12 A Okay. 13 Q About the middle of that 14 paragraph, Mr. Littlejohn writes: 15 "The shipper was also contacted by 16 our IDGA to review proper 17 procedures when offering this item 18 for air transportation." 19 Okay. So that's another measure 20 that was taken; right? 21 A Okay. 22 Q Is "okay" in indicating "okay, " NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 192 

### 1 you're agreeing; correct? 2 A 

### I'm just agreeing with what you're 3 

### saying that, yeah, they did take they 4 contacted

-- they contacted the shipper. 5 Q 

### Do you agree that that's another 6 remedial measure taken to address this issue? 7 A I 

### think it's good business 8 practice. 9 Q 

### Do you agree that it's another 10 remedial measure to address this issue? 11 A 

### Sure. 12 Q 

### Okay. And then go down to the

-- 13 on that page, the secondpage of C9, paragraph 14 three, now that's where FedEx talks about its 15 website which you did reference in the initial 16 testimony earlier with the FAA attorney. 17 A 

### Correct. 18 Q 

### If you'll go down further on 19 there, it says: 20 

### "In addition, we are ln the 21 

### process of changing our clinical 22 

### pak for those shipments that may NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com193
1 need to use this source because of 2 the size of their outer packaging. 3 The updated pak has been approved 4 by your FAA Washington, D.C. 5 office and we hope to make this 6 available to shippers in about 60 7 days. A copy was forwarded to 8 your manager, Thomas L. Kenny, on 9 May 21st of 2008.

### " 10 Correct? 11 A That's what it says. Yes. 12 Q Okay. Well, and as far as you 13 know, that actually happened, didn't it? 14 A I'm not sure if it was made 15 available to shippers, but I

-- I have seen 16 the package. Yes. 17 Q Okay. Do you know about or did 18 you inquire about anyconversations that FedEx 19 had with the FAA in Washington, D.C.? 20 A No. I just had heard about it 21 through Thomas Kenny. 22 Q Okay. And you do know then that
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• 194 

### 1 Mr. Kenny received a copy of the clinical pak, 2 the new one that was updated according to this 3 letter? 4 A 

### Yes. Yes. 5 Q 

### Okay. 6 A 

### It's sitting on my desk. 7 Q 

### All right. So all of those are 8 additional measures that weren't addressed in 9 

### response to your question what did FedEx do to 10 address the issues you cited them for? 11 A 

### Okay. 12 Q 

### Okay. Now, let's go to Exhibit 13 C11. Inyour testimonyon direct examination, 14 when asked what activities or what steps 15 Corporate Air took to address the violations, 16 I believe that you said that they did not 17 follow up; is that right? 18 A 

### I didn't say that they did not 19 

### follow up. I just said that there were no 20 corrective actions. 21 Q 

### Okay. Now, first of all, I think 22 one of those

-- one of the times that the FAA NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 195 

### 1 attorney asked you that, he asked in response 2 to the UN 3373 clinical paks was any follow-up 3 offered, and you said no. 4 

### Turn back to Exhibit CI0. Now, 5 you agree that nowhere

-- I'm sorry -- okay. 6 You agree that nowhere in CI0 do you list 7 173.199 as a potential violation; correct? 8 A 

### I do point out there are two 9 improperly-marked packages, but I do not cite 10 173.199. No. 11 Q 

### Right. So in the provisions of 12 Section 49 CFR that you actually cite or 13 provide to Corporate Air saying, These are the 14 violations at this point we think you may 15 have, they're not put on notice by that, that 16 there's any 173.199 violations, are they? 17 A 

### Right. But keep in mind that the 18 investigation does not show all violations. 19 Q 

### Right. But at that point, you 20 knew there was a problem with the UN 3373 21 'cause you 22 MR. LOMAZOW: Objection, Your
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• 196 1 Honor. There's alreadybeen testimony this is 2 a preliminary

-- this is a preliminary letter 3 indicating that the charges might change in 4 the future. 5 MS. CHANDLER-SNELL: Your Honor, 6 I'm

-- 7 JUDGE GOODWIN: Overruled. 8 MS. CHANDLER-SNELL: Thank you. 9 BY MS. CHANDLER-SNELL: 10 Q On page two of CI0, you say that 11 there's Category B UN 3353 that had been 12 accepted and transported for alr

-- it says 13 accepted and transported for 14 transportationandyouprovide thosepictures. 15 A Yes. 16 Q So you reference UN 3373. But if 17 you go back to the first page, you agree that 18 what you cited them under didn't actually 19 reference Category B infectious substances 20 173.199; right? 21 A Right. 22 Q So

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•

• 197
1 

### JUDGE GOODWIN: You know, the 2 problem with that chart blown up, it's like 3 

### reading an eye chart. I can see 49 CFR. 4 

### MS. CHANDLER-SNELL: And I will 5 

### move it up if I'm going to actually use it for 6 

### demonstrative purposes, Your Honor. I -- 7 

### JUDGE GOODWIN: Which reminds me 8 

### of what somebody said the other day, that her 9 

### motherpassed the exambecause when the doctor 10 

### left the room, she memorized the chart. I 11 

### have no intention of memorizing that one. 12 

### MS. CHANDLER-SNELL: Unfort13 unately, you may be the only one in the room 14 who doesn't have it memorized, Your Honor, at 15 this point. 16 

### MR. LOMAZOW: If it helps, just 17 for the record

-- I mean, if it helps, this is 18 an exhibit. 19 

### THE WITNESS: It 1S 

### an exhibit. 20 

### MR. LOMAZOW: It 1S 

### an exhibit. 21 

### JUDGE GOODWIN: When we break for 22 the day, you can put it

-- since we don't have NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 198 1 

### a jury box, you can put it over in the Jury 2 box or you can put it over here, whatever you 3 two agree on. 4 

### MS. CHANDLER-SNELL: Yes, Your 5 

### Honor. I'll do that. We can move it closer. 6 

### JUDGE GOODWIN: Like I said, I can 7 

### see a diamond and I can see 49 

### CFR and that's 8 

### it. 9 

### MS. CHANDLER-SNELL: Well, we 10 

### won't quiz you on it now and I may point to it 11 

### but just for reference purposes. It won't 12 

### need to be in the record. 13 

### BY MS. CHANDLER-SNELL: 14 Q 

### Now, Agent, ln Cll, the response 15 

### of Corporate Air to your letter of 16 investigation, if you look atparagraphthree, 17 Mr. McIver actually says the following is a 18 response to each specific violation, each 19 specific regulation cited in the letter of 20 investigation, doesn't he? 21 A 

### Yes. 22 Q 

### So that shows or demonstrates, NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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• 199 

### 1 doesn't it, that he addressed the provisions 2 

### that were listed in your letter of 3 investigation; correct? 4 A It shows that he did address those 5 back to me. Yes. 6 Q 

### Okay. And so there's no Section 7 173.199 in his response that addresses those 8 shipments, but there's alsono Section 173.199 9 

### in your letter of investigation that 10 references the shipments; right? 11 A 

### Correct. 12 Q 

### Okay. At the bottom of page two 13 of CI0

-- or Cll, I'm sorry -- bottom of page 14 two, Mr. McIver writes: 15 

### "In speaking with a 

### field 16 

### administrator for FedEx, the 17 station from which these packages 18 originated has been notified and 19 is taking corrective actions." 20 So this conversation with FedEx in 21 some respects could be seen as the next step 22 

### in trying to get these fixed; right? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 200 

### 1 A 

### Okay. 2 Q 

### Well, I'm asking the question, so 3 1S 

### that agreement yes? 4 A 

### Well, I see that they they 5 notified the field administrator of FedEx. 6 Q 

### Okay. 7 A 

### And that they say they're taking 8 corrective actions, but it doesn't list what 9 corrective actions. 10 Q 

### Well, let's talk about that. 11 Prior to that, in Mr. McIver's letter, he has 12 

### said that the package packages are 13 processedbyFedEx onbehalf of CorporateAiri 

### 14 right? 15 A 

### Correct. 16 Q 

### He says that FedEx is responsible 17 for putting in the paperwork for the pilot 18 notification, for example. 19 A 

### Right. 20 Q 

### And he explains that the

-- 21 

### "Corporate Air reIies on FedEx for 22 

### the initial acceptanceprocessing, NEAL R. GROSS (202) 234-4433 COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 

# • 12 13 14 15 16 17 18 19 20 21 22 201 correct labeling, proper delivery of hazardous material pieces to the aircraft, and notification paperwork." So he's telling you that FedEx is responsible for these activities onourbehalf and, in response to this letter, I have followed up with FedEx who tells me they're looking at it from their side and the station has been notified and it's taking corrective actions; right? A Right. Q Okay. Then he says: "On the Corporate Air side, we will continue to monitor our crews in the field regarding" -- now go to page three of C11 "the loading process, the identification of hazardous material shipments and the proper procedures for handling these items. We have also tasked the NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 202
1 Director of Safety to conduct 2 periodic inspections of FedEx 3 stations to monitor the processing 4 of hazardous materials at the 5 station from acceptance or 6 delivery from a courier to 7 placement on an aircraft." 8 Right? 9 A Right. 10 Q So that's an additional actioni 11 right? 12 A Sure. 13 Q And that 1S not something that's 14 required by 49 CFR, 1S it? 15 A Correct. 16 Q Okay. All right. Let's go to 17 C12. That document is for the second flight 18 you observed that's at issue in this case; 19 correct? 20 A Correct. 21 Q Okay. So it's aircraft N710FXi 1S 22 that right? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 

# • 22 203 

### A Yes. Q 

### Okay. Now, that document says, "No DG onboard"; right? A Correct. Q 

### And, ln fact, there was no DG onboard that aircraft; correct? A Not any of the kind that was supposed to be on this notification. Q 

### Well, in addition to that, haven't you told us that those 3373s didn't containDG at all? A But at the time, we did not know that. Q 

### Right. But the segment "No DG onboard" is correct, isn't it? A It is correct as far as the -- the alert goes. Q 

### Okay. Well, let me ask you this A It wouldn't normally be on the Inbound Dangerous Goods Alert anyway is what I'm saying. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 204
1 Q Oh l 

### I agree. Even a properly 2 marked

-- 3 A 

### Yes. Yes. 4 Q 

### -- and declared 5 A 

### Correct. 6 Q -- 3373 

### wouldn/t show up on this 7 

### document anyway. 8 A 

### That is correct. 9 Q 

### So there/s really no significance 10 to this document saying no DG was onboard. 11 Because even if this had been UN 3373 1 

### there 12 wouldn/t have been anything

-- it would have 13 

### said no DG onboard l 

### wouldn/t it? 14 A Correct. 15 Q 

### Okay. So there/s nothing wrong 16 

### with that document at all? 17 

### A No. 18 Q 

### Okay. Let/s go to C14. And C14 19 is the letterof interpretationbasicallyfrom 20 PHMSA I 

### which is a USDOT agencYi 

### correct? 21 A 

### Correct. 22 Q 

### And the portion that you read in NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

### 1 2 3 4 5 

### 6 7 8 9 

### 10 11 

# • 12 13 14 15 

### 16 17 18 19 

### 20 21 22 205 

### your testimony earlier was regarding diagnostic specimen; right? A Correct. Q 

### And you testified that nothing in this case had the words "Diagnostic specimen" on it; correct? A That's correct. Q 

### Okay. But if you go up to the beginning of the paragraph marked A1, A Dh-huh. Q 

### that second sentence there says: "Effective October 1st, 2006, under Docket No." and it refers to it and then it says HM-226A "we replaced the proper shipping name and marking 'Diagnostic specimen' with 'Biological substances, Category B,' and a diamond-shaped mark containing the letters and numbers 'UN 3373.'"
NEAL

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•

• 206
1 

### Right? 2 A 

### Correct. 3 Q 

### So these shipments didn't have 4 anything to do with diagnostic specimens 5 

### except that a few years earlier they would 6 have been called diagnostic specimens; right? 7 A 

### Right. 8 Q 

### If they had actually been UN 

### 3373s 9 

### but, in this case, theyweren't anywayi 

### right? 10 A 

### Eventually found out, yes. 11 Q 

### Okay. So

-- so before '06, the 12 words "Diagnostic specimen' would have 13 required more? 14 A 

### Yes. 15 Q 

### Okay. But now when our employees 16 state "Diagnostic specimen," it doesn't 17 require anything? 18 A 

### Right. 19 Q 

### Okay. Now, your investigation of 20 this case revealed that after the initial 21 these shipments never flew on a FedEx aircraft 22 

### at all? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 207
1 A 

### Yes, they did. 2 Q 

### I'm sorry. What aircraft was 3 that? 4 A 

### One moment. 5 

### (Pause.) 6 

### If you go to C3, this is Inbound 7 Dangerous Goods Alert for the Bozeman flight, 8 Flight 7772-13. And then go to the pictures 9 of the 5.1 in C7. That was actually removed 10 from that flight. 11 Q 

### But that flight doesn't this 12 may be outside of your knowledge, but I'm 13 going to ask you. Are you aware that that 14 flight isn't on FedEx's flight certificate? 15 A No. 

### This is the Corporate Air 16 from Bozeman to Great Falls. 17 Q 

### Okay. So that maybe I'll 18 

### rephrase it. Those shipments never flew on 19 any flight operated under FedEx's flight 20 certificate? 21 A No. 

### It's Corporate Air. 22 Q 

### Okay. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 208
1 A 

### And then the other two flew from 2 the point also Corporate Air. 3 Q 

### Okay. And that was also a 4 Corporate Air flight? 5 A 

### Yes. 6 Q 

### Okay. And are you aware that 7 FedEx doesn't actually operate any aircraft 8 out of those two locations, that all the 9 flights operated from those two locations are 10 operated under feeder certificates? 11 A 

### I disagree. I believe there is 12 flight that comes in from Martinez 13 Q 

### From the locations where these 14 flights originated, not the flights where you 15 did the inspections but the places where the 16 flights originated

-- 17 A 

### Okay. From Wolf Point in those

-- 18 yes, those are Corporate or Empire Air 19 flights. 20 Q 

### Okay. So there was never a flight 21 out of those two locations that operate under 22 FedEx's flight certificate? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 209
1 A 

### That's my understanding. 2 Q 

### Okay. Okay. On C4, that lS 

### the 3 Dangerous Goods System Aircraft DG Manifest. 4 And that lS 

### for N933FE. There's a signature 5 on there. It says "Captain Signature." Now, 6 

### I believe your testimony was that a Corporate 7 

### CorporateAirpilot providedyou with this; 8 is that correct? 9 A 

### Yes. 10 Q 

### Okay. 11 A 

### Yes. 12 Q 

### And do you believe that signature 13 to be the Corporate Air pilot's signature? 14 A 

### Yes. 15 Q 

### Okay. 16 

### (Pause.) 17 

### You had given some testimony 18 earlier about the inspection sticker that 19 FedExDG specialistsput ondeclaredhazardous 20 materials after they've inspected them. 21 You're familiar with that sticker; right? 22 A 

### Yes, I am. NEAL

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• 210
1 Q 

### And are you familiar that 2 sometimes it can be a stamp? 3 A 

### Yes. 4 Q 

### Okay. And you agree that that 5 sticker's not actually required for any 6 regulation; right? 7 A 

### Yes. 8 Q 

### What matters is the inspection, 9 not the presence of the sticker? 10 A 

### Correct. 11 Q 

### Okay. And you're pretty familiar 12 

### with air transport; right? 13 A 

### Correct. 14 Q 

### You've been In our facilities -- 15 

### FedEx facilities, Corporate Air well, 16 

### Corporate Air locations. You've been 17 you've seen a lot of transportation; right? 18 

### A Yes. 19 Q 

### Okay. And stickers sometimes come 20 

### off, don't they? 21 

### A Sure. 22 Q 

### Okay. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 211
1 (Pause.) 2 Okay. Now, I think that the FAA 3 attorney had asked you if the Agency followed 4 the Sanction Guidelines in determining the 5 appropriate sanction to propose in this case. 6 Do you remember him asking you 7 that question? 8 A Yes. 9 Q Okay. And you believe the Agency 10 did follow the Sanction Guidelines? 11 A Yes. 12 Q Okay. And you believe the Agency 13 looked at the totality of the circumstances in 14 coming up with this? 15 A Yes. 16 Q Okay. And do you know what 17 remedial measures were considered 18 A No. 19 Q in determining the Sanction 20 Guidelines? 21 A In determining the Sanction 22 Guidelines themselves? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

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•

• 212
1 Q I mean, in determining the

-- In 2 determining the proposed sanction In this 3 case. 4 A No. 5 Q Okay. And do you know what weight 6 was given to which factors in determining the 7 sanction proposed In this case? 8 A It was the fact that it was a 9 shipment that was marked as a as an 10 oxidizer, which would carry a heavier weight 11 and then also the two 6.2 biological substance 12 Category B shipments, which would go more in 13 a moderate weight. 14 Q Okay. And that's the list 15 categories of

-- that are in 2150 16 A Correct. 17 Q -- which is Exhibit C15i right? 18 A Yes. 19 Q Okay. What other factors are 20 considered in determining a sanction? 21 A Some of the factors are a 22 violation history and let's see a NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 213 1 

### violation history, what type of air carrler, 2 whether they're a shipper of hazmat or not, 3 those kind of things. 4 Q 

### Okay. And there are also other 5 

### relevant factors that can be considered; 6 

### right? 7 A 

### Sure. 8 Q 

### And that includes evidence of 9 

### corrective action; right? 10 A 

### Sure. 11 Q 

### Okay. And

-- let's see the 12 

### other relevant category -- or other relevant 13 

### sanction factors can be any number of things, 14 

### can't it? 15 A 

### For example? 16 Q 

### That's what I'm asking you. 17 A 

### Yes. 18 Q 

### Okay. Can it be a lot of 19 different things? 20 A 

### Oh, sure. Sure. If it's a 21 

### declared shipment, if it's an undeclared 22 shipment, if it's something that leaks or NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 

# • 22 214 spills, if there's something that causes death or injury, that kind of that kind of thing. Q All right. So whether it's declared or undeclared, whether it causes death, whether it causes I mean, severe injury, things like that. A Sure. Q But all of it having to do with safety and risk; right? A Mess I delays, yes. Q Okay. Now, at the in this case, was was this considered when determining a sanction, was it considered a declared or undeclared shipment, the 3373? A It was considered a declared. Q Okay. Well, what's an undeclared shipment? A When it has no indication on the outside at all or no paperwork no indication whatsoever of it possibly being a hazardous material. Q Well, if it has no indication
NEAL

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• 215 

### 1 whatsoever on the outside that it's a 2 hazardous material, why would you sanction 3 anybody to begin with? 4 A 

### Well, because I see that these 5 packages did have UN 3373 marking on both of 6 them. 7 Q 

### Not In ours. 8 A 

### Oh, okay. 9 Q 

### But I'm saying if one of the 10 factors you consider is whether it was 11 declaredorundeclared, and ifyour definition 12 

### of undeclared is that there was no indication 13 on any six sides of the box that this shipment 14 contained DG, why would you get the sanction 15 anyway? You wouldn't, would you? 16 A 

### Well, I can't give a sanction on 17 something that I don't see. So a lot of times 18 we don't even know that they're undeclared 19 until something leaks, spills, explodes, 20 catches fire, or tears apart. 21 Q 

### Okay. Well, that really goes into 22 whether the shipper declared this or not, NEAL

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# •

•

• 216
1 doesn't it? That's what it means. 2 A Sure. 3 Q Isn't it? When determining 4 whether it was declared or undeclared, that 5 goes to the shipper's sanctions. That doesn't 6 go to the carrier's sanctions, does it? 7 A Right. 8 Q 'Cause you wouldn't you 9 wouldn't sanction a carrier for an undeclared 10 shipment at all. 11 A Not unless there was something on 12 the package or something in the paperwork that 13 might have some indicia of a hazmat. 14 Q Such as 3373? 15 A That is an indicia, yes. 16 Q Okay. So a 3373 is an undeclared 17 shipment. It's not a declared shipment? 18 A No. It's a declared shipment 19 because it does have that that indicia on 20 there, so that's why FedEx or Corporate would 21 havebeen sanctionedbecause there's something 22 that should show that, Hey, this could be a NEAL

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• 217
1 

### hazmat. 2 Q 

### Tell me of a shipment that a 3 

### carrler could carry that a carrier could 4 get cited for that the FAA would 

### saYI That/s 5 

### an undeclared so we I

### re going to give that 6 

### weight in our sanctioning. 7 A 11m 

### sorry. Repeat that again. 8 Q 

### In determining what sanction is 9 

### appropriate I 

### tell me a shipment that a carrier 10 

### could be cited for that would be undeclared 11 

### where that would be a factor. 12 A 

### Like I 

### saidl if there was 13 something that could have been seen ahead of 14 

### timel if there was something on the trigger 15 list I 

### something that wouldhave triggered them 16 to have some constructive knowledge that it 17 would be a hazmat. 18 Q 

### Like a UN 3373. 19 A 

### To 

### mel it/s a hazmat. So when you 20 see UN 3373 1 

### they should have rejected the 21 shipment. 22 Q 

### What does a declared UN 3373 NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 218 

### 1 shipment look like on the outside? 2 A 

### It has a diamond square point, 3 like what you have there behind you. 4 Q 

### Dh-huh. 5 A 

### And then underneath would also 6 have "Biological substances Category B." 7 Q 

### Okay. These shipments didn't have 8 any of that; right? 9 A 

### This had the UN 3373 which 1S 

### a 10 marking that is a transportation marking. 11 It's a hazardousmaterialsmarking, Class 6.2. 12 Q 

### So that would be declared? 13 A 

### Yeah. It's improperly marked, 14 improperly declared, but it was declared. 15 Q 

### Okay. So what would be undeclared 16 from a carrier perspective? I mean, you said 17 that that is a guideline you consider in 18 determining sanctions and you've cited a 19 carrier and you're looking at the weight of 20 whether it was declared or undeclared for the 21 carrier. When would it be undeclared? 22 A 

### It would be undeclared had it not NEAL

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# •

• 219 1 

### had anything on it and then there was a spill 2 or a leak and maybe it was found out to be a 3 regulated material. 4 Q 

### And in that case, what would a 5 

### carrier have done wrong to get sanctioned? 6 A 

### They wouldn't. 7 Q 

### Okay. So there would never be a 8 

### time when the FAA 

### considers on a carrier 9 

### perspective for sanction whether it was 10 

### declared or undeclared 'cause you'd never get 11 

### the sanction. 12 A 

### I don't say never. I

-- I can't 13 

### say that. No. 14 Q 

### Okay. In this case, did the 15 

### Agency consider, for either the sanction of 16 

### FedEx or the sanction of Corporate Air, 17 

### whether these were declared or undeclared 18 

### shipments? Did that factor into the Sanction 19 

### Guidance at all? 20 A 

### Yes. 21 Q 

### Okay. And you participated in 22 that? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 220
1 A 

### They were declared shipments, 2 improperly-declared shipments. 3 Q 

### How was that weighted by the FAA 4 

### when they decided the sanctions for this case? 5 A 

### It's weighted by the FAA when you 6 

### look at the matrix on page C-13 of the 7 

### Sanction Guidelines. 8 Q 

### And I'm asking you what weight was 9 

### it glven in the deliberations when the 10 

### sanction recommendation was determined? 11 A 

### It was an improperly accepted and 12 

### transported material. 13 Q 

### And what weight was that given? 14 Was it given a lot of weight? Was it given a 15 little weight? 16 A 

### It was given actually a moderate 17 weight because one of them was Category Band 18 the other was Category A. 19 Q 

### And you had a conversation about 20 that when you determined how much weight to 21 

### glve it? 22 A 

### Actually, I 

### did have a NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 221 1 conversation with my supervisor about that. 2 Q Okay. 3 A And we went actually with a lower 4

-- a lower sanction. 5 Q You went with a lower sanction 6 based on the fact that this only had the 3373 7 on it and didn't have 8 A No. Honestly, I went -- I went 9 with a lower sanction because it was 10 determined not to be hazmat after all. So I 11 did try to cut you guys a break. The Agency 12 tried to cut you a break. 13 Q Okay. So when you say you cut us 14 a break, you still used the Guideline; right? 15 A Yes. 16 Q 'Cause you have to. 17 A I have to. 18 Q So you didn't cut us a break. You 19 followed your Sanction Guidelines which is 20 what you've been testifying about. 21 A I right. We followed the 22 Sanction Guidelines. Yes. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 222
1 Q 

### Okay. 2 A 

### We did go to the lower end of the 3 scale. 4 Q 

### Because you were required to In 5 the overall consideration of the sanctions. 6 A 

### Well, I have to consider the 7 sanctions. 8 Q 

### Okay. So you didn't cut us a 9 

### break. You used the Guidelines the way 10 they're meant to be used; right? 11 A 

### We could 12 MR. LOMAZOW: Objection, Your 13 Honor. At the end of the day, it's Legal who 14 makes the ultimate determination as to what 15 

### the sanction is. So this talk of cutting a 16 

### break doesn't really do anything. Agent 17 Luscher recommended a sanction. It was Legal 18 that ultimately determines what sanction we 19 actually lssue. 20 

### MS. CHANDLER-SNELL: And, Your 21 Honor, they opened the door on direct when 22 

### they asked her if the Agency followed the NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 

# • 22 223 SanctionGuidelines inproposingthispenalty. MR. LOMAZOW: We asked that in regards to the sanction. JUDGE GOODWIN: It's the question's been asked and answered. MS. CHANDLER-SNELL: Yes, Your Honor. (Pause.) BY MS. CHANDLER-SNELL: Q In determining the sanction, did the Agency consider the fact that FedEx didn't transport these items? A Yes. Q Okay. And is there a specific reference in the matrix or in the guidelines that tells you what

-- what weight to give that?A Actually, I believe that the

-- the sanctions were based on lmproper acceptance, failure to inspect, and improper storage - - well, not storage on Corporate, but failure to inspect and improper acceptance and
NEAL

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• 224
1 

### the failure to provide the pilot-in-command. 2 Q 

### Okay. So for the one act of 3 

### inspecting or failing to inspect this 4 shipment, the

-- the shipment that had the 5 

### oxidizer labeling for that one failure, you 6 

### looked to cite both Corporate Air and FedEx 7 

### for that act? 8 A 

### Yes. 9 Q 

### Okay. And that was because it was 10 

### a FedEx employee? 11 A 

### That is because they're both 12 

### certificatedair carriers. One was inspecting 13 

### and then the other one -- 14 Q 

### But

-- 15 A 

### is still responsible. 16 Q 

### Corporate

-- Corporate can get 17 

### Joe's Inspection Service to do its 18 inspections; right? 19 A 

### Yes. 20 Q 

### Okay. 21 A 

### May I make a comment? 22 Q No. NEAL

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•

• 225
1 A 

### Okay. 2 Q 

### Regarding these substances that 3 were actually inside the shipments in this 4 case, none of those posed any risk to safety, 5 

### did they, regarding the substances? 6 A 

### They were determined not to be 7 

### regulated. 8 Q 

### So none of the substances had a 9 

### risk to safety. Is that true? 10 A 

### Eventually after the 11 

### investigation, we found out that was true. 12 Q 

### I understand that. So none of the 13 

### substances that were involved in this were a 14 

### risk to safety? 15 A 

### Which was found out after the 16 

### investigation, yes. 17 Q 

### Do you agree with the statement I 18 

### just said? 19 A 

### Yes. 20 Q 

### Okay. In the process of 21 

### investigating with the shipper of the UN 3373 22 

### shipments, NEAL

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• 226
1 A 

### Uh-huh. 2 Q 

### -- did you determine whether they 3 eve had training to ship any kind of 4 A 

### I did actually. I did have a 5 letter of investigation with

-- with them and 6 I did investigate them. 7 Q 

### Okay. Well, did you determine 8 whether they were trained to ship either UN 9 3373 or any -- 10 A 

### The shipments were not regulated. 11 Q 

### I understand. But you said that 12 

### they had

-- they accidentally used the wrong 13 pak, so they had UN

-- paks that were already 14 marked with UN 3373 on 'em. Did you -- 15 A 

### Somebody had written UN 3373 on 16 them with black ink. 17 Q 

### Okay. Did you determine whether 18 anyone at that location was actually trained 19 to ship UN 3373? 20 

### MR. LOMAZOW: Objection, Your 21 

### Honor. That has nothing to do with the

-- 22 

### with the case here. It has nothing to do with NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 227
1 

### FedEx accepting and Corporate Air 2 transporting. 3 

### JUDGE GOODWIN: Overruled. 4 BY MS. CHANDLER-SNELL: 5 Q 

### Did you determine if anyone there 6 was actually trained to ship UN 

### 3373? 7 A 

### They are not because they don't 8 typically ship UN 

### 3373. 9 Q 

### Well, did they give any 10 explanation as to why they had 11 A 

### 'Cause they had called the FedEx 12 hotline and they were supposed to put the UN 

### 13 3373 on there. 14 Q 

### Okay. Did you disclose that 15 information to FedEx at any time in the course 16 of your investigation? 17 A 

### No, I did not. 18 Q 

### Don't you think FedEx would want 19 to know if there was a shipper that claimed 20 they had relied on a 1(800) number that we 21 provide service 24 hours a dayi 

### don't you 22 think that would be important? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 228 1 A 

### I hear that all the time with 2 shippers. Oh, I called FedEx. They told me 3 to do it this way. 4 Q 

### Yeah. And my question is: Don't 5 you think that would be important to pass 6 along to FedEx? 7 A 

### For every shipper? 8 

### MR. LOMAZOW: Objection, Your 9 

### Honor. It's not on us to help FedEx

-- 10 

### JUDGE GOODWIN: Overruled. 11 

### MR. LOMAZOW: Okay. 12 

### THE WITNESS: For every shipper? 13 BY MS. CHANDLER-SNELL: 14 Q 

### If there is a shipper of hazmat 15 that is claiming that FedEx gave incorrect 16 information about shipping dangerous goods, 17 don't you think that would be important to 18 convey to the person allegedly giving the 19 information? 20 A 

### Yes. But-- 21 Q 

### Couldn't that potentially even be 22 a citation? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 229
1 A 

### Again, almost every shipper I go 2 

### to that uses FedEx when they say when 3 there's something wrong, they always blame 4 

### FedEx. So if you would like for me to call 5 FedEx every single time, I can do that. 6 Q 

### So what you're saying then is that 7 you don't really believe that they called the 8 (800) hotline and we gave them bad advice? 9 A 

### Right. 10 Q 

### Okay. As a side note, I still 11 think you can call the (800) number. 12 Are these substances that are 13 categorized as UN 

### 3373 a high risk in air 14 transport? 15 A 

### They are a risk which is why they 16 are regulated in air transportation. They are 17 Category B 

### of an infectious substance. 18 Q 

### In your dealings in your 11 years 19 

### of inspections, have you ever seen an 20 occurrence - - have you ever seen an occurrence 21 where a plane had to have an emergency landing 22 

### due to a UN 

### 3373? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 230
1 A No. 2 Q 

### Okay. Have you ever seen an 3 occurrence where there has been leakage or 4 failure of packaging on a 3373? 5 A 

### Yes. 6 Q 

### Okay. And at that point, your 7 

### concern is with the everyone's concern is 8 with the cleanup of that substance; correct? 9 A Cleanup and exposure to anybody 10 around. Yes. 11 Q 

### Okay. And you agree that cleanup 12 doesn't occur in the air. It occurs on the 13 ground. Ground personnel handle that? 14 A That would be my understanding, 15 yes. 16 Q 

### Okay. 17 (Pause.) 18 

### Did the shipper of the UN 3373 19 shipments, did that case conclude with a 20 letter of warning or with a civil penalty 21 letter? 22 A 

### I'm not so sure I can answer that. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 231
1 

### Can I answer that? 2 

### JUDGE GOODWIN: Unless you -- 3 

### MR. LOMAZOW: Your Honor, I 

### 4 will

-- 5 

### JUDGE GOODWIN: Is there a 6 

### security issue? 7 

### THE WITNESS: I think that one -- 8 

### I'm trying to keep all four of these things 9 

### straight here in my head. 10 

### JUDGE GOODWIN: If you know. If 11 

### you don't know, say you don't know. 12 

### THE WITNESS: Yeah. I don't know 13 

### off the top of my head. 14 

### BY MS. CHANDLER-SNELL: 15 Q 

### Well 16 A 

### Each case is 17 Q 

### -- are you just confused

-- you 18 

### don't know which one 19 A 

### Each case is different. And 

### so 20 since we're dealingwithCorporateAir, FedEx, 21 

### and then BioScience and Checker's, Inc. and 22 

### then with the Empire stuff coming up in the
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# •

• 232
1 

### next couple days 2 Q 

### We've got two more. 3 A 

### -- yeah, so -- 4 Q 

### Well, to make it to make it 5 easy, you know that the one against FedEx and 6 the one against Corporate ended 1n civil 7 

### penalty. On the other two, for the UN 3373 8 shipments, did any of those shippers end up 9 with a penalty more than a thousand dollars? 10 A 

### I don't know the amount but, yes, 11 

### one of them did. I can tell you that. 12 Q 

### Okay. Do you know which one that 13 

### is? 14 A 

### BioScience did receive a civil 15 

### penalty. 16 Q 

### And that was the oxidizer case? 17 A 

### Yes. 18 Q 

### And do you know if that case was 19 

### settled? 20 A 

### Yes. 21 Q 

### And it was settled for more than a 22 

### thousand dollars 1S your understanding? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 233
1 

### MR. LOMAZOW: Objection, Your 2 Honor. 3 

### THE WITNESS: I don't know. 4 

### MR. LOMAZOW: It's not relevant to 5 this case. 6 

### JUDGE GOODWIN: Sustained. 7 

### THE WITNESS: I can tell you that 8 they have been visited again since and they 9 are now in compliance with the regulations. 10 

### MS. CHANDLER-SNELL: Okay. 11 

### (Pause.) 12 

### JUDGE GOODWIN: We're going to 13 take a ten-minute break. We'll go back on the 14 

### record at 20 after. Remember, we want to 15 finish at 4:30. So if either one of you -- in 16 terms of what I've talked about as the 1 7 schedule, if you get to a breaking point 18 that's logical for your thought process, you 19 know, around the morning, afternoon break or 20 around lunch or around 4:30, I'm not adverse 21 

### to breaking then. Okay. My case for San 22 Francisco fell out. You know, if necessary, NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 234 1 

### we can go into next week, but I don't 2 

### anticipate that. But I don't want to break 3 your train of thought. So like if you get to 4 

### ten o'clock and you get a change in thought 5 

### process andyou feel that's a comfortable time 6 

### to break, then we'll do so. 7 

### Okay. So we'll go off the record 8 

### and be back on the record at 20 

### after. 9 

### MS. CHANDLER-SNELL: Thank you, 10 

### Your Honor. 11 

### (Whereupon, at 3:11 

### p.m. off the 12 

### record until 3:25 

### p.m.) 13 

### JUDGE GOODWIN: Back on the 14 

### record. Okay. Do you have any redirect? 15 

### MR. LOMAZOW: I do, Your Honor. 16 

### MS. CHANDLER-SNELL: Oh, sorry. 17 

### MR. LOMAZOW: No. That's okay. 18 I'll be brief. 19 

### JUDGE GOODWIN: And how long do 20 

### you think your next witness is going to take? 21 

### THE REPORTER: Stay on the record, 22 

### Your Honor? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 235
1 

### MR. LOMAZOW: Actually, Your 2 

### Honor, what I'm going to I did plan on 3 

### having Agent Stiger testify next. But what 4 I'm going to do now is I'm going to rest after 5 

### Agent Luscher and I'm going to use him 6 possibly for rebuttal testimony. 7 

### JUDGE GOODWIN: Okay. 8 

### MR. LOMAZOW: May I proceed, Your 9 Honor? 10 

### JUDGE GOODWIN: Go ahead. 11 

### MR. LOMAZOW: Okay. 12 REDIRECT EXAMINATION 13 BY MR. LOMAZOW: 14 Q 

### Agent Luscher, these three 15 

### packages the oxidizer, the UN 

### 3373s 16 ultimately they were not determined to be 17 hazardous material; correct? 18 A 

### They were determined not to be 19 hazardous material. 20 Q 

### Okay. So why did you write up 21 violations then? 22 A 

### Because it lS 

### against the
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 236 1 regulations to offer, accept, or transport 2 something that's marked and offered for 3 transport when it's not a hazardous material. 4 Q Okay. Agent Luscher, please turn 5 to the pictures which -- let me see -- which 6 are marked C7. Looking at what's marked as 7 page 1 of 16, that

- - the UN 2428 in that 8 picture, that as you stated is the hazmat 9 identification number; right? 10 A That is a UN number for a 5.1. 11 Q Okay. And that's side one of the 12 shipment. 13 A Yes. 14 Q And then turning to page 15 photograph 2 of 16, lS that the same UN 16 number? 17 A Yes, it lS. 18 Q Okay. Turning to the next 19 photograph, which lS marked 3 of 16, is that 20 the same UN number? 21 A Yes. 22 Q Okay. And then please turn to NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 237 1 page -- photograph 4 of 16. And once again, 2 1S that the same UN number? 3 A Yes. 4 Q So that UN identification number 5 1S marked on four separate sides of this box; 6 correct? or this package which everyone 7 referred to it as. 8 A Right. 9 Q Okay. Okay. Please turn to 10 photograph 13 of 16

-- I'm sorry -- please 11 turn to page -- photograph 14 of 16. That is 12 the back of the package; correct? 13 A I'm sorry. 14 Q Oh, photograph 14 of 16 for the 15 first UN 3373. 16 A Yes. 17 Q Okay. And as you stated

-- and 18 correct me if I'm wrong -- but that box was -- 19 the box marked indicating the presence of a 20 biological substance Category B was not 21 marked; correct? 22 A That's correct. NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 238
1 Q 

### Okay. Please turn to the front of 2 that photograph, which is

-- or the front of 3 

### that package, which is photograph 13 

### of 16. 4 A 

### Okay. 5 Q 

### That big

-- that big label 1n the 6 middle, 1S that the FedEx tracking? 7 A 

### Yes. That's where they scan and 8 it shows the date and the

-- 9 Q 

### Okay. 10 A 

### -- type of service as well as the 11 

### tracking. 12 Q 

### So in order to scan and enter this 13 

### into the system, the FedEx employee has to 14 

### look at this

-- at the front of this package; 15 

### correct? 16 

### MS. CHANDLER-SNELL: Objection, 17 

### Your Honor. That's leading and, in addition, 18 

### it calls for testimony regarding what FedEx 19 

### employees do under our policy and procedure, 20 and I don't think that the agent can testify 21 

### as to what our employees do. 22 JUDGE GOODWIN: Sustained. NEAL R. GROSS (202) 234-4433 COURT REPORTERSAND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 239 1 BY MR. LOMAZOW: 2 Q Agent Luscher, in your experience, 3 what does the presence of that tracking number 4 indicate? 5 A That 1S a scanning and tracking 6 label that I have observed Federal Express 7 employees use when they're sorting packages. 8 Q Okay. Okay. Agent Luscher, 9 please turn to the FedEx letter of response to 10 your letter of investigation, which is C9. 11 A C9? 12 Q Yes. 13 A Okay. 14 Q The first page. As Counsel had 15 you read, it says: 16 "BZN management held a station 17 meeting with all employees as a 18 result of the acceptance error. 19 Proper handling and the proper 20 procedure for acceptance of DG 21 packages were addressed at this 22 meeting." NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 240
1 

### In your experience, is that 2 something that should have been addressed 3 beforehand? 4 

### MS. CHANDLER-SNELL: Objection, 5 

### Your Honor. I don't think that I don't 6 

### think that the agent can testify to whether 7 

### this was or wasn't covered beforehand. I 8 

### think it's miscategorizing the exhibit. 9 

### JUDGE GOODWIN: Her testimony was 10 

### she would have expected this to be part of 11 

### normal procedures and that was her response in 12 

### response to cross-examination. So from that 13 

### standpoint, the question's redundant. 14 

### MR. LOMAZOW: Okay. 15 

### BY MR. LOMAZOW: 16 Q 

### Now, all

-- it says: 17 

### "All employees were issued a memo 18 

### outlining the importance of proper 19 

### DG acceptance." 20 

### In their response, did they 21 

### include this memo? Did FedEx include this 22 memo? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 241
1 A 

### No. 2 Q 

### Okay. Agent Luscher, please turn 3 

### to what is marked as C14. Now, Counsel 4 discussedwith you that, in the past, these

-- 5 these biological

-- what's now labeled as a 6 biological substance Category B was marked as 7 

### a diagnostic specimen; is that correct? 8 A 

### Yes. 9 Q 

### Okay. At the time of these 10 

### violations, what according under 49 CFR, 11 what were they

-- what was -- what was the 12 

### proper name for them? 13 A 

### The

-- if it is stated to be a UN 

### 14 3373, 

### it's biological substances Category B. 15 Q 

### Okay. So not a diagnostic 16 specimen? 17 A 

### That is correct. 18 Q 

### Okay. Diagnostic specimen is no 19 longer a 

### regulated hazardous material; 20 correct? 21 A 

### Correct. 22 Q 

### Biological substance Category B
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 242 

### 1 is? 2 

### MS. CHANDLER-SNELL: I object to 3 leading, Your Honor. 4 

### JUDGE GOODWIN: Overruled. 5 

### (Pause.) 6 

### MR. LOMAZOW: Okay. 7 

### BY MR. LOMAZOW: 8 Q 

### Agent Luscher I'm sorry 9 please turn back to the exhibit listed

-- to 10 

### FedEx's response to the letter of 11 investigation at C9. 12 A 

### Okay. 13 Q 

### Reading from the

-- where it says: 14 

### "Regarding the classified 5.1 15 shipment, the pick-up courier 16 

### mistakenly did not bring this 17 

### package to the attention of the 18 

### dangerous goods specialist for 19 

### inspection. The package would 20 

### have been rejected by the DG 21 

### specialist for the shipper's error 22 

### if inspected." NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 243 

### 1 Is that the response? 2 A 

### Yes. That's what it says. 3 Q 

### Okay. So the response wasn't that 4 the sticker fell off. The response was this 5 

### package should have been rejected? 6 A 

### Should have been inspected and 7 

### rejected. 8 Q 

### I'm sorry. Yes. Okay. Now, in 9 terms of safety with hazardous materials, in 10 your opinion, 1S 

### that the reason -- is that 11 one of the reasons at least that hazardous 12 materials are marked as hazmat is because of 13 safety? 14 A 

### Yes. 15 Q 

### Okay. And in regards to the 16 oxidizer, that's a in regards to the 17 Sanction Guidance, that's a maximum; correct? 18 A 

### Yes. 19 Q 

### Okay. And safety requires that 20 these hazmat packages be properly marked, 21 regardless of whether they ultimately contain 22 

### hazmat or not; correct? NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 244 

### 1 MS. CHANDLER-SNELL: Your Honor, 2 I'll object to leading again. 3 

### JUDGE GOODWIN: Yeah. 4 leading. Sustained. 5 BY MR. LOMAZOW: 6 Q 

### Okay. Do these

-- 7 

### MR. LOMAZOW: Actually, you know 8 

### what. I'll just withdraw. No further 9 questions, Your Honor. 10 

### JUDGE GOODWIN: Okay. Anything 11 else of this witness? 12 MS. CHANDLER-SNELL: Briefly on 13 recross, Your Honor. 14 

### JUDGE GOODWIN: All right. Based 15 only on the questions from redirect. 16 

### MS. CHANDLER-SNELL: Yes, Your 17 Honor. 18 RECROSS EXAMINATION 19 BY MS. CHANDLER-SNELL: 20 Q 

### You just stated that the reasons 21 these items are marked as dangerous goods and 22 regulated is because they have safety
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 245 1 

### implications; right? 2 A 

### Correct. 3 Q 

### And these markings and labelings 4 are all required because of safety? 5 A 

### Correct. 6 Q 

### And in order for these packages to 7 

### travel safely, they have to be easily 8 

### recognizable both to agents, to carriers, to 9 

### anyone who might come into contact with them; 10 

### right? 11 A 

### Correct. 12 Q 

### And that's the purpose of the 13 

### regulation? 14 A 

### Yes. 15 Q 

### And the regulations require what 16 is needed for safety? 17 A 

### Right. 18 Q 

### And neither of these shipments had 19 all the things that were required

- - that were 20 needed for the safety andrecognition of these 21 

### items when they were tendered by the shipper; 22 

### right? NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 246 

### 1 A 

### Exactly. 2 Q 

### Okay. The first question that you 3 were asked on redirect, I believe, was that 4 none of the items actually transported 5 involved in this case were actually dangerous 6 goods; right? 7 A 

### After the investigations occurred, 8 right. 9 Q 

### Okay. Well, they

-- before the 10 

### investigations occurred, they weren't 11 dangerous goods; right? 12 A 

### But at the time, we did not know. 13 Q 

### Okay. And you were asked why you 14 

### pursued those and you said that it's 15 because

-- why did you pursue these citations 16 when the actual substances weren't regulated? 17 A 

### Because it's against the 18 regulations to offer, accept, or transport 19 something that 1S 

### labeled or declared as a 20 hazmat when it's not actually hazardous 21 material. 22 Q 

### And when you say that, you're NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# • 247 

### 1 referring to 172.401; 1S 

### that correct? 2 A If I can look at my bookl 

### I could 3 tell you. I don/t 

### have that in front of me. 4 Q 

### Let me read it to you and see if 5 the 6 "No 

### person may offer for 7 

### transportation and no carrier may 8 

### transport a package bearing ..." 9 

### WeIll let I 

### s see Section (a) 10 says: 11 "Except as otherwise provided in 12 this section l 

### no person may offer 13 

### for transportation and a carrier 14 may transport a package bearing a 15 

### label specified in this subpart 16 

### unless the package contains a 17 material that is a hazardous 18 

### material and the label represents 19 

### a hazard of the hazardous material 20 in this package." 21 Right? 22 A lId 

### like to see that in front of
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 248
1 

### me. Actually, if I could have my set of 2 regulations, I'd appreciate that. 3 

### MR. LOMAZOW: I have a set here. 4 

### JUDGE GOODWIN: Show it to 5 Counsel. 6 (Pause.) 7 

### MR. LOMAZOW: Is your book here? 8 

### THE WITNESS: They should pretty 9 much all say the same. 10 MS. CHANDLER-SNELL: And for the 11 record, we're looking at 49 CFR 172.401. 12 (Witness reviewing manual.) 13 

### THE WITNESS: That is one of them, 14 yes. 15 BY MS. CHANDLER-SNELL: 16 Q 

### Are there others? 17 A 

### I believe so. If you give me a 18 moment. 19 (Pause.) 20 I have to look ln my head. That's 21 a scary thing. 22 (Pause.) NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 249
1 

### What I was looking at would be 2 171.2(k). 3 

### JUDGE GOODWIN: What is the 4 citation again? 5 

### THE WITNESS: 171.2(k) . 6 BY MS. CHANDLER-SNELL: 7 Q 

### Okay. So under 171.2(k), will you 8 

### read that to the Court? 9 A 

### Sure. 10 

### "No person may, by marking or 11 otherwise, represent that a hazardousmaterial 12 is present in a package contained in a motor 13 vehicle, rail car, aircraft, or vessel if the 14 hazardous material is not present." 15 Q 

### Okay. Now, you agree that goes 16 towards the shipper; correct? 17 A 

### Correct. 18 Q 

### Okay. Neither FedEx nor Corporate 19 Air was cited under that provision; right? 20 A 

### That's correct. 21 Q 

### 'Cause that shows that the shipper 22 

### acted incorrectly by marking something
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# •

• 250 

### 1 representing it was a hazardous material when 2 it was not. 3 A 

### Right. 4 Q 

### But you would agree that ln the 5 complaint where FedEx and Corporate Air were 6 cited, that FedEx and CorporateAir were cited 7 

### for transporting a 

### hazardous material, 8 accepting a hazardous material, loading a 9 hazardous material, carrying a shipment of 10 hazardous material, that the regulations that 11 FedEx and Corporate Air were cited under had 12 to do with shipments of hazardous materials; 13 right? 14 A 

### Correct. And if you look at 173.5 15 I'm sorry -- 175.3, it is in regards to 16 accepting a hazardous material shipment for 17 transportationnotpreparedinaccordancewith 18 

### Subchapter (c). So if it wasn't prepared 19 properly, that's why we cited that. 20 Q 

### Okay. But in 175.3, it says, "A 21 hazardous material that is not prepared for 22 shipment in accordance with this subchapter," NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 251 1 

### but these weren't hazardous materials. 2 A 

### But they were prepared partially 3 

### In accordance with the subchapter. 4 Q 

### But you agree none of them were 5 hazardous materials? 6 A 

### At the end of the investigation, 7 

### yes, we realized that none of them were. 8 Q 

### Right. 9 

### MS. CHANDLER-SNELL: Nothing 10 

### further. 11 

### MR. LOMAZOW: Your Honor, just one 12 

### more quick question. 13 

### FURTHER REDIRECT EXAMINATION 14 

### BY MR. LOMAZOW: 15 Q 

### Agent Luscher, In regards to the 16 

### safety issue, one of the considerations

-- 17 

### JUDGE GOODWIN: To which issue? 18 

### MR. LOMAZOW: The safety issue

-- 19 

### JUDGE GOODWIN: Okay. 20 

### MR. LOMAZOW: -- of UN 3373. 

### I'm 21 

### sorry. 22 

### BY MR. LOMAZOW: NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 252
1 Q 

### One of the concerns lS also 2 emergency responders; correct? 3 

### MS. CHANDLER-SNELL: I object to 4 leading, Your Honor. 5 

### JUDGE GOODWIN: It's beyond the 6 scope. 7 

### MR. LOMAZOW: Okay. Actually, 8 I'll withdraw it. 9 

### JUDGE GOODWIN: Anything else of 10 this witness? 11 

### MR. LOMAZOW: No. 12 

### JUDGE GOODWIN: Okay. Do you want 13 

### her to remain? It's up to you. She's the 14 

### FAA's witness. It's up to the FAA whether 15 she's to remain. The Court doesn't care. I'm 16 gOlng to instruct you not to discuss your 17 testimony with anybody during the pendency of 18 the hearing. 19 And are you also going to be a 20 witness in the case that's later this week? 21 

### THE WITNESS: Yes. 22 JUDGE GOODWIN: Okay. Then I'm
NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 

# • 12 13 14 15 16 17 18 19 20 21 22 253 gOlng to ask you not to discuss your testimony at least till all of the cases are concluded. THE WITNESS: Okay. JUDGE GOODWIN: With what you said, what you should have said, or anything else. You shouldn't discuss it with anybody, and that includes the FAA attorney. Now, whether you stay in the building is up to the FAA attorney. I don't have any need

-- any of the witnesses in any of the cases are welcome to be here, as long as they're accessible. So you can step down if you want. (The witness was excused.) JUDGE GOODWIN: I'm especially concerned about the doctor. I don't know what schedule he's on, but this would be true with anybody. But if we've got a witness, like a doctor coming ln who's got a strict point in time, we'll break, take that testimony, and then come back on. MS. CHANDLER-SNELL: I appreciate NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 254 

### 1 that, Your Honor. You know, we have the two 2 witnesses

-- we have two experts corning in 3 

### tomorrow. Their testimony should work in 4 

### nicely. And then the next day, we have two 5 witnesses as well. I think that we'll be able 6 tomanage that agreeably, but I appreciate you 7 accommodating their schedules. 8 

### JUDGE GOODWIN: I mean, the 9 Government people get paid to be here and the 10 

### other people don't necessarily, but 11 anything else you want -- so we're finished 12 with this witness. What's the position of 13 your case? 14 

### MR. LOMAZOW: Your Honor, at this 15 time we rest. 16 

### JUDGE GOODWIN: So at this point, 17 Ms. Snell, you could present a witness but 18 unless you've got one that you can do in 40 19 minutes, my suggestion is you may want to wait 20 and we'll start promptly at 9:00 in the 21 morning. 22 MS. CHANDLER-SNELL: We can start NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

•

• 255 

### 1 ln the morning, Your Honor. For the record, 2 I would like to make a motion to dismiss based 3 on the FAA's failure to prove the provisions 4 and the citations that are -- the violations 5 that are alleged in the complaint. 6 

### JUDGE GOODWIN: Okay. What

-- I'm 7 

### going to deny it at this point. You're 8 

### allowed to re-offer it again, it's a 9 jurisdictional motion. So if the FAA hasn't 10 proved their case, then whether we do it now, 11 whether we do it later, but at this point I'll 12 deny the motion. 13 

### MS. CHANDLER-SNELL: Thank you, 14 Your Honor. 15 

### JUDGE GOODWIN: One of the things 16 I want you to think about while I'm thinking 17 about it, I brought this case up in the past. 18 There's

-- I am presuming that a portion of 19 this case is going to address considerations 20 done by hazardous material, which is a 21 componentof theDepartment ofTransportation. 22 I had a case of Williamson Transport
- - 

### let me NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 

# • 22 256 give you the citation

-- which was a Federal Motor Carrier Safety case. And while I'm looking this thing up, your first reaction is why is he bringing that up, and I'll tell you ln a minute. Williamson Transport was a Federal Motor Carrier case, 2004-17247. The reason I'm bringing that up is I had a hearing, issued an opinion, went up to General Counsel's Office and they

-- the argument for the Agency in that case was that I should apply federal law to the case. Went upstairs and I had looked to the law of other agencies. There wasn't any DOT agency law, so we looked to some other regulatory decisions, federal regulatory decisions. So Office of General Counsel reversed my case and held that it was not proper for me to consider the law of other federal agencies in making my determination and that I had to apply North Carolina state law to determine continuity of ownership in the case. I'm only a judge, okay. I think
NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 257 

### 1 they're wrong. But if

-- I think you need to 2 look at that case and see whether it's got any 3 applicability either way in this case and, if 4 

### so, address it. Because

-- I mean, I could 5 certainly make an argument that it is a fact6 specific decision. Not only was I reversed, 7 but the Federal Motor Carrier asked for a 8 review of the decision, which only further 9 complicated it because when they denied the 10 petition for review, they essentially invited 11 the Agency to reconsider the issue if they 12 

### wanted to in the future and then, and my words 13 are, they'd reflect on it, to which my 14 response lS, 

### Now what have they said? 15 My concern is the principle that 16 if the two of you get into an argument as to 1 7 whether otherDOT modes, regulations shouldbe 18 applied and one component of DOT is saying, 19 well, I can't look at other modes and I can't 20 look at other federal agencies when there's no 21 

### law, then where are we? I mean, it's

-- I 22 think

-- well, it doesn't matter what I think. NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 258 

### 1 They've overruled me. But-- 2 

### MS. CHANDLER-SNELL: Are we still 3 on the record? 4 

### JUDGE GOODWIN: Yeah. 5 

### MS. CHANDLER-SNELL: Okay. 6 

### JUDGE GOODWIN: Yeah. And 

### I'm 7 saying that because you need to read the 

### 8 Williamson case, the two of you, decide 9 whether it has applicabilityto this case and, 10 if so, address it. If you don't think it has 11 applicability, then don't address it. 12 

### But, you know, we're here trying 13 this case and someplace down the road somebody 14 else may bring up the

-- the 

### Williamson case 15 on one side of the other of this and say that 16 we applied the law incorrectly ln this case. 17 

### So

-- and you also there are 18 two decisions after mine in 

### Williamson. One 19 was the original reversing me and the other 20 one was an application for reconsideration 21 

### which was denied. I've talked to the 22 

### attorneys who appeared before me and that's NEAL R. GROSS (202) 234-4433 COURT REPORTERS ANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com

# •

• 259 1 why I'm bringing this up. 2 Any other matters that we need to 3 do on the record today? 4 (No response.) 5 Okay. What we'll do is go off the 6 record. I'm going to make sure that the 7 door's locked. I wouldn't leave goods and 8 valuables in, but I think you're going to 9 leave your stuff here. And generally what I 10 do is when I walk out, I tell the esos -- I'll 11 probably flip the lock on that before I leave, 12 but I'll tell the court securityofficers that 13 we're out of here and they're generallypretty 14 good about coming up here and making sure the 15 door's locked. 16 Then I'll be here sometime shortly 1 7 after 8:30 to give you access to the courtroom 18 if the esos aren't here to let you in. So 19 we'll go off the record. 20 (Whereupon, the above-entitled 21 matter went off the record at 3:50 p.m., to 22 reconvene the following day at 9:00 a.m.) NEAL R. GROSS (202) 234-4433 COURT REPORTERSANDTRANSCRIBERS 1323 RHODE ISLAND AVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com---------**~-** -------- - - A**---------"-~--** ------ --- able11:11 31:7 124:3254:5 aboard43:544:8 111:3 above-entitled1:17

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# • Neal R. Gross & Co. I Inc. 202-234-4433Page 285 

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• 287 C E R T I F I CAT E
This is to certify that the foregoing transcript

In the matter of: Federal Express
Before: US DOT
Date: 08-22-11
Place: Seattle, Washington

was duly recorded and accurately transcribed under my direction; further, that said transcript is a true and accurate record of the proceedings.

(202)234-4433 Court Reporter

NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323RHODEISLANDAVE., N.w. WASHINGTON,D.C. 20005-3701 www.nealrgross.com