UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION FEDERAL AVIATION ADMINISTRATION
In re the Complaint of
PENSACOLA AVIATION CENTER LLC

Complainant,

- against

- DOCKET NO. 16

- 12

- 12 PENSACOLA INTERNATIONAL AIRPORT, A DIVISION OF THE CITY OF PENSACOLA

Respondent. Pursuant to Part 16 of the Federal Aviation Regulations

MOTION TO ADMIT MATERIAL FACTS

1. COMES NOW THE COMPLAINANT , Pensacola Aviation Center LLC (“Complainant”), and files this Motion to Admit Material Facts. Pursuant to 14 CFR § 16. 19 , the Complainant may file an application for an order or ruling not otherwise specifically provided for by the Part 16 rules of procedure.
2. Complainant requests that the FAA admit and consider certain material information that are relevant to this Part 16 preceding

. This information pertains to content and credibility of the Respondent’s most recent filing , dated April 20, 2015

. A. INFORMATION PROVIDED BY THE RESPONDENT IS MISLEADING AND ERRONOUS 3. On March 13, 2015 , the FAA requested additional information from the Respondent regarding the matters at issue in this Part 16 proceeding (the “FAA Information2

Request”) . The Respondent responded on April 20, 2015 (the “Reply to FAA Information Request”)

. 4. Regarding “Primary and Secondary A eronautical Services,” FAA requested that Respondent: a. Provide documentary ev idence to demonstrate that Innisfree is providing, or subcontracting, required airframe and powerplant maintenance services. Docu mentary evidence should identify the maintenance service provider(s) and demonstrate that required maintenance services are available to aeronautical users during the day s and times specified by Section 5.7 of the 2012 revised Minimum Standards. Provide evidence that the maintenance provider has leased from the Respondent or Innisfree the minimum required ramp, hangar, and office space identified in Section 7.1.2 of the 2012 revised Minimum Standards. b. Provide documentary evidence identifying which secondary FBO services Innisfree provides ( or subcontracts) to aeronautical users in accordance with Sections 5.7 and 5.8 of the 2012 revised Minimum Standards. Documentary evidence should identify the service provider(s) and demonstrate that the required services are available to aeronautical user s during the days and times specified by Section 5.8 of the 2012 revised Minimum Standards. Provide evidence that the service provider(s) have leased from the Respondent or Innisfree the minimum required ramp, hangar, and office space identified in Section 7.1.2 of the 2012 revised Minimum Standards.

5. The Respondent provided a “survey” that it says was filled out by Innisfree’s General Manager, Carl Braddock (included as “Exhibit 10” in Respondent’s Reply to FAA Information Request, hereinafter the “Innisfr ee Survey” ).
6. The Innisfree Survey is an undated, unverified, and unwitnessed document, which has been submitted by the Respondent to prove the fact of the matter; this is, whether Innisfree complies with the Airport’s Minimum Standards for primary and se condary aeronautical services. As such the Innisfree Survey is hearsay. Under the Rules of Procedure,3

hearsay evidence is admissible; however the weight of the evidence is affected by the fact that it is hearsay. 14 C.F.R. 16.223(e). The glaring defici encies of the Innisfree Survey make it highly suspect.
7. No explanation is offered by either Innisfree or the Respondent as to when the survey was filled out . It could have been made in 2012 when Innisfree began operating as a FBO, or it could have been made recently, in response to the FAA’s information request. Furthermore, the Respondent has accepted the Innisfree Survey and the responses contained therein at face value

– Respondent apparently made no attempt to indepe ndently verify or confirm compliance. Respondent’s response to this particular item of the FAA’s information request is carefully crafted so that the Respondent itself makes no representation as to the veracity or credibility of the information

. 8. E ven if the Innisfree Survey is accepted at face value , along with its supporting documentation , and lack thereof, it shows plainly that Innisfree does not meet the Airport’s Minimum Standards for primary and secondary aeronautical services (discussed infra )

. Per haps because of the glaring noncompliance and the lack of its own investigation , the Respondent avoids directly stating whether or not Innisfree is in compliance with the Minimum Standards. 1

1 On page 5 of the Reply to the FAA Information Request, the Respondent states: “Pensacola served upon Innisfree a survey of all primary and secondary FBO services that are being provided by or through it, including identification of the services, whether or not they are being provided, and how (i.e., directly or by a subcontractor). Copies of the completed survey, which has been executed by Innisfree’s General Manager, and supporting correspondence are attached hereto collectively as Exhibit 10.” The Respondent’ s self

- serving response does not provide the documentation that the FAA requested. Further the Responden t does not attest to the veracity or accuracy of the Innisfree Survey.4 9. The plain fact that the Innisfree Survey itself confirms obvious noncompliance raises the question of when it was created. If it was created in 2012, then the Respondent has purposely ignored glaring noncompliance for three years , and has taken no steps to require compliance. If it was created recently for the Reply t o FAA Information Request, then this means that the Respondent never undertook the most basic of measures to ensure that Innisfree was compliant with the Minimum Standards when it began operating an FBO. Airframe and Powerplant Maintenance
10. The Innisfree Survey claims that airframe and powerplant maintenance , which is a required primary service of the Airport’s Minimum Standards, is provided by “Lifeguard Air Ambulance / Southern Sky Leasing LLC.” A copy of a letter, dated 2012, from Lifeguard
Air Ambula nce (“Lifeguard”) to Innisfree states that Lifeguard would provide “aircraft servicing and maintenance” on an “as needed basis” ( see Exhibit 10 of the Reply to FAA Information Request). No other information about the maintenance services is provided.
11. The Airport’s Minimum Standards require that maintenance services be available onsite, for a minimum of five days per week, eight hours per day. Clearly, services provided on an “as needed basis” do not meet the requ irements of the Minimum Standards to

ma ke maintenance services available five days per week, eight hours per day.
12. The only reasonable conclusion is that the arrangement between Innisfree and Lifeguard never met the Minimum Standard requirements to provide airframe and powerplant services on sit e and during all normal business hours

. 13. Either the Respondent never before reviewed Innisfree’s compliance with the
Minimum Standards mainte nance requirement, or if the Respondent did, then it purposefully5

looked away from the glaring deficiency. In eith er case, the Respondent was obligated to uphold the Minimum Standards and it has intentionally avoided doing so.
14. Furthermore, upon information and belief, the owner of Lifeguard sold the company to new management in 2014, and Lifeguard no longer provides a ny maintenance services for, or on behalf of, Innisfree. Upon information and belief, Innisfree has not found any subcontractor to replace Lifeguard. Avionics Maintenance and Sales
15. The Respondent states that “Avionics Solutions” provides subcontracted

ser vices of avionics maintenance and sales to Innisfree. Under the Minimum Standards, avionics maintenance and sales qualifies as a secondary FBO service only if a minimum amount of ramp, hangar, and office space is dedicated to it, and the services are provi ded five days a week for eight hours per day

. 16. The Respondent has not provided any documentation to support the existence of an arrangement between Avionics Solutions and Innisfree. It also has not shown that any ramp, hangar, or office space is dedicated t o Avionics Solutions. Neither has the Respondent provided any evidence that avionics maintenance and sales is provided for five days per week for eight hours for eight hours per day

. 17. The only reasonable conclusion is that any arrangement between Innisfree and Avionics Solutions never met the Minimum Standard requirements to provide avionics maintenance and sales on site and during all normal business hours . It is also reasonable to conclude that the Respondent never before reviewed Innisfree’s compliance with the6

Minimum Standards on this requirement because, if it had, based on the information that it has provided, the glaring failure would have been apparent. Aircraft Sales
18. The Respondent states that “Eric Evans Aviation LTD” (“Eric Evans”) provides subcontracted services of aircraft sales to Innisfree. Under the Minimum Standards, aircraft sales qualifies as a secondary FBO service if a minimum amount of ramp, hangar, and office space is dedicated to it, and it is open five days a week for e ight hours per day. The Respondent has not provided any documentation to support the existence of an arrangement between Eric Evans and Innisfree. It also has not shown that any ramp, hangar, or office space is dedicated to Eric Evans. Neither has the Resp ondent provided any evidence that aircraft sales is provided for five days per week for eight hours per day

. 19. Furthermore, there is no “Eric Evans Aviation LTD” registered with the Florida Department of State, Division of Corporations. Ewalt Aff., 3

. Wit hout registration within the State of Florida, a company is not permitted to do business in Florida. There is an “Eric Evans Aviation” aircraft sales company based in Mt. Vernon, Illinois; however there is no evidence from the company’s website that it has any relationship with Innisfree, or does business in Florida. Ewalt Aff., 5

. 20. The only reasonable conclusion is that any arrangement between Innisfree and Eric Evans never met the Minimum Standard requirements to provide aircraft sales on site and during all normal business hours . It is also reasonable to conclude that the Respondent never before reviewed Innisfree’s compliance with the Minimum Standards on this7

requirement because, if it had, based on the information that it has provided, the glaring fai lure would have been apparent.
B. RESPONDENT SUSPENDED THE HANGAR CONSTRUCTION OBLIGATION BUT STILL GRANTED RENTAL CREDITS TO INNISFREE. 21. The FAA also asked Respondent to clarify the status of the 9,000 sq. ft. hangar that Innisfree was required to buil d on Leased Premises No. 2 within 24 months of the effective date of Amendment No. 2 . The FAA also asked Respondent whether the rental credits, which were granted in exchange for construction of that hangar, were in effect. (FAA Request for Information, pg. 1

- 2.)
22. Astonishingly, the Respondent freely acknowledge s that seventeen months after the lease became effective, it willingly suspended Innisfree’s requirement to build the hangar. But , e ven though Innisfree ha s not invested in a hangar as required by Amend ed ment No. 2, and the deadline to do so is suspended, the Respondent allowed Innisfree to deduct $150,000 in rental credits anyway

. 23. The Respondent ’s rationale for suspending the hangar construction requirement is that the Part 16 proceeding may make the u se and viability of the hangar question able . However both the Respondent and Innisfree were fully and completely aware that Complainant questioned the terms and conditions of the grant of FBO status to Innisfree. In fact, Amendment No. 2 to the lease make s quite clear that the parties were aware of the risk involved. Both the Respondant and Innisfree specifically considered the risk of a third party challenge and concluded that “ the Operator has determined that it wishes to pro ceed, at its own risk, to ini tiate a full Fixed Base Operato r (FBO) business at the Airport [.] ”8 24. Even more specifically, Innisfree agreed to build the hangar in spite of the risk and agree d not to see reimbursement in case the FAA nullified the agreement.
T HIRD P ARTY C HALLENGES The City and the Operator agree, third parties could challenge this Amendment Number 2 to the Agreement. Therefore, the Operator understands that it is proceeding at its own risk concerning the planning, financing and constructing of facilities on the Exclusive Use Leased Premises

. In the event that federal authorities or a court of competent jurisdiction nullify this Amen dment Number 2 to the Agreement, the Operator agrees that it will not ask the City for reimbursement of costs and/or damages for development undertaken on Exclusive Use Leased Premises or business privileges changed or nullified. (Emphasis added) Amendment No. 2, page 8.

25. Astonishingly , the Respondent acknowledged that it had willingly suspended Innisfree’s requirement to build a h angar, then permitted it to deduct rental credits for the hangar it never built. Now Respondent excuses its intentional reversa l because of the risk of a third party challenge, the same risk that the parties were aware of all along.
26. Not only is the hangar required as a condition of Lease Amendment No. 2, it is also required by section 5.3.1 of the Airport’s Minimum Standards. The Respondent’s suspension of the hangar requirement is effectively a waiver of the Minimum Standards. However the Minimum Standards permit a waiver only when “it is determined that such waiver or modification is in the best interest of the public and will n ot result in unjust discrimination against other commercial operators at the Airport .” (Minimum Standards, Section 2.4.)9 27. T he Minimum Standards require the FBO to request a waiver, describing it and providing the reason for which it is sought, and providi ng a rationale and duration. Id

. Here, there is no evidence that Innisfree requested a waiver. Rather , the Respondent freely offer ed the waiver to Innisfree, without anything in return, and without any showing that it has evaluated whether the waiver will result in unjust discrimination to the Complainant. (Reply to FAA Information Request, Exhibit 1.) In fact, suspending the hangar requirement does result in unjust discrimination to the Complainant, because Innisfree is relieved of yet another requirement that the Respondent’s Minimum Standards and Lease Amendment No. 2 otherwise required. C. RESPONDENT HAS PERMITTED ASTONISHINGLY UNEQUAL ECONOMIC CONDITIONS THAT GRANT SUBSTANTIAL BENEFITS TO INNISFREE. 28. The only reasonable conclusion is that the Respondent has willingly permitted Innisfree to be in FBO business primarily to sell fuel at the Airport, while allowing Innisfree to flagrantly defy the minimal requirements of its own Minimum Standards. These are the same Minimum Standards which were watered down to accommodate Innisfree . Further, the Respondent suspended the hangar construction requirement, while still allowing Innisfree to deduct rental credits which were the bargained

- for consideration for tha t very hangar. The Respondent offers no rationale for such contradictory and discriminatory actions

. 29. The result of Respondent’ s actions and inactions is to grant a significant financial advantage to Innisfree

– a similarly

- situated FBO

– by permitting it to forego constructing a hangar, permitt ing it to reduce its ground lease rental rate without meeting the terms and conditions of the rental credit, and by not requiring it to provide the services10

required of the Minimum Standards or undertake the investments and overhead costs that correspond t o those services. RELIEF SOUGHT

30. Complainant requests the FAA admit the material information contained in this Motion to its consideration of this Part 16 proceeding. Further, Complainant requests all other timely determinations, orders, and relief as r equested and set forth in its prior submissions.

Dated: May 6 , 2015 Jericho, New York Respectfully submitted,

Leonard D. Kirsch , Esq. Shelley A. Ewalt , Esq. McBreen & Kopko Attorneys for Complainant 500 North Broadway , Suite 129 Jericho, New York 11753 Tel : ( 516) 364

- 1095 Fax : (516) 364

- 0612Certificate of Service I hereby certify that I have today, the 6 th day of May , 201 5 , caused the foregoing to Motion to Admit Material Facts to be served by electronic mail o n the following:

Office of the Chief Counsel Attn: FAA Part 16 Airport Proceedings Docket, AGC

- 610 Federal Aviation Administration 800 Independence Avenue, SW Washington, DC 20591 1 copy via E

- mail 9

- AWA

- AGC

- Part

- 16@faa.gov Attorney for Respondent Robert J. Williams Schnader Harrison Segal & Lewis LLP 120 Fifth Avenue, Suite 2700 Pittsburgh, PA 15222

- 3001 rwilliams@schnader.com

____________________ ____________________ Shelley A. Ewalt