:'^RTMENT OF 

•iSPORWION 

- i i OPERATIONS 

UN -M A M: 3 1 

SERVED JANUARY 3, 2011 

UNITED STATES DEPARTMENT OF TRANSPORTATION 

OFFICE OF HEARINGS 

WASHINGTON, D.C. 

Application of 

RECURRENT TRAINING CENTER, INC. 

FAA DOCKET NO. CPIOGLOOIO, successor to CP09GL0008 

DMS No. FAA-2010-0973, successor to FAA-2009-0971 

(Equal Access to Justice Action) 

INITIAL DECISION 

DENYING APPLICATION FOR ATTORNEY'S FEES 

AND OTHER EXPENSES 

Background 

This application under tiie Equal Access to Justice Act, 5 U.S.C. §504, 

originated in a proceeding in which the Federal Aviation Administration ("FAA" or 

"the agency") charged Recurrent Training Center, Inc. ("RTC" or "Applicant"), an Air 

Agency certificated for an approved Provisional Pilot School, with violations of 

§§141.41(b)(3), 141.83(a)(1), and 61.57(d) of the Federal Aviation Regulations 

("FARs"). The allegations originated in the nature of Instrument Proficiency Checks 

("IPCs") that the Applicant had conducted for two pilots. The agency had sought a 

civil penalty of $3,850. 

Following an oral evidentiary hearing, I issued an Initial Decision ("I.D.") in 

which I found that the allegations had not been proven. I dismissed the Complaint 

(^Federal Aviation Administration v. Recurrent Training Center, Inc., FAA Docket No. 

CP09GL0008, Initial Decision of Administrative Law Judge Richard C. Goodwin, 

served August 11, 2010). Neither party appealed. The case became 

administratively final. 

RTC filed an application for attorney's fees and other expenses under the 

Equal Access to Justice Act ("EAJA" or "the Act"), 5 U.S.C. §504, and implementing 

regulations 14 C.F.R. Part 14. The agency answered in opposition, and RTC, now the 

Applicant, filed a reply. For the reasons set forth below, 1 deny the application. 
Standards 

The EAJA requires an agency conducting an "adversary adjudication" to 

award fees and other expenses to a prevailing party (other than the United States) 

unless the position of the agency was "substantially justified" or special 

circumstances make an award unjust (5 U.S.C. §504(a)(l)). The FAA's rules 

implementing the statute essentially track its language (^ee §14.04). The burden of 

proof that an award should not be made rests with the agency. 14 CFR §14.04(a). 

It is not disputed that the underlying civil-penalty matter constituted an 

adversary adjudication in which the Applicant prevailed. Nor does the agency 

assert that "special circumstances" ought to foreclose a fee award. The parties 

differ on whether the agency was "substantially justified" in bringing and 

maintaining the action. 

An action is substantially justified when it has a reasonable basis for 

proceeding. It must be justified to a degree that would satisfy a reasonable person. 

Pierce v. Underwood, 487 U.S. 552, 565 (1988); 14 CFR 14.04(a); Michael Edward 

Wendt, FAA Order 93-9 (March 25,1993), p. 3; Neel v. Administrator, NTSB Order 

No. EA-4517, p. 5 n. 6,1996 NTSB Lexis 104, p. 5 n. 6 (1997). The standard is met if 

there is a "genuine dispute," or if reasonable people could differ as to the 

appropriateness of the contested action. Pierce v. Underwood, p. 565. 

The determination of "substantial justification" encompasses a review of the 

entire proceeding. It is decided "on the basis of the administrative record, as a 

whole, which is made in the adversary adjudication..." 5 U.S.C. §504(a)(l), 

"Substantial justification" connotes an active, searching inquiry into the quality of 

evidence advanced and the overall reasonableness of the agency's position. United 

Brothertiood of Carpenters and Joiners v. NLRB, 891 F.2d 1160,1163 (5* Cir. 1990). 

Failure to prevail does not raise a presumption of lack of substantial 

justification. It must not be assumed that the government's position was not 

substantially justified simply because it lost on the merits. Morgan v. Perry, 142 

F.3d 670,685 (3^^ Cir. 1998); Bay Area Peace Navy v. United States, 914 F.2d 1224, 

1231 n. 4 (9* Cir. 1990); MichaeiEdward Wendt, FAA Order 93-9 (March 25,1993), 

p. 3. Nor must the agency demonstrate that it had a substantial likelihood of 

prevailing to prove that its litigation position was substantially justified. Kiareldeen 

V. Ashcroft, 273 F.3d 542,554 (3>-d Cir. 2001); Michael Edward Wendt, FAA Order 

93-9. 

The decision in the underlying proceeding turned on an interpretation of a 

regulation. The agency's position was rejected. For the agency to prevail in this 

matter, it must show a reasonable basis for the legal theory propounded. Valley Air 

Services, Inc., FAA Order No. 95-27 (December 19,1995), pet forreconsid. denied, 

FAA Order No. 96-15 (May 3,1996); Smith v. National Transportation Safety Board, 
• f 

992 F.2d 849 (8* Cir. 1993). The FAA has demonstrated substantial justification if 

the legal theory it advanced is credible or plausible. See jazz Photo Corporation v. 

U.S., 502 F.Supp.2d 1277 (Ct. of Intl. Trade 2007). Even if the government's legal 

argument is ultimately rejected, it also may meet the test if it can show that the 

question involved was close or unsettled. Edge v. Schweiker, 814 F.2d 125,128 (S"""! 

Cir. 1987). By contrast, the government cannot show substantial justification if its 

legal position "clearly offend[ed] established precedent." Washington v. Heckler, 

756 F.2d 959,961-62 (3'-d Cir. 1985); Corona v. Barnhart, 431 F.Supp.2d 506, 511-

12 (E.D.Pa. 2006). 

Findings and Conclusions 

I find and conclude that the agency has sustained its burden of proof It has 

shown that its action in the underlying matter was substantially justified. I will 

deny the Applicant's application. 

The agency's position in the underlying matter rested on its contention that 

14 CFR §61.57(d) requires an IPC to test for all Instrument Rating Practical Test 

Standards. Although this interpretation ultimately was rejected, it is plausible. The 

language of the regulation refers to a "representative number of tasks required by 

the instrument rating practical test." The agency's position that the "instrument 

rating practical test" standards thereby were incorporated into §61.57(d), and thus 

were all mandatory, is plausibly suggested by that language. The parties, moreover, 

were unable to utilize precedent to help formulate their respective positions. There 

was none. The question was unsettled. Also supporting the agency's proof is the 

principle that FAA is entitled to "err" on the side of bringing close cases to trial to 

fulfill its mandate of enforcing and ensuring air safety. Manifestly that is what 

occurred in this matter. The agency demonstrably had a reasonable basis for 

proceeding and seeing the matter through. Against this background, I find that the 

agency was substantially justified in bringing and maintaining the underlying action. 

I conclude that the FAA met its burden of demonstrating that it had 

substantial justification under the Equal Access to Justice Act to bring and to 

maintain the underlying civil-penalty proceeding against Recurrent Training Center, 

Inc. 
For the reasons stated, I deny the application. 

Administrative Law Judge 

Attachment - Service List 

w 

m 

' This decision becomes final 30 days after its issuance unless a party appeals or the FAA Decisionmaker 

takes review under his or her own initiative. 14 CFR § 14.28(a). The appeal must be either (a) mailed to the 

Federal Aviation Administration, 800 Independence Avenue, S.W., Washington, D.C. 20591, Attention: 

Hearing Docket Clerk, AGC-430, Wilbur Wright Building - Suite 2W1000; or (b) delivered personally or 

via expedited courier service to the Federal Aviation Administration, 600 Independence Avenue, S.W., 

Wilbur Wright Building - Suite 2 W1000, Washington, D.C. 20591, Attention: Hearing Docket Clerk, 

AGC-430. 
FAA Docket No. CP09GL0008 

(Civil Penalty Action) 

SERVICE LIST 

ORIGINAL & ONE COPY 

Federal Aviation Administration 

800 Independence Avenue, S.W, 

Washington, DC 20591 

Attention: Hearing Docket Clerk, AGC-430 

Wilbur Wright Building—Suite 2W1000' 

ONE COPY 

Charles R, Barnett, III, Respondent's Counsel 

1664 Moorland Lane 

Crystal Lake, IL 60014-2985 

TEL: 815-356-8647 

FAX: 815-356-7042 

Briana Morgan, Complainant's Counsel 

Great Lakes Region, AGL-7M 

Federal Aviation Administration 

2300 East Devon Avenue 

De5 Plaines, IL 60018-4696 

TEL: 847-294-7313 

FAX: 847-294-7498 

The Honorable Richard C. Goodwin, Administrative Law Judge 

Office of Hearings, M-20 

1200 New Jersey Avenue, S.E. 

East Building Ground Floor 

Room El2-320 

Washington, DC 20590 

TEL: 202-366-2139 Attorney-Advisor 

202-366-5121 Legal Assistant 

FAX: 202-366-7536 

' Service was by U.S. Mail. For service in person or by expedited courier, use the following address: Federal 

Aviation Administration, 600 Independence Avenue, S. W., Wilbur Wright Building—Suite 2W1000, Washington, 

DC 20591; Attention: Hearing Docket Clerk, AGC-430.