U.S . DEPARTMEN T O FTRANSPORTATIO N FEDERA L AVIATIO N ADMINISTRATIO N

I N TH E MATTERO F APOLL O A & H S 

## JA N2 9 

## 2 m Compan y ^^^'^W G DQCKE T FA A DOCKE T NO . CP08AL000 1 (Civi l Penalt y Action ) DM S No . FAA-2008-0783

COMPLAINANT' S APPEA LBRIE F \'^: ^ C D Complainant , th e Federa l Aviatio n Administration , hereb y files thi s Appea l Brie f i n accordanc e with sectio n 13.233(c ) o f th e Rule s o f

Practic e i n FA A Civi l Penalty Actions , 1 4 C.F.R. § 13.233(c). ' 

### STATEMENT O F TH E CAS E AN D FACT S O n Januar y 7,2008 , Complainan t issue daNotic e o f

Propose dCivi l Penalty (NPCP ) i n whic hi t propose dt o asses s a$22,50 0 civi l penalt y for Respondent' s allege dviolation s o f th e HMR . I n th e NPCP , Complainan t allege dtha t 1 . O n o r

abou t Augus t 16 , 2007 , [Respondent ] knowingl y use dan employe e t o offe r t o Federa l Expres s ashipmen t containin g hazardou s materia l for transportatio n b y ai r fromHon g Kong , People' s Republi c o f China , t o Ne w York , Ne w York . 2 . Th e abov e shipmen t consiste do f

on e fiberboar dbox , an d[Respondent ] presente d i t t o Federa l Expres s o n Internationa l Ai r Waybil l No . 860 7 729 0 777 0 0402 . 3 . Th e above bo x containe dsom e 19,20 0 safety matche s package di n paperboar d boxes . 4 . Safet

y matche s ar e classifie da s ahazardou s materia l unde r § 172.10 1 o f

th e .. . HMR , 4 9 C.F.R . Chapte r I , Subchapte r

C (Part s 171-80) . Thei r

prope r shippin g Complainant' s appea

l brie f wa s originally due o

n Decembe

r 24 , 2009 . I

n a n orde r servedo n Decembe

r 17 , 2009 , Complainan

t wa s granteda

n extension of

tim e unti l Februar

y 1 , 201 0 to file it s appea

l brie fnam e i s "Matches , safety. " The y are i n hazar dclas s 4. 1 an dpackin g grou p III , an dhav e a n assigne didentificatio n numbe r o f U N 1944 . 5 . Th e offerin g o f

ashipmen t

containin g hazardou s material s a s describe dabov e i s a fimction tha t

directl y affect s hazardou s material s transportatio n safety . A t th e tim e o f th e event s describe dabove , therefore , th e employe e o f [Respondent ] tha t offere dth e shipmen t

was ahazma t

employe e unde r

th e HMR . 6 . A t th e tim e o f

th e events describe dabove , [Respondent ] ha dfaile dt o ensur e that th e abov e employe e ha dreceive dth e trainin g specifie di n Subpart H o f part 17 2 o f th e HM Rwithi n th e precedin g thre e years . 7 . A t all time s mentione dherein , th e bo x wa s no t accompanie db y aShipper' s Declaratio n fo

r Dangerou s Goods . 8 . [Respondent ] offere dth e above-describe dshipmen t o f hazardou s materia l for transportatio n b y ai r

whe n th e shippin g paper s di dno t contai n th e prope r

shippin g nam e o f eac h hazardou s material , th e hazar dclas s o f eac h hazardou s material , th e assigne didentificatio n numbe r o f eac h hazardou s materia l precede db y "UN " o r "NA, " a s applicable , th e packin g grou p i n Roma n numerals , th e tota l quantity b y weigh t o r volum e o f

eac h hazardou s materia l covere db y th e description , an dth e basi c descriptio n o f

eac h hazardou s materia l show n i n sequence . 9 . [Respondent ] offere dth e above-describe dhazardou s materia l fo r transportatio n withou t includin g i n th e shippin g paper s an emergenc y respons e telephon e nvunbe r a s prescribe di n Subpart

Go f Part 17 2 o f th e HMR . 10 . [Respondent ] offere dth e above-describe dhazardou s materia l for transportatio n b y ai r withou t includin g i n th e shippin g paper s astatemen t indicatin g that

th e shipmen t i s withi n th e limitation s prescribe dfo r eithe r passenge r

an dcarg o aircraf t o r carg o aircraf

t only . 11 . [Respondent ] offere dth e above-describe dhazardou s materia l for transportatio n b y ai r whe n i t di dnot certif y tha t eac h hazardou s materia l was i n accordanc e with th e HM Rb y printin g th e certificatio n se t fort h i n § 172.204(a ) o r

§ 172.204(c)(1 ) o f th e HM Ro n th e shippin g papers . 12 . [Respondent ] offere dth e above-describe dhazardou s materia l for transportatio n b y ai r an ddi dno t

provid e tw o (2 ) copie s o f th e require dshipper' s certification . 13 . [Respondent ] offere dth e above-describe dshipmen t for transportatio n b y ai r withou t includin g i n th e certificatio n require db y § 172.20 4 o f th e HM Rth e followin g statement : " I declar e that al l o f th e applicabl e ai r

transportatio n requirement s hav e bee n met. "14 . [Respondent ] offere dth e above-describe dhazardou s materia l whe n th e bo x was not marke do r

labele di n an y manne r

tha t woul dindicat e th e hazardou s natur e o f it s contents . 15 . [Respondent ] offere dth e above-describe dshipmen t for transportatio n b y ai r

whe n th e bo x wa s no t

marke dwit h th e prope r

shippin g nam e an dth e assigne d identificatio n numbe r

o f eac h hazardou s materia l containe di n it , an dth e require d marking s i n Englis h wer e no t printe do n o r

affixe dt o th e surfac e o f

th e box . 16 . [Respondent ] offere dth e above-describe dshipmen t for transportatio n b y ai r

whe n n o "Flammabl e solid " labe l was affixe dt o th e box . Complainan t

further allege dtha t

Responden t

violate dth e followin g section s o f th e HMR : 171.2(e) , 172.200(a) , 172.201(d) , 172.202(a)(1) , 172.202(a)(2) , 172.202(a)(3) , 172.202(a)(4) , 172.202(a)(5) , 172.203(f) , 172.204(a) , 172.204(c)(2) , 172.204(c)(3) , 172.300(a) , 172.301(a) , 172.400(a) , 172.600(c) , 172.702(a) . ^e e Appendix . Durin g th e investigatory phas e o f th e case , before th e NPC P wa s issued . Responden t submitte darespons e t o Complainant' s lette r o f investigation , i n whic h i t admitte dtha t

i t offere d an undeclare dshipmen t

o f safet y matche s t o Federa l Expres s for transportatio n b y air . Exh . C-1 , Lette r date dOctobe r

3 , 2007 . Responden t

state dtha t

th e shipmen t

wa s suppose dt o contai n displa y sample s consistin g o f woode n sticks , but

was filledwith actua l safet y matche s instead . Id . I n respons e t o th e NPCP , Responden t state dtha t

i t di dno t knowingl y shi p hazardou s material s b y ai r

an dprovide ddocumentatio n i n support . Exh . C-1 , Respons e t o NPC P a t 3- 4 an d Attachment s 1-7 . Responden t indicate dtha t

on e o f it s customer s ha drequeste da n orde r o f sampl e matchbook s t o b e filledwith woode n stick s painte dt o loo k lik e matches . Id . a

t 3 an d Attachment s 1-4 , 6 . O n Augus t 14 , 2008 , on e o f

Respondent' s employees , Esthe r Wong , assume dtha t

th e orde r was incorrec t

an dsubstitutedactual matche s for th e woode n sticks . Id. , Attachmen t

5 . O n Augus t

15 , 2008 , employe e Alic e L o offere dth e shipmen t t o Federa l Expres sno t

knowin g tha t

th e woode n stick s ha dbee n replace dwith actua l matches . Id. , Attachmen t 7 . Responden t

requeste da

n informal conference , whic h was hel do n Apri l 22 , 2008 . O n Jun e 30 , 2008 , Complainan t issue daFina l Notic e o f

Propose dCivi l Penalty (FNPCP ) incorporatin g all o f

th e allegation s i n th e NPCP . Responden t requeste dahearing o n Jul y 10 , 2008 . Complainan t

filedit s complain t

o n Jul y 15 , 2008 . O n Augus t 10 , 2008 , Responden t

sen t a lette r t o Complainan t

requestin g " adismissa l o f th e civi l penalty, " assertin g tha t it s investigatio n o f th e matte r

reveale dtha t

th e material s tha t

wer e shippe dwer e unabl e t o b e ignite dan dha donl y th e shap e an dcolo r

o f actua l matches . Exh . C-3 . O n Jul y 23 , 2009 , Complainan t filed amotio n for

decision . Exh . C-1 . Construin g Respondent' s Augus t

10,200 8 lette r

a s it s answe r

t o th e complaint , Complainan t note dtha t Responden t

denie donl y on e o f

th e allegation s i n th e complaint—^tha t th e shipmen t

offere dt o Federa l Express^ n o r

about^ugus t

16 , 200 8 containe d19,20 0 safet y matches . /«/ . a t

2 . Complainan t

state dtha t

th e evidenc e i n th e investigativ e file, togethe r with Respondent' s admission s i n it s respons e t o th e lette r o f investigatio n an dth e NPCP , establishe dthat th e material s tha t

wer e offere dfor

transportatio n b y ai r

o n o r abou t Augus t 16 , 200 8 wer e actua l safet y matche s an dwer e not

merel y stick s painte dt o loo k lik e safet y matches . Id . at

1-2 . I n support , Complainan t

submitte dth e declaratio n o f Special Agen t

Gary Meaders , wh o inspecte d th e shipmen t

an dfoun dtha t

i t containe dapproximatel y 19,20 0 safet y matche s packe di n a fiberboardbo x tha t

was no t marke do r

labele di n accordanc e with th e HMR . Exh . C-1 , Declaratio n o f

Gary D . Meader s at

para . 2- 3 an dAttachmen t A , Photograph s 1-9 . Special Agen t

^ Respondent' s Augus t

10, 2009 lette

r t o Complainant' s counse

l presumabl

y wa s i n respons e to th e Complaint . Exh . C-3 . I

n it s motion fo

r decision . Complainan

t construedth e Augus t

1 0 lette r as Respondent' s answer . Exh . C- 1 a t 2 . Respondent , however , di dnot file a n officia l answe r to the complain t wit hth e Hearing Docke

t a s requiredby section 13.20 9 of the Rule s of

Practice , 1 4 C.F.R . § 13.209 . Se

e Exh . C-3 . Accordingly , b y rule , all of

th e allegation s i

n th e complain

t shouldb e deeme d admitted . 1 4 C.F.R . § 13.209(f) .Meader s state dthat , upo n physica l inspectio n o f th e shipment , h e determine dtha t th e item s i n th e shipmen t

wer e actua l safet

y matche s base do n thei r

appearanc e an dth e distinctiv e odo r o f phosphorou s emanatin g fro mth e matc h heads . Id. , Declaratio n at para . 3 an dAttachmen t

A , Photograp h8 . I n ligh t o f thi s evidenc e an dRespondent' s failur e t o den y an y o f th e remainin g allegation s i n th e complaint . Complainan t argue dtha t

i t wa s entitle dt o judgmen t a s amatte r

o f law . Exh . C- 1 at

2 . Wit h regar dt o th e propose dsanction . Complainan t asserte dtha t

th e amoun t sought , $22,500 , wa s wel l withi n th e rang e specifie di n th e sanctio n guidanc e for HM R violations , whic h i s foim

di n FA A Orde r

2150.3A , Appendi x 6 . Id . a t 3 . I n support . Complainan t

attache dacop y o f

th e sanctio n guidanc e an da n affidavi t fromSpecia l Agen t Meader s explainin g ho w Complainan t arrive dat

th e propose dsanction . Exh . C-1 , Declaratio n at -para . 5 an dAttachmen t

D ; se e FA A Orde r

2150.3A , Appendi x 6 . Specia l Agen t

Meader s determine dtha t th e matche s tha t

Responden t

shippe di n ai r transportatio n wer e i n Risk Category A , whic h warrante damaximum-rang e penalty.' ' Exh . C-1 , Declaration at

para . 5 an dAttachmen t

D ; FA A Orde r

2150. 3 A , Appendi x 6 at 6 , 18 . Respondent' s conduc t

fel l withi n Offens e Category I I o f th e sanctio n matri x becaus e th e shipmen t was undeclare dbu t

withi n hazardou s material s quantity limitations . Exh . C-1 , Declaration at

para . 5 an dAttachmen t

D ; FA A Orde r

2150. 3 A , Appendi x 6 , Figur e 1 at 14 . Base do n th e fact s an dcircumstance s o f th e case , includin g Respondent' s initia l admissio n that i t ha dshippe dsafet

y matches . Specia l Agen t Meader s determine dtha t Responden t

violate dth e subcategorie s i n Offens e Category B an ddetermine dtha t amid-range , rathe r

tha n amaximum

- ^ FA A Orde r 2150. 3 A , Appendix 6 , Figur e 2 , page 1 8 provide s tha

t Ris k Categor y A material s ar

e assignedamaximu

mweigh t becaus e of

their potentia l to hav e a"catastrophi c effec t o n a n aircraft' s abilit y to continue saf

e flight , resulting i

n acrash o r emergency landin g causing injur y o r deat h to passenger s an

dflightcrew , a s well as person s o n th e ground. " FA

A Orde r 2150.3A , Appendix 6 a

t 18 .rang e penalt y was appropriate.' * Exh . C-1 , Declaratio n at para . 5 an dAttachmen t

D ; FA A Orde r 2150.3A , Appendi x 6 a

t 14,16 . Applyin g th e fact s an dcircumstance s i n thi s cas e t o th e sanctio n matri x containe di n th e penalt y guidanc e fo r HM Rviolations . Specia l Agen t Meader s determine dtha t

Responden t

committe dviolation s i n five differen t subcategories : shippin g papers , marking , labeling , training , an demergenc y respons e information . Exh . C-1 , Declaratio n a t para . 5 an dAttachmen t

D ; FA A Orde r

2150.3A , Appendi x 6 at

10,14 . H e further

determine d tha t apenalt y i n th e amoun t

o f $4,50 0 wa s appropriat e for eac h o f th e five subcategorie s o f offens e tha t

wer e violated , resultin g i n atota l recommende dsanctio n o f $22,500 . Exh . C-1 , Declaratio n at

para . 5 an dAttachmen t

D ; FA A Orde r

2150.3A , Appendi x 6 a

t 10 . A hearin g wa s hel do n Augus t 21 , 200 9 i n Anchorage , Alaska . Tr . a t 4 . A s apreliminary matter , th e AL J note dtha t coimse l for

th e Complainan t

was present , but

tha t n o on e was presen t o n behal f o f Respondent . Id . at

4-5 . Counse l for

th e Complainan t

notedtiiat-Complainant4ia d— filedamotio n for

decision , whic h was delivere dt o Responden t b y Federa l Expres s o n Jul y 27 , 2009 , an daske dth e AL J t o gran t th e motion . Id . a t

5-6 , Exh . C-2 . Th e AL J determine dthat , base do n Respondent' s failure t o appear , i t ha dabandone dit s reques t fo r ahearing . Tr . at

6 . Th e AL J note dtha t

h e ha don e concern regardin g th e evidenc e tha t th e hazardou s material s tha t

wer e shippe dwere , i n fact , matches . Id . at 8 . Coimse l for

th e Complainan t explaine dthat , initially . Responden t admitte dthat

i t ha dshippe dactua l safet

y matches . Id . at

9 . Later , o n Augus t

10 , 2009 , Responden t

sen t Complainan t

alette r i n whic h i t

asserte dtha t

i t ha d shippe dsample s painte dt o loo k like matches , rathe r

than actua l matches . Id . at 8-9 ; Exh . C-3 . Counse l for

th e Complainan t

state dtha t

th e motio n for

decisio n containe dadeclaratio n from

' * Offense Categor

y B i s appliedto busines s entitie s tha t do not us e o r handl e hazardou s material s i n the cours e of busines s o

r regularly offer, accept , o

r transpor t hazardou s material s i

n the cours e o

f business . FA A Orde r 2150.3A , Appendix 6 at

14 , 16 . Unde

r the sanction matrix , th e ordinar y rang e o f sanction fo

r eac hsubcategor

y of offens e violate di s $1,500 to $7,500 . Id . a t 14 .Special Agen t Meaders , wh o explaine dho w h e determine dthat th e material s wer e safet

y matches . Tr . a t

9-10 ; se e Exh . C-1 , Declaratio n a t para . 3 . Wit

h regar dt o th e propose dcivi l penalty , counse l fo

r th e Complainan t

note dtha t

th e motio n for

decisio n als o include dth e sanctio n guidanc e tabl e fo r violation s o f

th e HM Ralon g with an explanatio n o f ho w i t arrive da t th e propose dcivi l penalty o f $22,500 . Tr . a

t 7-8 . Th e AL J foun dtha t Responden t

was deeme d t o hav e admitte dal l o f

th e allegation s i n th e complain t and , subjec t

t o hi s revie w o f

th e evidence , h e woul dente r

adecisio n i n favo r

o f Complainant . Id . a t

6-7 , 10 . Th e AL J als o foun dthat , subjec t t o hi s revie w o f

th e evidence , h e woul dasses s acivi l penalt y i n th e amoimt o f $22,500 . Id . a t 10 . Th e AL J issue dawritte n initia l decisio n an dorde r o n Novembe r

4 , 2009 . Initia l Decisio n a

t 1 . Th e AL J reiterate dtha t Responden t

ha dconstructivel y admitte dal l o f th e allegation s i n th e complaint . Initia l Decisio n a t 2 . Th e AL J als o determined , after arevie w of

— th e evidence , tha t

Complainan t

ha d"prove dit s cas e o n th e merits. " Id . Th e AL J foun dtha t Special Agen t

Meaders' s declaratio n establishe dthat th e shipmen t

containe dsafet

y matche s an d that i t di dnot contai n an y o f

th e "marking , labeling , an dothe r informatio n that

th e HMR s require. " Id. ; Exh . C-1 , Declaration at paras . 2- 3 an dAttachmen t A . Th e AL J als o foun dthat Responden t

ha dadmitte dth e allegation s i n th e Complain t i n it s writte n response s t o th e lette r o f investigatio n an dth e NPCP , respectively . Id . at 2-3 ; Exh . C-1 , Respons e t o NPC P at 3- 4 an d Attachment s 1-7 , Declaratio n at Attachmen t

C . Withregar dt o th e propose dcivi l penalty , th e AL J state dtha t h e was require dt o conside r th e totality o f

th e circumstance s i n determinin g th e appropriat e amount . Id . at 3 . Th e AL J note d tha t case s involvin g undeclare dshipment s o f hazardou s material s ar e "particularl y worrisome " an dthat , unde r

th e FAA' s sanctio n guidanc e for violation s o f

th e HMR , shipment s o f

matche s8

ar e assigne damaximu mrisk becaus e o f

th e potentia l dange r

the y pos e t o saf

e flight. Id . a t

3-4 . Th e ALJ observe dtha t

Complainant , i n it s sanctio n determination , categorize dResponden t a s a "busines s entity " subjec t

t o apenalt y i n th e low-to-mediu mrange . Id . at 4 ; se e Exh . C-1 , Declaration at

para . 5 , Attachmen t

D . Usin g th e sanctio n matrix . Complainan t determine dthat $4,50 0 wa s th e midpoin t

o f th e penalt y rang e an dmultiplie dtha t amoun t b y th e five offens e categorie s tha t

wer e foun dt o hav e bee n violated , resultin g i n apropose dpenalt y o f $22,500 . Id . Th e AL J foun dtha t

acivi l penalt y o f

$9,000 , rathe r

tha n $22,500 , wa s warrante dbase d o n th e totality o f

th e fact s an dcircumstance s i n th e case . Id . at 4-5 . Th e ALJ determine dtha t ther e wer e tw o violation s fo r sanctio n purposes : "on e involvin g th e absenc e o f informatio n o n th e package , an dth e othe r concernin g th e lac k

o f training. " Id . a t

4 . H e the n assigne damid

rang e penalty o f

$4,50 0 for

eac h violatio n "i n conformanc e with Complainant' s suggestion. " Id . -"Pa e ALJ reasoned^a t

"i n non-egregiou s cases , assessin g multipl e penaltie s for wha t i s essentiall y on e typ e o f

violation—^tenderin g ashipmen t lackin g th e requisit e information— shoul db e avoided. " Id . Th e AL J als o note dthat tha t Responden t

was not i n th e busines s o f shippin g hazardou s material s an dha d"readil y admitte dt o th e ac t comprisin g th e violations. " Id . Th e AL J conclude dtha t

a$9,00 0 civi l penalt y wa s appropriat e i n ligh t o f th e statutory factor s se t fort hi n 4 9 U.S.C . § 5123(c) . Id . at 4-5 . Complainan t

filed atimel y notic e o f

appeal . STANDAR D O FREVIE W O n appeal , th e FA A Decisionmake r mus t conside r whethe r th e ALJ' s conclusion s o f law ar e i n accordanc e with applicabl e law , precedent , an dpubli c policy . 1 4 C.F.R . § 13.233(b)(2) .9 ISSU E Th e sol e issu e o n appea l i s whethe r th e AL J erre di n assessin g alowe r civi l penalty for Respondent' s violation s o f th e HMR—$9,000—^tha

n th e civi l penalt y requeste di n th e Complaint—$22,500 . ARGUMEN T Th e AL J erre db y failin g t o appl y th e FAA' s validl y adopte dsanctio n guidanc e polic y i n determinin g th e sanctio n i n thi s case . Th e ALJ foun dthat

Responden t

violate dth e HM Ra s allege di n th e Complaint . Tr . at 6 - 7 , 10 ; Initial Decisio n at

2 . H e determined , however , tha t th e violation s warrante dacivi l penalt y i n th e amoun t

o f $9,000 . Complainan t

submit s tha t

th e ALJ erre di n assessin g acivi l penalty lowe r tha n th e $22,50 0 civi l penalt y requeste di n th e Complain t becaus e hi s basi s for

reducin g th e amoun t

o f th e civi l penalt y wa s arbitrary an dinconsisten t with applicabl e law , precedent , an d FA A sanctio n guidance . A . Th e AL J erre di n assessin g acivi l penalt y base do n tw o violation s of th e HM Rwhe n th e undispute devidenc e i n th e recor destablishe dtha t Responden t

violate dfiv e distinc t

subpart s o f

th e HMR . Th e statut e governin g th e transportatio n o f hazardou s materials , 4 9 U.S.C . § 5101 , e t seq . provide s tha t

"[a ] perso n that

knowingl y violate s thi s chapte r o r aregulation , order , special permit , o r approva l issue dunde r

thi s chapte r

i s liabl e t o th e Unite dState s Governmen t for acivi l penalty o f

a t leas t $25 0 bu t no t mor e tha n $50,000/o r

eac h violation. " 4 9 U.S.C . § 5123(a)(1 ) (emphasi s added) . I f

th e violatio n i s relate dt o training , th e minimu mpenalt y i s $450 . 4 9 U.S.C . § 5123(a)(3) . I f

th e violatio n "result s i n death , seriou s illness , o r sever e injur

y t o an y perso n o r substantia l destructio n o f property, " th e maximu mpenalty i s $100,000 . 4 9 U.S.C . § 5123(a)(2) . Th e FA A ha s develope dpenalty guidelines , approve db y th e Administrator , t o guid e prosecutoria l discretio n an dt o "promot e arelativ e consistenc y i n determinin g civi l penalties for1 0

violation s o f

th e .. . HMR. " FA A Orde r 2150.3A , Appendi x 6 at

1 (Apr . 14 , 1999) . Thes e penalty guideline s wer e adopte dan dincorporate dint o FA A Orde r 2150.3A , a s publishe di n th e Federa l Register , an drepresen t th e polic y o f

th e Federa l Aviatio n Administration . 6 4 Fed . Reg . 19443-1945 0 (Apr . 21 , 1999) ; se e I n th e Matte r o f Northwes t

Airlines , Inc. , FA A Orde r No . 90

- 37at9(Nov . 7 , 1990) . Unde r th e penalt y guideline s containe di n FA A Orde r 2150. 3 A , Appendi x 6 , offens e categorie s ar e divide dint o subcategorie s tha t correspon dwith subpart s o f th e HMR . Compar e FA A Orde r

2150.3A , Appendi x 6 a

t 1 4 (offens e categories ) wit h 4 9 C.F.R . part

172 , subpart s C (shippin g papers) , D (marking) , E (labeling) , G (emergenc y respons e information) , an dH (training) . Agenc y personne l evaluat e th e cas e t o determin e whic h subcategorie s o f th e correspondin g regulation s wer e allegedly violate dan dthe n assig n asingle penalt y amoim t for eaclrretevantgroup T FA A Orde r 2150.3A , Appendi x 6 at^^lOr-ThisTS^thercase^eveirdiough- ^ th e NPC P ma y cit e numerou s violation s o f aparticular

.. . subpart

o f th e HMR , unles s upwar d departur e i s justified. " Id . at 10 . Sanction s are not

assesse dfor

violatio n group s i f

ther e hav e bee n n o violation s o f

th e correspondin g subpart . Id . Th e penaltie s attribute dt o eac h violatio n grou p are adde dtogethe r

t o reac h th e recommende dsanction . Id . at 4,10 . Althoug h ALJ' s ar e no t

boun dt o follo w th e penalty guidelines , the y are entkel y subjec t t o th e agenc y wit h regar dt o matter s concernin g agenc y la w an dpolicy . Northwes t Airlines , Inc. , FA A Orde r

No . 90-3 7 at

8 (citin g Assoc , o f

Admin . La w Judge s v . Heckler , 59 4 F.Supp . 1132 , 114 1 (D.D.C . 1984)) . Accordingly , th e FA A Decisionmake r ma y revers e th e ALJ' s sanctio n determinatio n o n appea l whe n i t i s inconsisten t

with agenc y policy . Id . at 9-10 ; se e Ira n Ai r

v . Kugelman , 99 6 F.2 d1253 , 126 2 (D.C . Cir . 1993 ) (holdin g tha t th e agenc y decisionmake r "remain s th e final administrativ e arbite r o n question s o f

la w an dpolicy") .1 1

Here , th e AL J foun dtha t

th e undispute devidenc e i n th e recor dsupporte dafinding tha t Responden t

ha dcommitte dal l o f

th e violation s o f

th e HM Rallege di n th e Complaint . Tr . at 6-7 , 10 ; Initia l Decisio n at

2 . Thes e violation s can b e groupe dint o five o f th e subcategorie s foun di n Offens e Category I I o f

th e sanctio n matrix : shippin g papers , labels , markings , training , an d emergenc y respons e information . Se e Exh . C-1 , Declaratio n a t para . 5 an dAttachmen t

D . Althoug hth e AL J accepte dComplainant' s recommendatio n t o asses s amid-rang e penalt y o f $4,50 0 fo r eac h grou p o f

regulation s (subcategorie s o f "Offens e Categor y 11") , th e AL J conclude dtha t

Responden t

shoul db e subjec t

t o sanctio n for

onl y tw o violations : on e for th e lac k o f require dinformatio n o n th e packag e an don e fo r training . Initia l Decisio n at 4 . In reducin g th e subcategorie s o f

offense s tha t

wer e subjec t

t o sanction , th e ALJ erroneousl y combine dfour o f th e subcategories—^shippin g papers , labels , markings , an demergenc y respons e information— int o asingl e subcategory tha t h e characterize da s "tenderin g ashipmen t lackin g th e require d information. " Id . I n support o f hi s assessmen t

o f a$9,00 0 civi l penalty , th e ALJ , citin g I n th e Matte r o f Pau l A . Carr , FA A Orde r No . 98- 2 (Mar . 12 , 1998) , determine dtha t increasin g th e sanctio n b y "assessin g multipl e penaltie s for wha t i s essentiall y on e typ e o f violation.. . shoul db e avoided. " Initia l Decisio n a

t 4 (citin g Car r

a t 13-14) . I n Carr , th e FA A Decisionmake r foun dthat

man y o f th e violation s allege di n hazardou s material s case s wer e "duplicative " and , a s aresult , i t wa s no t appropriat e t o conside r

thes e "duplicative " violation s a s separat e violation s for sanctio n purposes . Car r

at 11-12 , 14 . Carr , however , wa s decide dbefore th e FA A adopte dth e penalty guideline s and , a s aresult , shoul dnot b e viewe da s controllin g i n th e instan t case . Th e FAA' s penalt y guideline s for violation s o f

th e HMR , whic h appl y i n thi s case , effectivel y addres s th e FA A Decisionmaker' s concern s regardin g th e "pilin g on " o f violation s1 2

fo r sanctio n purpose s b y applyin g asingl e sanctio n for eac h violatio n grou p regardles s o f th e numbe r o f individua l regulatory violation s ple di n th e Complaint , unles s a n upwar ddepartur e i s warranted . FA A Orde r

2150.3A , Appendi x 6 at

10 . Contrary t o th e ALJ' s reasoning , th e violatio n group s tha t

h e combine dint o asingle violatio n grou p ar e no t duplicative ; eac h grou p require s proo f

o f differen t elements . Th e FA A Decisiomnaker recognize da s muc h i n Car r whe n sh e maintaine dth e distinctio n betwee n violation s o f different subpart s o f

th e HMR—shippin g papers , labels , markings , an dpackaging—^notwithstandin g he r findin g tha t

certai n violation s shoul dnot

coun t separatel y fo r

sanctio n purposes . Se e Car r at 1 5 n.25 . I n Carr , th e FA A Decisionmake r

foun dthat , o f

th e 1 3 regulatory violation s allege di n th e Complaint , onl y 8 shoul db e subjec t

t o sanction . Id . at

10 , 15 . O f

thes e 8 violations , 5 wer e violation s o f variou s provision s i n subpart

C (pertainin g t o shippin g papers) , whil e th e remainin g 3 wer e equall y divide damon g subpart

D (pertainin g t o markings) , subpart E (pertainin g t o labeling) , an d 4 9 C.F.R . 17 3 subpart

B (pertainin g t o packaging). ^ Se e id . at 1 5 n.2 5 an dAppendi x A . Eac ho f th e subpart s at

issu e i n thi s case—shippin g papers , labels , markings , an d emergenc y respons e information—concern distinc t communicativ e fimctions. Eac h o f th e communicativ e fimction s i s a n essentia l componen t o f th e regulatory schem e tha t ha s bee n develope dt o ensur e safet y i n th e transportatio n o f

hazardou s materials . Th e requuement s tha t package s containin g flammable solid s (matches ) b e properl y marked , labeled , an ddescribe do n shippin g paper s place s person s that accep t an dtranspor t

(e.g. , ai r carriers ) o n notic e a s t o th e hazardou s natur e o f

th e content s o f

th e packag e and , i n turn , provide s thos e persons with th e informatio n necessar y t o compl y with th e handlin g an dstowag e requirement s that th e HM R place s upo n them . Se e generall y 4 9 C.F.R . 17 2 subpart s C (shippin g papers) , D (labelmg ) an dE

^ I t i s noteworth

y tha t ha dthe penalt

y guideline s appliedi

n Carr , the numbe

r of violation s subjec

t to sanction wouldhav e bee

n reducedeve

n further—^t

o 4—becaus e th e 5 separat

e shipping pape

r violation s wouldhave bee

n rolledint

o asingl e violatio n group . FA A Orde r 2150. 3 A , Appendix 6 a

t 4 , 10 .1 3

(marking) . Emergenc y respons e informatio n als o ha s adistinc t communicativ e functio n i n tha t i t provide s first

responder s with informatio n concernin g th e risk pose db y th e material s mth e shipment , ho w t o provid e immediat e an deffectiv e first ai di f contac t wit h o r exposur e t o th e materia l occurs , an dho w t o clean u p spill s o r leaks . .Se

e 4 9 C-F-R

- 172 , subpart

G(ernergenc y respons e information) . Eac h o f thes e regulatory requirement s provide s aseparat e metho do f communicatin g essentia l informatio n abou t th e packag e an dit s contents . Together , the y creat e a syste mo f safeguards , limitations , an dcontrols . A shipper' s failur e t o compl y with an y on e o f thes e communicatio n requirement s result s i n abreakdow n o f th e regulator y schem e an drender s th e syste mo f

safeguard s ineffective . I n vie w o f

th e foregoing , ther e i s n o basi s t o findtha t th e violatio n group s a t

issu e ar e duplicative . Complainan t respectfiill y submit s that th e ALJ' s decisio n t o combin e four separat e group s o f regulator y violations—shippin g papers , labels , markings , an demergenc y respons e information—int o on e regulatory violatio n for purpose s o f

sanctio n i s contrary t o preceden t an d i s inconsistent

wit h th e FAA' s validl y adopte dsanctio n guidance . Accordingly , th e ALJ erre di n assessin g alowe r

civi l penalty o n thi s basis . B . Th e Complainant' s Determinatio n o f th e Amoun t

o f th e Propose dCivi l Penalt y Wa s Appropriat e Unde r di e Rule s o f

Practic e i n FA A Civi l Penalty Actions , 1 4 C.F.R . § 13.224(a) , Complainan t

mus t prov e both th e regulatory violation s an dth e appropriatenes s o f th e propose d civi l penalty b y apreponderanc e o f th e evidence . I n th e Matte r o f Phillip s Buildin g Supply , Inc. , FAA Orde r

No . 2000-2 0 at

8 (Aug . 11 , 2000) . I n determinin g di e amoun t o f th e civi l penalt y t o b e assessed , th e Complainant' s representative s mus t consul t th e penalt y guidelines , whic h incorporat e th e consideration s se t fort h i n 4 9 U.S.C . § 5123(c) . Thes e consideration s includ e th e natur e an dcircumstance s o f th e violation , th e culpability o f th e violator , whethe r

th e violato r

ha s1 4

ahistory o f

prio r violations , th e violator' s ability t o pay , an dothe r matter s tha t

justic e requires . 4 9 U.S.C . § 5123(c) ; Phillips , FA A Orde r No . 2000-2 0 at

11 . Th e FAA' s penalty guideline s for violation s o f

th e HMR , whic h facto r

thes e consideration s int o th e sanctio n guidanc e matrix , presen t aserie s o f

question s to_assis t

agenc y personne l i n determinin g thesanctionamoun t withi n th e appropriat e rang e base do n th e variou s aggravatin g an dmitigatin g factor s tha t ma y exis t i n th e case . FA A Orde r

2150.3A , Appendi x 6 at

2-3 . Here , th e violation s foun db y th e AL J concern Respondent' s offerin g o f an undeclare d shipmen t o f 19,20 0 safet

y matche s t o Federa l Expres s for transportatio n b y air . Exh . C-1 , Respons e t o NPC P at

3- 4 an dAttachment s 5 , 7 , Declaration a t para . 2-3 . I t

i s undispute dtha

t Responden t

di dno t communicat e i n an y wa y t o Federal Expres s th e hazardou s natur e o f th e content s o f

th e package . Exh . C-1 , Declaratio n a t para . 2 an dAttachmen t

A , Photograph s 1-6 . Without thi s information . Federa l Expres s wa s unabl e t o tak e th e necessar y precaution s require d whe n acceptin g an dtransportin g flammable materials . Th e shipmen t was accepte db y Federal Expres s an dwa s transporte daboar daflight fromHon g Kong , Chin at o Anchorage , Alaska . I f th e packag e ha dbee n place dnear an ignitio n source , th e consequence s migh t hav e bee n very serious , eve n catastrophic , du e t o th e hig h leve l o f risk presente db y matches . Whil e all violation s o f

th e HM Rar e serious , undeclare dshipment s presen t an increase d ris k becaus e th e ai r

carrie r doe s no t kno w what

th e materia l i s tha t

i t i s acceptin g and/o r transporting . Se e I n th e Matte r o f Envirosolve , LLC , FA A Orde r No . 2006- 2 a

t 1 4 (Feb . 7 , 2006 ) (citin g I n th e Matte r

o f Toyot aMoto r

Sales , USA, FA A Orde r

No . 1994-2 8 at

1 2 (Sept . 30 , 1994)) . Althoug h th e ris k pose db y a

n undeclare dshipmen t

o f matche s coul dcomman da maximu mrang e penalty . Complainan t determine dthat

amid-rang e penalt y was appropriat e base do n th e fact s an dcircumstance s o f th e case . Se e Exh . C-1 , Declaratio n at para . 5 an d1 5

Attachmen t

D . Ther e i s n o evidenc e o f an y additiona l aggravatui g o r mitigatin g circumstances . See generall y Exhs . C-1 , C-3 . Respondent' s failure t o ensur e tha t th e shipmen t

o f matche s i n thi s cas e wa s properl y prepare di n accordanc e with th e HM Rpresente dapotentiall y seriou s hazar dto^person s an dproperty , both i n th e aircraf t andjD U the

_ground^Jrherefore , Complain^i t submit s tha t

a$22,50 0 civi l penalty , whic h i s consisten t with statutory sanctio n consideration s andvalidl y adopte dFA A sanctio n guidance , i s not excessiv e an di s warrante dunde r th e fact s andcircumstance s o f

th e case . CONCLUSIO N Complainan t

submit s tha t

th e ALJ' s decisio n t o impos e a$9,00 0 civi l penalty i s inconsisten t

with law , precedent , an dpolicy . Th e ALJ' s decisio n t o reduc e th e numbe r o f violation s subjec t

t o sanctio n i s contrary t o preceden t an dFA A sanctio n guidance . I t als o fail s t o acknowledg e tha t

eac h o f th e violatio n group s at

issu e requir e proo f

o f differen t element s an d hav e distinc t

communicativ e functions . I n contras t t o th e ALJ' s decision . Complainan t ha s sustaine dit s burde n o f

proo f t o sho w tha t

th e propose dcivi l penalt y o f $22,50 0 i s consisten t

with FA A sanctio n guidanc e an di s warrante dunde r th e fact s an dcircumstance s o f th e case . Fo r th e foregoin g reasons , th e ALJ erre di n assessin g a$9,00 0 civi l penalty , rathe r tha n th e $22,50 0 civi l penalt y requeste di n th e complaint . Complainan t

therefor e respectfiill y request s that th e FA A Decisionmake r issu e a n Orde r reversin g th e ALJ' s initia l decisio n an dorder , i n part , b y assessin g acivi l penalty agains t Responden t

i n th e amoimt

o f $22,500 .1 6 Respectfull y submitted ,

Dated : January 29,201 0 Pete r J . Lync h Assistan t Chie f Counse l

land aK . Bruchs , Attorne y Enforcemen t

Division , AGC-30 0 Federa l Aviatio n Administratio n Offic e o f th e Chie f Counse l 80 0 Independenc e Ave. , S.W . Washington , D.C . 2059 1 Telephone : (202 ) 493-554 8 Facsimile : (202)267-510 61 7 CERTIFICAT E O FSERVIC E I hereb y certif

y tha t o n thi s dat e I hand-delivere dth e origina l an don e cop y o f th e foregoin g Complainant' s Appea l Brie f to : Federa l Aviatio n Administratio n 60 0 Independenc e Avenue , S W Wilbu r Wrigh t Building—Suit e 2W100 0 Washington , D C 2059 1 Attention : Hearin g Docke t Clerk , AGC-43 0 I n addition , I hereb y certif y tha t o n thi s dat e I sen t

b y facsimile , registere dmai l return-receip t requested , an dFedera l Expres s acop y o f th e foregoin g Complainant' s Appea l Brie f to : Eri c Won g Apoll o A & H S Compan y Flat 1515 , Mefro Centr e 2 2 1 LamHin g Stree t Kowloo n Bay , Hon g Kon g People' s Republi c o f

Chin a FAX : 852-2385733 2 

# /i^y^jM^u ^ Datdd : January 29 , 201 0APPENDI X

4 9 C.F.R . 171.2(e ) provides : §171. 2 Genera l requirements . (e ) N o perso n may offe

r o r accep t ahazardou s materia l fo

r fransportation i n commerc e unles s th e hazardou s materia l i s properl y classed , described , packaged , marked , labeled , an di n conditio n fo r shipmen t a s require do r

authorize db y applicabl e requirement s o f thi s subchapte r

o r a n exemptio n o r

special permit , approval , o r

registratio n issue dunde r thi s subchapte r

o r subchapte r

A o f thi s chapter . 4 9 C.F.R . § 172.200(a ) provides : § 172.20 0 Applicability . (a ) Descriptio n o f

hazardou s material s required . Excep t a s otherwis e provide di n thi s subpart , eac h perso n wh o offer s ahazardou s materia l fo r transportatio n shal l describ e th e hazardou s materia l o n th e shippin g pape r i n th e manne r

require db y thissubpart . 4 9 C.F.R . § 172.201(d ) provides : § 172.20 1 Preparatio n an dretentio n o f shippin g papers . (d ) Emergenc y respons e telephon e number . Excep t a s provide di n § 172.604(c) , a shippin g pape r

mus t contai n a n emergenc y respons e telephon e number , a s prescribe di n subpart

Go f thi s part . 4 9 C.F.R . § § 172.202(a)(1) , 172.202(a)(2) , 172.202(a)(3) , 172.202(a)(4) , an d172.202(a)(5 ) provide : § 172.20 2 Descriptio n o f hazardou s materia l o n shippin g papers . (a ) Th e shippin g descriptio n o f ahazardou s materia l o n th e shippin g pape r mus t include : (1 ) Th e identificatio n numbe r prescribe dfor

th e materia l a s show n i n Colum n (4 ) ofth e §172.10 1 table ;(2 ) Th e prope r shippin g nam e prescribe dfo r th e materia l i n Colum n (2 ) ofth e §172.10 1 table ; (3 ) Th e hazar dclas s o r

divisio n numbe r

prescribe dfor

th e material , a s show n i n Colum n (3 ) o f

th e §172.10 1 table . Th e subsidiary hazar dclas s o r divisio n numbe r i s not require dt o b e entere dwhe n acorrespondin g subsidiary hazar dlabe l i s no t required . Excep t

for combustibl e liquids , th e subsidiary hazar dclass(es ) o r subsidiary divisio n number(s ) mus t b e entere di n parenthese s immediatel y followin g th e primar y hazar dclas s o r divisio n number... . (4 ) Th e packin g grou p i n Roma n numerals , a s designatedfor th e hazardou s materia l i n Colum n (5 ) o f th e §172.10 1 table . Clas s 1 (explosives ) materials ; self

reactiv e substances ; batterie s othe r tha n thos e containin g lithium , lithiu mions , o r sodium ; Divisio n 5. 2 materials ; an dentrie s tha t ar e not assigne dapackin g grou p ( e.g. , Clas s 7 ) ar e excepte dfromthi s requirement . Th e packin g grou p may b e precede db y di e letter s "PG " (for example , "PG11") ; an d (5 ) Excep t

for transportatio n b y aircraft , th e tota l quantity o f hazardou s material s covere db y th e descriptio n mus t b e indicate d(b y mas s o r volume , o r

b y activity fo r Clas s 7 materials ) an dmus t includ e a n indicatio n ofth e applicabl e uni t o f measurement , for

example , "20 0 kg " (44 0 pounds ) o r "5 0 L " (1 3 gallons).. . . 4 9 C.F.R . §172.203(1 ) provides : § 172.20 3 Additiona l descriptio n requirements . (f ) Transportatio n b y air . A statemen t indicatin g tha t

th e shipmen t

i s withi n th e limitation s prescribe dfor eithe r passenge r

an dcarg o aircraf

t o r carg o aircraf

t onl y mus t b e entere do n th e shippin g paper . 4 9 C.F.R . § § 172.204(a) , 172.204(c)(2) , an d172.204(c)(3 ) provide : § 172.20 4 Shipper' s certification . (a ) General . Excep t

a s provide di n paragraph s (b ) an d(c ) o f thi s section , eac h perso n wh o offer s ahazardou s materia l for transportatio n shal l certif y tha t th e materia l i s offere dfo r

transportatio n i n accordanc e with thi s subchapte r b y printin g (manuall y o r

mechanically ) o n th e shippin g pape r containin g th e require d shippin g descriptio n th e certificatio n containe di n paragrap h (a)(1 ) o f thi s sectio n o r th e certificatio n (declaration ) containin g th e languag e containe di n paragrap h (a)(2 ) o f thi s section . (1 ) "Thi s i s t o certif

y tha t th e above-name dmaterial s ar e properl y classified , described , packaged , marke dan dlabeled , an dar e i n prope r conditio n fo

rtransportatio n accordin g t o th e applicabl e regulation s ofth e Departmen t o f Transportation. " Note : I n lin e on e ofth e certificatio n th e word s "herein-named " ma y b e substitute d for th e word s "above-named" . (2 ) " I hereb y declar e that

th e content s o f

thi s consignmen t

ar e fully an daccuratel y describe dabov e b y th e prope r shippin g name , an dar e classified , packaged , marke dan dlabelled/placarded , an dar e i n al l respect s i n prope r conditio n for transpor t accordin g t o applicabl e internationa l an dnationa l governmenta l regulations. " (c ) Transportatio n b y ai r

—(1 ) General . Certificatio n containin g th e followin g languag e may b e use di n plac e ofth e certificatio n require db y paragrap h (a ) o f thi s section : I hereb y certif

y tha t th e content s o f

thi s consignmen t

are ftilly an daccuratel y describe dabov e b y prope r shippin g nam e an dar e classified , packaged , marke d an dlabeled , an di n prope r conditio n for

carriag e b y ai r

accordin g t o applicabl e nationa l governmenta l regulations . Not e t o paragraph(c)(l) : I n th e certification , th e wor d"packed " ma y b e use d instea dofth e wor d"packaged " unti l Octobe r 1 , 2010 . (2 ) Certificat e i n duplicate . Eac h perso n wh o offer s ahazardou s materia l t o a n aircraf t operato r for transportatio n b y ai r

shal l provid e tw o copie s ofth e certificatio n require di n thi s section . (Se e §175.3 0 o f thi s subchapter. ) (3 ) Additiona l certificatio n requkements . Effectiv e Octobe r 1,2006 , eac h perso n wh o offer s ahazardou s materia l for transportatio n b y ai r

mus t ad dt o th e certificatio n require di n thi s sectio n th e followin g statement :

" I declar e tha t

al l ofth e applicabl e ai r

transport requirement s hav e bee n met. " 4 9 C.F.R . § 172.300(a ) provides : § 172.30 0 ApplicabiUty . (a ) Eac h perso n wh o offer s ahazardou s materia l for transportatio n shal l mark eac hpackage , freight

container , an dtransport

vehicl e containin g th e hazardou s materia l i n th e manne r

require db y thi s subpart .4 9 C.F.R . § 172.301(a ) provides :

§ 172.30 1 Genera l markin g requirement s fo r non-bul k

packagings . (a ) Prope r shippin g nam e an didentificatio n number . (1 ) Excep t a s otherwis e provide db y thi s subchapter , eac h perso n wh o offer s ahazardou s materia l for transportatio n i n anon-bul k packagin g mus t

mar k th e packag e with th e prope r shippin g nam e an didentificatio n numbe r (precede db y "UN " o r

"NA, " a s appropriate ) fo

r th e materia l a s show n i n th e §172.10 1 Table . Identificatio n number s ar e not

require do n packaging s that contai n onl y ORM- D material s o r limite dquantities , a s define di n §171. 8 o f thi s subchapter , excep t

for limite d quantitie s marke di n accordanc e with th e markin g requirement s i n §172.315 . 4 9 C.F.R . § 172.400(a ) provides : § 172.40 0 Genera l labelin g requirements . (a ) Excep t

a s specifie di n § 172.400a , eac h perso n wh o offer s fo r transportatio n o r transport s ahazardou s materia l i n an y ofth e followin g package s o r containmen t devices , shal l labe l th e packag e o r containmen t

devic e with label s specifie dfo r th e materia l i n th e §172.10 1 tabl e an di n thi s subpart ... . 4 9 C.F.Rr§172;600(c ) provides : § 172.60 0 Applicabilit y an dgenera l requirements . (c ) Genera l requirements . N o perso n t o who mthi s subpart applies may offe

r for transportation , accep t

for transportation , transfer , stor e o r otherwis e handl e durin g transportatio n ahazardou s materia l unless : (1 ) Emergenc y respons e informatio n conformin g t o thi s subpart i s immediatel y availabl e fo r

us e at al l times th e hazardou s materia l i s present ; an d (2 ) Emergenc y respons e information , includin g th e emergenc y respons e telephon e number , require db y thi s subpart i s immediatel y availabl e t o an y perso n who , a s a representativ e o f

aFederal , Stat e o r

loca l governmen t

agency , respond s t o an inciden t involvin g ahazardou s material , o r i s conductin g a n investigatio n whic h involve s ahazardou s material . 4 9 C.F.R . § 172.702(a ) provides : § 172.70 2 Applicabilit y an dresponsibilit y fo r trainin g an dtesting . (a ) A hazma t

employe r

shal l ensur e tha t

eac h o f it s hazma t

employee s i s trainedi n accordanc e with th e requirement s prescribe di n thi s subpart .