[Federal Register Volume 74, Number 138 (Tuesday, July 21, 2009)]
[Rules and Regulations]
[Pages 36030-36055]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-17133]



[[Page 36029]]

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Part IV





Department of Homeland Security





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Transportation Security Administration



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49 CFR Part 1503



Revision of Enforcement Procedures; Final Rule

Federal Register / Vol. 74 , No. 138 / Tuesday, July 21, 2009 / Rules 
and Regulations

[[Page 36030]]


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DEPARTMENT OF HOMELAND SECURITY

Transportation Security Administration

49 CFR Part 1503

[Docket No. TSA-2009-0013]
RIN 1652-AA62


Revision of Enforcement Procedures

AGENCY: Transportation Security Administration, DHS.

ACTION: Final rule; request for comments.

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SUMMARY: The Transportation Security Administration (TSA) amends its 
Investigative and Enforcement Procedures in this final rule to conform 
to the Implementing Recommendations of the 9/11 Commission Act of 2007. 
The rule establishes procedures by which TSA may issue civil monetary 
penalties for violations of any statutory requirement administered by 
TSA, including surface transportation requirements and Transportation 
Worker Identification Credentials requirements. The rule also clarifies 
and reorganizes TSA's investigative and enforcement procedures, and 
makes inflation adjustments to the maximum civil monetary penalty 
amounts.

DATES: Effective Date: This rule is effective August 20, 2009.
    Comment Date: Comments must be received by September 21, 2009.

ADDRESSES: You may submit comments, identified by the TSA docket number 
to this rulemaking, to the Federal Docket Management System (FDMS), a 
government-wide, electronic docket management system, using any one of 
the following methods:
    Electronically: You may submit comments through the Federal 
eRulemaking portal at http://www.regulations.gov. Follow the online 
instructions for submitting comments.
    Mail, In Person, or Fax: Address, hand-deliver, or fax your written 
comments to the Docket Management Facility, U.S. Department of 
Transportation, 1200 New Jersey Avenue, SE., West Building Ground 
Floor, Room W12-140, Washington, DC 20590-0001; Fax 202-493-2251. The 
Department of Transportation (DOT), which maintains and processes TSA's 
official regulatory dockets, will scan the submission and post it to 
FDMS.
    See SUPPLEMENTARY INFORMATION for format and other information 
about comment submissions.

FOR FURTHER INFORMATION CONTACT: Sarah Tauber, Office of Chief Counsel, 
TSA-2, Transportation Security Administration, 601 South 12th Street, 
Arlington, VA 20598-6002; telephone (571) 227-3964; facsimile (571) 
227-1380; e-mail <a href="/cdn-cgi/l/email-protection#97e4f6e5f6ffb9e3f6e2f5f2e5d7f3ffe4b9f0f8e1"><span class="__cf_email__" data-cfemail="196a786b7871376d786c7b7c6b597d716a377e766f">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

Comments Invited

    TSA invites interested persons to participate in this rulemaking by 
submitting written comments, data, or views. TSA also invites comments 
relating to the economic, environmental, energy, or Federalism impacts 
that might result from this rulemaking action. See ADDRESSES above for 
information on where to submit comments.
    With each comment, please identify the docket number at the 
beginning of your comments. TSA encourages commenters to provide their 
names and addresses. The most helpful comments reference a specific 
portion of the rulemaking, explain the reason for any recommended 
change, and include supporting data. The public may submit comments and 
material electronically, in person, by mail, or fax as provided under 
ADDRESSES, but please submit your comments and material by only one 
means. If you submit comments by mail or delivery, submit them in an 
unbound format, no larger than 8.5 by 11 inches, suitable for copying 
and electronic filing.
    If you want TSA to acknowledge receipt of comments submitted by 
mail, include with your comments a self-addressed, stamped postcard on 
which the docket number appears. We will stamp the date on the postcard 
and mail it to you.
    TSA will file in the public docket all comments received by TSA, 
except for comments containing confidential information and sensitive 
security information (SSI).\1\ TSA will consider all comments received 
on or before the closing date for comments and will consider comments 
filed late to the extent practicable. The docket is available for 
public inspection before and after the comment closing date.
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    \1\ ``Sensitive Security Information'' or ``SSI'' is information 
obtained or developed in the conduct of security activities, the 
disclosure of which would constitute an unwarranted invasion of 
privacy, reveal trade secrets or privileged or confidential 
information, or be detrimental to the security of transportation. 
The protection of SSI is governed by 49 CFR part 1520.
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Handling of Confidential or Proprietary Information and Sensitive 
Security Information (SSI) Submitted in Public Comments

    Do not submit comments that include trade secrets, confidential 
commercial or financial information, or SSI to the public regulatory 
docket. Please submit such comments separately from other comments on 
the rulemaking. Comments containing this type of information should be 
appropriately marked as containing such information and submitted by 
mail to the address listed in the FOR FURTHER INFORMATION CONTACT 
section.
    TSA will not place comments containing SSI in the public docket and 
will handle them in accordance with applicable safeguards and 
restrictions on access. TSA will hold documents containing SSI, 
confidential business information, or trade secrets in a separate file 
to which the public does not have access, and place a note in the 
public docket that TSA has received such materials from the commenter. 
However, if TSA determines that portions of these comments may be made 
publicly available, TSA may include a redacted version of the comment 
in the public docket. If TSA receives a request to examine or copy 
information that is not in the public docket, TSA will treat it as any 
other request under the Freedom of Information Act (FOIA), 5 U.S.C. 
552, and the Department of Homeland Security's (DHS') FOIA regulation 
found in 6 CFR part 5.

Reviewing Comments in the Docket

    Please be aware that anyone is able to search the electronic form 
of all comments received into any of our dockets by the name of the 
individual submitting the comment (or signing the comment, if submitted 
on behalf of an association, business, labor union, etc.). You may 
review the applicable Privacy Act Statement published in the Federal 
Register on April 11, 2000 (65 FR 19477), or you may visit http://DocketInfo.dot.gov.
    You may review TSA's electronic public docket on the Internet at 
http://www.regulations.gov. In addition, DOT's Docket Management 
Facility provides a physical facility, staff, equipment, and assistance 
to the public. To obtain assistance or to review comments in TSA's 
public docket, you may visit this facility between 9 a.m. to 5 p.m., 
Monday through Friday, excluding legal holidays, or call (202) 366-
9826. This docket operations facility is located in the West Building 
Ground Floor, Room W12-140 at 1200 New Jersey Avenue, SE., Washington, 
DC 20590.

Availability of Rulemaking Document

    You can get an electronic copy using the Internet by--
    (1) Searching the electronic Federal Docket Management System 
(FDMS) Web page at http://www.regulations.gov;

[[Page 36031]]

    (2) Accessing the Government Printing Office's Web page at http://www.gpoaccess.gov/fr/index.html; or
    (3) Visiting TSA's Security Regulations Web page at http://www.tsa.gov and accessing the link for ``Research Center'' at the top 
of the page.
    In addition, copies are available by writing or calling the 
individual in the FOR FURTHER INFORMATION CONTACT section. Make sure to 
identify the docket number of this rulemaking.

Small Entity Inquiries

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires TSA to comply with small entity requests for information 
and advice about compliance with statutes and regulations within TSA's 
jurisdiction. Any small entity that has a question regarding this 
document may contact the person listed in FOR FURTHER INFORMATION 
CONTACT. Persons can obtain further information regarding SBREFA on the 
Small Business Administration's Web page at http://www.sba.gov/advo/laws/law_lib.html.

Abbreviations and Terms Used in This Document

9/11 Act--Implementing Recommendations of the 9/11 Commission Act of 
2007
ALJ--Administrative Law Judge
CPI--Consumer Price Index
FNPCP--Final Notice of Proposed Civil Penalty
FOIA--Freedom of Information Act
NPCP--Notice of Proposed Civil Penalty
OACP--Order Assessing Civil Penalty
SSI--Sensitive Security Information
TWIC--Transportation Worker Identity Credential
USCG--United States Coast Guard

Table of Contents

I. Summary of the Rulemaking
II. Background
    A. New Civil Penalty Authority
    B. Summary of the Civil Penalty Process
    1. Notice of Proposed Civil Penalty
    2. Informal Conference
    3. Order Assessing a Civil Penalty
    4. Final Notice of Proposed Civil Penalty
    5. Formal Hearing
    6. Appeal From the ALJ Initial Decision
    7. Appeal From the TSA Decision Maker's Final Decision and Order
III. Reorganization Summary
IV. Section-by-Section Analysis
    A. Subpart B--Scope of Investigative and Enforcement Procedures
    1. TSA Requirements (Sec.  1503.101)
    2. Terms Used in This Part (Sec.  1503.103)
    B. Subpart D--Non-Civil Penalty Enforcement
    C. Subpart E--Assessment of Civil Penalties by TSA
    1. Maximum Penalty Amounts (Sec.  1503.401)
    2. Delegation of Authority (Sec.  1503.403)
    3. Injunctions (Sec.  1503.405)
    4. Military Personnel (Sec.  1503.407)
    5. Service of Documents (Sec.  1503.409)
    6. Computation of Time (Sec.  1503.411)
    7. Notice of Proposed Civil Penalty (Sec.  1503.413)
    8. Request for Portions of the Enforcement Investigative Report 
(EIR) (Sec.  1503.415)
    9. Final Notice of Proposed Civil Penalty and Order (Sec.  
1503.417)
    10. Order Assessing Civil Penalty (Sec.  1503.419)
    11. Streamlined Civil Penalty Procedures for Certain Security 
Violations (Sec.  1503.421)
    12. Consent Orders (Sec.  1503.423)
    13. Compromise Orders (Sec.  1503.425)
    14. Request for a Formal Hearing (Sec.  1503.427)
    15. Filing of Documents With the Enforcement Docket Clerk (Sec.  
1503.429)
    16. Certification of Documents (Sec.  1503.431)
    D. Subpart G--Rules of Practice in TSA Civil Penalty Actions
    1. Applicability (Sec.  1503.601)
    2. Administrative Law Judges (Sec.  1503.607)
    3. Complaint (Sec.  1503.609)
    4. Consolidation and Separation of Cases (Sec.  1503.613)
    5. Extension of Time (Sec.  1503.617)
    6. Withdrawal of Complaint or Request for Hearing (Sec.  
1503.623)
    7. Discovery (Sec.  1503.633)
    8. Standard of Proof (Sec.  1503.637)
    9. Argument Before the ALJ (Sec.  1503.653)
    10. Initial Decision (Sec.  1503.655)
    11. Appeal From Initial Decision (Sec.  1503.657)
V. Administrative Procedure Act
VI. Paperwork Reduction Act
VII. Economic Impact Analyses
    A. Regulatory Evaluation Summary
    B. Executive Order 12866 Assessment
    C. Costs and Benefits
    D. Regulatory Flexibility Act Assessment
    E. International Trade Impact Assessment
    F. Unfunded Mandates Assessment
VIII. Other Analyses
    A. Executive Order Federalism
    B. Environmental Analysis
    C. Energy Impact Analysis
List of Subjects in 49 CFR Part 1503
The Amendments

I. Summary of the Rulemaking

    In this rule, TSA makes several changes to TSA's enforcement 
procedures, codified at 49 CFR part 1503. As described more fully 
below, this rule--
    <bullet> Reorganizes and clarifies TSA's enforcement procedures and 
make them easier to use;
    <bullet> Applies TSA's enforcement procedures to violations of 
surface transportation requirements and of TSA's Transportation Worker 
Identification Credential requirements, as provided in sections 1302 
and 1304(e) of the Implementing Recommendations of the 9/11 Commission 
Act of 2007, Public Law 110-53, 121 Stat. 266, 390, Aug. 3, 2007 (9/11 
Act); and
    <bullet> Adjusts for inflation the maximum civil penalty amounts, 
in accordance with the Federal Civil Penalty Inflation Adjustment Act 
of 1990, Public Law 101-410 (Adjustment Act), 28 U.S.C. 2461 note.

II. Background

    This rulemaking implements certain provisions of the 9/11 Act that 
expand TSA's civil penalty authority.\2\ This section describes the 
relevant 9/11 Act provisions and TSA's enforcement process.
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    \2\ Pub. L. 110-53, section 1302(a), 121 Stat. 390 (Aug. 3, 
2007).
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A. New Civil Penalty Authority

    Section 1302(a) of the 9/11 Act applies civil penalties provisions 
to: (1) Any provision of title 49 U.S.C. administered by TSA, including 
violations of any surface transportation requirements; and (2) any 
violations of ch. 701 of title 46 U.S.C., which governs transportation 
worker identification credentials (TWIC).\3\ TSA may assess a maximum 
penalty per case of $50,000 if the violation is committed by an 
individual or small business. TSA may assess a maximum penalty amount 
per case of $400,000 if the violation is committed by a person other 
than an individual or small business.\4\ A Federal court may assess 
penalties exceeding these amounts.\5\
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    \3\ Pub. L. 110-53, section 1302(a), 121 Stat. 390 (Aug. 3, 
2007). TSA exercises this function under delegated authority from 
the Secretary.
    \4\ 49 U.S.C. 114(v)(3)(D).
    \5\ 49 U.S.C. 114(v)(3)(C).
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    Prior to imposing a civil penalty, TSA must provide to the person 
against whom the penalty is to be imposed: (1) Written notice of the 
proposed penalty; and (2) the opportunity to request a hearing on the 
proposed penalty, if TSA receives the request not later than 30 days 
after the date on which the person receives notice.\6\ Investigations 
and proceedings governing such cases must follow the requirements set 
forth in ch. 461 of title 49 U.S.C., which govern aviation security 
matters.\7\
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    \6\ 49 U.S.C. 114(v)(3)(E).
    \7\ 49 U.S.C. 114(v)(5).
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    The 9/11 Act establishes additional procedural requirements in 
cases involving public transportation agencies. Under section 1304(e) 
of the 9/11 Act, prior to imposing a civil penalty against a public 
transportation agency, TSA is required to give written notice of the 
violation and a reasonable opportunity to correct the violation or 
propose an alternative means of compliance acceptable to TSA. TSA may 
not take legal enforcement action against a public transportation 
agency unless TSA has provided such notice and the public 
transportation agency fails to correct the violation or propose

[[Page 36032]]

an alternative means of compliance acceptable to TSA within the 
timeframe provided in the notice.\8\
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    \8\ See Pub. L. 110-53, section 1304(e)(2), 121 Stat. 393.
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    Prior to enactment of section 1302 of the 9/11 Act, TSA assessed 
administrative civil penalties only for violations of aviation security 
related statutes under 49 U.S.C. ch. 449, and 49 U.S.C. 46302 and 
46303. TSA's procedures for assessing civil penalties for such 
violations are set forth at 49 CFR part 1503. This rule amends part 
1503 to expand its application to violations of any statutory 
requirement administered by TSA, including surface transportation 
requirements and TWIC requirements, in accordance with the provisions 
of the 9/11 Act.

B. Summary of the Civil Penalty Process

    The following is a general summary of the process TSA currently 
uses to assess a civil penalty for violations of the statutes, 
regulations, and orders it administers. The rule applies this process, 
with certain changes discussed below, to violations of surface 
transportation and TWIC requirements, to include: (1) TWIC; \9\ (2) 
commercial drivers' licenses with hazardous material endorsements (49 
CFR parts 1570 and 1572); and (3) rail transportation security (49 CFR 
part 1580).\10\
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    \9\ TWIC is a joint program with the United States Coast Guard. 
TSA enforces its regulatory program at 49 CFR parts 1570 and 1572, 
and the Coast Guard enforces its regulations at 33 CFR parts 101-
106.
    \10\ See Rail Transportation Security; final rule, 73 FR 72130 
(Nov. 26, 2008).
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1. Notice of Proposed Civil Penalty
    TSA initiates a civil penalty action by sending the alleged 
violator (the respondent) a Notice of Proposed Civil Penalty (NPCP), 
which states the statute, regulation, or order allegedly violated, the 
facts TSA believes establish the violation, and the amount of the 
penalty TSA proposes to impose for the violation. The NPCP also informs 
the respondent that he or she has 30 days from receipt to either: (1) 
Pay the penalty; or (2) provide information demonstrating that a 
violation did not occur, that the penalty should be lower because of 
mitigating circumstances, or that the respondent is unable to pay the 
proposed penalty. If the respondent does not pay the penalty, they must 
also request an informal conference with TSA counsel; or request a 
formal hearing before an Administrative Law Judge (ALJ).
    Pursuant to section 1304(e) of the 9/11 Act, TSA will not send an 
NPCP to a public transportation agency unless TSA first gives the 
public transportation agency written notice of the violation and a 
reasonable opportunity to correct the violation, or to propose an 
alternative means of compliance acceptable to TSA, and the public 
transportation agency fails to do so within the timeframe provided in 
the notice.\11\ Reasonableness will depend on the totality of the 
circumstances, including the security consequences of the violation.
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    \11\ See Pub. L. 110-53, section 1304(e)(2), 121 Stat. 393.
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2. Informal Conference
    The informal conference provides the respondent with an opportunity 
to discuss the alleged violation informally with TSA counsel and to 
present exculpatory evidence. This conference can be held by telephone 
or in person. Many TSA enforcement cases settle as a result of 
information exchanged or representations made at (or after) the 
informal conference.
3. Order Assessing a Civil Penalty
    If the respondent elects to pay the penalty, or if the matter 
settles (either at the informal conference or before or after the 
informal conference), TSA counsel issues an Order Assessing a Civil 
Penalty (OACP). The order states the law violated, the facts 
establishing the violation, the amount of the penalty, and how and by 
when the respondent is to pay the penalty.
4. Final Notice of Proposed Civil Penalty
    In the event the respondent does not respond to the NPCP within 30 
days, or in the event the respondent and TSA counsel cannot agree on a 
penalty amount during settlement discussions, TSA counsel issues a 
Final Notice of Proposed Civil Penalty (FNPCP). The FNPCP gives the 
respondent 15 days from receipt to: (1) Pay the penalty; (2) reach an 
agreed penalty amount with TSA counsel; or (3) request a formal hearing 
before an ALJ. Under the current regulations, the FNPCP also states 
that if the respondent does not respond to the FNPCP within 15 days, or 
if the matter has not settled and the respondent has not requested a 
formal hearing within 15 days, TSA counsel will issue an OACP in the 
penalty amount proposed by the FNPCP. One of the changes this rule 
makes is to have the FNCP automatically convert to an OACP, if within 
15 days the respondent has not responded to the FNPCP, settled the 
case, or requested a formal hearing.
5. Formal Hearing
    A respondent must request a formal hearing in writing within 30 
days of receipt of the NPCP, or within 15 days of receipt an FNPCP. The 
respondent must send the request for a formal hearing to the 
Enforcement Docket Clerk and a copy of the request for a formal hearing 
to the TSA counsel.
    An Administrative Law Judge (ALJ) conducts the formal hearing. The 
procedural rules governing formal hearings are set forth at 49 CFR part 
1503, subpart G. Within 20 days of receipt of a timely request for 
hearing, TSA counsel will file a Complaint reciting the allegations in 
the NPCP or FNPCP, as applicable. The respondent must file a written 
Answer to the Complaint within 30 days of receipt.
    The matter proceeds to a formal hearing unless the ALJ grants a 
motion to dismiss or a motion for a decision (or unless the case 
settles). At the formal hearing, both parties have the opportunity to 
present witnesses and other evidence. The ALJ will issue an Initial 
Decision at the close of a hearing or shortly thereafter.
6. Appeal From the ALJ Initial Decision
    Either party may appeal the ALJ Initial Decision to the TSA 
Decision Maker. The TSA Decision Maker is the Assistant Secretary of 
Homeland Security (Transportation Security Administration) or his or 
her designee. The party appealing the decision must file a written 
Notice of Appeal with the Enforcement Docketing Center within 10 days 
of receipt of the Initial Decision and must also file an appeal brief 
with the Docketing Center within 50 days of receipt of the Initial 
Decision. Reply briefs may be filed up to 35 days after receipt of the 
appeal brief. The address of the Docketing Center is: Docketing Center, 
U.S. Coast Guard, 40 S. Gay Street, Room 412, Baltimore, MD 21202-4022, 
Attn: Enforcement Docket Clerk.
    After receipt of the appeal brief (and any reply brief), the TSA 
Decision Maker will render a Final Decision and Order. A party may 
request the TSA Decision Maker to reconsider a Final Decision and Order 
by filing a Petition for Reconsideration within 30 days of the Final 
Decision.
7. Appeal From the TSA Decision Maker's Final Decision and Order
    Either party may appeal a Final Decision of the TSA Decision Maker 
to an appropriate U.S. Circuit Court of Appeals within 60 days after 
the Final Order has been served on the party.

[[Page 36033]]

III. Reorganization Summary

    This rule reorganizes part 1503 and clarifies its provisions 
without substantive change. TSA intends, in the recodification of these 
regulations, to conform to the understood policy, intent, and purpose 
of the original regulations, with such amendments and corrections as 
will remove ambiguities, contradictions, and other imperfections. The 
reorganization is illustrated in the accompanying redistribution table 
in Table 1 that follows.

                                   Table 1--Redistribution of 49 CFR Part 1503
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       Former section           New section                                New title
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1503.1......................  1503.201.......  Reports of violations.
1503.3......................  1503.203.......  Investigations.
1503.5......................  1503.801.......  Formal complaints.
1503.7......................  1503.205.......  Records, documents, and reports.
1503.11.....................  1503.301.......  Warning notices and letters of correction.
1503.12.....................  1503.415.......  Request for portions of the enforcement investigative report
                                                (EIR).
1503.13.....................  1503.423.......  Consent orders.
1503.15.....................  1503.701.......  Applicability of this subpart.
                              1503.703.......  Civil penalty letter; referral.
1503.16.....................  1503.401.......  Maximum penalty amounts; jurisdiction.
                              1503.403.......  Delegation of authority.
                              1503.413.......  Notice of Proposed Civil Penalty.
                              1503.417.......  Final Notice of Proposed Civil Penalty and Order.
                              1503.419.......  Order Assessing Civil Penalty.
                              1503.425.......  Compromise orders.
                              1503.427.......  Request for a formal hearing.
                              1503.657(a)....  Appeal from initial decision.
1503.21.....................  1503.407.......  Military personnel.
1503.25.....................  1503.405.......  Injunctions.
1503.29.....................  1503.421.......  Streamlined civil penalty procedures for certain security
                                                violations.
                              1503.419.......  Order Assessing Civil Penalty.
1503.201....................  1503.601.......  Applicability.
1503.202....................  1503.103.......  Terms used in this part.
1503.203....................  1503.603.......  Separation of functions.
1503.204....................  1503.605.......  Appearances and rights of parties.
                              1503.651.......  Record.
1503.205....................  1503.607.......  Administrative law judges.
1503.206....................  1503.619.......  Intervention.
1503.207....................  1503.431.......  Certification of documents.
1503.208....................  1503.609.......  Complaint.
1503.209....................  1503.409.......  Service of documents.
                              1503.429.......  Filing of documents with the Enforcement Docket Clerk.
                              1503.611.......  Answer.
1503.210....................  1503.429.......  Filing of documents with the Enforcement Docket Clerk.
1503.211....................  1503.409.......  Service of documents.
1503.212....................  1503.411.......  Computation of time.
1503.213....................  1503.617.......  Extension of time.
1503.214....................  1503.621.......  Amendment of pleadings.
1503.215....................  1503.623.......  Withdrawal of complaint or request for hearing.
1503.216....................  1503.625.......  Waivers.
1503.217....................  1503.627.......  Joint procedural and discovery schedule.
1503.218....................  1503.629.......  Motions.
1503.219....................  1503.631.......  Interlocutory appeals.
1503.220....................  1503.633.......  Discovery.
1503.221....................  1503.615.......  Notice of hearing.
1503.222....................  1503.635.......  Evidence.
1503.223....................  1503.637.......  Standard of proof.
1503.224....................  1503.639.......  Burden of proof.
1503.225....................  1503.641.......  Offer of proof.
1503.226....................  1503.643.......  Public disclosure of evidence.
1503.227....................  1503.645.......  Expert or opinion witnesses.
1503.228....................  1503.647.......  Subpoenas.
1503.229....................  1503.649.......  Witness fees.
1503.230....................  1503.651.......  Record.
1503.231....................  1503.653.......  Argument before the ALJ.
1503.232....................  1503.655.......  Initial decision.
1503.233....................  1503.655(d)....  Effect of initial decision.
                              1503.657.......  Appeal from initial decision.
1503.234....................  1503.659.......  Petition to reconsider or modify a final decision and order of
                                                the TSA decision maker on appeal.
1503.235....................  1503.661.......  Judicial review of a final order.
1503.301....................  1503.901.......  Scope and purpose.

[[Page 36034]]

 
1503.303....................  1503.903.......  Definitions.
1503.305....................  1503.401.......  Maximum penalty amounts.
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IV. Section-by-Section Analysis

    TSA makes amendments and corrections as will remove ambiguities, 
contradictions, and other imperfections in the provisions of part 1503 
discussed below. The changes begin with subpart B. Subpart A is 
reserved. Sections of the rule that were reorganized without change are 
not discussed in this preamble.

A. Subpart B--Scope of Investigative and Enforcement Procedures

1. TSA Requirements (Sec.  1503.101)
    For purposes of this part, TSA adopts the term ``TSA requirements'' 
to refer to the universe of statutory, regulatory, and other legal 
requirements, the violation of which could give rise to TSA 
enforcement. Accordingly, the revised part 1503 applies to enforcement 
actions for violations of any TSA surface transportation requirement 
under title 49 U.S.C. and the TWIC requirements TSA has issued under 46 
U.S.C. ch. 701.
2. Terms Used in This Part (Sec.  1503.103)
    Section 1503.103 removes the definition of ``complainant'' because 
it is no longer used in the revised part 1503. The definitions of 
``complaint'' and ``order assessing civil penalty'' are removed because 
they are defined in the specific sections where they are used. Section 
1503.103 adds a definition of ``enforcement investigative report 
(EIR)'', which appears in the current part 1503, but is not defined.
    This rule amends the definition of ``mail'' by clarifying that it 
includes regular U.S. mail service. In addition, the rule deletes 
reference to overnight express courier service in the definition of 
``mail.'' Overnight express courier service is more appropriately 
covered under the current definition of ``personal delivery,'' which 
includes ``use of a contract or express messenger service.'' 
Accordingly, the definition of ``personal delivery'' is amended to 
include reference to an overnight express courier service.
    The rule amends the definition of ``pleading'' to include not only 
a complaint, answer, and amendment to the complaint or answer, but also 
any other written submission to the ALJ or a party during the course of 
the hearing proceedings.
    The rule codifies the statutory definition of ``public 
transportation agency'' as a publicly owned operator of public 
transportation eligible to receive Federal assistance under 49 U.S.C. 
ch. 53.\12\
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    \12\ 9/11 Act at section 1402(5).
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    Under the current part 1503, the term ``respondent'' is defined as 
``a person, corporation, or company named in a complaint.'' This rule 
amends this definition to be ``the person named in a Notice of Proposed 
Civil Penalty, a Final Notice of Proposed Civil Penalty and Order, or a 
complaint.'' This promotes clarity in the regulation by permitting the 
use of ``respondent'' to refer to the alleged violator at any stage in 
the enforcement process.

B. Subpart D--Non-Civil Penalty Enforcement

    Subpart D (Warning Notices and Letters of Correction (Sec.  
1503.301)) broadens the scope of these provisions making them 
applicable to cases involving any TSA requirement. It also codifies the 
provisions of section 1304(e) of the 9/11 Act requiring that: (1) TSA 
give written notice of a violation and a reasonable opportunity to 
correct the violation or propose an alternative means of compliance 
before taking legal enforcement action against a public transportation 
agency; and (2) TSA not initiate civil enforcement action for 
violations of administrative and procedural requirements pertaining to 
transportation security grant programs under Public Law 110-53.\13\ In 
determining reasonableness under this provision, TSA will consider the 
totality of the circumstances.
---------------------------------------------------------------------------

    \13\ See Pub. L. 110-53, section 1304(e), 121 Stat. 393.
---------------------------------------------------------------------------

C. Subpart E--Assessment of Civil Penalties by TSA

1. Maximum Civil Penalty Amounts (Sec.  1503.401)
    Section 1503.401 updates the maximum civil penalty amounts for 
civil penalties assessed by TSA. Congress raised the maximum civil 
penalty amounts per violation for certain aviation security statutes. 
Homeland Security Act of 2002, Public Law 107-296, section 1602, 116 
Stat. 2135 (Nov. 25, 2002). Congress also raised the total civil 
penalty amount per case that TSA may assess. Vision 100--Century of 
Aviation Reauthorization Act (Vision 100) (Pub. L. 108-176, sec. 
503(b), 117 Stat. 2490 (Dec. 12, 2003).
    Section 1503.401 also adds reference to the maximum civil penalty 
amounts under the 9/11 Act for violations of any statute administered 
by TSA. Statutes administered by TSA include both aviation security 
statutes and statutes authorizing or directing TSA to impose surface 
transportation requirements. See 49 U.S.C. ch. 449, and secs. 46302, 
46303, and 46 U.S.C. ch. 701. TSA may impose penalties under these 
statutes for violations of any aviation or surface transportation 
security requirements, including violations of TSA's TWIC requirements, 
whether imposed by an implementing regulation or order.
    Paragraph (d) adjusts the applicable maximum penalties for 
inflation as described below.
    The Federal Civil Penalties Inflation Adjustment Act of 1990, 
Public Law 101-410 (Adjustment Act), 28 U.S.C. 2461 note, provides for 
the regular evaluation of civil monetary penalties to ensure that they 
continue to maintain their deterrent effect and that penalty amounts 
due the Federal Government are properly accounted for and collected.
    On April 26, 1996, the President signed into law the Omnibus 
Consolidated Rescissions and Appropriations Act of 1996, Public Law 
104-134. Section 31001 of that Act, also known as the Debt Collection 
Improvement Act of 1996 (Improvement Act), amended the Adjustment Act 
to provide more effective tools for government-wide collection of 
delinquent debt. Section 31001(s)(1) of the Improvement Act added a new 
section 7 to the Adjustment Act providing that any increase in a civil 
monetary penalty made pursuant to this Act shall apply only to 
violations that occur after the date the increase takes effect. The 
Improvement Act provides that the adjustments for inflation required by 
the Adjustment Act should be made at least every four years.
    The amounts of the adjustments are determined according to a 
detailed formula specified in the Adjustment Act, incorporating a 
``cost-of-living adjustment'' that is defined in section 5(b) of the 
Adjustment Act as being the

[[Page 36035]]

percentage (if any) for each civil monetary penalty by which--
    (1) The Consumer Price Index for the month of June of the calendar 
year preceding the adjustment, exceeds
    (2) The Consumer Price Index for the month of June of the calendar 
year in which the amount of such civil monetary penalty was last set or 
adjusted pursuant to law.
    Section 31001(s)(2) of the Improvement Act also provides that the 
first adjustment of a civil monetary penalty made pursuant to these 
procedures may not exceed 10 percent of the penalty. Congress reenacted 
the penalties in 2003. This rule, accordingly, represents the first 
adjustment of the civil monetary penalties after the last Congressional 
action.
    Subpart E of this rule incorporates the provisions previously in 
subpart H and establishes new civil penalty maximums based on an 
adjustment for inflation for violations of 49 U.S.C. ch. 449 (except 
secs. 44902, 44903(d), 44907(a)-(d)(1)(A), 44907(d)(1)(C)-(f), 44908, 
and 44909), or 49 U.S.C. 46302 or 46303.
    TSA has adjusted maximum penalties as follows:
    The CPI increased by 21.63 percent from June 2002 to June 2008.\14\
---------------------------------------------------------------------------

    \14\ Table 24, Historical Consumer Price Index for All Urban 
Consumers (CPI-U): U.S. City Average, All Items.'' See http://www.bls.gov/cpi/cpid0904.pdf.
---------------------------------------------------------------------------

    Based on this increase, the inflation adjusted maximum for the 
$10,000 civil penalty amount would be $12,163. However, the $10,000 
maximum amount is adjusted to $11,000 because this is the first 
adjustment after Congress increased the penalties in 2003. As such, it 
is limited to an increase of 10 percent. The inflation adjusted maximum 
for the $25,000 civil penalty amount would be $30,408. However, as 
adjusted the amount is $27,500, 10 percent above the amount as 
increased by Congress in 2003. Upon the effective date of today's rule, 
these new civil penalty maximums become effective. The $10,000 maximum 
for violations of other provisions of title 49 and title 46 U.S.C. ch. 
701 is not being adjusted at this time because it is a newly enacted 
penalty amount.
2. Delegation of Authority (Sec.  1503.403)
    Section 1503.403 makes minor revisions to former Sec.  1503.16(c), 
delegating to TSA's Chief Counsel and the Deputy Chief Counsel for 
Enforcement the authority to prosecute civil enforcement cases and 
refer them to the Attorney General, as necessary. Section 1503.403 
changes the title of the Deputy Chief Counsel and makes explicit the 
authority of the Chief Counsel or Deputy Chief Counsel for Enforcement 
to negotiate lower civil penalties than those that TSA initially 
proposed.
3. Injunctions (Sec.  1503.405)
    Section 1503.405 incorporates the provisions regarding the 
institution of injunctions currently codified in Sec.  1503.25, and 
expands their scope to cover any violation of title 49 U.S.C. 
administered by TSA or TSA's TWIC requirements under 46 U.S.C. ch. 701.
4. Military Personnel (Sec.  1503.407)
    The current regulation provides that the Chief Counsel or Deputy 
Chief Counsel for Civil Enforcement will refer such cases to the 
appropriate military authority for such disciplinary action, as that 
authority considers appropriate. Section 1503.407 of this rule expands 
the delegation to authorize any designated agency official to make such 
referrals and expands the scope of the section to encompass violations 
of any TSA requirement.
5. Service of Documents (Sec.  1503.409)
    Section 1503.409 amends current Sec.  1503.211, which governs 
service of documents in the context of a formal hearing. Section 
1503.409 governs the service of documents at all stages of the civil 
enforcement process, beginning with the service of a notice of proposed 
civil penalty. In addition, this section, as amended, permits service 
to be made by electronic mail or facsimile transmission, if consented 
to in writing by the person served. Even in such cases, however, 
service by electronic mail or facsimile transmission will not be 
effective if the party making service obtained credible information 
indicating that the attempted service did not reach the person to be 
served. In addition, for pleadings served during the formal hearing 
process, the party making service must file with the Enforcement Docket 
Clerk a copy of the opposing party's consent to receive service by 
electronic mail or facsimile transmission. The date of service by 
electronic mail or facsimile transmission is the date of transmission. 
See F.R. Civ. P. 5(b)(2)(E).
6. Computation of Time (Sec.  1503.411)
    Section 1503.411 amends current Sec.  1503.212, which governs the 
computation of time for purposes of deadlines applicable in the context 
of the formal hearing process. Section 1503.411 expands the application 
of this section to time requirements at any stage of the civil 
enforcement process.
7. Notice of Proposed Civil Penalty (Sec.  1503.413)
    When TSA determines that a person has violated a TSA requirement 
and that a civil penalty is warranted, the agency issues a Notice of 
Proposed Civil Penalty to the alleged violator. Section 1503.413 
revises without significant change the provisions governing the 
issuance of Notices of Proposed Civil Penalty currently codified at 
Sec.  1503.16(d) and updates the address for TSA's Enforcement Docket 
Clerk, which now is located at the United States Coast Guard (USCG) ALJ 
Docketing Center, 40 S. Gay Street, Room 412, Baltimore, Maryland 
21202-4022.
8. Request for Portions of the Enforcement Investigative Report (EIR) 
(Sec.  1503.415)
    Section 1503.415 revises slightly the provisions currently codified 
at Sec.  1503.12 governing the release of limited investigative 
materials to the recipient of a Notice of Proposed Civil Penalty. When 
TSA issues a Notice of Proposed Civil Penalty, the respondent may 
request portions of the relevant investigative report that are not 
privileged (e.g., under the deliberative process, attorney work-
product, or attorney-client privileges). This information may contain 
Sensitive Security Information (SSI), which is restricted from public 
disclosure under 49 CFR part 1520. TSA will provide this information to 
the respondent for the sole purpose of preparing a response to the 
allegations contained in the Notice of Proposed Civil Penalty. The 
individual receiving SSI under this provision must comply with 49 CFR 
part 1520, which permits TSA to require a background check and imposes 
other conditions, as well as the requirements to manage the information 
in accordance with part 1520. Any violation of 49 CFR part 1520 by the 
respondent would be a violation of TSA requirements and subject to 
additional enforcement action.
9. Final Notice of Proposed Civil Penalty and Order (Sec.  1503.417)
    Section 1503.417 makes one significant change in the provisions 
governing the issuance of Final Notices of Proposed Civil Penalty 
currently codified at Sec.  1503.16(e). The change is intended to 
reduce the time necessary to resolve civil penalty cases.
    Under the current regulation, TSA issues a Final Notice of Proposed 
Civil Penalty when: (1) The alleged violator fails to respond to the 
Notice of Proposed Civil Penalty within 30 days after receipt of that 
notice; or (2) the

[[Page 36036]]

parties have engaged in settlement discussions but have not reached a 
settlement. After the Final Notice of Proposed Civil Penalty is issued, 
the respondent has 15 days from receipt to: (1) Pay the proposed civil 
penalty; (2) negotiate and pay a lesser amount; or (3) request a formal 
hearing. If the respondent pays the penalty or fails to exercise the 
other two options, TSA issues an Order Assessing Civil Penalty, which 
ends the enforcement process and makes the civil penalty final.
    Amended Sec.  1503.417, in conjunction with amended Sec.  
1503.419(b), shortens this process by making the Final Notice of 
Proposed Civil Penalty automatically convert to an Order Assessing 
Civil Penalty if one of the events in Sec.  503.419(b) has occurred, 
eliminating the need for TSA to issue a separate Order Assessing Civil 
Penalty. This change will not affect the procedural rights of the 
alleged violator; rather, it will streamline the process and allow 
quicker resolution of cases, once a respondent has exercised, or failed 
to exercise, those procedural rights that are available. TSA currently 
uses this streamlined process for routine enforcement actions against 
individuals who bring prohibited items through airport screening 
checkpoints. Thus, the revision to Sec.  1503.417 primarily affects 
enforcement actions against entities, such as airports and air 
carriers. Under Sec.  1503.417, the Final Notice of Proposed Civil 
Penalty is now called a Final Notice of Civil Penalty and Order 
(``Final Notice and Order'').
10. Order Assessing Civil Penalty (Sec.  1503.419)
    Section 1503.419 revises the provisions governing the issuance of 
Orders Assessing Civil Penalty currently codified at Sec.  1503.16(b), 
with the change discussed above regarding the automatic conversion of a 
Final Notice and Order to an Order Assessing Civil Penalty. TSA has 
moved the provisions of current Sec.  1503.16(b) regarding the status 
of ALJ decisions as orders assessing civil penalty to Sec.  
1503.655(c).
11. Streamlined Civil Penalty Procedures for Certain Security 
Violations (Sec.  1503.421)
    Section 1503.421 reorganizes and makes minor revisions to the 
provisions of Sec.  1503.29 of the current regulation, which provide 
for the issuance of Notices of Violation for certain types of common 
security violations at a passenger screening or baggage screening 
checkpoint. TSA issues Notices of Violation when an individual presents 
a weapon, explosive, or incendiary for screening at a passenger 
screening checkpoint or in checked baggage, and where the amount of the 
proposed civil penalty is less than $5,000. A Notice of Violation 
contains a statement of the charges, the amount of the proposed civil 
penalty, and an offer to settle the matter for a lesser specified 
penalty amount. Under the current regulation, the recipient of a Notice 
of Violation has the option to request an Informal Conference with an 
agency attorney. Under this rule, an Informal Conference with an agency 
attorney or another agency official, as determined by TSA, is 
available. This change allows TSA to increase its capacity to provide 
Informal Conferences and therefore resolve cases more quickly.
12. Consent Orders (Sec.  1503.423)
    Under Sec.  1503.13 of the current regulation, a consent order must 
contain: (1) An admission of all jurisdictional facts; (2) an express 
waiver of the right to further procedural steps and of all rights to 
judicial review; and (3) an incorporation of the notice of proposed 
civil penalty by reference and an acknowledgment that the notice may be 
used to construe the terms of the order.
    Section 1503.423 revises slightly the provisions of this section by 
eliminating the reference to the notice of proposed civil penalty, 
thereby making the consent order a self-contained document. The consent 
order includes: (1) An admission of all jurisdictional facts; (2) an 
admission of agreed-upon allegations; (3) a statement of the law 
violated; (4) a finding of violation; and (5) an express waiver of the 
right to further procedural steps and of all rights to administrative 
and judicial review.
13. Compromise Orders (Sec.  1503.425)
    Section 1503.425 incorporates and makes slight revisions to the 
provisions of Sec.  1503.16(l) of the current regulation. Section 
1503.425 provides explicitly that a compromise order will include all 
jurisdictional facts and allegations.
14. Request for a Formal Hearing (Sec.  1503.427)
    Section 1503.427 revises slightly the provisions of Sec.  
1503.16(f) of the current regulations to make clear that the filing of 
a request for a formal hearing does not guarantee a person an 
opportunity to appear before an ALJ in person. The ALJ may issue an 
initial decision or dispositive order resolving the case prior to the 
commencement of the formal hearing.
15. Filing of Documents With the Enforcement Docket Clerk (Sec.  
1503.429)
    Section 1503.429 of this rule revises slightly the provisions of 
Sec.  1503.210 to add provisions permitting the filing of documents 
with the Enforcement Docket Clerk by electronic mail or facsimile 
transmission. The amended rule also updates the address of the 
Enforcement Docket Clerk, which now is located at the United States 
Coast Guard (USCG) ALJ Docketing Center, 40 S. Gay Street, Room 412, 
Baltimore, Maryland 21202-4022. If this address changes in the future, 
TSA will announce the change through a notice in the Federal Register.
16. Certification of Documents (Sec.  1503.431)
    Section 1503.431 of this rule revises slightly the provisions of 
Sec.  1503.207 of the current regulation governing the certification of 
documents filed with the Enforcement Docket clerk by adding several 
items to the certification. One of the items to which one must certify 
under the current regulation at Sec.  1503.207(b)(1) is that the 
document is ``[w]arranted by existing law or that a good faith argument 
exists for extension, modification, or reversal of existing law.'' This 
rule requires that a good faith and non-frivolous argument exist for 
extension, modification, or reversal of existing law. This rule also 
adds that a certification includes that the document is supported by 
evidence, and any denials of factual contentions are warranted on the 
evidence. These issues are implicit in the requirements governing 
certification of documents under the current regulation; this rule 
makes them explicit.

D. Subpart G--Rules of Practice in TSA Civil Penalty Actions

1. Applicability (Sec.  1503.601)
    Section 1503.601 of this rule revises the provisions of Sec.  
1503.201 of the current regulation, regarding the applicability of 
TSA's formal hearing procedures. First, in accordance with the 9/11 
Act, paragraph (a) expands the applicability of the formal hearing 
procedures to cases involving violations of any statutory requirement 
administered by TSA, including surface transportation requirements and 
TWIC requirements.
    Second, paragraph (b) of this rule makes clear that the formal 
hearing procedures cannot be used to conduct an adjudication of the 
validity of any TSA rule or other requirement under the U.S. 
Constitution, the Administrative Procedure Act, or any other law. Put 
differently, a person may not use a

[[Page 36037]]

formal hearing under subpart G to challenge the legal basis of a TSA 
rule or other requirement, the violation of which gave rise to the 
issuance of a civil penalty. The purpose of the formal hearing is to 
adjudicate whether a violation occurred and whether the civil penalty 
is appropriate. See Appeal of Rendon, 2004 DOT Av. LEXIS 1287, at *3, 
(ALJ lacks authority to determine whether a TSA regulation was 
unconstitutional) aff'd sub nom. Rendon v. Transportation Security 
Admin., 424 F.3d 475 (6th Cir. 2005).
    Third, paragraph (d) of this rule adds a provision clarifying that 
the consolidation of two or more cases that individually are below the 
Federal district court jurisdictional threshold does not cause the 
consolidated action to exceed that threshold and thereby fall within 
the exclusive jurisdiction of the Federal district court. The issue of 
consolidation of cases is addressed further in Sec.  1503.613.
2. Administrative Law Judges (Sec.  1503.607)
    Section 1503.607 of this rule revises the provisions of Sec.  
1503.205 of the current rule, with the following changes. First, 
paragraph (a) makes explicit the following implicit powers that an ALJ 
holds under the current regulation: (1) To issue scheduling orders and 
other appropriate orders regarding discovery or other matters that come 
before him or her; (2) to hold conferences to settle or to simplify the 
issues on his or her own motion; (3) to strike unsigned documents 
unless omission of the signature is corrected promptly after being 
called to the attention of the attorney or party; and (4) to order 
payment of witness fees.
    Second, paragraph (b) of this rule adds an express limitation on an 
ALJ's powers, consistent with current law. Specifically, the amended 
rule provides that an ALJ is not authorized to decide issues involving 
the validity of a TSA regulation, order, or other requirement under the 
U.S. Constitution, the Administrative Procedure Act, or other law. See 
Appeal of Rendon, 2004 DOT Av. LEXIS 1287, at *3, (ALJ lacks authority 
to determine whether a TSA regulation was unconstitutional) aff'd sub 
nom. Rendon v. Transportation Security Admin., 424 F.3d 475 (6th Cir. 
2005). Nor may the ALJ adopt or follow a standard of proof or procedure 
contrary to that set forth in TSA's formal hearing procedures.
3. Complaint (Sec.  1503.609)
    Section 1503.609 of this rule revises slightly the provisions of 
Sec.  1503.208 of the current regulation. First, Sec.  1503.609 changes 
from 20 to 30 the number of days within which TSA has to file a 
complaint after a respondent requests a formal hearing. A 30-day period 
is consistent with the length of most of the other response periods 
allowed under TSA's enforcement procedures.
    Second, Sec.  1503.609 omits provisions on the manner of service of 
the complaint, because service of all documents is addressed in Sec.  
1503.409.
4. Consolidation and Separation of Cases (Sec.  1503.613)
    This rule adds a new provision governing the consolidation and 
separation of cases. In addition to clarifying the process for 
consolidation and separation of cases, Sec.  1503.613 makes clear that 
consolidation of two or more actions that individually involve amounts 
in controversy below the jurisdictional maximum of the administrative 
court will not cause the resulting action to exceed that jurisdictional 
maximum and thereby come under the exclusive jurisdiction of the 
Federal district courts, as specified in 49 U.S.C. 46301(d)(4)(A).
5. Extension of Time (Sec.  1503.617)
    Section 1503.617 of this rule revises slightly the provisions of 
Sec.  1503.213 of the current rule by adding a new provision 
specifically governing requests for continuances of a hearing. 
Paragraph (c) provides that either party may request a continuance of 
the date of a hearing, for good cause shown, no later than seven days 
before the date of the hearing. Good cause does not include a 
scheduling conflict involving the parties or their attorneys which by 
due diligence could have been foreseen. This new provision is intended 
to establish certainty and predictability for the parties as they 
prepare for a formal hearing and discourage undue delay in the 
proceedings.
6. Withdrawal of Complaint or Request for Hearing (Sec.  1503.623)
    Section 1503.623 of this rule revises slightly the provision of 
Sec.  1503.215 of the current regulation, which permits an agency 
attorney to withdraw a complaint or a respondent to withdraw a request 
for a hearing without the consent of the ALJ, at any time before or 
during a hearing. The rule now permits the ALJ to dismiss the 
proceedings without prejudice if the withdrawing party shows good cause 
for dismissal without prejudice. The current regulation requires 
dismissal with prejudice in all cases. This change is intended to leave 
open the possibility that the withdrawing party may have a bona fide 
reason for withdrawing and should not be automatically precluded from 
refiling. In addition, the amended rule permits a party to withdraw a 
request for hearing without prejudice at any time before a complaint 
has been filed. This is intended to address situations where 
respondents mistakenly request a hearing when they intended to ask for 
an informal conference or another procedural option.
7. Discovery (Sec.  1503.633)
    Section 1503.633 of this rule incorporates the provisions in Sec.  
1503.220 of the current regulation and adds a new provision at Sec.  
1503.633(g) clarifying a party's access to Sensitive Security 
Information through discovery. Specifically, at the request of a party, 
TSA may provide SSI to the party when, in the sole discretion of TSA, 
access to the SSI is necessary for the party to prepare a response to 
allegations contained in the complaint. TSA may provide such 
information, subject to such restrictions on further disclosure and 
such safeguarding requirements as TSA determines appropriate. This new 
provision largely reiterates a similar provision in 49 CFR 1520.15(d) 
of TSA's regulation governing Sensitive Security Information. TSA 
repeats it here for clarity.
8. Standard of Proof (Sec.  1503.637)
    Section 1503.637 of this rule amends the provisions of Sec.  
1503.223 of the current regulation regarding the standard of proof in a 
formal hearing. The current regulation states that a party must prove 
its case or defense by ``a preponderance of reliable, probative, and 
substantial evidence.'' This statement of the standard may be confusing 
because it refers to ``substantial evidence.'' The ``substantial 
evidence'' standard is a standard of judicial review applicable to an 
agency's finding of fact. See American Textile Mfrs. Inst. v. Donovan, 
452 U.S. 490, 522 (1981). Courts have defined ``substantial evidence'' 
as ``such relevant evidence as a reasonable mind might accept as 
adequate to support a conclusion.'' Id. Moreover, courts have 
consistently held that substantial evidence ``requires more than a 
scintilla but less than a preponderance.'' Id. Thus, the substantial 
evidence standard and the preponderance standard differ. By using the 
term ``substantial evidence'' in the description of the preponderance 
standard, Sec.  1503.223 of the current regulation appears to introduce 
confusion about the appropriate standard of proof. To eliminate any 
confusion, TSA has restated the standard of proof simply as

[[Page 36038]]

proof of a party's case or defense by a preponderance of the evidence. 
Preponderance of the evidence means proof by information that, compared 
with information opposing it, leads to the conclusion that the fact at 
issue is more probably true than not.
9. Argument Before the ALJ (Sec.  1503.653)
    Section 1503.653 of this rule revises slightly the provisions in 
Sec.  1503.231 of the current regulation. Current Sec.  1503.231(a) 
states that the ALJ may request written arguments during the hearing if 
he or she finds that submission of written arguments would be 
``reasonable.'' This rule changes this standard by providing that the 
ALJ may request written arguments during the hearing if written 
argument is ``necessary to issue the ruling or order to which the 
argument pertains.'' The purpose of this change is simply to clarify to 
the parties and the ALJ what constitutes a reasonable ground to request 
written arguments.
10. Initial Decision (Sec.  1503.655)
    Section 1503.655 of this rule regarding the initial decision of the 
ALJ revises slightly the provision of Sec.  1503.232 of the current 
regulation. Paragraph (a) makes a conforming change by clarifying that 
the ALJ's issuance of an initial decision may follow the party's 
submission of written posthearing briefs.
    Paragraph (b) changes the requirement as to when an initial 
decision must be issued and whether it must be written. Under the 
current regulation, the ALJ must issue the initial decision and order 
orally on the record at the conclusion of the hearing, unless the ALJ 
finds that issuing a written initial decision is reasonable. In such 
cases the ALJ must issue a written initial decision not later than 30 
days after the conclusion of the hearing or submission of the last 
posthearing brief. This rule changes this practice by making the 
issuance of a written initial decision mandatory in all cases. 
Specifically, paragraph (b) provides that, after the conclusion of the 
hearing, the ALJ may issue the initial decision and order orally on the 
record. The ALJ must issue a written initial decision and order not 
later than 30 days after the conclusion of the hearing or submission of 
the last post-hearing brief. The ALJ must serve a copy of any written 
initial decision on each party.
    TSA has made this change to better document ALJ decisions and 
preserve guidance for future enforcement proceedings.
    Paragraph (d) revises the provision in Sec.  1503.233(j)(3) of the 
current regulation regarding the precedential value of ALJ rulings and 
initial decisions. That section now states that any issue, finding or 
conclusion, order, ruling, or initial decision of an ALJ that has not 
been appealed to the TSA decision maker is not precedent in any other 
civil penalty action. While this is correct in that such decisions are 
not binding in other civil penalty actions, the language of this 
provision appeared to preclude reliance on such prior decisions as 
instructive or persuasive. In the interest of promoting predictability 
and consistency in enforcement, it is appropriate that ALJ initial 
decisions be recognized as persuasive authority in subsequent civil 
penalty actions. Consequently, paragraph (d) revises the current 
regulation by providing that an initial decision of an ALJ may be 
considered as persuasive authority in any other civil penalty action, 
unless appealed and reversed by the TSA decision maker or a court of 
competent jurisdiction.
11. Appeal From Initial Decision (Sec.  1503.657)
    Section 1503.657 of this rule revises the reference in paragraph 
(b) to the preponderance-of-the-evidence standard of proof, as 
discussed previously.

V. Administrative Procedure Act

    The Administrative Procedure Act (APA) requires TSA to provide 
public notice and seek public comment on substantive regulations. 5 
U.S.C. 553. The APA, however, excludes certain types of regulations and 
permits exceptions for other types of regulations from this public 
notice and comment requirement. TSA issues this rule without providing 
the opportunity for prior notice and comment for the reasons described 
below. TSA is requesting, however, and will consider, public comments 
submitted during the public comment period as described in the 
``Comments Invited'' section.
    Reorganization and clarification of 49 CFR part 1503. The 
Administrative Procedure Act (APA) exempts from the prior notice and 
opportunity for comment requirements ``rules of agency organization, 
procedure or practice.'' 5 U.S.C. 553(b)(A). The reorganization and 
clarification of part 1503 makes changes such as making it explicit 
that an ALJ can issue scheduling orders or hold conferences changing 
from 20 to 30 the number of days within which TSA must file a complaint 
after a respondent requests a formal hearing. Accordingly, to the 
extent that this rule adopts rules of agency organization, procedure or 
practice, those portions of the rule are excepted from the notice-and-
comment requirements under 5 U.S.C. 553(b)(A).
    Surface Mode Administrative Penalties. This portion of the rule 
would codify provisions of the 9/11 Act that bring surface mode 
violations within the scope of TSA's civil penalty authority. Sections 
1302 and 1304(e) of the 9/11 Act consist of specific directions to TSA 
for assessing civil penalties for surface transportation and 
Transportation Worker Identification Credential violations. Prior to 
enactment of the 9/11 Act, TSA could assess civil penalties primarily 
for violations of ch. 449 of title 49 U.S.C., which relates to 
aviation. Accordingly, this rule would make TSA's current civil penalty 
enforcement procedures at 49 CFR part 1503, which now only apply to 
violations of ch. 449 of title 49 U.S.C. (aviation), applicable to the 
additional types of violations added by the 9/11 Act, such as 
violations of surface transportation requirements. As an application of 
the existing procedures to a new substantive area of regulation, the 
rule remains a procedural rule that may be excepted from notice and 
comment under 5 U.S.C. 553(a)(2). Advance notice-and-comment, moreover, 
is unnecessary and would not serve the public interest under 5 U.S.C. 
553(b)(3)(B) because these rules already apply to all other civil 
penalties before TSA.
    Civil Monetary Penalty Adjustment. This rule makes inflation 
adjustments to the maximum civil penalty amounts in accordance with the 
Federal Civil Penalty Inflation Adjustment Act of 1990, 28 U.S.C. 2461 
note. TSA has no discretion over the amounts of these increases. The 
Adjustment Act specifies an arithmetic calculation of the inflation 
adjustment. This rule is a nondiscretionary ministerial action to 
conform to the Adjustment Act. Therefore, advance public notice and an 
opportunity for public comment is unnecessary and not in the public 
interest. 5 U.S.C. 553(b)(3)(B).

VI. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq., 
requires that TSA consider the impact of paperwork and other 
information collection burdens imposed on the public and, under the 
provisions of PRA section 3507(d), obtain approval from the Office of 
Management and Budget (OMB) for each collection of information it 
conducts, sponsors, or requires through regulations. As protection 
provided by the Paperwork Reduction Act, as amended, an agency may not 
conduct or sponsor, and a person is not required to respond to, a 
collection of information unless it

[[Page 36039]]

displays a currently valid OMB control number.
    TSA has determined that there are no current or new information 
collection requirements associated with this rule.

VII. Economic Impact Analyses

A. Regulatory Evaluation Summary

    Changes to Federal regulations must undergo several economic 
analyses. First, Executive Order 12866, Regulatory Planning and Review 
\15\ directs each Federal agency to propose or adopt a regulation only 
upon a reasoned determination that the benefits of the intended 
regulation justify its costs. Second, the Regulatory Flexibility Act of 
1980, 5 U.S.C. 601 et seq., as amended by the Small Business Regulatory 
Enforcement Fairness Act (SBREFA) of 1996, requires agencies to analyze 
the economic impact of regulatory changes on small entities. Third, the 
Trade Agreements Act, 19 U.S.C. 2531-2533, prohibits agencies from 
setting standards that create unnecessary obstacles to the foreign 
commerce of the United States. Fourth, the Unfunded Mandates Reform Act 
of 1995, 2 U.S.C. 1531-1538, requires agencies to prepare a written 
assessment of the costs, benefits, and other effects of proposed or 
final rules that include a Federal mandate likely to result in the 
expenditure by State, local, or tribal governments, in the aggregate, 
or by the private sector, of $100 million or more annually (adjusted 
for inflation).
---------------------------------------------------------------------------

    \15\ 58 FR 51735 (October 4, 1993).
---------------------------------------------------------------------------

B. Executive Order 12866 Assessment

    In conducting these analyses, TSA has determined:
    1. This rulemaking is not a ``significant regulatory action'' as 
defined in the Executive Order. The Office of Management and Budget 
agrees with this conclusion.
    2. This rulemaking does not have a significant economic impact on a 
substantial number of small entities.
    3. This rulemaking does not constitute a barrier to international 
trade.
    4. This rulemaking does not impose an unfunded mandate on State, 
local, or tribal governments, or on the private sector.
    The bases for these conclusions are summarized below.

C. Costs and Benefits

    This is a procedural rule whose costs and benefits will not 
significantly exceed, or be lower than, those imposed by TSA's current 
rule. While maximum penalty amounts have been adjusted for inflation, 
this change is not likely to have a significant impact because TSA does 
not expect to impose maximum penalties in most enforcement actions. 
More importantly, however, the costs of these penalties only affect 
those that engage in conduct prohibited by statute or related 
regulations. Those who comply with the law will not be affected.

D. Regulatory Flexibility Act Assessment

    The Regulatory Flexibility Act (RFA) of 1980 requires that agencies 
perform a review to determine whether a rule will have a significant 
economic impact on a substantial number of small entities. If the 
agency determines that a rule will have a significant economic impact 
on a substantial number of small entities, the agency must prepare a 
regulatory flexibility analysis as described in the RFA. For purposes 
of the RFA, small entities include small businesses, not-for-profit 
organizations, and small governmental jurisdictions. 5 U.S.C. 601(6). 
Individuals and States are not included in the definition of a small 
entity. Pursuant to 5 U.S.C. 603(a), however, the requirement to 
perform a regulatory flexibility analysis does not apply where, as is 
the case in today's rule, the agency is not required to issue a 
proposed rule prior to issuing a final rule.
    This rule provides guidance for the parties as to how civil 
penalties are imposed. The rules state the procedures for 
investigations, enforcement actions, for TSA civil penalty actions, and 
other details of imposing and adjudicating civil penalties. The civil 
penalties implemented by this rule will only affect those that engage 
in conduct prohibited by statute or related regulations. Those who 
comply with the law will not be affected by these civil penalties. 
Pursuant to Sec.  1503.401, maximum civil penalties for individuals and 
small businesses are lower than those for larger entities.

E. International Trade Impact Assessment

    The Trade Agreement Act of 1979 prohibits Federal agencies from 
establishing any standards or engaging in related activities that 
create unnecessary obstacles to the foreign commerce of the United 
States. Legitimate domestic objectives, such as safety, are not 
considered unnecessary obstacles. The statute also requires 
consideration of international standards and, where appropriate, that 
they be the basis for U.S. standards. TSA has assessed the potential 
effect of this rulemaking and has determined that it will impose the 
same costs on domestic and international entities and thus have a 
neutral trade impact.

F. Unfunded Mandates Assessment

    The Unfunded Mandates Reform Act of 1995 is intended, among other 
things, to curb the practice of imposing unfunded Federal mandates on 
State, local, and tribal governments. Title II of the Act requires each 
Federal agency to prepare a written statement assessing the effects of 
any Federal mandate in a proposed or final agency rule that may result 
in a $100 million or more expenditure (adjusted annually for inflation) 
in any one year by State, local, and tribal governments, in the 
aggregate, or by the private sector; such a mandate is deemed to be a 
``significant regulatory action.''
    This rulemaking does not contain such a mandate. The requirements 
of Title II of the Act, therefore, do not apply and TSA has not 
prepared a statement under the Act.

VIII. Other Analyses

A. Executive Order 13132, Federalism

    TSA has analyzed this rule under the principles and criteria of 
Executive Order 13132, Federalism. TSA has determined that this action 
will not have a substantial direct effect on the States, on the 
relationship between the National Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government, and therefore does not have Federalism implications.

B. Environmental Analysis

    TSA has reviewed this action for purposes of the National 
Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321-4347, and has 
determined that this action will not have a significant effect on the 
human environment.

C. Energy Impact Analysis

    The energy impact of the notice has been assessed in accordance 
with the Energy Policy and Conservation Act (EPCA), Public Law 94-163, 
as amended (42 U.S.C. 6362). TSA has determined that this rulemaking is 
not a major regulatory action under the provisions of the EPCA.

List of Subjects in 49 CFR Part 1503

    Administrative practice and procedure, Investigations, Law 
enforcement, Penalties, Transportation.

The Amendments

0
For the reasons set forth in the preamble, the Transportation Security 
Administration revises part 1503 in chapter XII of title 49, Code of 
Federal Regulations to read as follows:

[[Page 36040]]

PART 1503--INVESTIGATIVE AND ENFORCEMENT PROCEDURES

Subpart A--[Reserved]
Subpart B--Scope of Investigative and Enforcement Procedures
Sec.
1503.101 TSA requirements.
1503.103 Terms used in this part.
Subpart C--Investigative Procedures
1503.201 Reports of violations.
1503.203 Investigations.
1503.205 Records, documents, and reports.
Subpart D--Non-Civil Penalty Enforcement
1503.301 Warning notices and letters of correction.
Subpart E--Assessment of Civil Penalties by TSA
1503.401 Maximum penalty amounts.
1503.403 Delegation of authority.
1503.405 Injunctions.
1503.407 Military personnel.
1503.409 Service of documents.
1503.411 Computation of time.
1503.413 Notice of Proposed Civil Penalty.
1503.415 Request for portions of the enforcement investigative 
report (EIR).
1503.417 Final Notice of Proposed Civil Penalty and Order.
1503.419 Order Assessing Civil Penalty.
1503.421 Streamlined civil penalty procedures for certain security 
violations.
1503.423 Consent orders.
1503.425 Compromise orders.
1503.427 Request for a formal hearing.
1503.429 Filing of documents with the Enforcement Docket Clerk.
1503.431 Certification of documents.
Subpart F--[Reserved]
Subpart G--Rules of Practice in TSA Civil Penalty Actions
1503.601 Applicability.
1503.603 Separation of functions.
1503.605 Appearances and rights of parties.
1503.607 Administrative law judges.
1503.609 Complaint.
1503.611 Answer.
1503.613 Consolidation and separation of cases.
1503.615 Notice of hearing.
1503.617 Extension of time.
1503.619 Intervention.
1503.621 Amendment of pleadings.
1503.623 Withdrawal of complaint or request for hearing.
1503.625 Waivers.
1503.627 Joint procedural and discovery schedule.
1503.629 Motions.
1503.631 Interlocutory appeals.
1503.633 Discovery.
1503.635 Evidence.
1503.637 Standard of proof.
1503.639 Burden of proof.
1503.641 Offer of proof.
1503.643 Public disclosure of evidence.
1503.645 Expert or opinion witnesses.
1503.647 Subpoenas.
1503.649 Witness fees.
1503.651 Record.
1503.653 Argument before the ALJ.
1503.655 Initial decision.
1503.657 Appeal from initial decision.
1503.659 Petition to reconsider or modify a final decision and order 
of the TSA decision maker on appeal.
1503.661 Judicial review of a final order.
Subpart H--Judicial Assessment of Civil Penalties
1503.701 Applicability of this subpart.
1503.703 Civil penalty letter; referral.
Subpart I--Formal Complaints
1503.801 Formal complaints.

    Authority: 18 U.S.C. 6002; 28 U.S.C. 2461 (note); 49 U.S.C. 114, 
20109, 31105, 40113-40114, 40119, 44901-44907, 46101-46107, 46109-
46110, 46301, 46305, 46311, 46313-46314; Sec. 1413(i), Public Law 
110-53, 121 Stat. 414 (6 U.S.C. 1142).

PART 1503--INVESTIGATIVE AND ENFORCEMENT PROCEDURES

Subpart A--[Reserved]

Subpart B--Scope of Investigative and Enforcement Procedures


Sec.  1503.101  TSA requirements.

    (a) The investigative and enforcement procedures in this part apply 
to TSA's investigation and enforcement of violations of TSA 
requirements.
    (b) For purposes of this part, the term TSA requirements means the 
following statutory provisions and a regulation prescribed or order 
issued under any of those provisions:
    (1) Those provisions of title 49 U.S.C. administered by the 
Administrator; and
    (2) 46 U.S.C. chapter 701.


Sec.  1503.103  Terms used in this part.

    In addition to the terms in Sec.  1500.3 of this chapter, the 
following definitions apply in this part:
    Administrative law judge or ALJ means an ALJ appointed pursuant to 
the provisions of 5 U.S.C. 3105.
    Agency attorney means the Deputy Chief Counsel for Enforcement or 
an attorney that he or she designates. An agency attorney will not 
include--
    (1) Any attorney in the Office of the Chief Counsel who advises the 
TSA decision maker regarding an initial decision or any appeal to the 
TSA decision maker; or
    (2) Any attorney who is supervised in a civil penalty action by a 
person who provides such advice to the TSA decision maker in that 
action or a factually related action.
    Attorney means any person who is eligible to practice law in, and 
is a member in good standing of the bar of, the highest court of any 
State, possession, territory, or Commonwealth of the United States, or 
of the District of Columbia, and is not under any order suspending, 
enjoining, restraining, disbarring, or otherwise restricting him or her 
in the practice of law.
    Enforcement Investigative Report or EIR means a written report 
prepared by a TSA Inspector or other authorized agency official 
detailing the results of an inspection or investigation of a violation 
of a TSA requirement, including copies of any relevant evidence.
    Mail includes regular First Class U.S. mail service, U.S. certified 
mail, or U.S. registered mail.
    Party means the respondent or TSA.
    Personal delivery includes hand-delivery or use of a contract or 
express messenger service, including an overnight express courier 
service. Personal delivery does not include the use of Government 
interoffice mail service.
    Pleading means a complaint, an answer, motion and any amendment of 
these documents permitted under this subpart as well as any other 
written submission to the ALJ or a party during the course of the 
hearing proceedings.
    Properly addressed means a document that shows an address contained 
in agency records, a residential, business, or other address submitted 
by a person on any document provided under this part, or any other 
address obtained by other reasonable and available means.
    Public transportation agency means a publicly owned operator of 
public transportation eligible to receive Federal assistance under 49 
U.S.C. chapter 53.
    Respondent means the person named in a Notice of Proposed Civil 
Penalty, a Final Notice of Proposed Civil Penalty and Order, or a 
complaint.
    TSA decision maker means the Administrator, acting in the capacity 
of the decision maker on appeal, or any person to whom the 
Administrator has delegated the Administrator's decision-making 
authority in a civil penalty action. As used in this part, the TSA 
decision maker is the official authorized to issue a final decision and 
order of the Administrator in a civil penalty action.

Subpart C--Investigative Procedures


Sec.  1503.201  Reports of violations.

    (a) Any person who knows of a violation of a TSA requirement should 
report it to appropriate personnel of any TSA office.
    (b) TSA will review each report made under this section, together 
with any other information TSA may have that is relevant to the matter 
reported, to determine the appropriate response, including additional 
investigation or administrative or legal enforcement action.

[[Page 36041]]

Sec.  1503.203  Investigations.

    (a) General. The Administrator, or a designated official, may 
conduct investigations, hold hearings, issue subpoenas, require the 
production of relevant documents, records, and property, and take 
evidence and depositions.
    (b) Delegation of authority. For the purpose of investigating 
alleged violations of a TSA requirement, the Administrator's authority 
may be exercised by the agency's various offices for matters within 
their respective areas for all routine investigations. When the 
compulsory processes of 49 U.S.C. 46104 are invoked, the 
Administrator's authority has been delegated to the Chief Counsel, each 
Deputy Chief Counsel, and in consultation with the Office of Chief 
Counsel, the Assistant Administrator for Security Operations, the 
Assistant Administrator for Transportation Sector Network Management, 
the Assistant Administrator for Inspections, the Assistant 
Administrator for Law Enforcement/Director of the Federal Air Marshal 
Service, each Special Agent in Charge, and each Federal Security 
Director.


Sec.  1503.205  Records, documents, and reports.

    Each record, document, and report that regulations issued by the 
Transportation Security Administration require to be maintained, 
exhibited, or submitted to the Administrator may be used in any 
investigation conducted by the Administrator; and, except to the extent 
the use may be specifically limited or prohibited by the section that 
imposes the requirement, the records, documents, and reports may be 
used in any civil penalty action or other legal proceeding.

Subpart D--Non-Civil Penalty Enforcement


Sec.  1503.301  Warning notices and letters of correction.

    (a) If TSA determines that a violation or an alleged violation of a 
TSA requirement does not require the assessment of a civil penalty, an 
appropriate official of the TSA may take administrative action in 
disposition of the case.
    (b) An administrative action under this section does not constitute 
a formal adjudication of the matter, and may be taken by issuing the 
alleged violator--
    (1) A ``Warning Notice'' that recites available facts and 
information about the incident or condition and indicates that it may 
have been a violation; or
    (2) A ``Letter of Correction'' that confirms the TSA decision in 
the matter and states the necessary corrective action the alleged 
violator has taken or agrees to take. If the agreed corrective action 
is not fully completed, legal enforcement action may be taken.
    (c) The issuance of a Warning Notice or Letter of Correction is not 
subject to appeal under this part.
    (d) In the case of a public transportation agency that is 
determined to be in violation of a TSA requirement, an appropriate TSA 
official will seek correction of the violation through a written 
``Notice of Noncompliance'' to the public transportation agency giving 
the public transportation agency reasonable opportunity to correct the 
violation or propose an alternative means of compliance acceptable to 
TSA.
    (e) TSA will not take legal enforcement action against a public 
transportation agency under subpart E unless it has provided the Notice 
of Noncompliance described in paragraph (d) of this section and the 
public transportation agency fails to correct the violation or propose 
an alternative means of compliance acceptable to TSA within the 
timeframe provided in the notice.
    (f) TSA will not initiate civil enforcement action for violations 
of administrative and procedural requirements pertaining to the 
application for, and the expenditure of, funds awarded pursuant to 
transportation security grant programs under Public Law 110-53.

Subpart E--Assessment of Civil Penalties by TSA


Sec.  1503.401  Maximum penalty amounts.

    (a) General. TSA may assess civil penalties not exceeding the 
following amounts against a person for the violation of a TSA 
requirement.
    (b) In General. Except as provided in paragraph (c) of this 
section, in the case of violation of title 49 U.S.C. or 46 U.S.C. 
chapter 701, or a regulation prescribed or order issued under any of 
those provisions, TSA may impose a civil penalty in the following 
amounts:
    (1) $10,000 per violation, up to a total of $50,000 per civil 
penalty action, in the case of an individual or small business concern, 
as defined in section 3 of the Small Business Act (15 U.S.C. 632); and
    (2) $10,000 per violation, up to a total of $400,000 per civil 
penalty action, in the case of any other person.
    (c) Certain aviation related violations. In the case of a violation 
of 49 U.S.C. chapter 449 (except sections 44902, 44903(d), 44907(a)-
(d)(1)(A), 44907(d)(1)(C)-(f), 44908, and 44909), or 49 U.S.C. 46302 or 
46303, or a regulation prescribed or order issued under any of those 
provisions, TSA may impose a civil penalty in the following amounts:
    (1) $10,000 per violation, up to a total of $50,000 per civil 
penalty action, in the case of an individual (except an airman serving 
as an airman), any person not operating an aircraft for the 
transportation of passengers or property for compensation, or a small 
business concern, as defined in section 3 of the Small Business Act (15 
U.S.C. 632).
    (2) $25,000 per violation, up to a total of $400,000 per civil 
penalty action, in the case of a person operating an aircraft for the 
transportation of passengers or property for compensation (except an 
individual serving as an airman).
    (d) Inflation adjustment. TSA may adjust the maximum civil penalty 
amounts in conformity with the Federal Civil Penalties Inflation 
Adjustment Act of 1990, 28 U.S.C. 2461 (note). Minimum and maximum 
civil penalties within the jurisdiction of TSA are adjusted for 
inflation as follows:

[[Page 36042]]



                  Table 1--Minimum and Maximum Civil Penalties--Adjusted for Inflation, Effective December 12, 2003 to August 20, 2009
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                           Maximum penalty amount
                                                                     Minimum    Adjusted      when last set or
    United States Code  citation        Civil penalty description    penalty    minimum     adjusted pursuant to           Maximum penalty amount
                                                                                penalty             law
--------------------------------------------------------------------------------------------------------------------------------------------------------
49 U.S.C. 46301(a)(1), (4)..........  Violation of 49 U.S.C. ch.          N/A        N/A  $25,000 per violation,   $25,000 per violation.
                                       449 (except secs. 44902,                            reset 12/12/2003.
                                       44903(d), 44907(a)-
                                       (d)(1)(A), 44907(d)(1)(C)-
                                       (f), 44908, and 44909), or
                                       49 U.S.C. 46302 or 46303, a
                                       regulation prescribed, or
                                       order issued thereunder by
                                       a person operating an
                                       aircraft for the
                                       transportation of
                                       passengers or property for
                                       compensation.
49 U.S.C. 46301(a)(1), (4)..........  Violation of 49 U.S.C. ch.          N/A        N/A  $10,000 per violation,   $10,000 per violation.
                                       449 (except secs. 44902,                            reset 12/12/2003.
                                       44903(d), 44907(a)-
                                       (d)(1)(A), 44907(d)(1)(C)-
                                       (f), 44908, and 44909), or
                                       49 U.S.C. 46302 or 46303, a
                                       regulation prescribed, or
                                       order issued thereunder by
                                       an individual (except an
                                       airman serving as an
                                       airman), any person not
                                       operating an aircraft for
                                       the transportation of
                                       passengers or property for
                                       compensation, or a small
                                       business concern.
--------------------------------------------------------------------------------------------------------------------------------------------------------


                             Table 2--Minimum and Maximum Civil Penalties--Adjusted for Inflation, Effective August 20, 2009
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                           Maximum penalty amount
                                                                     Minimum    Adjusted      when last set or
     United States Code Citation        Civil penalty description    penalty    minimum     adjusted pursuant to           Maximum penalty amount
                                                                                penalty             law
--------------------------------------------------------------------------------------------------------------------------------------------------------
49 U.S.C. 46301(a)(1), (4)..........  Violation of 49 U.S.C. ch.          N/A        N/A  $25,000 per violation,   $27,500 per violation.
                                       449 (except secs. 44902,                            reset 12/12/2003.
                                       44903(d), 44907(a)-
                                       (d)(1)(A), 44907(d)(1)(C)-
                                       (f), 44908, and 44909), or
                                       49 U.S.C. 46302 or 46303, a
                                       regulation prescribed, or
                                       order issued thereunder by
                                       a person operating an
                                       aircraft for the
                                       transportation of
                                       passengers or property for
                                       compensation.
49 U.S.C. 46301(a)(1), (4)..........  Violation of 49 U.S.C. ch.          N/A        N/A  $10,000 per violation,   $11,000 per violation.
                                       449 (except secs. 44902,                            reset 12/12/2003.
                                       44903(d), 44907(a)-
                                       (d)(1)(A), 44907(d)(1)(C)-
                                       (f), 44908, and 44909), or
                                       49 U.S.C. 46302 or 46303, a
                                       regulation prescribed, or
                                       order issued thereunder by
                                       an individual (except an
                                       airman serving as an
                                       airman), any person not
                                       operating an aircraft for
                                       the transportation of
                                       passengers or property for
                                       compensation, or a small
                                       business concern.
49 U.S.C. 114(v)....................  Violation of any other              N/A        N/A  NA.....................  $10,000 per violation.
                                       provision of title 49
                                       U.S.C. or of 46 U.S.C. ch.
                                       701, a regulation
                                       prescribed, or order issued
                                       under thereunder.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Sec.  1503.403  Delegation of authority.

    The Administrator delegates the following authority to the Chief 
Counsel and the Deputy Chief Counsel for Enforcement, which authority 
may be redelegated as necessary:
    (a) To initiate and assess civil penalties under 49 U.S.C. 114 and 
46301 and this subpart for a violation a TSA requirement;
    (b) To compromise civil penalties initiated under this subpart; and
    (c) To refer cases to the Attorney General of the United States, or 
the delegate of the Attorney General, for the collection of civil 
penalties.


Sec.  1503.405  Injunctions.

    Whenever it is determined that a person has engaged, or is about to 
engage, in any act or practice constituting a violation of a TSA 
requirement, the Chief Counsel or the Deputy Chief Counsel for 
Enforcement may request the Attorney General of the United States, or 
the delegate of the Attorney General, to bring an action in the 
appropriate United States district court for such relief as is 
necessary or appropriate, including mandatory or prohibitive injunctive 
relief, interim equitable relief, and punitive damages, as provided by 
49 U.S.C. 114 and 46107.


Sec.  1503.407  Military personnel.

    If a report made under this part indicates that, while performing 
official duties, a member of the Armed Forces, or a civilian employee 
of the Department of Defense who is subject to the Uniform Code of 
Military Justice (10 U.S.C. chapter 47), has violated a TSA 
requirement, an agency official will send a copy of the report to the

[[Page 36043]]

appropriate military authority for such disciplinary action as that 
authority considers appropriate and a report to the Administrator 
thereon.


Sec.  1503.409  Service of documents.

    (a) General. This section governs service of documents required to 
be made under this part.
    (b) Type of service. A person may serve documents by:
    (1) Personal delivery;
    (2) Mail, or
    (3) Electronic mail or facsimile transmission, if consented to in 
writing by the person served, except that such service is not effective 
if the party making service receives credible information indicating 
that the attempted service did not reach the person to be served.
    (c) If a party serves a pleading on another party during the course 
of hearing proceedings by electronic mail or facsimile transmission, 
the party making service must file with the Enforcement Docket Clerk a 
copy of the consent of the receiving party to accept such method of 
service.
    (d) Date of service. The date of service will be:
    (1) The date of personal delivery.
    (2) If mailed, the mailing date stated on the certificate of 
service, the date shown on the postmark if there is no certificate of 
service, or other mailing date shown by other evidence if there is no 
certificate of service or postmark.
    (3) If sent by electronic mail or facsimile transmission, the date 
of transmission.
    (e) Valid service. A document served by mail or personal delivery 
that was properly addressed, was sent in accordance with this part, and 
that was returned, that was not claimed, or that was refused, is deemed 
to have been served in accordance with this part. The service will be 
considered valid as of the date and the time that the document was 
deposited with a contract or express messenger, the document was 
mailed, or personal delivery of the document was attempted and refused.
    (f) Presumption of service. There will be a presumption of service 
where a party or a person, who customarily receives mail, or receives 
it in the ordinary course of business, at either the person's residence 
or the person's principal place of business, acknowledges receipt of 
the document.
    (g) Additional time after service by mail. Whenever a party has a 
right or a duty to act or to make any response within a prescribed 
period after service by mail, or on a date certain after service by 
mail, 5 days will be added to the prescribed period.
    (h) Service of documents filed with the Enforcement Docket. A 
person must serve a copy of any document filed with the Enforcement 
Docket on each party and the ALJ or the chief ALJ if no judge has been 
assigned to the proceeding at the time of filing. Service on a party's 
attorney of record or a party's designated representative is service on 
the party.
    (i) Certificate of service. Each party must attach a certificate of 
service to any document tendered for filing with the Enforcement Docket 
Clerk. A certificate of service must consist of a statement, dated and 
signed by the person who effected service, of the name(s) of the 
person(s) served, and the method by which each person was served and 
the date that the service was made.
    (j) Service by the ALJ. The ALJ must serve a copy of each document 
he or she issues including, but not limited to, notices of pre-hearing 
conferences and hearings, rulings on motions, decisions, and orders, 
upon each party to the proceedings.


Sec.  1503.411  Computation of time.

    (a) This section applies to any period of time prescribed or 
allowed by this part, or by notice or order of an ALJ.
    (b) The date of an act, event, or default, after which a designated 
time period begins to run, is not included in a computation of time 
under this subpart.
    (c) The last day of a time period is included in a computation of 
time unless it is a Saturday, Sunday, a legal holiday, or a day on 
which the enforcement docket is officially closed. If the last day of 
the time period is a Saturday, Sunday, legal holiday, or a day on which 
the enforcement docket is officially closed, the time period runs until 
the end of the next day that is not a Saturday, Sunday, legal holiday, 
or a day on which the enforcement docket is officially closed.


Sec.  1503.413  Notice of Proposed Civil Penalty.

    (a) Issuance. TSA may initiate a civil penalty action under this 
section by serving a Notice of Proposed Civil Penalty on the person 
charged with a violation of a TSA requirement. TSA will serve the 
Notice of Proposed Civil Penalty on the individual charged with a 
violation or on the president of the corporation or company charged 
with a violation, or other representative or employee previously 
identified in writing to TSA as designated to receive such service. A 
corporation or company may designate in writing to TSA another person 
to receive service of any subsequent documents in that civil penalty 
action.
    (b) Contents. The Notice of Proposed Civil Penalty contains a 
statement of the facts alleged, the statute, regulation, or order 
allegedly violated, the amount of the proposed civil penalty, and a 
certificate of service.
    (c) Response. Not later than 30 days after receipt of the Notice of 
Proposed Civil Penalty, the person charged with a violation may take 
one, and only one, of the following options.
    (1) Submit a certified check or money order in the amount of the 
proposed civil penalty made payable to Transportation Security 
Administration, at the address specified in the Notice of Proposed 
Civil Penalty, or make payment electronically through http://www.pay.gov.
    (2) Submit to the agency attorney who issued the Notice of Proposed 
Civil Penalty one of the following:
    (i) A written request that TSA issue an Order Assessing Civil 
Penalty in the amount stated in the Notice of Proposed Civil Penalty 
without further notice, in which case the person waives the right to 
request a Formal Hearing, and payment is due within 30 days of receipt 
of the Order.
    (ii) Written information and other evidence, including documents 
and witness statements, demonstrating that a violation of the 
regulations did not occur as alleged, or that the proposed penalty is 
not warranted by the circumstances.
    (iii) A written request to reduce the proposed civil penalty, the 
amount of requested reduction, together with any documents supporting a 
reduction of the proposed civil penalty, which reflect a current 
financial inability to pay or records showing that payment of the 
proposed civil penalty would prevent the person from continuing in 
business.
    (iv) A written request for an Informal Conference, at a date to be 
determined by the agency attorney, to discuss the matter with the 
agency attorney and to submit supporting evidence and information to 
the agency attorney before the date of the Informal Conference.
    (3) Submit to the agency attorney and to TSA's Enforcement Docket 
Clerk a written request for a Formal Hearing before an ALJ in 
accordance with subpart G of this part. TSA's Enforcement Docket Clerk 
is currently located at the United States Coast Guard (USCG) ALJ 
Docketing Center, 40 S. Gay Street, Room 412, Baltimore, Maryland 
21202-4022. If this location changes, TSA will provide notice of the 
change by notice in the Federal Register.

[[Page 36044]]

Sec.  1503.415  Request for portions of the enforcement investigative 
report (EIR).

    (a) Upon receipt of a Notice of Proposed Civil Penalty, a person 
charged with a violation of a TSA requirement, or a representative 
designated in writing by that person, may request from the agency 
attorney who issued the Notice of Proposed Civil Penalty portions of 
the relevant EIR that are not privileged (e.g., under the deliberative 
process, attorney work-product, or attorney-client privileges). This 
information will be provided for the sole purpose of providing the 
information necessary to prepare a response to the allegations 
contained in the Notice of Proposed Civil Penalty. Sensitive Security 
Information (SSI) contained in the EIR may be released pursuant to 49 
CFR part 1520. Information released under this section is not produced 
under the Freedom of Information Act.
    (b) Any person not listed in paragraph (a) of this section that is 
interested in obtaining a copy of the EIR must submit a FOIA request 
pursuant to 5 U.S.C. 552, et seq., 49 CFR part 7, and any applicable 
DHS regulations. Portions of the EIR may be exempt from disclosure 
pursuant to FOIA.


Sec.  1503.417  Final Notice of Proposed Civil Penalty and Order.

    (a) Issuance. TSA may issue a Final Notice of Proposed Civil 
Penalty and Order (``Final Notice and Order'') to a person charged with 
a violation in the following circumstances:
    (1) The person has failed to respond to a Notice of Proposed Civil 
Penalty within 30 days after receipt of that notice.
    (2) The person requested an Informal Conference under Sec.  
1503.413(c)(2), but failed to attend the conference or continuation of 
the conference or provide the agency attorney with a written request 
showing good cause for rescheduling of the informal conference to a 
specified alternate date.
    (3) The parties have participated in an Informal Conference or 
other informal proceedings as provided in Sec.  1503.413(c)(2) and the 
parties have not agreed to compromise the action or the agency attorney 
has not agreed to withdraw the notice of proposed civil penalty.
    (b) Contents. The Final Notice and Order will contain a statement 
of the facts alleged, the law allegedly violated by the respondent, and 
the amount of the proposed civil penalty. The Final Notice and Order 
may reflect a modified allegation or proposed civil penalty as a result 
of information submitted to the agency attorney during the informal 
proceedings held under Sec.  1503.413(c)(2).


Sec.  1503.419  Order Assessing Civil Penalty.

    (a) Issuance pursuant to a settlement. TSA will issue an Order 
Assessing Civil Penalty if the parties have participated in an Informal 
Conference or other informal proceedings as provided in Sec.  
1503.413(c)(2) and agreed to a civil penalty amount in compromise of 
the matter, in which case the person waives the right to request a 
formal hearing, and payment is due within 30 days of receipt of the 
Order.
    (b) Automatic issuance. A Final Notice and Order automatically 
converts to an Order Assessing Civil Penalty if--
    (1) The person charged with a violation submits a certified check 
or money order in the amount reflected in the Final Notice and Order to 
Transportation Security Administration, to the address specified in the 
Final Notice and Order, or makes such payment electronically through 
http://www.pay.gov; or
    (2) The person fails to respond to the Final Notice and Order or 
request a formal hearing within 15 days after receipt of that notice.


Sec.  1503.421  Streamlined civil penalty procedures for certain 
security violations.

    (a) Notice of violation. TSA, at the agency's discretion, may 
initiate a civil penalty action through issuance of a Notice of 
Violation for violations described in the section and as otherwise 
provided by the Administrator. TSA may serve a Notice of Violation on 
an individual who violates a TSA requirement by presenting a weapon, 
explosive, or incendiary for screening at an airport or in checked 
baggage, where the amount of the proposed civil penalty is less than 
$5,000.
    (b) Contents. A Notice of Violation contains a statement of the 
charges, the amount of the proposed civil penalty, and an offer to 
settle the matter for a lesser specified penalty amount.
    (c) Response. Not later than 30 days after receipt of the Notice of 
Violation, the individual charged with a violation must respond to TSA 
by taking one, and only one, of the following options.
    (1) Submit a certified check or money order for the lesser 
specified penalty amount in the Notice of Violation, made payable to 
Transportation Security Administration and sent to the address 
specified in the Notice of Violation, or make such payment 
electronically through http://www.pay.gov.
    (2) Submit to the office identified in the Notice of Violation one 
of the following:
    (i) Written information and other evidence, including documents and 
witness statements, demonstrating that a violation of the regulations 
did not occur as alleged, or that the proposed penalty is not warranted 
by the circumstances.
    (ii) A written request to reduce the proposed civil penalty, the 
amount of requested reduction, together with any documents supporting a 
reduction of the proposed civil penalty, which reflect a current 
financial inability to pay or records showing that payment of the 
proposed civil penalty would prevent the person from continuing in 
business.
    (iii) A written request for an Informal Conference, at a date to be 
determined by an agency official, to discuss the matter with the agency 
official and to submit supporting evidence and information to the 
agency official before the date of the Informal Conference.
    (3) Submit to the office identified in the Notice of Violation and 
to TSA's Enforcement Docket Clerk a written request for a formal 
hearing before an ALJ in accordance with subpart G. A request for a 
formal hearing before an ALJ must be submitted to the address provided 
in Sec.  1503.413(c)(3).
    (d) Final Notice of Violation and Civil Penalty Assessment Order. 
TSA may issue a Final Notice of Violation and Civil Penalty Assessment 
Order (``Final Notice and Order'') to the recipient of a Notice of 
Violation in the following circumstances:
    (1) The individual has failed to respond to a Notice of Violation 
within 30 days after receipt of that notice.
    (2) The individual requested an Informal Conference under Sec.  
1503.421(c)(2)(iii) but failed to attend the conference or continuation 
of the conference or provide the agency official with a written request 
showing good cause for rescheduling the informal conference to a 
specified alternate date.
    (3) The parties have participated in an Informal Conference or 
other informal proceedings as provided in Sec.  1503.421(c)(2) and the 
parties have not agreed to compromise the action or the agency official 
has not agreed to withdraw the Notice of Violation.
    (e) Order Assessing Civil Penalty. A Final Notice and Order 
automatically converts to an Order Assessing Civil Penalty if--
    (1) The individual charged with a violation submits a certified 
check or money order in the amount reflected in the Final Notice and 
Order to Transportation Security Administration at the address 
specified in the Final Notice and Order, or makes such

[[Page 36045]]

payment electronically through http://www.pay.gov; or
    (2) The individual fails to respond to the Final Notice and Order 
or request a formal hearing within 15 days after receipt of that 
notice.
    (f) Delegation of authority. The authority of the Administrator, 
under 49 U.S.C. 46301, to initiate, negotiate, and settle civil penalty 
actions under this section is delegated to the Assistant Administrator 
for Security Operations. This authority may be further delegated.


Sec.  1503.423  Consent orders.

    (a) Issuance. At any time before the issuance of an Order Assessing 
Civil Penalty under this subpart, an agency attorney and a person 
subject to a Notice of Proposed Civil Penalty, or an agency official 
and a person subject to a Notice of Violation, may agree to dispose of 
the case by the issuance of a consent order by TSA.
    (b) Contents. A consent order contains the following:
    (1) An admission of all jurisdictional facts.
    (2) An admission of agreed-upon allegations.
    (3) A statement of the law violated.
    (4) A finding of violation.
    (5) An express waiver of the right to further procedural steps and 
of all rights to administrative and judicial review.


Sec.  1503.425  Compromise orders.

    (a) Issuance. At any time before the issuance of an Order Assessing 
Civil Penalty under this subpart, an agency attorney and a person 
subject to a Notice of Proposed Civil Penalty, or an agency official 
and a person subject to a Notice of Violation, may agree to dispose of 
the case by the issuance of a compromise order by TSA.
    (b) Contents. A compromise order contains the following:
    (1) All jurisdictional facts.
    (2) All allegations.
    (3) A statement that the person agrees to pay the civil penalty 
specified.
    (4) A statement that TSA makes no finding of a violation.
    (5) A statement that the compromise order will not be used as 
evidence of a prior violation in any subsequent civil penalty 
proceeding.


Sec.  1503.427  Request for a formal hearing.

    (a) General. Any respondent may request a formal hearing, pursuant 
to Sec.  1503.413(c)(3) or Sec.  1503.421(c)(3), to be conducted in 
accordance with the procedures in subpart G of this part. The filing of 
a request for a formal hearing does not guarantee a person an 
opportunity to appear before an ALJ in person, because the ALJ may 
issue an initial decision or dispositive order resolving the case prior 
to the commencement of the formal hearing.
    (b) Form. The person submitting a request for hearing must date and 
sign the request, and must include his or her current address. The 
request for hearing must be typewritten or legibly handwritten.
    (c) Submission of request. A person requesting a hearing must file 
a written request for a hearing with the Enforcement Docket Clerk in 
accordance with Sec.  1503.429 and must serve a copy of the request on 
the agency attorney or other agency official who issued the Notice of 
Proposed Civil Penalty, or Notice of Violation, as applicable, and any 
other party, in accordance with Sec.  1503.429.


Sec.  1503.429  Filing of documents with the Enforcement Docket Clerk.

    (a) General. This section governs filing of documents with the 
Enforcement Docket Clerk when required under this part.
    (b) Type of service. A person must file a document with the 
Enforcement Docket Clerk by delivering two copies of the document as 
follows:
    (1) By personal delivery or mail, to United States Coast Guard 
(USCG) ALJ Docketing Center, ATTN: Enforcement Docket Clerk, at the 
address specified in Sec.  1503.413(c)(3).
    (2) By electronic mail, to <a href="/cdn-cgi/l/email-protection#d7969b9db3b8b4bcb2a397969b9d95b6bba3f982849490f99a9e9b"><span class="__cf_email__" data-cfemail="0e4f42446a616d656b7a4e4f42444c6f627a205b5d4d4920434742">[email protected]</span></a>. If this e-
mail address changes, TSA will provide notice of the change by notice 
in the Federal Register.
    (3) By facsimile transmission, to 410-962-1746. If this number 
changes, TSA will provide notice of the change by notice in the Federal 
Register.
    (c) Contents. Unless otherwise specified in this part, each 
document must contain a short, plain statement of the facts supporting 
the person's position and a brief statement of the action requested in 
the document. Each document must be typewritten or legibly handwritten.
    (d) Date of filing. The date of filing will be as follows:
    (1) The date of personal delivery.
    (2) If mailed, the mailing date stated on the certificate of 
service, the date shown on the postmark if there is no certificate of 
service, or other mailing date shown by other evidence if there is no 
certificate of service or postmark.
    (3) If sent by electronic mail or facsimile transmission, the date 
of transmission.
    (e) Service of documents filed with the Enforcement Docket. A 
person must serve a copy of any document filed with the Enforcement 
Docket on each party and the ALJ or the chief ALJ if no judge has been 
assigned to the proceeding at the time of filing. Service on a party's 
attorney of record or a party's designated representative is service on 
the party.


Sec.  1503.431  Certification of documents.

    (a) General. This section governs each document tendered for filing 
with the Enforcement Docket Clerk under this part.
    (b) Signature required. The attorney of record, the party, or the 
party's representative must sign each document tendered for filing with 
the Enforcement Docket Clerk, or served on the ALJ, the TSA decision 
maker on appeal, or each party.
    (c) Effect of signing a document. By signing a document, the 
attorney of record, the party, or the party's representative certifies 
that he or she has read the document and, based on reasonable inquiry 
and to the best of that person's knowledge, information, and belief, 
the document is--
    (1) Consistent with the rules in this part;
    (2) Warranted by existing law or that a good faith and nonfrivolous 
argument exists for extension, modification, or reversal of existing 
law;
    (3) Not unreasonable or unduly burdensome or expensive, not made to 
harass any person, not made to cause unnecessary delay, not made to 
cause needless increase in the cost of the proceedings, or for any 
other improper purpose; and
    (4) Supported by evidence, and any denials of factual contentions 
are warranted on the evidence.
    (d) Sanctions. On motion of a party, if the ALJ or TSA decision 
maker finds that any attorney of record, the party, or the party's 
representative has signed a document in violation of this section, the 
ALJ or the TSA decision maker, as appropriate, will do the following:
    (1) Strike the pleading signed in violation of this section.
    (2) Strike the request for discovery or the discovery response 
signed in violation of this section and preclude further discovery by 
the party.
    (3) Deny the motion or request signed in violation of this section.
    (4) Exclude the document signed in violation of this section from 
the record.
    (5) Dismiss the interlocutory appeal and preclude further appeal on 
that issue by the party who filed the appeal until an initial decision 
has been entered on the record.
    (6) Dismiss the appeal of the ALJ's initial decision to the TSA 
decision maker.

[[Page 36046]]

Subpart F--[Reserved]

Subpart G--Rules of Practice in TSA Civil Penalty Actions


Sec.  1503.601  Applicability.

    (a) This subpart applies to a civil penalty action in which the 
requirements of paragraphs (a)(1) through (a)(3) of this section are 
satisfied.
    (1) There is an alleged violation of a TSA requirement.
    (2) The amount in controversy does not exceed--
    (i) $50,000 if the violation was committed by an individual or a 
small business concern;
    (ii) $400,000 if the violation was committed by any other person.
    (3) The person charged with the violation has requested a hearing 
in accordance with Sec.  1503.427 of this part.
    (b) This subpart does not apply to the adjudication of the validity 
of any TSA rule or other requirement under the U.S. Constitution, the 
Administrative Procedure Act, or any other law.


Sec.  1503.603  Separation of functions.

    (a) Civil penalty proceedings, including hearings, will be 
prosecuted only by an agency attorney, except to the extent another 
agency official is permitted to issue and prosecute civil penalties 
under Sec.  1503.421 of this part.
    (b) An agency employee engaged in the performance of investigative 
or prosecutorial functions in a civil penalty action must not, in that 
case or a factually related case, participate or give advice in a 
decision by the ALJ or by the TSA decision maker on appeal, except as 
counsel or a witness in the public proceedings.
    (c) The Chief Counsel or an agency attorney not covered by 
paragraph (b) of this section will advise the TSA decision maker 
regarding an initial decision or any appeal of a civil penalty action 
to the TSA decision maker.


Sec.  1503.605  Appearances and rights of parties.

    (a) Any party may appear and be heard in person.
    (b) Any party may be accompanied, represented, or advised by an 
attorney or representative designated by the party and may be examined 
by that attorney or representative in any proceeding governed by this 
subpart. An attorney or representative who represents a respondent and 
has not previously filed a pleading in the matter must file a notice of 
appearance in the action, in the manner provided in Sec.  1503.429, and 
must serve a copy of the notice of appearance on each party, in the 
manner provided in Sec.  1503.409, before participating in any 
proceeding governed by this subpart. The attorney or representative 
must include the name, address, and telephone number of the attorney or 
representative in the notice of appearance.


Sec.  1503.607  Administrative law judges.

    (a) Powers of an ALJ. In accordance with the rules of this subpart, 
an ALJ may:
    (1) Give notice of, and hold, prehearing conferences and hearings.
    (2) Issue scheduling orders and other appropriate orders regarding 
discovery or other matters that come before him or her consistent with 
the rules of this subpart.
    (3) Administer oaths and affirmations.
    (4) Issue subpoenas authorized by law.
    (5) Rule on offers of proof.
    (6) Receive relevant and material evidence.
    (7) Regulate the course of the hearing in accordance with the rules 
of this subpart.
    (8) Hold conferences to settle or to simplify the issues on his or 
her own motion or by consent of the parties.
    (9) Rule on procedural motions and requests.
    (10) Make findings of fact and conclusions of law, and issue an 
initial decision.
    (11) Strike unsigned documents unless omission of the signature is 
corrected promptly after being called to the attention of the attorney 
or party.
    (12) Order payment of witness fees in accordance with Sec.  
1503.649.
    (b) Limitations on the power of the ALJ. (1) The ALJ may not:
    (i) Issue an order of contempt.
    (ii) Award costs to any party.
    (iii) Impose any sanction not specified in this subpart.
    (iv) Adopt or follow a standard of proof or procedure contrary to 
that set forth in this subpart.
    (v) Decide issues involving the validity of a TSA regulation, 
order, or other requirement under the U.S. Constitution, the 
Administrative Procedure Act, or other law.
    (2) If the ALJ imposes any sanction not specified in this subpart, 
a party may file an interlocutory appeal of right pursuant to Sec.  
1503.631(c)(3).
    (3) This section does not preclude an ALJ from issuing an order 
that bars a person from a specific proceeding based on a finding of 
obstreperous or disruptive behavior in that specific proceeding.
    (c) Disqualification. The ALJ may disqualify himself or herself at 
any time. A party may file a motion, pursuant to Sec.  1503.629(f)(6), 
requesting that an ALJ be disqualified from the proceedings.


Sec.  1503.609  Complaint.

    (a) Filing. The agency attorney must file the complaint with the 
Enforcement Docket Clerk in accordance with Sec.  1503.429, or may file 
a written motion pursuant to Sec.  1503.629(f)(2)(i) instead of filing 
a complaint, not later than 30 days after receipt by the agency 
attorney of a request for hearing. The agency attorney should suggest a 
location for the hearing when filing the complaint.
    (b) Contents. A complaint must set forth the facts alleged, any 
statute, regulation, or order allegedly violated by the respondent, and 
the proposed civil penalty in sufficient detail to provide notice of 
any factual or legal allegation and proposed civil penalty.


Sec.  1503.611  Answer.

    (a) Filing. A respondent must file a written answer to the 
complaint in accordance with Sec.  1503.429, or may file a written 
motion pursuant to Sec.  1503.629(f)(1)-(4) instead of filing an 
answer, not later than 30 days after service of the complaint. Subject 
to paragraph (c) of this section, the answer may be in the form of a 
letter, but must be dated and signed by the person responding to the 
complaint. An answer may be typewritten or may be legibly handwritten. 
The person filing an answer should suggest a location for the hearing 
when filing the answer.
    (b) Contents. An answer must specifically state any affirmative 
defense that the respondent intends to assert at the hearing. A person 
filing an answer may include a brief statement of any relief requested 
in the answer.
    (c) Specific denial of allegations required. A person filing an 
answer must admit, deny, or state that the person is without sufficient 
knowledge or information to admit or deny, each numbered paragraph of 
the complaint. Any statement or allegation contained in the complaint 
that is not specifically denied in the answer may be deemed an 
admission of the truth of that allegation. A general denial of the 
complaint is deemed a failure to file an answer.
    (d) Failure to file answer. A person's failure to file an answer 
without good cause, as determined by the ALJ, will be deemed an 
admission of the truth of each allegation contained in the complaint.


Sec.  1503.613  Consolidation and separation of cases.

    (a) Consolidation. If two or more actions involve common questions 
of law or fact, the Chief Administrative Law Judge may do the 
following:

[[Page 36047]]

    (1) Order a joint hearing or trial on any or all such questions.
    (2) Order the consolidation of such actions.
    (3) Otherwise make such orders concerning the proceedings as may 
tend to avoid unnecessary costs or delay.
    (b) Consolidation shall not affect the applicability of this part. 
Consolidation of two or more actions that individually meet the 
jurisdictional amounts set forth in Sec.  1503.601(a)(2) shall not 
cause the resulting consolidated action to come under the exclusive 
jurisdiction of the district courts of the United States as specified 
in 49 U.S.C. 46301(d)(4)(A).
    (c) Separate trials. The Chief Administrative Law Judge, in 
furtherance of convenience or to avoid prejudice, or when separate 
trials will be conducive to expedition and economy, may order a 
separate trial of any claim, or of any separate issue, or any number of 
claims or issues.


Sec.  1503.615  Notice of hearing.

    (a) Notice. The ALJ must give each party at least 60 days notice of 
the date, time, and location of the hearing. With the consent of the 
ALJ, the parties may agree to hold the hearing on an earlier date than 
the date specified in the notice of hearing.
    (b) Date, time, and location of the hearing. The ALJ to whom the 
proceedings have been assigned must set a reasonable date, time, and 
location for the hearing. The ALJ must consider the need for discovery 
and any joint procedural or discovery schedule submitted by the parties 
when determining the hearing date. The ALJ must give due regard to the 
convenience of the parties, the location where the majority of the 
witnesses reside or work, and whether the location is served by a 
scheduled air carrier.


Sec.  1503.617  Extension of time.

    (a) Oral requests. The parties may agree to extend for a reasonable 
period the time for filing a document under this subpart. If the 
parties agree, the ALJ must grant one extension of time to each party. 
The party seeking the extension of time must submit a draft order to 
the ALJ to be signed by the ALJ and filed with the Enforcement Docket 
Clerk. The ALJ may grant additional oral requests for an extension of 
time where the parties agree to the extension.
    (b) Written motion. A party must file a written motion for an 
extension of time not later than 7 days before the document is due 
unless the party shows good cause for the late filing. The ALJ may 
grant the extension of time if the party shows good cause.
    (c) Request for continuance of hearing. Either party may request in 
writing a continuance of the date of a hearing, for good cause shown, 
no later than seven days before the scheduled date of the hearing. Good 
cause does not include a scheduling conflict involving the parties or 
their attorneys which by due diligence could have been foreseen.
    (d) Failure to rule. If the ALJ fails to rule on a written motion 
for an extension of time by the date the document was due, the motion 
for an extension of time is deemed granted for no more than 20 days 
after the original date the document was to be filed. If the ALJ fails 
to rule on a request for continuance by the scheduled hearing date, the 
request is deemed granted for no more than 10 days after the scheduled 
hearing date.


Sec.  1503.619  Intervention.

    (a) A person may file a motion for leave to intervene as a party in 
a civil penalty action. The person must file a motion for leave to 
intervene not later than 10 days before the hearing unless the person 
shows good cause for the late filing.
    (b) If the ALJ finds that intervention will not unduly broaden the 
issues or delay the proceedings, the ALJ may grant a motion for leave 
to intervene if the person will be bound by any order or decision 
entered in the action or the person has a property, financial, or other 
legitimate interest that may not be addressed adequately by the 
parties. The ALJ may determine the extent to which an intervenor may 
participate in the proceedings.


Sec.  1503.621  Amendment of pleadings.

    (a) Filing and service. A party must file the amendment with the 
Enforcement Docket Clerk and must serve a copy of the amendment on the 
ALJ and all parties to the proceeding.
    (b) Time. A party must file an amendment to a complaint or an 
answer within the following:
    (1) Not later than 15 days before the scheduled date of a hearing, 
a party may amend a complaint or an answer without the consent of the 
ALJ.
    (2) Less than 15 days before the scheduled date of a hearing, the 
ALJ may allow amendment of a complaint or an answer only for good cause 
shown in a motion to amend.
    (c) Responses. The ALJ must allow a reasonable time, but not more 
than 20 days from the date of filing, for other parties to respond if 
an amendment to a complaint, answer, or other pleading has been filed 
with the ALJ.


Sec.  1503.623  Withdrawal of complaint or request for hearing.

    At any time before or during a hearing, an agency attorney may 
withdraw a complaint or a respondent may withdraw a request for a 
hearing without the consent of the ALJ. If an agency attorney withdraws 
the complaint or a party withdraws the request for a hearing and the 
answer, the ALJ must dismiss the proceedings under this subpart with 
prejudice, unless the withdrawing party shows good cause for dismissal 
without prejudice, except that a party may withdraw a request for 
hearing without prejudice at any time before a complaint has been 
filed.


Sec.  1503.625  Waivers.

    Waivers of any rights provided by statute or regulation must be in 
writing or by stipulation made at a hearing and entered into the 
record. The parties must set forth the precise terms of the waiver and 
any conditions.


Sec.  1503.627  Joint procedural or discovery schedule.

    (a) General. The parties may agree to submit a schedule for filing 
all prehearing motions, a schedule for conducting discovery in the 
proceedings, or a schedule that will govern all prehearing motions and 
discovery in the proceedings.
    (b) Form and content of schedule. If the parties agree to a joint 
procedural or discovery schedule, one of the parties must file the 
joint schedule with the ALJ, setting forth the dates to which the 
parties have agreed, and must serve a copy of the joint schedule on 
each party.
    (1) The joint schedule may include, but need not be limited to, 
requests for discovery, any objections to discovery requests, responses 
to discovery requests to which there are no objections, submission of 
prehearing motions, responses to prehearing motions, exchange of 
exhibits to be introduced at the hearing, and a list of witnesses that 
may be called at the hearing.
    (2) Each party must sign the original joint schedule to be filed 
with the Enforcement Docket Clerk.
    (c) Time. The parties may agree to submit all prehearing motions 
and responses and may agree to close discovery in the proceedings under 
the joint schedule within a reasonable time before the date of the 
hearing, but not later than 15 days before the hearing.
    (d) Order establishing joint schedule. The ALJ must approve the 
joint schedule filed by the parties. One party must submit a draft 
order establishing a joint schedule to the ALJ to be signed by

[[Page 36048]]

the ALJ and filed with the Enforcement Docket Clerk.
    (e) Disputes. The ALJ must resolve disputes regarding discovery or 
disputes regarding compliance with the joint schedule as soon as 
possible so that the parties may continue to comply with the joint 
schedule.
    (f) Sanctions for failure to comply with joint schedule. If a party 
fails to comply with the ALJ's order establishing a joint schedule, the 
ALJ may direct that party to comply with a motion or discovery request 
or, limited to the extent of the party's failure to comply with a 
motion or discovery request, the ALJ may do the following:
    (1) Strike that portion of a party's pleadings.
    (2) Preclude prehearing or discovery motions by that party.
    (3) Preclude admission of that portion of a party's evidence at the 
hearing.
    (4) Preclude that portion of the testimony of that party's 
witnesses at the hearing.


Sec.  1503.629  Motions.

    (a) General. A party applying for an order or ruling not 
specifically provided in this subpart must do so by motion. A party 
must comply with the requirements of this section when filing a motion. 
A party must serve a copy of each motion on each party.
    (b) Form and contents. A party must state the relief sought by the 
motion and the particular grounds supporting that relief. If a party 
has evidence in support of a motion, the party must attach any 
supporting evidence, including affidavits, to the motion.
    (c) Filing of motions. A motion made prior to the hearing must be 
in writing or orally on the record. Unless otherwise agreed by the 
parties or for good cause shown, a party must file any prehearing 
motion, and must serve a copy on each party, not later than 30 days 
before the hearing. Motions introduced during a hearing may be made 
orally on the record unless the ALJ directs otherwise.
    (d) Reply to motions. Any party may file a reply, with affidavits 
or other evidence in support of the reply, not later than 10 days after 
service of a written motion on that party. When a motion is made during 
a hearing, the reply may be made at the hearing on the record, orally 
or in writing, within a reasonable time determined by the ALJ. At the 
discretion of the ALJ, the moving party may file a response to the 
reply.
    (e) Rulings on motions. The ALJ must rule on all motions as 
follows:
    (1) Discovery motions. The ALJ must resolve all pending discovery 
motions not later than 10 days before the hearing.
    (2) Prehearing motions. The ALJ must resolve all pending prehearing 
motions not later than 7 days before the hearing. If the ALJ issues a 
ruling or order orally, the ALJ must serve a written copy of the ruling 
or order, within 3 days, on each party. In all other cases, the ALJ 
must issue rulings and orders in writing and must serve a copy of the 
ruling or order on each party.
    (3) Motions made during the hearing. The ALJ may issue rulings and 
orders on motions made during the hearing orally. Oral rulings or 
orders on motions must be made on the record.
    (f) Specific motions. A party may file, but is not limited to, the 
following motions with the Enforcement Docket Clerk:
    (1) Motion to dismiss for insufficiency. A respondent may file a 
motion to dismiss the complaint for insufficiency instead of filing an 
answer. If the ALJ denies the motion to dismiss the complaint for 
insufficiency, the respondent must file an answer not later than 20 
days after service of the ALJ's denial of the motion. A motion to 
dismiss the complaint for insufficiency must show that the complaint 
fails to state a violation of a TSA requirement. If the ALJ grants the 
motion to dismiss the complaint for insufficiency, the agency attorney 
may amend the complaint in accordance with Sec.  1503.621.
    (2) Motion to dismiss. A party may file a motion to dismiss, 
specifying the grounds for dismissal. If an ALJ grants a motion to 
dismiss in part, a party may appeal the ALJ's ruling on the motion to 
dismiss under Sec.  1503.631(b).
    (i) Motion to dismiss a request for a hearing. An agency attorney 
may file a motion to dismiss a request for a hearing as untimely 
instead of filing a complaint. If the motion to dismiss is not granted, 
the agency attorney must file the complaint and must serve a copy of 
the complaint on each party not later than 20 days after service of the 
ALJ's ruling or order on the motion to dismiss. If the motion to 
dismiss is granted and the proceedings are terminated without a 
hearing, the respondent may file an appeal pursuant to Sec.  1503.657. 
If required by the decision on appeal, the agency attorney must file a 
complaint and must serve a copy of the complaint on each party not 
later than 30 days after service of the decision on appeal.
    (ii) Motion to dismiss a complaint. A respondent may file a motion 
to dismiss a complaint instead of filing an answer, on the ground that 
the complaint was not timely filed or on other grounds. If the ALJ does 
not grant the motion to dismiss, the respondent must file an answer and 
must serve a copy of the answer on each party not later than 30 days 
after service of the ALJ's ruling or order on the motion to dismiss. If 
the ALJ grants the motion to dismiss and the proceedings are terminated 
without a hearing, the agency attorney may file an appeal pursuant to 
Sec.  1503.657. If required by the decision on appeal, the respondent 
must file an answer and must serve a copy of the answer on each party 
not later than 20 days after service of the decision on appeal.
    (iii) Motion to dismiss based on settlement. A party may file a 
motion to dismiss based on a mutual settlement of the parties.
    (3) Motion for more definite statement. A party may file a motion 
for more definite statement of any pleading that requires a response 
under this subpart. A party must set forth, in detail, the indefinite 
or uncertain allegations contained in a complaint or response to any 
pleading and must submit the details that the party believes would make 
the allegation or response definite and certain.
    (i) Complaint. A respondent may file a motion requesting a more 
definite statement of the allegations contained in the complaint 
instead of filing an answer. If the ALJ grants the motion, the agency 
attorney must supply a more definite statement not later than 15 days 
after service of the ruling granting the motion. If the agency attorney 
fails to supply a more definite statement, the ALJ must strike the 
allegations in the complaint to which the motion is directed. If the 
ALJ denies the motion, the respondent must file an answer and must 
serve a copy of the answer on each party not later than 20 days after 
service of the order of denial.
    (ii) Answer. An agency attorney may file a motion requesting a more 
definite statement if an answer fails to respond clearly to the 
allegations in the complaint. If the ALJ grants the motion, the 
respondent must supply a more definite statement not later than 15 days 
after service of the ruling on the motion. If the respondent fails to 
supply a more definite statement, the ALJ must strike those statements 
in the answer to which the motion is directed. The respondent's failure 
to supply a more definite statement may be deemed an admission of 
unanswered allegations in the complaint.
    (4) Motion to strike. Any party may move to strike any insufficient 
allegation or defense, or any redundant, immaterial, or irrelevant 
matter in a pleading. A party must file a motion to strike before a 
response is required under this subpart or, if a response is

[[Page 36049]]

not required, not later than 10 days after service of the pleading.
    (5) Motion for decision. A party may move for decision, regarding 
all or any part of the proceedings, at any time before the ALJ has 
issued an initial decision in the proceedings. A party may include with 
a motion for decision affidavits as well as any other evidence in 
support of the motion. The ALJ must grant a party's motion for decision 
if the pleadings, depositions, answers to interrogatories, admissions, 
affidavits, matters that the ALJ has officially noticed, or evidence 
introduced during the hearing show that there is no genuine issue of 
material fact and that the party making the motion is entitled to a 
decision as a matter of law. The party moving for decision has the 
burden of showing that there is no genuine issue of material fact.
    (6) Motion for disqualification. A party may file the motion at any 
time after the ALJ has been assigned to the proceedings but must make 
the motion before the ALJ files an initial decision in the proceedings.
    (i) Motion and supporting affidavit. A party must state the grounds 
for disqualification, including, but not limited to, personal bias, 
pecuniary interest, or other factors supporting disqualification, in 
the motion for disqualification. A party must submit an affidavit with 
the motion for disqualification that sets forth, in detail, the matters 
alleged to constitute grounds for disqualification.
    (ii) Answer. A party must respond to the motion for 
disqualification not later than 5 days after service of the motion for 
disqualification.
    (iii) Decision on motion for disqualification. The ALJ must render 
a decision on the motion for disqualification not later than 20 days 
after the motion has been filed. If the ALJ finds that the motion for 
disqualification and supporting affidavit show a basis for 
disqualification, the ALJ must withdraw from the proceedings 
immediately. If the ALJ finds that disqualification is not warranted, 
the ALJ must deny the motion and state the grounds for the denial on 
the record. If the ALJ fails to rule on a party's motion for 
disqualification within 20 days after the motion has been filed, the 
motion is deemed granted.
    (iv) Appeal. A party may appeal the ALJ's denial of the motion for 
disqualification in accordance with Sec.  1503.631(b).


Sec.  1503.631  Interlocutory appeals.

    (a) General. Unless otherwise provided in this subpart, a party may 
not appeal a ruling or decision of the ALJ to the TSA decision maker 
until the initial decision has been entered on the record. A decision 
or order of the TSA decision maker on the interlocutory appeal does not 
constitute a final order of the Administrator for the purposes of 
judicial appellate review under 49 U.S.C. 46110.
    (b) Interlocutory appeal for cause. If a party files a written 
request for an interlocutory appeal for cause with the ALJ, or orally 
requests an interlocutory appeal for cause, the proceedings are stayed 
until the ALJ issues a decision on the request. If the ALJ grants the 
request, the proceedings are stayed until the TSA decision maker issues 
a decision on the interlocutory appeal. The ALJ must grant an 
interlocutory appeal for cause if a party shows that delay of the 
appeal would be detrimental to the public interest or would result in 
undue prejudice to any party.
    (c) Interlocutory appeals of right. If a party notifies the ALJ of 
an interlocutory appeal of right, the proceedings are stayed until the 
TSA decision maker issues a decision on the interlocutory appeal. A 
party may file an interlocutory appeal, without the consent of the ALJ, 
before an initial decision has been entered in the following cases:
    (1) A ruling or order by the ALJ barring a person from the 
proceedings.
    (2) Failure of the ALJ to dismiss the proceedings in accordance 
with Sec.  1503.215.
    (3) A ruling or order by the ALJ in violation of Sec.  1503.607(b).
    (4) A ruling or order by the ALJ regarding public access to a 
particular docket or documents.
    (d) Procedure. Not later than 10 days after the ALJ's decision 
forming the basis of an interlocutory appeal of right or not later than 
10 days after the ALJ's decision granting an interlocutory appeal for 
cause, a party must file a notice of interlocutory appeal, with 
supporting documents, and the party must serve a copy of the notice and 
supporting documents on each party. Not later than 10 days after 
service of the appeal brief, a party must file a reply brief, if any, 
and the party must serve a copy of the reply brief on each party. The 
TSA decision maker must render a decision on the interlocutory appeal, 
on the record and as a part of the decision in the proceedings, within 
a reasonable time after receipt of the interlocutory appeal.
    (e) Frivolous appeals. The TSA decision maker may reject frivolous, 
repetitive, or dilatory appeals, and may issue an order precluding one 
or more parties from making further interlocutory appeals in a 
proceeding in which there have been frivolous, repetitive, or dilatory 
interlocutory appeals.


Sec.  1503.633  Discovery.

    (a) Initiation of discovery. Any party may initiate discovery 
described in this section, without the consent or approval of the ALJ, 
at any time after a complaint has been filed in the proceedings.
    (b) Methods of discovery. The following methods of discovery are 
permitted under this section: depositions on oral examination or 
written questions of any person; written interrogatories directed to a 
party; requests for production of documents or tangible items to any 
person; and requests for admission by a party. A party is not required 
to file written discovery requests and responses with the ALJ or the 
Enforcement Docket Clerk. In the event of a discovery dispute, a party 
must attach a copy of these documents in support of a motion made under 
this section.
    (c) Service on the agency. A party must serve each discovery 
request directed to the agency or any agency employee on the agency 
attorney of record.
    (d) Time for response to discovery requests. Unless otherwise 
directed by this subpart, agreed by the parties, or by order of the 
ALJ, a party must respond to a request for discovery, including filing 
objections to a request for discovery, not later than 30 days after 
service of the request.
    (e) Scope of discovery. Subject to the limits on discovery set 
forth in paragraph (f) of this section, a party may discover any matter 
that is not privileged and that is relevant to the subject matter of 
the proceeding. A party may discover information that relates to the 
claim or defense of any party including the existence, description, 
nature, custody, condition, and location of any document or other 
tangible item and the identity and location of any person having 
knowledge of discoverable matter. A party may discover facts known, or 
opinions held, by an expert who any other party expects to call to 
testify at the hearing. A party may not object to a discovery request 
on the basis that the information sought would not be admissible at the 
hearing if the information sought during discovery is reasonably 
calculated to lead to the discovery of admissible evidence.
    (f) Limiting discovery. The ALJ must limit the frequency and extent 
of discovery permitted by this section if a party shows that--

[[Page 36050]]

    (1) The information requested is cumulative or repetitious;
    (2) The information requested can be obtained from another less 
burdensome and more convenient source;
    (3) The party requesting the information has had ample opportunity 
to obtain the information through other discovery methods permitted 
under this section; or
    (4) The method or scope of discovery requested by the party is 
unduly burdensome or expensive.
    (g) Disclosure of Sensitive Security Information (SSI). At the 
request of a party, TSA may provide SSI to the party when, in the sole 
discretion of TSA, access to the SSI is necessary for the party to 
prepare a response to allegations contained the complaint. TSA may 
provide such information subject to such restrictions on further 
disclosure and such safeguarding requirements as TSA determines 
appropriate.
    (h) Confidential orders. A party or person who has received a 
discovery request for information, other than SSI, that is related to a 
trade secret, confidential or sensitive material, competitive or 
commercial information, proprietary data, or information on research 
and development, may file a motion for a confidential order with the 
ALJ and must serve a copy of the motion for a confidential order on 
each party.
    (1) The party or person making the motion must show that the 
confidential order is necessary to protect the information from 
disclosure to the public.
    (2) If the ALJ determines that the requested material is not 
necessary to decide the case, the ALJ must preclude any inquiry into 
the matter by any party.
    (3) If the ALJ determines that the requested material may be 
disclosed during discovery, the ALJ may order that the material may be 
discovered and disclosed under limited conditions or may be used only 
under certain terms and conditions.
    (4) If the ALJ determines that the requested material is necessary 
to decide the case and that a confidential order is warranted, the ALJ 
must provide the following:
    (i) An opportunity for review of the document by the parties off 
the record.
    (ii) Procedures for excluding the information from the record.
    (iii) An order that the parties must not disclose the information 
in any manner and the parties must not use the information in any other 
proceeding.
    (i) Protective orders. A party or a person who has received a 
request for discovery may file a motion for protective order and must 
serve a copy of the motion for protective order on each party. The 
party or person making the motion must show that the protective order 
is necessary to protect the party or the person from annoyance, 
embarrassment, oppression, or undue burden or expense. As part of the 
protective order, the ALJ may do the following:
    (1) Deny the discovery request.
    (2) Order that discovery be conducted only on specified terms and 
conditions, including a designation of the time or place for discovery 
or a determination of the method of discovery.
    (3) Limit the scope of discovery or preclude any inquiry into 
certain matters during discovery.
    (j) Duty to supplement or amend responses. A party who has 
responded to a discovery request has a duty to supplement or amend the 
response, as soon as the information is known, as follows:
    (1) A party must supplement or amend any response to a question 
requesting the identity and location of any person having knowledge of 
discoverable matters.
    (2) A party must supplement or amend any response to a question 
requesting the identity of each person who will be called to testify at 
the hearing as an expert witness and the subject matter and substance 
of that witness' testimony.
    (3) A party must supplement or amend any response that was 
incorrect when made or any response that was correct when made but is 
no longer correct, accurate, or complete.
    (k) Depositions. The following rules apply to depositions taken 
pursuant to this section:
    (1) Form. A deposition must be taken on the record and reduced to 
writing. The person being deposed must sign the deposition unless the 
parties agree to waive the requirement of a signature.
    (2) Administration of oaths. Within the United States, or a 
territory or possession subject to the jurisdiction of the United 
States, a party must take a deposition before a person authorized to 
administer oaths by the laws of the United States or authorized by the 
law of the place where the examination is held. Outside the United 
States, a party will take a deposition in any manner allowed by the 
Federal Rules of Civil Procedure (28 U.S.C. App.).
    (3) Notice of deposition. A party must serve a notice of 
deposition, stating the time and place of the deposition and the name 
and address of each person to be examined, on the person to be deposed, 
on the ALJ, on the Enforcement Docket Clerk, and on each party not 
later than 7 days before the deposition. A party may serve a notice of 
deposition less than 7 days before the deposition only with consent of 
the ALJ and for good cause shown. If a subpoena ``duces tecum'' is to 
be served on the person to be examined, the party must attach a copy of 
the subpoena duces tecum that describes the materials to be produced at 
the deposition to the notice of deposition.
    (4) Use of depositions. A party may use any part or all of a 
deposition at a hearing authorized under this subpart only upon a 
showing of good cause. The deposition may be used against any party who 
was present or represented at the deposition or who had reasonable 
notice of the deposition.
    (l) Interrogatories. A party, the party's attorney, or the party's 
representative may sign the party's responses to interrogatories. A 
party must answer each interrogatory separately and completely in 
writing. If a party objects to an interrogatory, the party must state 
the objection and the reasons for the objection. An opposing party may 
use any part or all of a party's responses to interrogatories at a 
hearing authorized under this subpart to the extent that the response 
is relevant, material, and not repetitious.
    (1) A party must not serve more than 30 interrogatories to each 
other party. Each subpart of an interrogatory will be counted as a 
separate interrogatory.
    (2) Before serving additional interrogatories on a party, a party 
must file a motion for leave to serve additional interrogatories on a 
party with the ALJ and must serve a copy on each party before serving 
additional interrogatories on a party. The ALJ may grant the motion 
only if the party shows good cause for the party's failure to inquire 
about the information previously and that the information cannot 
reasonably be obtained using less burdensome discovery methods or be 
obtained from other sources.
    (m) Requests for admission. A party may serve a written request for 
admission of the truth of any matter within the scope of discovery 
under this section or the authenticity of any document described in the 
request. A party must set forth each request for admission separately. 
A party must serve copies of documents referenced in the request for 
admission unless the documents have been provided or are reasonably 
available for inspection and copying.
    (1) Time. A party's failure to respond to a request for admission, 
in writing and signed by the attorney or the party, not later than 30 
days after service of the request, is deemed an admission of the truth 
of the statement or statements

[[Page 36051]]

contained in the request for admission. The ALJ may determine that a 
failure to respond to a request for admission is not deemed an 
admission of the truth if a party shows that the failure was due to 
circumstances beyond the control of the party or the party's attorney.
    (2) Response. A party may object to a request for admission and 
must state the reasons for objection. A party may specifically deny the 
truth of the matter or describe the reasons why the party is unable to 
truthfully deny or admit the matter. If a party is unable to deny or 
admit the truth of the matter, the party must show that the party has 
made reasonable inquiry into the matter or that the information known 
to, or readily obtainable by, the party is insufficient to enable the 
party to admit or deny the matter. A party may admit or deny any part 
of the request for admission. If the ALJ determines that a response 
does not comply with the requirements of this rule or that the response 
is insufficient, the matter is deemed admitted.
    (3) Effect of admission. Any matter admitted or deemed admitted 
under this section is conclusively established for the purpose of the 
hearing and appeal.
    (n) Motion to compel discovery. A party may move to compel 
discovery if a person refuses to answer a question during a deposition, 
a party fails or refuses to answer an interrogatory, if a person gives 
an evasive or incomplete answer during a deposition or when responding 
to an interrogatory, or a party fails or refuses to produce documents 
or tangible items. During a deposition, the proponent of a question may 
complete the deposition or may adjourn the examination before moving to 
compel if a person refuses to answer.
    (o) Failure to comply with a discovery order or order to compel. If 
a party fails to comply with a discovery order or an order to compel, 
the ALJ, limited to the extent of the party's failure to comply with 
the discovery order or motion to compel, may do the following:
    (1) Strike that portion of a party's pleadings.
    (2) Preclude prehearing or discovery motions by that party.
    (3) Preclude admission of that portion of a party's evidence at the 
hearing.
    (4) Preclude that portion of the testimony of that party's 
witnesses at the hearing.


Sec.  1503.635  Evidence.

    (a) General. A party is entitled to present the party's case or 
defense by oral, documentary, or demonstrative evidence, to submit 
rebuttal evidence, and to conduct any cross-examination that may be 
required for a full and true disclosure of the facts.
    (b) Admissibility. A party may introduce any oral, documentary, or 
demonstrative evidence in support of the party's case or defense. The 
ALJ must admit any oral, documentary, or demonstrative evidence 
introduced by a party, but must exclude irrelevant, immaterial, or 
unduly repetitious evidence.
    (c) Hearsay evidence. Hearsay evidence is admissible in proceedings 
governed by this subpart. The fact that evidence submitted by a party 
is hearsay goes only to the weight of the evidence and does not affect 
its admissibility.


Sec.  1503.637  Standard of proof.

    The ALJ may issue an initial decision or may rule in a party's 
favor only if the decision or ruling is supported by a preponderance of 
the evidence contained in the record. In order to prevail, the party 
with the burden of proof must prove the party's case or defense by a 
preponderance of the evidence.


Sec.  1503.639  Burden of proof.

    (a) Except in the case of an affirmative defense, the burden of 
proof is on the agency.
    (b) Except as otherwise provided by statute or rule, the proponent 
of a motion, request, or order has the burden of proof.
    (c) A party who has asserted an affirmative defense has the burden 
of proving the affirmative defense.


Sec.  1503.641  Offer of proof.

    A party whose evidence has been excluded by a ruling of the ALJ may 
offer the evidence for the record on appeal.


Sec.  1503.643  Public disclosure of evidence.

    This section applies to information other than Sensitive Security 
Information (SSI). All release of SSI is governed by Sec.  1503.415 and 
49 CFR part 1520.
    (a) The ALJ may order that any other information contained in the 
record be withheld from public disclosure. Any person may object to 
disclosure of information in the record by filing a written motion to 
withhold specific information with the ALJ and serving a copy of the 
motion on each party. The party must state the specific grounds for 
nondisclosure in the motion.
    (b) The ALJ must grant the motion to withhold information in the 
record if, based on the motion and any response to the motion, the ALJ 
determines that disclosure would be detrimental to transportation 
safety, disclosure would not be in the public interest, or that the 
information is not otherwise required to be made available to the 
public.


Sec.  1503.645  Expert or opinion witnesses.

    An employee of the agency may not be called as an expert or opinion 
witness, for any party other than TSA, in any proceeding governed by 
this subpart. An employee of a respondent may not be called by an 
agency attorney as an expert or opinion witness for TSA in any 
proceeding governed by this subpart to which the respondent is a party.


Sec.  1503.647  Subpoenas.

    (a) Request for subpoena. A party may obtain a subpoena to compel 
the attendance of a witness at a deposition or hearing, or to require 
the production of documents or tangible items, from the ALJ who is 
assigned to the case, or, if no ALJ is assigned or the assigned law 
judge is unavailable, from the chief ALJ. The party must complete the 
subpoena, stating the title of the action and the date and time for the 
witness' attendance or production of documents or items. The party who 
obtained the subpoena must serve the subpoena on the witness or the 
custodian of the documents or tangible items sought to be produced.
    (b) Motion to quash or modify the subpoena. A party, or any person 
upon whom a subpoena has been served, may file a motion to quash or 
modify the subpoena at or before the time specified in the subpoena for 
compliance. The applicant must describe, in detail, the basis for the 
application to quash or modify the subpoena including, but not limited 
to, a statement that the testimony, document, or tangible evidence is 
not relevant to the proceeding, that the subpoena is not reasonably 
tailored to the scope of the proceeding, or that the subpoena is 
unreasonable and oppressive. A motion to quash or modify the subpoena 
will stay the effect of the subpoena pending a decision by the ALJ on 
the motion.
    (c) Enforcement of subpoena. Upon a showing that a person has 
failed or refused to comply with a subpoena, a party may apply to the 
U.S. district court having jurisdiction to seek judicial enforcement of 
the subpoena in accordance with 49 U.S.C. 46104.


Sec.  1503.649  Witness fees.

    (a) General. Unless otherwise authorized by the ALJ, the party who 
applies for a subpoena to compel the attendance of a witness at a 
deposition or hearing, or the party at whose request a witness appears 
at a deposition or

[[Page 36052]]

hearing, must pay the witness fees described in this section.
    (b) Amount. Except for an employee of the agency who appears at the 
direction of the agency, a witness who appears at a deposition or 
hearing is entitled to the same fees and mileage expenses as are paid 
to a witness in a court of the United States in comparable 
circumstances.


Sec.  1503.651  Record.

    (a) Exclusive record. The request for hearing, complaint, answer, 
transcript of all testimony in the hearing, all exhibits received into 
evidence, and all motions, responses to motions, applications, 
requests, and rulings will constitute the exclusive record for decision 
of the proceedings and the basis for the issuance of any orders in the 
proceeding.
    (b) Examination and copying of record. (1) Generally. Any person 
interested in reviewing or obtaining a copy of a record may do so only 
by submitting a Freedom of Information Act (FOIA) request under 5 
U.S.C. 552, et seq., 49 CFR part 7, and any applicable DHS regulations. 
Portions of the record may be exempt from disclosure pursuant to FOIA.
    (2) Docket Files or Documents Not for Public Disclosure. (i) Only 
the following persons may review docket files or particular documents 
that are not for public disclosure:
    (A) Parties to the proceedings.
    (B) Their designated representatives.
    (C) Persons who have a need to know as determined by the 
Administrator.
    (ii) Those persons with permission to review these documents or 
docket files may view the materials at the TSA Headquarters, 601 South 
12th Street, Arlington, Virginia 20598-6002. Persons with access to 
these records may have a copy of the records after payment of 
reasonable costs.


Sec.  1503.653  Argument before the ALJ.

    (a) Arguments during the hearing. During the hearing, the ALJ must 
give the parties a reasonable opportunity to present arguments on the 
record supporting or opposing motions, objections, and rulings if the 
parties request an opportunity for argument. The ALJ may request 
written arguments during the hearing if the ALJ finds that submission 
of written arguments is necessary before the ALJ issues the ruling or 
order.
    (b) Final oral argument. At the conclusion of the hearing and 
before the ALJ issues an initial decision in the proceedings, the 
parties are entitled to submit oral proposed findings of fact and 
conclusions of law, exceptions to rulings of the ALJ, and supporting 
arguments for the findings, conclusions, or exceptions. At the 
conclusion of the hearing, a party may waive final oral argument.
    (c) Posthearing briefs. The ALJ may request written posthearing 
briefs before the ALJ issues an initial decision in the proceedings. If 
a party files a written posthearing brief, the party must include 
proposed findings of fact and conclusions of law, exceptions to rulings 
of the ALJ, and supporting arguments for the findings, conclusions, or 
exceptions. The ALJ must give the parties a reasonable opportunity, not 
more than 30 days after receipt of the transcript, to prepare and 
submit the briefs.


Sec.  1503.655  Initial decision.

    (a) Contents. The ALJ may issue an initial decision after the 
conclusion of the hearing or after the submission of written 
posthearing briefs, if so ordered. In each oral or written decision, 
the ALJ must include findings of fact and conclusions of law, and the 
grounds supporting those findings and conclusions, upon all material 
issues of fact, the credibility of witnesses, the applicable law, any 
exercise of the ALJ's discretion, the amount of any civil penalty found 
appropriate by the ALJ, and a discussion of the basis for any order 
issued in the proceedings. The ALJ is not required to provide a written 
explanation for rulings on objections, procedural motions, and other 
matters not directly relevant to the substance of the initial decision. 
If the ALJ refers to any previous unreported or unpublished initial 
decision, the ALJ must make copies of that initial decision available 
to all parties and the TSA decision maker.
    (b) Written decision. At the conclusion of the hearing, the ALJ may 
issue the initial decision and order orally on the record. The ALJ must 
issue a written initial decision and order not later than 30 days after 
the conclusion of the hearing or submission of the last posthearing 
brief. The ALJ must serve a copy of any written initial decision on 
each party.
    (c) Order assessing civil penalty. Unless appealed pursuant to 
Sec.  1503.657, the initial decision issued by the ALJ will be 
considered an order assessing civil penalty if the ALJ finds that an 
alleged violation occurred and determines that a civil penalty, in an 
amount found appropriate by the ALJ, is warranted.
    (d) Effect of initial decision. An initial decision of an ALJ is 
persuasive authority in any other civil penalty action, unless appealed 
and reversed by the TSA decision maker or a court of competent 
jurisdiction.


Sec.  1503.657  Appeal from initial decision.

    (a) Notice of appeal. Either party may appeal the initial decision, 
and any decision not previously appealed pursuant to Sec.  1503.631, by 
filing a notice of appeal with the Enforcement Docket Clerk. A party 
must file the notice of appeal with USCG ALJ Docketing Center, ATTN: 
Enforcement Docket Clerk, 40 S. Gay Street, Room 412, Baltimore, 
Maryland 21202-4022. A party must file the notice of appeal not later 
than 10 days after entry of the oral initial decision on the record or 
service of the written initial decision on the parties and must serve a 
copy of the notice of appeal on each party. Upon filing of a notice of 
appeal, the effectiveness of the initial decision is stayed until a 
final decision and order of the TSA decision maker have been entered on 
the record.
    (b) Issues on appeal. A party may appeal only the following issues:
    (1) Whether each finding of fact is supported by a preponderance of 
the evidence.
    (2) Whether each conclusion of law is made in accordance with 
applicable law, precedent, and public policy.
    (3) Whether the ALJ committed any prejudicial errors during the 
hearing that support the appeal.
    (c) Perfecting an appeal. Unless otherwise agreed by the parties, a 
party must perfect an appeal, not later than 50 days after entry of the 
oral initial decision on the record or service of the written initial 
decision on the party, by filing an appeal brief with the Enforcement 
Docket Clerk.
    (1) Extension of time by agreement of the parties. The parties may 
agree to extend the time for perfecting the appeal with the consent of 
the TSA decision maker. If the TSA decision maker grants an extension 
of time to perfect the appeal, the Enforcement Docket Clerk will serve 
a letter confirming the extension of time on each party.
    (2) Written motion for extension. If the parties do not agree to an 
extension of time for perfecting an appeal, a party desiring an 
extension of time may file a written motion for an extension with the 
Enforcement Docket Clerk and must serve a copy of the motion on each 
party. The TSA decision maker may grant an extension if good cause for 
the extension is shown in the motion.
    (d) Appeal briefs. A party must file the appeal brief with the 
Enforcement Docket Clerk and must serve a copy of the appeal brief on 
each party.
    (1) In the appeal brief, a party must set forth, in detail, the 
party's specific

[[Page 36053]]

objections to the initial decision or rulings, the basis for the 
appeal, the reasons supporting the appeal, and the relief requested in 
the appeal. If, for the appeal, the party relies on evidence contained 
in the record for the appeal, the party must specifically refer in the 
appeal brief to the pertinent evidence contained in the transcript.
    (2) The TSA decision maker may dismiss an appeal, on the TSA 
decision maker's own initiative or upon motion of any other party, 
where a party has filed a notice of appeal but fails to perfect the 
appeal by timely filing an appeal brief.
    (e) Reply brief. Unless otherwise agreed by the parties, any party 
may file a reply brief not later than 35 days after the appeal brief 
has been served on that party. The party filing the reply brief must 
serve a copy of the reply brief on each party. If the party relies on 
evidence contained in the record for the reply, the party must 
specifically refer to the pertinent evidence contained in the 
transcript in the reply brief.
    (1) Extension of time by agreement of the parties. The parties may 
agree to extend the time for filing a reply brief with the consent of 
the TSA decision maker. If the TSA decision maker grants an extension 
of time to file the reply brief, the Enforcement Docket Clerk will 
serve a letter confirming the extension of time on each party.
    (2) Written motion for extension. If the parties do not agree to an 
extension of time for filing a reply brief, a party desiring an 
extension of time may file a written motion for an extension and will 
serve a copy of the motion on each party. The TSA decision maker may 
grant an extension if good cause for the extension is shown in the 
motion.
    (f) Other briefs. The TSA decision maker may allow any person to 
submit an amicus curiae brief in an appeal of an initial decision. A 
party may not file more than one appeal brief or reply brief. A party 
may petition the TSA decision maker, in writing, for leave to file an 
additional brief and must serve a copy of the petition on each party. 
The party may not file the additional brief with the petition. The TSA 
decision maker may grant leave to file an additional brief if the party 
demonstrates good cause for allowing additional argument on the appeal. 
The TSA decision maker will allow a reasonable time for the party to 
file the additional brief.
    (g) Number of copies. A party must file the original appeal brief 
or the original reply brief, and two copies of the brief, with the 
Enforcement Docket Clerk.
    (h) Oral argument. The TSA decision maker has sole discretion to 
permit oral argument on the appeal. On the TSA decision maker's own 
initiative or upon written motion by any party, the TSA decision maker 
may find that oral argument will contribute substantially to the 
development of the issues on appeal and may grant the parties an 
opportunity for oral argument.
    (i) Waiver of objections on appeal. If a party fails to object to 
any alleged error regarding the proceedings in an appeal or a reply 
brief, the party waives any objection to the alleged error. The TSA 
decision maker is not required to consider any objection in an appeal 
brief or any argument in the reply brief if a party's objection is 
based on evidence contained in the record and the party does not 
specifically refer to the pertinent evidence from the record in the 
brief.
    (j) The TSA decision maker's decision on appeal. The TSA decision 
maker will review the briefs on appeal and the oral argument, if any, 
to determine if the ALJ committed prejudicial error in the proceedings 
or that the initial decision should be affirmed, modified, or reversed. 
The TSA decision maker may affirm, modify, or reverse the initial 
decision, make any necessary findings, or may remand the case for any 
proceedings that the TSA decision maker determines may be necessary.
    (1) The TSA decision maker may raise any issue, on the TSA decision 
maker's own initiative, that is required for proper disposition of the 
proceedings. The TSA decision maker will give the parties a reasonable 
opportunity to submit arguments on the new issues before making a 
decision on appeal. If an issue raised by the TSA decision maker 
requires the consideration of additional testimony or evidence, the TSA 
decision maker will remand the case to the ALJ for further proceedings 
and an initial decision related to that issue. If the TSA decision 
maker raises an issue that is solely an issue of law, or the issue was 
addressed at the hearing but was not raised by a party in the briefs on 
appeal, the TSA decision maker need not remand the case to the ALJ for 
further proceedings but has the discretion to do so.
    (2) The TSA decision maker will issue the final decision and order 
of the Administrator on appeal in writing and will serve a copy of the 
decision and order on each party. Unless a petition for review is filed 
pursuant to Sec.  1503.659, a final decision and order of the 
Administrator will be considered an order assessing civil penalty if 
the TSA decision maker finds that an alleged violation occurred and a 
civil penalty is warranted.
    (3) A final decision and order of the Administrator after appeal is 
binding precedent in any other civil penalty action unless appealed and 
reversed by a court of competent jurisdiction.
    (4) The TSA decision maker will determine whether the decision and 
order of the TSA decision maker, with the ALJ's initial decision or 
order attached, may be released to the public, either in whole or in 
redacted form. In making this determination, the TSA decision maker 
will consider whether disclosure of any of the information in the 
decision and order would be detrimental to transportation security, 
would not be in the public interest, or should not otherwise be 
required to be made available to the public.


Sec.  1503.659  Petition to reconsider or modify a final decision and 
order of the TSA decision maker on appeal.

    (a) General. Any party may petition the TSA decision maker to 
reconsider or modify a final decision and order issued by the TSA 
decision maker on appeal from an initial decision. A party must file a 
petition to reconsider or modify not later than 30 days after service 
of the TSA decision maker's final decision and order on appeal and must 
serve a copy of the petition on each party. The TSA decision maker will 
not reconsider or modify an initial decision and order issued by an ALJ 
that has not been appealed by any party to the TSA decision maker and 
filed with the Enforcement Docket Clerk.
    (b) Form and number of copies. A party must file in writing a 
petition to reconsider or modify. The party must file the original 
petition with the Enforcement Docket Clerk and must serve a copy of the 
petition on each party.
    (c) Contents. A party must state briefly and specifically the 
alleged errors in the final decision and order on appeal, the relief 
sought by the party, and the grounds that support the petition to 
reconsider or modify.
    (1) If the petition is based, in whole or in part, on allegations 
regarding the consequences of the TSA decision maker's decision, the 
party must describe and support those allegations.
    (2) If the petition is based, in whole or in part, on new material 
not previously raised in the proceedings, the party must set forth the 
new material and include affidavits of prospective witnesses and 
authenticated documents that would be introduced in support of the new 
material. The party must explain, in detail, why the new

[[Page 36054]]

material was not discovered through due diligence prior to the hearing.
    (d) Repetitious and frivolous petitions. The TSA decision maker 
will not consider repetitious or frivolous petitions. The TSA decision 
maker may summarily dismiss repetitious or frivolous petitions to 
reconsider or modify.
    (e) Reply petitions. Any other party may reply to a petition to 
reconsider or modify, not later than 10 days after service of the 
petition on that party, by filing a reply with the Enforcement Docket 
Clerk. A party must serve a copy of the reply on each party.
    (f) Effect of filing petition. Unless otherwise ordered by the TSA 
decision maker, filing a petition pursuant to this section will stay 
the effective date of the TSA decision maker's final decision and order 
on appeal.
    (g) The TSA decision maker's decision on petition. The TSA decision 
maker has sole discretion to grant or deny a petition to reconsider or 
modify. The TSA decision maker will grant or deny a petition to 
reconsider or modify within a reasonable time after receipt of the 
petition or receipt of the reply petition, if any. The TSA decision 
maker may affirm, modify, or reverse the final decision and order on 
appeal, or may remand the case for any proceedings that the TSA 
decision maker determines may be necessary.


Sec.  1503.661  Judicial review of a final order.

    For violations of a TSA requirement, a party may petition for 
review of a final order of the Administrator only to the courts of 
appeals of the United States or the United States Court of Appeals for 
the District of Columbia pursuant to 49 U.S.C. 46110. A party seeking 
judicial review of a final order must file a petition for review not 
later than 60 days after the final order has been served on the party.

Subpart H--Judicial Assessment of Civil Penalties


Sec.  1503.701  Applicability of this subpart.

    (a) Jurisdictional minimums. This subpart applies to a civil 
penalty action under this part in which the total amount in controversy 
exceeds the following amounts.
    (b) In general. Except as provided in paragraph (c) of this 
section, in the case of violation of title 49 U.S.C. or 46 U.S.C 
chapter 701, a regulation prescribed, or order issued under any of 
those provisions, the amount in controversy exceeds the following:
    (1) $50,000, in the case of violation by an individual or small 
business concern, as defined in section 3 of the Small Business Act (15 
U.S.C. 632).
    (2) $400,000, in the case of violation by any other person.
    (c) Certain aviation related violations. In the case of a violation 
of 49 U.S. C. chapter 449 (except sections 44902, 44903(d), 44907(a)-
(d)(1)(A), 44907(d)(1)(C)-(f), 44908, and 44909), or a regulation 
prescribed or order issued under any of those provisions, the amount in 
controversy exceeds the following:
    (1) $50,000, in the case of violation by an individual (except an 
airman serving as an airman), any person not operating an aircraft for 
the transportation of passengers or property for compensation, or a 
small business concern, as defined in section 3 of the Small Business 
Act (15 U.S.C. 632).
    (2) $400,000, in the case of violation by a person operating an 
aircraft for the transportation of passengers or property for 
compensation (except an individual serving as an airman).


Sec.  1503.703  Civil penalty letter; referral.

    (a) Issuance. In a civil penalty action in which the amount in 
controversy exceeds the amounts set forth in Sec.  1503.701, the 
Administrator will send a civil penalty letter to the person charged 
with a violation of a TSA requirement.
    (b) Contents. The civil penalty letter will contain a statement of 
the charges; the applicable law, rule, regulation, or order; the amount 
of civil penalty that the Administrator will accept in full settlement 
of the action or an offer to compromise the civil penalty.
    (c) Response. Not later than 30 days after receipt of the civil 
penalty letter, the person charged with a violation may present to the 
agency attorney any material or information in answer to the charges, 
either orally or in writing, that may explain, mitigate, or deny the 
violation or that may show extenuating circumstances. The Administrator 
will consider any material or information submitted in accordance with 
this paragraph (c) to determine whether the person is subject to a 
civil penalty or to determine the amount for which the Administrator 
will compromise the action.
    (d) Compromise. If the person charged with a violation offers to 
compromise the civil penalty action for a specific amount, that person 
must send payment in a form and manner acceptable to TSA for that 
amount to the agency, made payable to the Transportation Security 
Administration, or make payment electronically through http://www.pay.gov. The Chief Counsel or the Deputy Chief Counsel for Civil 
Enforcement may accept the payment or may refuse and return the 
payment. If the Administrator accepts the offer to compromise, the 
agency will send a letter to the person charged with the violation 
stating that the payment is accepted in full settlement of the civil 
penalty action and that the matter is closed.
    (e) Referral for prosecution and collection. If the parties cannot 
agree to compromise the civil penalty action or the offer to compromise 
is rejected and the payment submitted in compromise is returned, the 
Administrator may refer the civil penalty action to the United States 
Attorney General, or the delegate of the Attorney General, to begin 
proceedings in a United States district court, pursuant to the 
authority in 49 U.S.C. 114 or 46305 to prosecute and collect the civil 
penalty.
    (f) The Administrator delegates to the Chief Counsel and the Deputy 
Chief Counsel for Enforcement the authority to carry out any function 
of the Administrator described in this Sec.  1503.703.

Subpart I--Formal Complaints


Sec.  1503.801  Formal complaints.

    (a) Any person may file a complaint with the Administrator with 
respect to any act or omission by any person in contravention of 49 
U.S.C., subtitle VII, part A, (except sections 44902, 44903(d), 
44907(a)-(d)(1)(A), 44907(d)(1)(C)-(f), 44908, and 44909) administered 
by the Administrator, or a regulation prescribed or order issued under 
any of those provisions. This section does not apply to complaints 
against the Administrator or employees of the TSA acting within the 
scope of their employment.
    (b) Complaints filed under this section must--
    (1) Be submitted in writing and identified as a complaint filed for 
the purpose of seeking an appropriate order or other enforcement 
action;
    (2) Be submitted to the U.S. Department of Homeland Security, 
Transportation Security Administration, by following the instructions 
to complete a ``complaint'' contact form by following the instructions 
on the TSA Web site, currently accessible at http://www.tsa.gov/contact/index.shtm.
    (3) Set forth the name and address, if known, of each person who is 
the subject of the complaint and, with respect to each person, the 
specific provisions of the statute, regulation, or order that the 
person filing the complaint believes were violated;
    (4) Contain a concise, but complete, statement of the facts relied 
upon to substantiate each allegation;

[[Page 36055]]

    (5) State the name, address, and telephone number of the person 
filing the complaint; and
    (6) Be signed by the person filing the complaint or a duly 
authorized representative.
    (c) TSA will consider complaints that do not meet the requirements 
of paragraph (b) of this section as reports under Sec.  1503.1.
    (d) TSA will place complaints that meet the requirements of 
paragraph (b) of this section in the docket and will mail a copy to 
each person named in the complaint.
    (e) TSA will refer any complaint against a member of the Armed 
Forces of the United States acting in the performance of official 
duties to the Secretary of the Department concerned in accordance with 
the procedures set forth in Sec.  1503.407.
    (f) The person named in the complaint must file an answer within 20 
days after service of a copy of the complaint.
    (g) After the complaint has been answered or after the allotted 
time in which to file an answer has expired, the Administrator, or a 
designated official, will determine if there are reasonable grounds for 
investigating the complaint.
    (h) If the Administrator, or a designated official, determines that 
a complaint does not state facts that warrant an investigation or 
action, the Administrator or designated official may dismiss the 
complaint without a hearing and, if so, will provide the reason for the 
dismissal, in writing, to the person who filed the complaint and the 
person(s) named in the complaint.
    (i) If the Administrator, or a designated official, determines that 
reasonable grounds exist, an informal investigation may be initiated. 
Each person named in the complaint will be advised which official has 
been delegated the responsibility under Sec.  1503.203 for conducting 
the investigation.
    (j) If the investigation substantiates the allegations set forth in 
the complaint, a notice of proposed order may be issued or other 
enforcement action taken in accordance with this part.
    (k) The complaint and other pleadings and official TSA records 
relating to the disposition of the complaint are maintained in current 
docket form at: U.S. Department of Homeland Security, Transportation 
Security Administration, Office of the Chief Counsel, TSA-2, Complaint 
Docket, 601 South 12th Street, Arlington, VA 20598-6002. If this 
location changes, TSA will give notice of the change by publishing a 
notice in the Federal Register.
    (1) Generally. Any person interested in reviewing or obtaining a 
copy of a record may do so only by submitting a Freedom of Information 
Act (FOIA) request under 5 U.S.C. 552, et seq. and 49 CFR part 7. 
Portions of the record may be exempt from disclosure pursuant to FOIA.
    (2) Docket files or documents not for public disclosure. (i) Only 
the following persons may review docket files or particular documents 
that are not for public disclosure:
    (A) Parties to the proceedings.
    (B) Representatives designated in writing by a party.
    (C) Persons who have a need to know as determined by the 
Administrator.
    (ii) Those persons with permission to review these documents or 
docket files may view the materials at the Complaint Docket, TSA 
Headquarters, Visitor Center, 601 South 12th Street, Arlington, 
Virginia 20598-6002, Attn: Office of Chief Counsel. If this address 
changes, TSA will give notice by publishing a notice in the Federal 
Register. Persons with access to these records may have a copy of the 
records after payment of reasonable costs.

    Issued in Arlington, Virginia, on July 10, 2009.
Gale D. Rossides,
Acting Administrator.
[FR Doc. E9-17133 Filed 7-20-09; 8:45 am]
BILLING CODE 9110-05-P


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