Court Opinion

ID: 4416298
Source: CourtListenerOpinion
Date Created: 2019-07-12 15:00:27.915495+00
Date Added: 2024-06-11T14:23:20.531843
License: Public Domain

United States Court of Appeals
         FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued January 11, 2019                Decided July 12, 2019

                        No. 18-1160

   KORNITZKY GROUP, LLC, D/B/A AEROBEARINGS, LLC,
                     PETITIONER

                             v.

  DANIEL K. ELWELL, ACTING ADMINISTRATOR, FEDERAL
AVIATION ADMINISTRATION AND NATIONAL TRANSPORTATION
                   SAFETY BOARD,
                    RESPONDENTS

            On Petition for Review of an Order of
          the National Transportation Safety Board

    Jana Yocom Rine argued the cause for petitioner. With her
on the briefs were Elizabeth M. Candelario and Kathleen A.
Yodice.

     Christian A. Klein was on the brief for amicus curiae
Aeronautical Repair Station Association in support of
petitioner.

      Christopher R. Stevenson, Senior Attorney, Federal
Aviation Administration, argued the cause and filed the brief
for respondent.
                              2
   Before: SRINIVASAN, Circuit Judge, and EDWARDS and
RANDOLPH, Senior Circuit Judges.

    Opinion for the Court filed by Circuit Judge SRINIVASAN.

     SRINIVASAN, Circuit Judge: In 2018, the National
Transportation Safety Board revoked the air agency certificate
held by Kornitzky Group. The certificate authorized Kornitzky
Group to operate as a repair station that performs maintenance
on bearings used in jet engines. The Board revoked Kornitzky
Group’s certificate based on two distinct set of allegations.
First, the Board found that Kornitzky Group had violated
aviation safety regulations by repairing engine bearings
without technical data necessary to ensure it was conducting
the repairs properly. Second, the Board determined that
Kornitzky Group intentionally falsified maintenance records
by representing only that it had inspected the engine bearings
without indicating that it had also disassembled and repaired
them.

     Kornitzky Group seeks review of the Board’s decision.
We uphold the Board’s determination concerning Kornitzky
Group’s performance of maintenance without the appropriate
technical data.         But we set aside the Board’s
intentional-falsification charge because the Board departed
from its own precedents when considering whether Kornitzky
Group had acted with the requisite knowledge. We thus vacate
the Board’s revocation of Kornitzky Group’s air agency
certificate.
                               3
                               I.

                              A.

    Kornitzky Group, LLC, was founded in 2010 by two
engineers, Michael Kornitzky, who has since passed away, and
Zev Galel. The company performed maintenance on turbine
engine bearings used in jet engines. The bearings are structural
components of an engine that connect other components and
minimize friction, enabling the engine to function as designed.

     In August 2011, the FAA issued Kornitzky Group an air
agency certificate, which authorized the company to inspect
and clean turbine engine bearings. Between 2011 and 2012,
Kornitzky Group applied for and received additional ratings
allowing it to perform repairs on engine bearings in accordance
with a military specification it presented to the FAA. With the
additional ratings, the company not only could inspect and
clean bearings, but also could disassemble bearings, clean and
polish their parts, reassemble the bearings, and then certify
them for return to service.

     In December 2015, Gary Watson, an FAA Principal
Maintenance Inspector, conducted a three-day inspection of
Kornitzky Group, during which Watson “did not find any
discrepancies or anomalies.” Letter from Gary M. Watson to
Zev Galel (Dec. 14, 2015), J.A. 140. Nine months later, the
FAA received two complaints about the technical data used by
Kornitzky Group to conduct repairs. The complaints prompted
the agency’s Flight Standards District Office to forward the
proposed repair data provided by Kornitzky Group in 2012—
i.e., the military specification—to the agency’s Engine
Certification Office. The Certification Office determined that
Kornitzky Group’s data was not specific enough to support the
repair of turbine engine bearings.
                               4
     On March 24, 2017, Darren Pittacora, who had replaced
Watson as the FAA’s Principal Maintenance Inspector for
Kornitzky Group, sent the company a letter advising that the
agency had incorrectly issued one of Kornitzky Group’s ratings
in 2012, in part because the District Office had not forwarded
the proposed data to the Certification Office for review. The
letter advised Kornitzky Group that it had 10 days to submit to
reinspection under 49 U.S.C. § 44709 or face suspension of its
license.

     In May 2017, Pittacora and Dr. Chip Queitzsch, the FAA’s
Chief Scientific and Technical Advisor for Engine System
Dynamics, among other officials, conducted the reinspection.
On March 1, 2018, the FAA notified Kornitzky Group that the
results of the reinspection were unsatisfactory because the
company had exceeded the scope of work permitted by the
original equipment manufacturer (OEM) and the relevant
military specification.

     That same day, the FAA issued an emergency order
revoking Kornitzky Group’s air agency certificate. The order
rested on two distinct sets of alleged violations. First, the FAA
alleged that, by disassembling and repairing engine bearings
without the requisite technical data, Kornitzky Group had
violated several maintenance regulations (namely, 14 C.F.R.
§§ 43.13(a), 145.201(b), 145.201(c)(1), and 145.201(c)(2)).
Second, the FAA alleged that Kornitzky Group had
intentionally falsified statements in its repair station records
when approving bearings for return to service, in violation of
14 C.F.R. § 145.12(a). The intentional-falsification charge
related to four work orders documented on an FAA form, Form
8130-3. The FAA contended that Kornitzky Group had
indicated on the Form 8130-3 only that it had inspected engine
bearings without indicating the other work it had performed in
                               5
connection with the bearings (e.g., disassembly, polishing, and
reassembly).

                              B.

     In April 2018, an administrative law judge from the
National Transportation Safety Board, an independent agency
that adjudicates FAA enforcement actions, conducted a four-
day evidentiary hearing. The FAA presented Pittacora and
Queitzsch as its primary witnesses, with Queitzsch testifying
as an expert. Kornitzky Group presented Galel, the company’s
sole principal, and Emanuel Branzai, its own expert.

     The administrative law judge first found that Kornitzky
Group had violated each of the maintenance regulations
because the company was unable to produce the technical data
that supported its additional ratings for disassembly and repair
of bearings. The administrative law judge rejected the
intentional-falsification claim, however, because Pittacora
testified that Kornitzky Group’s statements on the Form
8130-3s were not false when examined alone. The judge thus
determined that the appropriate sanction was to suspend
Kornitzky Group’s certificate pending compliance, rather than
permanently revoke it.

    Both Kornitzky Group and the FAA appealed to the Board.
See Elwell v. Kornitzky Grp., LLC, NTSB Order No. EA–5840,
2018 WL 2733940 (May 11, 2018) [hereinafter Board
Decision]. The Board affirmed the administrative law judge’s
conclusion that Kornitzky Group had violated the maintenance
regulations by conducting disassembly and repair of bearings
without the necessary technical data. Id. at *10–11. The
Board, though, reversed the administrative law judge with
regard to the intentional-falsification claim, ruling that the
FAA had proved that charge. Id. at *7–10.
                               6
     The Board found that Kornitzky Group’s selective
disclosure of information rendered the Form 8130-3s false
because the company had excluded other information in a way
that gave an incomplete and misleading impression of the work
it had performed. The Board further found that the company
acted with knowledge of that falsity. Id. The Board decided
that the intentional-falsification charge warranted revocation of
Kornitzky Group’s certificate because it called into question
the company’s “care, judgment, and responsibility.” Id. at *12
(citation omitted).

                               II.

     We sustain a Board decision unless it is “arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with law.” Dickson v. NTSB, 639 F.3d 539, 542
(D.C. Cir. 2011) (quoting 5 U.S.C. § 706(2)(A)). Kornitzky
Group seeks a reinstatement of its air agency certificate,
arguing that the Board acted arbitrarily and capriciously in
finding violations of the FAA’s maintenance and
intentional-falsification regulations. We uphold the Board’s
determination that Kornitzky Group violated the FAA’s
maintenance regulations, but we set aside the Board’s finding
that the company intentionally falsified its entries on FAA
Form 8130-3. We therefore vacate the Board’s revocation of
the company’s air agency certificate.

                               A.

     The Board determined that Kornitzky Group’s repairs
violated certain FAA maintenance regulations: 14 C.F.R
§§ 43.13(a), 145.201(b), 145.201(c)(1), and 145.201(c)(2).
Section 43.13(a) requires that each person performing
maintenance must “use the methods, techniques, and practices
prescribed in the current manufacturer’s maintenance
                                7
manual . . . or other methods, techniques, and practices
acceptable to the Administrator.” Id. § 43.13(a).

     The remaining regulations impose requirements pertaining
to “technical data.” Technical data refers to the engineering
drawings and specifications “needed to define the
configuration and design features” of aircraft engines,
including the dimensions necessary to determine the
airworthiness of any altered or repaired aircraft article. Fed.
Aviation Admin., Collins Interpretation, 2011 WL 1459993, at
*2 (Apr. 8, 2011). Section 145.201(b) provides that a
“certificated repair station . . . may not maintain or alter any
article for which it is rated if it requires special technical
data . . . that are not available to it.” 14 C.F.R. § 145.201(b).
Section 145.201(c)(1) similarly establishes that a “certified
repair station may not approve for return to service” any article
that is repaired without acceptable technical data. Id.
§ 145.201(c)(1). And § 145.201(c)(2) parrots § 145.201(c)(1),
except that it requires pre-approved (rather than acceptable)
technical data for a “major repair or major alternation.” Id.
§ 145.201(c)(2).

      The Board reasonably determined that Kornitzky Group
violated each of those regulations. During the reinspection, the
FAA’s inspection officials asked Kornitzky Group about the
process it used for inspecting and repairing bearings. For each
of the work orders at issue in this case, Kornitzky Group
disassembled the bearing to inspect its parts with a stylus or
scribe, looking for scratches, dents, pits, or depressions. In
each instance, the bearing failed the initial inspection because
it exhibited signs of burnishing, pitting, staining, or scratching.
Kornitzky Group then polished and “lapped” the bearing parts
(i.e., used an abrasive to smooth the parts’ surfaces) to remove
the imperfections and then reassembled the bearing. That
process necessarily removes material from the bearing.
                               8
     By performing those functions, Kornitzky Group came
into conflict with the maintenance regulations. First, the
pertinent OEM manuals for the bearings prohibited
disassembly, which means Kornitzky Group’s maintenance
procedures violated § 43.13(a) unless it had other “acceptable”
maintenance procedures, which it did not. Second, Kornitzky
Group had no way to determine whether the amount of bearing
material it removed sufficed to jeopardize the bearings’
airworthiness because it had no access to the appropriate
technical data, in violation of the § 145.201 regulations. The
company could not produce the technical data because the data,
according to the company, was stored in a computer once
owned by its founder Mike Kornitzky and no longer in the
company’s possession.

     Kornitzky Group now argues that the military
specification cited in its ratings fulfills the requirements of
§ 145.201 and § 43.13(a). With regard to § 145.201, however,
the military specification does not itself contain the kind of
substantive technical data required by that provision. Instead,
the specification incorporates OEM technical data, stating:
“The need for maintaining the latest technical data in a readily
available state cannot be overemphasized. It shall be the
responsibility of the bearing shop . . . to obtain all drawings
pertaining to bearings prior to induction in the shop for
processing.” Military Specification T.O. 44-B-1-122, Ex. A-
33, R. 1366. Because the military specification relies on the
possession of OEM technical data—which the company does
not possess—the Board appropriately determined that the
military specification did not itself satisfy § 145.201.

     With regard to § 43.13(a), Kornitzky Group is correct that
the FAA approved use of the military specification when it
issued the company’s additional ratings in 2012. But
Kornitzky Group did not perform the work in accordance with
                                9
the specification. The specification requires maintenance
providers to compare repaired bearings to tolerance drawings,
which Kornitzky failed to do. Also, the military specification
provides it is “only to be used on bearings designed to be
completely disassembled. The bearing drawing or the original
component technical manual should specify that the rolling
elements are removable.”         Military Specification T.O.
44-B-1-122, Ex. A-30, R. 1363. But the OEM manuals of the
bearings repaired by Kornitzky Group indicate the opposite,
that the bearings should not be disassembled. Therefore, even
if the military specification may be, in a vacuum, an
“acceptable” alternative method under § 43.13(a), Kornitzky
still violated that regulation by failing to comply with the
specification when performing its work.

    That leaves one narrow argument advanced by Kornitzky
Group, pertaining solely to § 145.201(c)(2). That regulation,
as noted, prohibits returning an article to service after a “major
repair” unless the repair was performed in accordance with pre-
approved technical data. Kornitzky Group argues that its
maintenance functions did not qualify as “major repairs.” The
Board reasonably concluded otherwise.

     A major repair is any repair “[t]hat, if improperly done,
might appreciably affect weight, balance, structural strength,
performance, powerplant operation, flight characteristics, or
other qualities affecting airworthiness.” 14 C.F.R. § 1.1. At
the hearing, the FAA’s witnesses testified that Kornitzky
Group’s repairs could affect the bearing’s airworthiness:
“Anytime that you change the characteristics of the bearing that
affect its life and its load-carrying capability [as Kornitzky
Group did], you introduce the potential for the bearing to fail
in service when it shouldn’t, and that means loss of the engine,
loss of thrust. You change the performance characteristics of
the aircraft, and it puts you at risk of an accident.” Hearing Tr.
                                10
359, J.A. 187. Additionally, another regulation provides an
illustrative list of major repairs, including “[s]pecial repairs to
structural engine parts by welding, plating, metalizing, or other
methods” as a type of “powerplant major repair[].” 14 C.F.R.
part 43, App. A(b)(2)(iii). And the FAA’s witnesses testified
at the hearing that bearings were “structural engine parts.”
Hearing Tr. 29–30, R. 216–17. What is more, Kornitzky Group
contracted to have “plating” performed on two of the four
bearings.

     Kornitzky Group points to an FAA staff manual, which
does not specifically list engine bearings as a structural engine
part or as a “main section[]” of an engine. See FAA Order
8900.1, Vol. 4, Ch. 14, Sec. 12, ¶¶ 4-1622, 4-1623. But
Kornitzky Group did not rely on the staff manual before either
the administrative law judge or the Board, meaning we are
restricted from reviewing the argument absent good cause,
which Kornitzky Group has not established. 49 U.S.C.
§ 1153(b)(4); see Gorman v. NTSB, 558 F.3d 580, 591 (D.C.
Cir. 2009). In any case, the cited provisions of the manual are
illustrative and do not purport to establish exhaustive lists of
either major repairs or structural engine parts. In the end, the
record adequately supports the Board’s finding that Kornitzky
Group’s repairs fall within the FAA’s regulatory definitions of
major repairs.

                                B.

      Kornitzky Group next challenges the Board’s finding of
intentional falsification. The relevant regulation, 14 C.F.R.
§ 145.12(a)(1)(ii), prohibits making any “intentionally false
entry” in maintenance records. The three elements of an
intentional-falsification charge are: (i) a false representation;
(ii) in reference to a material fact; (iii) made with knowledge
of its falsity. See Hart v. McLucas, 535 F.2d 516, 519 (9th Cir.
                              11
1976). Although we affirm the Board’s finding of material
falsity for purposes of the first two elements, we conclude with
regard to the third element that the Board failed to make a
finding of subjective knowledge as required by its own
precedent.

                               1.

     The Board alleged that Kornitzky Group intentionally
falsified entries on four Form 8130-3s. In those forms, the
company certified bearings as airworthy and authorized their
return to service. Box 11 of the form is titled “Status/Work”
and allows space for a short description of the maintenance
conducted.       FAA Form 8130-3s, Authorized Release
Certificates, J.A. 68, 87, 106, 123. On each form, Kornitzky
Group completed Box 11 with an entry stating:
“OVERHAULED.” Id.

     Box 12 of Form 8130-3, entitled “Remarks,” contains
space for more extensive comments. Agency guidance
provides further direction about Box 12: “Describe the work
identified in Block 11 and associated results necessary for the
user or installer to determine the airworthiness of the product
or article in relation to the work being certified.” FAA Order
8130.21H, § 3-6(l). On one of the four forms, Kornitzky Group
wrote in Box 12, in relevant part, “Work performed [in
accordance with OEM manual] CFM56-7B ESM,
CFMI-TP-SM.10, Bearing Inspection Section 72-09-01. Rev.
55, Dated 15JAN2017 and other data acceptable to or approved
by the FAA. Work performed met the overhaul requirements
[in accordance with] Part 14 C.F.R § 43.2.” FAA Form 8130-
3, Authorized Release Certificate, Work Order 107750 (May
12, 2017), J.A. 106. The other forms contain essentially that
same entry but substitute the appropriate OEM manual for the
particular bearing at issue.
                               12
     Kornitzky Group’s Box 12 entries were reasonably
deemed to have been false in two ways. First, a fair
interpretation of Kornitzky Group’s entry “Work performed [in
accordance with OEM] CFM56-7B ESM, CFMI-TP-SM.10,
Bearing Inspection Section 72-09-01” is that the company’s
repairs complied with the manufacturer’s guidelines. But
while the company adhered to the referenced inspection section
of the OEM manual, other sections of the manual prohibit
disassembly of the bearings, yet Kornitzky Group
disassembled each bearing at issue. The Board thus reasonably
concluded that Kornitzky Group’s representation was false,
and materially so, in that it was “capable of influencing a
decision of the FAA inspector.” Thunderbird Propellers, Inc.
v. FAA, 191 F.3d 1290, 1296 (10th Cir. 1999) (internal
quotation marks omitted).

     Second, Kornitzky Group cited only the inspection section
of the OEM manual. Each OEM manual, though, also has a
separate section addressing repair, refurbishment, and overhaul
of bearings. Kornitzky Group failed to cite those sections even
though it not only inspected the bearings, but also repaired
them. The Board reasonably determined that the company, by
omitting any reference to the repair section and only citing the
inspection section, failed to “[d]escribe the work . . . necessary
for the user or installer to determine the airworthiness of the
product or article,” as required by Box 12. FAA Order
8130.21H, § 3-6(l).

     Granted, certain clues on the certification forms suggest
that Kornitzky Group did more than inspect the bearings. Box
11 notes that the bearings were overhauled, and each Box 12
entry notes that the “[w]ork performed met the overhaul
requirements” of 14 C.F.R. § 43.2. FAA Form 8130-3s,
Authorized Release Certificates, J.A. 68, 87, 106, 123. But
clues are not enough: as the Board explained, customers
                                13
assume that repair records are “scrupulously accurate,” and the
certifications here, the Board permissibly concluded,
“provide[d] a false sense of confidence in the maintenance
work performed.” Board Decision at *7–8.

     In that respect, the Board’s decision was substantially
supported by the testimony of Pittacora, the FAA’s principal
inspector for Kornitzky Group. He explained that, even if
portions of the Box 12 entry were true, the entry was materially
false because it misled customers: “[T]he reason I think it’s
false and intentional is because . . . there’s lot of work that gets
done there that’s not documented on there, that the end user
should be made aware of to make a reasonable assumption of
airworthiness prior to installing it in a large turbo engine.”
Hearing Tr. 420, J.A. 195. The agency’s conclusion that
Kornitzky Group made materially false entries in documenting
its critical aircraft maintenance functions thus was not
arbitrary.

     It bears noting that the regulations include a provision
addressing material omissions in addition to the one addressing
material falsifications. See 14 C.F.R. § 145.12(b). We have no
occasion here to address the precise interrelationship between
those provisions, and we do not suggest that every material
omission under § 145.12(b) necessarily amounts to a material
falsification under § 145.12(a). But there is also no reason to
assume that the regulations occupy mutually exclusive ground.
See Lorenzo v. SEC, 139 S. Ct. 1094, 1102 (2019). For present
purposes, it is enough to conclude that Kornitzky Group’s
entries on Form 8130-3 were incomplete in a manner
reasonably found to have been materially false.

    In sum, the FAA required Kornitzky Group to disclose any
maintenance affecting the airworthiness of the bearings. The
Board permissibly concluded that Kornitzky Group made a
                              14
materially false representation by referencing some but not all
of its work affecting the bearings’ airworthiness.

                               2.

     While we sustain the Board’s finding of material falsity,
we cannot sustain the Board’s conclusion that Kornitzky Group
acted knowingly. Under its own precedent, the Board was
required to find that Galel, Kornitzky Group’s owner and sole
principal, correctly understood the Form 8130-3 requirements
but still instructed his company to provide a false response.
Galel’s subjective knowledge, however, was not addressed by
the administrative law judge and the Board did not make the
required factual finding. As a result, we must vacate the
Board’s intentional-falsification charge.

     Our starting point is our decision in Dillmon v. NTSB, 588
F.3d 1085 (D.C. Cir. 2009). Jack Dillmon applied to the FAA
for a medical certificate enabling him to become a pilot. Id. at
1087. One of the questions on the form asked whether Dillmon
had any “[h]istory of nontraffic conviction(s) (misdemeanors
or felonies).” Id. (alteration in original) (quoting FAA Form
8500-8). Dillmon answered no, even though he had recently
been convicted of felony bribery. The FAA charged him with
intentional falsification. Id. at 1088. The administrative law
judge credited Dillmon’s testimony that he thought the
question covered only drug- or alcohol-related offenses. Id. at
1088–89. The Board reversed the administrative law judge
because Dillmon “clearly knew that he had been convicted of
a non-traffic offense,” notwithstanding Dillmon’s testimony
that he misunderstood the question. Id. at 1093 (internal
quotation marks omitted).

   We reversed the Board because it had deviated from its
own precedent. Citing Administrator v. Reynolds, NTSB Order
                              15
No. EA-5135, 2005 WL 196535 (Jan. 24, 2005), we held that
Board precedent “require[d] the FAA to prove the airman
subjectively understood what the question meant.” Dillmon,
588 F.3d at 1094. By relying only on Dillmon’s knowledge of
his conviction, we concluded, the Board’s analysis had skipped
the necessary step of determining whether Dillmon understood
that the form required him to disclose the conviction. See id.

     We have consistently enforced that principle. In Singleton
v. Babbitt, 588 F.3d 1078, 1085 (D.C. Cir. 2009), for instance,
we reversed the Board’s revocation of a pilot’s license on an
intentional-falsification charge where the pilot had no
opportunity to testify about his understanding of the relevant
question. And in Manin v. NTSB, 627 F.3d 1239, 1244 (D.C.
Cir.    2011),      we     again    reversed    the    Board’s
intentional-falsification charge because the Board had failed to
consider testimony that the pilot did not think the
medical-certificate application required him to disclose his
disorderly conduct convictions.

     The Board of course is free to change course and depart
from its own precedents if it stays within the bounds of its
statutory authority. But the agency must recognize it is doing
so and provide a reasoned justification. Without such an
explanation, we have no way of ensuring that the Board’s
“policies and standards are being deliberately changed, not
casually ignored.” NLRB v. CNN Am., Inc., 865 F.3d 740, 751
(D.C. Cir. 2017) (internal quotation marks omitted).

     There is no indication that the Board intends to abandon
its subjective-knowledge requirement. To the contrary, the
Board has applied that requirement not only in medical cases
like Dillmon but also in mechanic cases like this one. In Acting
Administrator v. Reynolds, NTSB Order No. EA-5641, 2012
WL 5954694 (Oct. 25, 2012), the Board recognized that
                               16
“credibility findings from . . . law judges are necessary in
intentional falsification cases, because the Board must consider
a respondent’s subjective understanding of questions on
medical certificate applications.” Id. at *4. The Board found
that approach equally “applicable in . . . mechanic logbook
falsification case[s]” and relied upon it to reject an
intentional-falsification charge brought by the FAA. Id.

     Here, Galel’s testimony suggests that he believed Box 12
only required Kornitzky Group to disclose the final inspection,
not the work preceding it. He testified that the Form “8130 is
not intended to have all of the information in block 12. It’s
supposed to show of the information, representative
information, sufficient information. And there’s no—the word
of divulging does not—cannot be contained in that small block
12. If I had to divulge everything that I did, I would have to
put all of this in every block 12.” Hearing Tr. 654, J.A. 215.
He continued, “the block 12 on the 8130s does not require the
total list of everything that we use to perform the maintenance.”
Id.

     In the context of Galel’s testimony to that effect, the Board
could not find the subjective-knowledge standard satisfied
without also finding Galel’s testimony to be non-credible. But
the administrative law judge made no such determination
(because he concluded the entries on the forms were not false).
When the Board overturned the administrative law judge’s
falsity finding, then, it should have remanded the case to the
administrative law judge to make the credibility determination
required by its precedents.

    The Board did not follow that course. Instead, it
“expressly expand[ed] the Board’s ‘willful disregard’ standard
from Administrator v. Boardman, Administrator v. Cooper,
and Administrator v. Taylor.” Board Decision at *10
                                17
(footnotes omitted). Under that standard, when “an airman
intentionally chooses not to carefully read the question for
which he is providing an answer that he certifies by his
signature to be true, a factfinder can infer ‘actual knowledge’
from a willful disregard for truth or falsity.” Cooper v. NTSB,
660 F.3d 476, 484 (D.C. Cir. 2011).

    In Boardman, for example, the applicant testified, “I did
not read [the question]. I just glanced over it.” Acting
Administrator v. Boardman, NTSB Order No. EA-4514, 1996
WL 748190, at *2 (Dec. 20, 1996). In Cooper, the applicant
“admitted that it was a ‘big mistake’ to fail to read the question,
and that, if he had read it, he would have answered ‘Yes.’”
Administrator v. Cooper, NTSB Order No. EA-5538, 2010 WL
3358808, at *2 (Aug. 18, 2010). And in Taylor, similarly, the
applicant admitted he “chose not to read any of the 25
items . . . contained within question 18 . . . [and] testified had
he read the question, he would have checked ‘yes.’” Acting
Administrator v. Taylor, NTSB Order No. EA-5611, 2012 WL
158766, at *3 (Jan. 9, 2012).

     In this case, by contrast, there was no testimony about how
closely Galel had read Form 8130-3. Nor does the form itself
give us reason to assume Galel willfully disregarded its
instructions. The form simply provides a place for “Remarks”
and says nothing else. FAA Form 8130-3s, Authorized Release
Certificates, J.A. 68, 87, 106, 123. And the FAA’s guidance
about the form, which instructs a repair station only to describe
any work necessary to determine airworthiness, does not solve
the problem. See FAA Order 8130.21H, § 3-6(l). Galel could
have reasonably (even if incorrectly) assumed that disclosing
the final OEM inspection is all that is needed to determine
airworthiness, especially given that Kornitzky Group had
passed prior Administration inspections that way.
                              18
     In short, the Board identified no evidence that Galel had
intentionally disregarded the Form 8130-3 instructions, and the
Board thus could not rely on any “willful disregard” principle
to satisfy the subjective-knowledge standard required by its
precedents. The Board’s departure from its precedent falls
short of reasoned decision-making. See Ramaprakash v. FAA,
346 F.3d 1121, 1124–25 (D.C. Cir. 2003).

     The FAA observes that the Board can set aside an
administrative law judge’s findings as arbitrary and capricious,
reweigh the evidence, and make its own factual findings, as
long as the new findings are supported by substantial evidence.
See Dillmon, 588 F.3d at 1095. That may be true, but here, the
administrative law judge never determined whether Galel
subjectively understood the requirements of Form 8130-3. See
Board Decision at *9, *22. And in any event, we can affirm
the Board’s decision only on the grounds upon which it acted:
Galel’s alleged willful disregard for the instructions. See SEC
v. Chenery Corp., 318 U.S. 80, 87–88 (1943). On that score,
the Board nowhere in its decision purported to reweigh the
evidence and find that Galel subjectively understood the Box
12 requirements. The Board concluded only that “[t]he
evidence taken together suggests that [Galel] knew the
information provided on the forms in question was not
complete.” Board Decision at *10. That is no different than
the Board’s argument in Dillmon that Dillmon had acted
knowingly because he “knew he had been convicted of a
non-traffic offense.” Dillmon, 588 F.3d at 1093 (internal
quotation marks omitted). The argument failed then, and it
fails again today.

                              C.

    Our vacatur of the Board’s intentional-falsification finding
requires us to vacate the Board’s revocation of Kornitzky
                               19
Group’s air agency certificate. FAA guidance allows for two
types of remedial sanctions: (i) revocation, and (ii) indefinite
suspension pending compliance. FAA Order 2150.3B at 7-1 to
7-3. Revocation is appropriate when the FAA determines that
the individual or company “lacks the qualifications to hold the
certificate,” such as when its conduct demonstrates “a lack of
the degree of care, judgment, or responsibility” required of a
certificate holder. Id. at 7-2. Meanwhile, indefinite suspension
pending compliance is appropriate when “there is a need
temporarily to suspend the privileges of the certificate or rating
pending demonstration of qualification or compliance with
statutory or regulatory requirements.” Id. at 7-1 to 7-2.

     The Board held that Kornitzky Group’s intentional
falsification warranted revocation of the company’s certificate
because it undermined the company’s “care, judgment, and
responsibility.” Board Decision at *12 (internal quotation
marks omitted).        But because we vacate the Board’s
intentional-falsification charge, revocation of the certificate
can no longer rest on that rationale.

    The Board further found that “revocation is appropriate for
the remaining violations” for two reasons, neither of which
withstands scrutiny. Id. The Board first concluded that
indefinite suspension must originate with the FAA as the
charging agency rather with than the Board. But the Board’s
own precedent indicates otherwise. See Acting Administrator
v. Air Trek, Inc., NTSB Order No. EA-5440, 2009 WL
1157988, at *10 (Apr. 21, 2009) (affirming administrative law
judge’s reduction of sanction from revocation to indefinite
suspension). And the Aviation Act grants the Board authority
to “amend, modify, or reverse” an FAA order as air safety
requires. 49 U.S.C. § 44709(d)(1).
                              20
     The Board additionally observed that the technical data at
issue is “irrevocably lost” and that imposing an indefinite
sanction pending compliance would “put both parties in an
endless, repeating loop.” Board Decision at *12. In that regard
the Board evidently equated the required technical data with
the data on the lost Kornitzky computer. But the record
confirms that the company can acquire technical data in other
ways. Queitzsch testified that Kornitzky Group could license
the technical data directly from the OEM, as is typically done.
Or, as Queitzsch testified, the company could develop the
technical data itself by “reverse engineering” it (a contention
confirmed by Galel). Hearing Tr. 310, 555, J.A. 171, 207. And
in oral argument, the FAA conceded that Kornitzky Group
could license the technical data from the OEM for the right
price or reverse engineer the data itself. Oral Arg. Tr. 9. It
would be up to Kornitzky Group to decide whether to obtain
the required technical data as a means of ending an indefinite
suspension of its certificate.

                      *   *   *    *   *

     For the foregoing reasons, we grant Kornitzky Group’s
petition for review in part, vacate the sanction imposed by the
Board, and remand the matter for further consideration
consistent with this decision.
                                                    So ordered.