Court Opinion

ID: 9962045
Source: CourtListenerOpinion
Date Created: 2024-04-22 16:02:08.92827+00
Date Added: 2024-06-11T08:19:42.340460
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

JAMES M. FEJES, Jr.,                    No. 22-70129

                Petitioner,               FAA No.
                                          SE-30550
 v.

FEDERAL AVIATION                          OPINION
ADMINISTRATION,

                Respondent.

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

        Argued and Submitted October 19, 2023
              San Francisco, California

                 Filed April 22, 2024

  Before: Michael Daly Hawkins, Ryan D. Nelson, and
           Daniel P. Collins, Circuit Judges.

             Opinion by Judge R. Nelson
2                          FEJES V. FAA

                          SUMMARY *

              Federal Aviation Administration

    The panel denied James Fejes’s petition for review of the
National Transportation Safety Board’s order affirming the
Federal Aviation Administration (“FAA”)’s revocation of
his pilot certificate under 49 U.S.C. § 44710(b)(2).
    Fejes held a pilot certificate issued by the FAA under 49
U.S.C. § 44703, and at least three times piloted an aircraft to
transport and distribute marijuana to retail stores within
Alaska. Fejes argued that his conduct fell outside of
§ 44710(b)(2)’s reach.
    The panel rejected Fejes’s argument that the FAA lacked
jurisdiction to revoke his pilot certificate because Congress
cannot authorize an administrative agency to regulate purely
intrastate commerce like marijuana delivery within
Alaska. Airspace is a channel of commerce squarely within
congressional authority. Therefore, Congress can regulate
Fejes’s conduct, which involved use of a navigable airspace,
as a channel of interstate commerce. Aircraft are also
instrumentalities of interstate commerce.
    The panel also rejected Fejes’s argument that his conduct
was exempt under FAA regulation 14 C.F.R. § 91.19. The
FAA did not rely on 14 C.F.R. § 91.19 to revoke Fejes’s pilot
certificate, and the FAA need not comply with an exception
to a regulatory prohibition when it did not allege any
regulatory violation occurred.

*
 This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
                        FEJES V. FAA                       3

    Finally, the panel rejected Fejes’s argument that the FAA
misinterpreted § 44710(b)(2). First, the panel held that
§ 44710(b)(2) was mandatory, as evident from the plain text,
and the FAA did not exceed its statutory power by revoking
Fejes’s pilot certificate. Second, a criminal conviction is
unnecessary for a certificate revocation under
§ 44710(b)(2). Section 44710(b)(2) does not require a
finding that Fejes knew that his conduct was “punishable”
under law, but only that he knowingly engaged in activity
that was punishable under 21 U.S.C. § 841. Fejes admitted
that he knowingly piloted an aircraft to distribute marijuana
within Alaska. State law legalizing marijuana distribution
did not negate federal law criminalizing the same action.
   Accordingly, the panel concluded that the FAA’s
revocation of Fejes’s pilot certificate was not arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with law.

                        COUNSEL

Lance C. Wells (argued), Law Offices of Lance C. Wells
P.C., Anchorage, Alaska; Darryl L. Jones, Law Office of
Darryl L. Jones, Palmer, Alaska; for Petitioner.
Daniel Aguilar (argued), United States Department of
Justice, Civil Division, Appellate Staff, Washington, D.C.;
Casey E. Gardner, Senior Attorney, Aviation Litigation
Division, Office of the Chief Counsel, Federal Aviation
Administration, Washington, D.C.; for Respondent.
4                        FEJES V. FAA

                         OPINION

R. NELSON, Circuit Judge:

    James Fejes transported marijuana—which is legal
under Alaska law but a controlled substance under federal
law—by aircraft within Alaska. After an investigation, the
Federal Aviation Administration revoked his pilot certificate
under 49 U.S.C. § 44710(b)(2). Fejes petitions for review of
the National Transportation Safety Board’s order affirming
the Federal Aviation Administration’s revocation. We deny
the petition for review.
                              I
    Alaska voters approved a ballot measure in 2014 that
decriminalized the possession, cultivation, distribution, and
recreational use of marijuana. 2014 Ballot Measure No. 2
(codified at ALASKA STAT. §§ 17.38.010–17.38.900).
Following the ballot measure’s passage, the Alaska
legislature created the Alaska Marijuana Control Board
(AMCB) to regulate marijuana use within the state. See
ALASKA STAT. § 17.38.080.
    Petitioner James Fejes was the sole member, manager,
and owner of Flying High Investments, LLC, an Alaskan
company licensed by the AMCB to operate a marijuana
cultivation facility. In some remote parts of Alaska, aircraft
are the only mode of delivering goods, including marijuana.
Fejes held a pilot certificate issued by the Federal Aviation
Administration (FAA) under 49 U.S.C. § 44703. At least
three times, Fejes piloted an aircraft to transport and
distribute marijuana to retail stores within the state.
   The FAA caught wind of Fejes’s activities after Alaska’s
Alcohol and Marijuana Control Office (AMCO) reported
                         FEJES V. FAA                       5

him for violating AMCB regulations. The marijuana
industry is tightly regulated in Alaska with “seed-to-sale”
tracking requirements. Cultivation facilities must prepare
manifests using the state tracking system before transporting
marijuana to another licensee. In 2017, ACMO began
investigating Fejes for reporting inaccurate information on
his manifests. It later issued Fejes a violation for reporting
that he used his personal vehicle to transport the marijuana
when he instead used a private aircraft. AMCO then
reported to the FAA that Fejes used the aircraft to deliver
marijuana. After an investigation, the FAA Administrator
revoked Fejes’s pilot certificate, effective immediately. The
FAA acted under § 44710(b)(2), which mandates that the
FAA Administrator “shall” revoke a certificate when a pilot
knowingly uses an aircraft for an activity punishable by
more than a year’s imprisonment under a federal or state
controlled substance law. Distributing marijuana via aircraft
is a federal crime under 21 U.S.C. § 841(a), punishable by a
term of imprisonment for more than one year. See, e.g.,
United States v. Floyd, 21 F.3d 1116 (9th Cir. 1994).
    Fejes appealed the Administrator’s order to an
Administrative Law Judge (ALJ), who affirmed the
revocation. He then appealed the ALJ’s decision to the
National Transportation Safety Board (NTSB), which
affirmed the ALJ. Throughout agency proceedings, Fejes
admitted that he piloted an aircraft to distribute marijuana
within Alaska, but he argued that his conduct fell outside of
§ 44710(b)(2)’s reach. Fejes now petitions this court for
review.
                              II
   We have jurisdiction under 49 U.S.C. § 46110(a).
“Review of an NTSB decision is governed by the
6                        FEJES V. FAA

Administrative Procedure Act.” Connors v. Nat’l Transp.
Safety Bd., 844 F.3d 1143, 1145 (9th Cir. 2017). We may
hold unlawful and set aside agency action if it is “arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with law.” 5 U.S.C. § 706(2)(A). We review
legal questions de novo. See Connors, 844 F.3d at 1145.
                             III
    The FAA Administrator revoked Fejes’s pilot certificate
under § 44710(b)(2), which mandates that he “shall” revoke
a certificate when he finds that:

       (A) the individual knowingly carried out an
       activity punishable, under a law of the United
       States or a State related to a controlled
       substance (except a law related to simple
       possession of a controlled substance), by
       death or imprisonment for more than one
       year;
       (B) an aircraft was used to carry out or
       facilitate the activity; and
       (C) the individual served as an airman, or was
       on the aircraft, in connection with carrying
       out, or facilitating the carrying out of, the
       activity.

The FAA Administrator found that Fejes’s conduct was
punishable by more than a year of imprisonment under 21
U.S.C. § 841(a), which prohibits the transportation of
marijuana. Fejes still presents multiple arguments for why
his conduct falls outside of § 44710(b)(2) and the FAA’s
reach. These arguments fail.
                         FEJES V. FAA                       7

                              A
    Fejes argues that the FAA lacks jurisdiction to revoke his
pilot certificate because Congress cannot authorize an
administrative agency to regulate purely intrastate
commerce like marijuana delivery within Alaska. This
argument is foreclosed by precedent. The Constitution vests
Congress with the power “[t]o regulate Commerce . . .
among the several States.” U.S. Const. art. I, § 8, cl. 3. The
Commerce Clause covers three categories: (1) “the use of
the channels of interstate commerce,” (2) the protection of
“instrumentalities     of   interstate   commerce,”        and
(3) “activities having a substantial relation to interstate
commerce.” United States v. Lopez, 514 U.S. 549, 558–59
(1995).
                              1
    Other circuits have held that airspace is a channel of
commerce squarely within congressional authority. The
Third Circuit has held: “It is beyond dispute that Congress’s
power over interstate commerce includes the power to
regulate use of the nation’s navigable airspace, which is a
channel of interstate commerce.” Ickes v. FAA, 299 F.3d
260, 263 (3d Cir. 2002) (rejecting petitioner’s challenge that
“his flights [were] purely an intrastate recreational
activity”); see also Gorman v. Nat’l Transp. Safety Bd., 558
F.3d 580, 586 (D.C. Cir. 2009).
     We conclude the same. Channels of commerce are “the
interstate transportation routes through which persons and
goods move.” United States v. Morrison, 529 U.S. 598, 613
n.5 (2000) (quoting United States v. Lankford, 196 F.3d 563,
571–72 (5th Cir. 1999)). Channels include highways,
railroads, and navigable waters. Pierce County v. Guillen,
537 U.S. 129, 147 (2003); Oklahoma ex rel. Phillips v. Guy
8                        FEJES V. FAA

F. Atkinson Co., 313 U.S. 508, 516–18 (1941); Escanaba &
Lake Mich. Transp. Co. v. City of Chicago, 107 U.S. 678,
682 (1883). Similarly, navigable airspace is an interstate
route through which goods move. Therefore, Congress can
regulate Fejes’s conduct, which involved use of a navigable
airspace, as a channel of interstate commerce.
                              2
    Aircraft are also instrumentalities of interstate
commerce. Perez v. United States, 402 U.S. 146, 150
(1971). Instrumentalities of interstate commerce include
“persons or things in interstate commerce, even though the
threat may come only from intrastate activities.” Lopez, 514
U.S. at 558. As the Sixth Circuit explained,

       Instrumentalities of interstate commerce—
       e.g., cars, trains, airplanes—retain the
       inherent potential to affect commerce, unlike
       other objects of regulation. Thus, even if a
       particular      activity      involving    an
       instrumentality might not, through repetition
       elsewhere, substantially affect interstate
       commerce during the moment of regulation,
       the activity still falls within Category Two
       because the object of regulation contains the
       unique capacity to affect commerce at some
       future point in time.

United States v. McHenry, 97 F.3d 125, 127 (6th Cir. 1996)
(citation omitted).
    We have held that cars are instrumentalities of interstate
commerce. United States v. Oliver, 60 F.3d 547, 550 (9th
Cir. 1995). Even if an airplane, like a car, is mainly used for
                         FEJES V. FAA                         9

intrastate activities, its operations could substantially impact
interstate commerce. Thus, Fejes’s conduct falls within the
second category as well.
                               3
    Fejes also relies on United States v. Morrison, 529 U.S.
598 (2000), and Lopez, 514 U.S. at 549, to argue that his
intrastate transportation does not substantially affect
interstate commerce. Because his conduct falls within
Congress’s power to regulate the channels or
instrumentalities of interstate commerce, Congress need not
also show substantial effects. And even if that were
required, precedent forecloses this argument. In Gonzales v.
Raich, 545 U.S. 1 (2005), the Supreme Court held that
growing marijuana for personal use has a substantial effect
on interstate commerce. We see no reason why Raich would
not control the intrastate marijuana delivery here.
                               B
  Fejes next argues that his conduct is exempt under the
FAA’s regulation that provides:

       (a) Except as provided in paragraph (b) of
       this section, no person may operate a civil
       aircraft within the United States with
       knowledge that narcotic drugs, marihuana,
       and depressant or stimulant drugs or
       substances as defined in Federal or State
       statutes are carried in the aircraft.
       (b) Paragraph (a) of this section does not
       apply to any carriage of narcotic drugs,
       marihuana, and depressant or stimulant drugs
       or substances authorized by or under any
10                       FEJES V. FAA

       Federal or State statute or by any Federal or
       State agency.

14 C.F.R. § 91.19. Fejes interprets subsection (b) to exempt
his activity because Alaska law permits him to transport
marijuana. He thus asserts that the FAA acted unlawfully by
ignoring its own regulation.
    True, “an agency must abide by its own regulations.”
Fort Stewart Schs. v. Fed. Lab. Rels. Auth., 495 U.S. 641,
654 (1990). We are persuaded, however, by the FAA’s
position that the exception in § 91.19(b) is inapplicable to
the circumstances on appeal.          The FAA relied on
§ 44710(b)(2)—not 14 C.F.R. § 91.19—to revoke Fejes’s
pilot certificate. The FAA need not comply with an
exception to a regulatory prohibition when it does not allege
any regulatory violation occurred. The FAA did not act
unlawfully by not applying the exemption in regulation
§ 91.19(b).
                              C
    Finally, Fejes argues that the FAA misinterpreted
§ 44710(b)(2). First, he argues that the FAA abused its
discretion by revoking his pilot certificate when his conduct
did not fall into the enforcement priority categories
identified in a memorandum from then-Deputy Attorney
General James Cole on marijuana-related prosecutions.
Second, he contends that § 44710(b)(2) requires a conviction
before the FAA can revoke a certificate. Third, Fejes argues
that § 44710(b)(2) requires the individual to know that his or
her activity was punishable under the law. Each argument
fails.
                         FEJES V. FAA                       11

                              1
    Section 44710(b)(2) is mandatory, as evident from the
plain text: “The Administrator shall issue an order revoking
an airman certificate” if the three listed conditions are met.
§ 44710(b)(2) (emphasis added).             “Shall” indicates
mandatory action. See Alabama v. Bozeman, 533 U.S. 146,
153 (2001) (“The word ‘shall’ is ordinarily ‘the language of
command.’” (citation omitted)). Though other factors, such
as the statute’s prospective effect on government action and
the structure of the statute, may undermine mandatory
language, see Sierra Club v. Whitman, 268 F.3d 898, 904
(9th Cir. 2001), no adverse indicators are present here.
    To the contrary, neighboring provisions support
interpreting this section as mandatory. “When a statute
distinguishes between ‘may’ and ‘shall,’ it is generally clear
that ‘shall’ imposes a mandatory duty.” Kingdomware
Techs., Inc. v. United States, 579 U.S. 162, 172 (2016).
Section 44710 makes that distinction and elsewhere uses
“may” to reflect permissive action. See § 44710(d)(1) (“An
individual whose certificate is revoked by the Administrator
under subsection (b) of this section may appeal the
revocation order to the National Transportation Safety
Board.” (emphasis added)).
    Fejes counters that the FAA could have exercised
discretion to ignore his violation of § 44710(b)(2). But
discretion is just that—discretionary.            An agency’s
enforcement discretion is generally not judicially
reviewable. Agencies have enforcement discretion because
“[a]n agency generally cannot act against each technical
violation of the statute it is charged with enforcing.” Heckler
v. Chaney, 470 U.S. 821, 831 (1985). So “when an agency
determines not to start enforcement proceedings, there is a
12                        FEJES V. FAA

presumption against judicial review of that decision.”
Clementson v. Brock, 806 F.2d 1402, 1404 (9th Cir. 1986).
This is because “[t]he agency is far better equipped than the
courts to deal with the many variables involved in the proper
ordering of its priorities.” Heckler, 470 U.S. at 831–32; see
also Whitman, 268 F.3d at 903. But “when an agency does
act to enforce, that action itself provides a focus for judicial
review,” and the court “review[s] to determine whether the
agency exceeded its statutory powers.” Heckler, 470 U.S. at
832 (emphasis in original).
    Because we are reviewing the FAA’s action rather than
inaction, the certificate revocation is the “focus for judicial
review.” Id. As discussed above and in the following
section, the FAA did not exceed its statutory power by
revoking Fejes’s pilot certificate.
                               2
    A conviction is unnecessary under § 44710(b)(2)(A).
The statute requires the individual to commit an “activity
punishable” by federal or state law related to a controlled
substance, and “punishable” does not require a conviction.
See Punishable, BLACK’S LAW DICTIONARY (11th ed. 2019)
(defining punishable as “giving rise to a specified
punishment”). Again, neighboring sections provide useful
context. Unlike the “punishable” language, the preceding
subsection provides for revocation “after the individual is
convicted, under a law of the United States or a State related
to a controlled substance.” § 44710(b)(1) (emphasis added).
The meaningful difference between “punishable” and
“convicted” indicates that subsection (b)(2) does not require
a conviction.
     Precedent also reinforces this interpretation. In Connors,
we     interpreted a nearly identical requirement in
                         FEJES V. FAA                        13

§ 44106(b)(1), which provides for revocation of an aircraft
registration for controlled-substance violations. See 844
F.3d at 1145. This section requires that “the aircraft was
used to carry out, or facilitate, an activity that is punishable
by death or imprisonment for more than one year under a law
of the United States or a State related to a controlled
substance (except a law related to simple possession of a
controlled substance).” § 44106(b)(1)(A) (emphasis added).
Connors argued that his conduct was not “punishable”
because his state court criminal proceedings arising from the
same activities were dismissed, so there was no possibility
of conviction. See id. at 1144. We held that “§ 44106(b)(1)
plainly connects ‘punishable’ to the ‘activity,’ such that an
aircraft certificate may be revoked regardless of whether the
certificate holder could be convicted for” the underlying
activity. Id. at 1146. Fejes has an even weaker argument
because no criminal proceedings were dismissed; any
punishment was still possible when his license was revoked.
Thus, we reach the same conclusion as in Connors.
    Considering the text, context, and Connors’s
interpretation of an analogous provision, we hold that a
conviction is unnecessary for a certificate revocation under
§ 44710(b)(2).
                               3
    Section 44710(b)(2) does not require a finding that Fejes
knew that his conduct was “punishable” under the law, but
only that he knowingly engaged in the activity that is
punishable under 21 U.S.C. § 841. Bryan v. United States,
524 U.S. 184, 192 (1998) (“[T]he knowledge requisite to
knowing violation of a statute is factual knowledge as
distinguished from knowledge of the law.” (citation
omitted)). Fejes does not contend otherwise. Nor does he
14                       FEJES V. FAA

dispute that he knowingly engaged in the conduct that § 841
proscribes. Throughout the agency proceedings, Fejes
admitted that he knowingly piloted an aircraft to distribute
marijuana within Alaska. Instead, he argues that, even if his
conduct fell within the statute’s terms, it was nonetheless not
“punishable” under that statute because internal
prosecutorial guidance within the U.S. Department of Justice
(DOJ) limited the ability to charge Fejes with a violation
of § 841. We reject this contention.
    Although many states have legalized recreational
marijuana, it continues to be a controlled substance
federally. See 21 U.S.C. § 812. The government has, at
times, declined to prosecute certain marijuana crimes as a
matter of policy. For example, in 2013, the DOJ issued a
memorandum that advised federal prosecutors not to
prosecute certain marijuana crimes in states where it was
legalized. Memorandum from James Cole, Deputy Att’y
Gen., to All United States Attorneys (Aug. 29, 2013); but see
Memorandum from Jefferson Sessions, Att’y Gen., to All
United States Attorneys (Jan. 4, 2018) (rescinding the 2013
memorandum before the FAA’s revocation of Fejes’s pilot
certificate). But the DOJ’s decision to exercise prosecutorial
discretion does not alter marijuana’s status—it remains
illegal under federal law. See § 812. The public may believe
that a state’s legalization of marijuana broadly protects
marijuana use.        But state law legalizing marijuana
distribution does not negate federal law criminalizing the
same action. See United States v. Kleinman, 880 F.3d 1020,
1027 (9th Cir. 2017); United States v. McIntosh, 833 F.3d
1163, 1179 n.5 (9th Cir. 2016). And marijuana is still illegal
in many contexts under federal law, even in states that
provide legal allowances.
                        FEJES V. FAA                     15

                            IV
    For these reasons, the FAA’s revocation of Fejes’s pilot
certificate was not “arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law.” 5
U.S.C. § 706(2)(A). In fact, the FAA was required to revoke
his certificate under § 44710(b)(2) once the Administrator
found the statute was violated.
   PETITION DENIED.