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LEGAL CORNER


Settling with the FAA IN LEGAL ENFORCEMENT ACTIONS


By Gregory J. Reigel I


n past articles, I have discussed FAA legal enforcement actions in which the FAA has suspended or revoked a mechanic’s certifi cate or the certifi cate of an air carrier or repair station, or has assessed a civil penalty against a


certifi cate holder. In those situations, the FAA believed the regulatory violations committed by the certifi cate holders justifi ed legal enforcement action to suspend or revoke the off ending party’s certifi cate(s) or to assess a civil penalty, rather than simply resolving the violation through an administrative action. Fortunately, many legal enforcement cases settle once initiated. Some cases settle without a formal hearing before an administrative law judge (ALJ)and others may settle at some point during or even after the hearing. The settlement is an agreement between the FAA and the certifi cate holder to resolve the case on terms that both sides are willing to accept. In the past, when an alleged violator settled with the FAA, the settlement was typically documented either by letter or e-mail in which both the FAA attorney and the alleged violator acknowledged the terms upon which the parties were agreeing. Based upon that documentation, the FAA attorney would then either issue an order incorporating those terms, or he or she would take any other agreed upon action (e.g., outright dismissal, or downgrading from legal enforcement action to administrative action). However, the FAA recently updated its Order 3250.3B, FAA Compliance and Enforcement Program, to now require a more formal process for settling a legal enforcement case. Now such settlements (including settlements reached at or after hearing) must be documented with a written settlement agreement that is executed by the parties. The update states that the settlement agreement should include, as applicable and appropriate, the following items: 1. The specifi c terms and conditions of the settlement, including the obligations of each party;


2. The “material terms and phrases that are used in the settlement that are not otherwise commonly understood or are not defi ned in FAA regulations or policies”;


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3. The sanction proposed in the Notice of Proposed Certifi cate Action/Civil Penalty or ordered if an Order of Suspension, Revocation or Civil Penalty was actually issued and the sanction agreed to in settlement. In the case of a certifi cate action, the agreement should identify “the period of suspension or, in the case of a revocation, the number of months after which the person may apply for new certifi cate(s) and/ or rating(s).” For civil penalty actions, the agreement should state “the amount of the assessed civil penalty, whether the assessed civil penalty will be paid in a lump sum or in installments, the date(s) when the payment(s) must be made, and if the penalty is to be paid in installments, a statement that the person will sign a promissory note.”


4. If applicable, a statement that the sanction is waived under the Aviation Safety Reporting Program;


5. A statement that the person or entity charged with violating the regulations is waiving the right to a hearing before an administrative law judge;


6. A statement regarding the costs to be paid by each party, whether each pays their own or some other allocation;


7. If applicable and appropriate, a statement that the person charged with violating the regulations agrees not to initiate any litigation under the Equal Access to Justice Act or any other statutory provision or rule to collect legal fees or costs;


8. If appropriate, a waiver of all potential causes of action against the FAA and its employees and agents, both past and present, in their personal or offi cial capacity;


9. A statement that the agreement accurately refl ects the terms to which the parties have agreed and that it is a binding agreement; and


10. Signatures by the FAA legal counsel and the individual person or entity charged with violating the regulations or the alleged violator’s authorized representative.


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