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Updated: Friday, January 30, 2009 4:08 PM

OST-2004-16943 - Consent Orders



Coastal Mountain Airways, Ltd.

Order 04-1-19
OST-04-16943 - Violations of 49 USC 41301 and 41712

Issued and Served January 26, 2004

Consent Order

CMA, a foreign air carrier within the meaning of 49 U.S.C. § 40102(a)(21), provides  on demand air taxi services from its base in Pemberton, British Columbia, Canada, using two Cessna aircraft. CMA has never applied for or held economic authority from the Department or safety authority from the Federal Aviation Administration (FAA). Notwithstanding its lack of economic authority, CMA held out and operated charter air service between Canada and the United States in contravention of 49 U.S.C. § 41301, which states that foreign air carriers must obtain permit authority from the Department prior to commencing service to the United States.' Any violation of 49 U.S.C. § 41301 also constitutes an unfair and deceptive practice and unfair method of competition in violation of 49 U.S.C. § 41712.

Without admitting or denying the violations described above, CMA consents to the issuance of this order to cease and desist from future violations of 49 U.S.C. § 41301 and 41712 and to the assessment of $2,500 (US) in compromise of potential civil penalties otherwise assessable. Of this total penalty amount, $500 shall be paid under the terms described below.

By: Rosalind Knapp


Classic Limited Air, Inc.

Order 04-1-23
OST-04-16943 - Violations of 49 USC 41101 and 41712

Issued and Served January 29, 2004

Consent Order | Word

In August 1999, CLA began operations with a Boeing 727 and a Boeing 737-7BC, commonly known as a Boeing Business Jet (BBJ). Since then, CLA has provided air service pursuant to a significant number of contracts with a diverse range of entities, including a political campaign, a real estate development company, sports teams, rock bands, film production companies, various celebrities, and numerous charter brokers and agents.8 Service ranged from single flights to operations over several months.

On the question of whether it has held out air transportation, CLA states that it neither advertised nor directly solicited business. Rather, CLA maintains that the demand for its ostensibly private carriage service was driven solely, if indirectly, by “word of mouth.” However, even assuming that the carrier did not actively solicit business, its objective conduct involved the provision of air transportation to a significant number of diverse entities and, by doing so, it engaged in a course of conduct evincing a willingness to serve members of the general public indiscriminately.9 In effect, CLA gained a reputation for a willingness to provide transportation by air to at least a class or segment of the public while operating without an effective certificate issued under 49 U.S.C. § 41101.10 In fact, so well-established was CLA’s reputation that the carrier was frequently approached by air charter brokers who specialize in arranging air transportation services for members of the general public. The Office of Aviation Enforcement and Proceedings (Enforcement Office), therefore, believes that CLA has engaged in common carriage without appropriate economic authority. Holding out air transportation without requisite authority is also an unfair and deceptive practice and unfair method of competition prohibited by 49 U.S.C. § 41712.

5. Classic Limited Air, Inc., is assessed $150,000 in compromise of civil penalties that might otherwise be assessed for the violations described in ordering paragraphs 2 and 3, above. Of the assessed penalty, $75,000 is due and payable within 30 days of the date of issuance of this order.

By: Rosalind Knapp


JetBlue Airways, Inc.

Order 04-2-4
OST-04-16943 - Violations of 49 USC 41712 and 14 CFR 399.84

Issued and Served February 3, 2004

Consent Order | Word

Thus, by failing to state the full price of the fare that a consumer must pay or to comply with the Department’s enforcement case precedent regarding full fare advertising, JetBlue violated 14 CFR 399.84 and engaged in an unfair and deceptive practice in violation of 49 U.S.C. § 41712.  Under 49 U.S.C. § 46301, JetBlue is subject to civil penalties of up to $2,500 for each violation of this regulation and statutory provision and $2,500 for each day each such violation continues. JetBlue consents to the issuance of this order to cease and desist from future violations of 49 U.S.C. § 41712 and 14 CFR 399.84, and to the assessment of  $25,000 in compromise of potential civil penalties.  Of that amount, $12,500 is due and payable within 15 days of the date of service of this order and the remaining $12,500 will be forgiven if JetBlue does not violate this consent order for a period of one year from the date of its entry. 

By: Rosalind Knapp


TFI Tours International, Ltd.

Order 04-2-5
OST-04-16943 - Violations of 49 USC 41712 and 14 CFR 399.84

Consent Order | Word

TFI failed to properly disclose the full fare, including its service fee, where applicable, for airfares advertised on its website. TFI advertised via a search feature that displayed airfares, but failed to include in the advertised fares an additional service fee that was added to certain fares, or to comply with the conditions set forth in Order 2001-12-7. TFI customers were not informed until several steps into the booking process that a service fee would be added to the advertised fare. In addition, TFI failed to properly disclose the taxes and fees for airfares advertised on its website. The TFI search results display did indicate that taxes and fees were not included in the airfares displayed to consumers; however, it did not state the amount of the taxes and fees that may properly be separately stated (such as segment fees, Passenger Facility Charges, the September 11th Security Fee and, for international destinations, additional government-imposed taxes and fees). It was not until several steps into the booking process that TFI disclosed the full fare, including all taxes and fees, to a consumer.

TFI, in order to avoid litigation and without admitting or denying the alleged violations, consents to the issuance of this order to cease and desist from future violations of 49 U.S.C. § 41712 and of 14 CFR 399.84, and to the assessment of $40,000 in compromise of potential civil penalties, of which $10,000 shall be paid in accordance with the schedule set forth below and $10,000 shall be offset for past expenditures to improve future compliance.

By: Rosalind Knapp


AGS Partnership

Order 04-2-7
OST-04-16943 - Violations of 49 U.S.C. 41101 and 41712

Issued and Served: February 9, 2004

Consent Order | Word

Between November 2001 and March 2003, on a substantial number of occasions, AGS provided charter air transportation for compensation or hire to numerous college and professional sports teams using two DC-9-15 aircraft. During this time, AGS obtained its business largely through the use of several air charter brokers, including Scott Aviation, an affiliated air taxi 8 with which AGS also shares common ownership and substantial managerial and other operational resources. Starting with AGS's inception in 2001, Scott Aviation served as a conduit for marketing AGS's aircraft to the general public and for receiving offers for their operation in air transportation. Specifically, AGS, through Scott Aviation, sent written material to air charter brokers and other members of the general public holding out the availability of AGS's aircraft for charter flights.

AGS Partnership is assessed $65,000 in compromise of civil penalties that might otherwise be assessed for the violations described in ordering paragraphs 2 and 3, above. Of the assessed penalty, $32,500 is due and payable within 30 days of the date of issuance of this order. The remaining $32,500 shall be suspended for two years following the issuance of this order, and then forgiven, unless AGS Partnership violates this order's cease and desist or payment provisions.

By: Rosalind Knapp


Scott Aviation, Inc.


Oder 04-2-6
OST-04-16943 - Violations of 49 U.S.C. 41101 and 41712 and 14 CR 298.31

Issued and Served: February 9, 2004

Consent Order | Word

Scott Aviation states that it did not intend to hold itself out as the operator of DC-9 aircraft, but that it intended to contract with charter customers as an agent for its affiliated company, AGS Partnership. Scott Aviation asserts that its belief that it was not operating as a common carrier was based on advice received from its local FAA Flight Standards District Office. Moreover, the carrier points out that it stopped operating the DC-9 aircraft once it became aware of the Department's objections. Scott also notes that it is currently pursuing certification by the Department under 49 U.S.C. § 41102 and by the FAA under 14 CFR Part 121. Lastly, Scott Aviation has agreed to work with the Department to educate similarly situated carriers regarding the laws governing the holding out and provision of air transportation and the Department's economic licensing requirements.

Scott Aviation, in order to avoid litigation and without admitting or denying the alleged violations, agrees to the issuance of this order to cease and desist from future violations of 49 U.S.C. § 41101 and 41712 as described above, and to the assessment of $65,000 in compromise of potential civil penalties otherwise due and payable. Of this total penalty amount, $22,500 shall be due and payable within 30 days of the issuance of this order and $10,000 shall be due and payable on December 15, 2004.

By: Rosalind Knapp


Consorcio Aviacsa S.A. de C.V

Order 04-2-11
OST-04-16943 - Violations of 49 U.S.C. 41712 and 14 CFR 399.84

February 11, 2004

Consent Order

This consent order concerns advertisements published by Consorcio Aviacsa S.A. de C.V. that failed to comply with the Department's rule on full fare advertising, 14 CFR 399.84. In advertisements published in several widely circulated newspapers between June and November 2003, the carrier offered fares without disclosing all taxes and fees associated with the quoted fares. Under 14 CFR 399.84 and enforcement case precedent, ad valorem excise taxes must be included in any advertised fare, while certain additional charges can be stated separately but must be disclosed. The advertisements in question therefore violated the Department rule and constituted an unfair and deceptive trade practice and an unfair method of competition in violation of 49 U.S.C. § 41712.

Aviacsa, in order to avoid litigation and without admitting or denying the alleged violations, agrees to the issuance of this order to cease and desist from future violations of 49 U.S.C. § 41712 and 14 CFR 399.84 in future advertisements and to an assessment of $15,000 in compromise of potential civil penalties, of which one‑half will be paid according the payment provisions described below.

By: Rosalind Knapp


DB Air, Inc.

Order 04-02-21
OST-04-16943 - Violations of 49 USC 41101 and 41712

Issued and Served February 23, 2004

Consent Order

As of August 1, 2003, DB Air possessed two aircraft that it leased from Seven Two Capital Partners, LLC, the sole owner of which, David Bernstein, is also one of the two owners of DB Air. These two aircraft were in turn, sub‑leased to Miami Air International, Inc. (Miami Air), an air carrier that holds economic authority from the Department pursuant to 49 U.S.C. § 41101 and safety certification from the Federal Aviation Administration under 14 CFR Part 121. Miami Air in turn serviced the corporate charters that were arranged exclusively by DB Air on its aircraft. Under the companies' arrangement, DB Air paid all of the expenses incurred by Miami Air in placing the aircraft on Miami Air's Part 121 Operations Specifications. Furthermore, DB Air paid all of the expenses incurred by Miami Air in operating the aircraft, such as the loading and unloading fees, power carts, air startups, pushback fees, ramp charges, landing fees, all baggage fees, all taxes relating to operation of the aircraft, passenger facility charges, and all security fees. Under the arrangement, the aircraft were maintained for the exclusive use of DB Air and Miami Air was forbidden from using DB Air's aircraft without DB Air's permission.

We are particularly concerned about DB Air's operations because its scheme bypassed the protections put in place by the Department to afford the public a measure of financial protection where charter flights are involved. With respect to single-entity charters using large aircraft, Department rules require a direct air carrier that engages in charter air transportation to maintain a bond, in an unlimited amount, to guarantee performance of all charter flights for which it has contracted, or to maintain an escrow account into which it must deposit immediately all payments received for charter flights until after the flight has been operated. DB Air, however, entered into contracts for charter air transportation worth millions of dollars and as a principal it received payments for charter trips, none of which money was escrowed by DB Air or protected by a bond under Department rules while in DB Air's possession. Not only were DB Air's operations unlawful, but its conduct posed an unacceptable risk to the public's funds that 49 U.S.C. § 41101 and Department regulations, where followed, are designed to minimize.

DB Air, Ltd., is assessed $100,000 in compromise of civil penalties that might otherwise be assessed for the violations described in ordering paragraphs 2, 3, and 4, above. Of the assessed penalty, $50,000 is due and payable within 30 days of the date of the issuance of this order.

By: Rosalind Knapp


Northwest Airlines, Inc.

Order 04-03-4
OST-04-16943 - Violations of 14 CFR Part 382 and 49 U.S.C. §§ 41702, 41705 and 41712

Issued and Served March 9, 2004

Consent Order | Word

This order covers the issue of the stowage of one passenger's standard‑size folding wheelchair inside the cabin of Northwest's Airbus A319 and A320 aircraft. Northwest admits that prior to the investigation giving rise to this order its new aircraft did not contain enough space for the stowage of one passenger's standard‑size folding wheelchair. However, Northwest notes that section 382.2 1(a)(2) does not, by its terms, describe the size of the wheelchair that must be given priority space. After notification by the Enforcement Office of its concerns and the size requirements for standard‑sized folding wheelchair stowage, Northwest agreed to modify either the front or rear closet of the covered aircraft to bring them into compliance. Although the Enforcement Office appreciates Northwest's willingness to create a space to stow a passenger's standard‑size folding wheelchair, the office views the carrier's failure initially to provide the proper accommodation under 14 CFR 382.21(a)(2) seriously. After careful consideration of all the facts surrounding this matter, including the explanation and arguments set forth by Northwest, the Enforcement Office continues to believe that enforcement action is warranted. In order to avoid litigation, Northwest has agreed to settle these matters, without admitting to a violation of the Air Carrier Access Act, and to enter into this consent order directing it to cease and desist from future similar violations and to the assessment of a civil penalty.

Northwest is assesed a civil penalty of $225,000 in compromise of civil penalties that might otherwise be assessed for the violations found in ordering paragraphs 2 through 6, of which: a. $20,000 shall be due and payable within 30 days after the service date of this order; and b. up to $205,000 may be offset by the expenditures associated with installing a new closet large enough to fit a standard size folding wheelchair on Northwest's 27 Airbus A319 and A320 aircraft that are not required to comply with 14 CFR 382.21 (a)(2)5

By: Rosalind Knapp


Executive Airways, LLC

Order 04-03-28
OST-04-16943 - Violations of 49 U.S.C. 41101 and 41712

Issued and Served March 29, 2004

Consent Order

Companies engaged in air transportation are required to hold economic authority from the Department under 49 U.S.C. § 41101. A carrier may also operate small aircraft as an air taxi under the exemption authority of 14 CFR Part 298. Executive Airways is a charter company that operates its own small aircraft. However, it is not registered as an air taxi under 14 CFR Part 298. Thus, it does not have the economic authority itself to hold out or to provide air transportation, directly or indirectly. Executive Airways has nonetheless engaged in certain air carrier services. In this regard, since January 1, 2003, Executive Airways conducted various charter flights, either contracted by Raytheon Aircraft Management or by the company itself, and many "owner/operator" flights. Executive Airways' unlawful operations as an air carrier, in addition to violating the certificate requirements of Title 49, constitutes an unfair and deceptive trade practice and an unfair method of competition in violation of 49 U.S.C. § 41712. Executive Airways, LLC, is assessed $10,000 in compromise of civil penalties.

By: Rosalind Knapp


MM&S Airways, LLC

Order 04-03-29
OST-04-16943 - Violations of 49 U.S.C. 41101 and 41712

Issued and Served March 29, 2004

Consent Order

Companies engaged in air transportation are required to hold economic authority from the Department under 49 U.S.C. § 41101. A carrier may also operate small aircraft as an air taxi under the exemption authority of 14 CFR Part 298. MM&S Airways is a charter company that operates its own small aircraft. However, it is not registered as an air taxi under 14 CFR Part 298. Thus, it does not have the economic authority itself to hold out or to provide air transportation, directly or indirectly. MM&S Airways has nonetheless engaged in certain air carrier services. In this regard, since June 1, 2002, MM&S Airways conducted various air carrier charter flights, either contracted by Raytheon Aircraft Management or by the company itself, and many "owner/operator" flights. MM&S Airways' unlawful operations as an air carrier, in addition to violating the certificate requirements of Title 49, constitutes an unfair and deceptive trade practice and an unfair method of competition in violation of 49 U.S.C. § 41712. MM&S Airways, LLC, is assessed $20,000 in compromise of civil penalties that might otherwise be assessed for the violations.

By: Rosalind Knapp


Professional Airways, LLC

Order 04-03-30
OST-04-16943 - Violations of 49 U.S.C. 41101 and 41712

Issued and Served March 29, 2004

Consent Order

Companies engaged in air transportation are required to hold economic authority from the Department under 49 U.S.C. § 41101. A carrier may also operate small aircraft as an air taxi under the exemption authority of 14 CFR Part 298. Professional Airways is a charter company that operates its own small aircraft. However, it is not registered as an air taxi under 14 CFR Part 298. Thus, it does not have the economic authority itself to hold out or to provide air transportation, directly or indirectly. Professional Airways has nonetheless engaged in certain air carrier services. In this regard, since January 1, 2002, Professional Airways conducted various charter flights, either contracted by Raytheon Aircraft Management or by the company itself, and many "owner/operator" flights. Professional Airways' unlawful operations as an air carrier, in addition to violating the certificate requirements of Title 49, constitutes an unfair and deceptive trade practice and an unfair method of competition in violation of 49 U.S.C. § 41712. Professional Airways, LLC, is assessed $20,000 in compromise of civil penalties that might otherwise be assessed for the violations.

By: Rosalind Knapp


Continental Airlines, Inc.

Order 04-04-04
OST-04-16943 - Violations of 49 USC 41301 and 41712

Issued and Served April 2, 2004

Consent Order | Word

In response to the Enforcement Office’s concerns, Continental states that it thoroughly investigated the complaints in question.  Continental is convinced that its employees did not act in violation of the law and that the incidents at issue were not the result of discrimination or in any way indicative of a systemic problem in its workforce.  Continental firmly denies the allegations and conclusions of the Enforcement Office contained in this order and states that it has been and remains committed to its policy against discrimination.  According to Continental, it is a diverse company in its workforce and customer base and does not tolerate discrimination in any form.

By: Rosalind Knapp


Miami Air International, Inc.

Order 04-04-15
OST-04-16943 - Consent Orders

Issued and Served April 20, 2004

Consent Order | Word

This consent order concerns violations by Miami Air International, Inc. of 49 U.S.C. § 41712, which prohibits unfair and deceptive practices and unfair methods of competition. Miami Air entered into contracts with DB Air, Ltd., which in turn unlawfully engaged in air transportation as an indirect air carrier, without the requisite economic authority from the Department. The order directs Miami Air to cease and desist from future unlawful conduct and assesses the company $15,000 in compromise civil penalties.

By: Rosalind Knapp


ATA Airlines, Inc.

Order 04-04-22
OST-04-16943 - Violations of 14 CFR Part 382 and 49 USC 41702, 41705 and 41712

Issued and Served April 30, 2004

Consent Order

This order addresses the stowage of one passenger's standard-size folding wheelchair inside the cabin of ATA's Boeing 737s and Boeing 757s. It is the Enforcement Office's position that section 382.21 (a)(2) requires that new aircraft with at least 100 seats have priority space for the stowage of at least one standard-size folding wheelchair. Although ATA denies that, prior to this investigation, its aircraft did not contain enough space for the stowage of one passenger's folding wheelchair, after notification by the Enforcement Office of its concerns and the size requirements for a standard-sized folding wheelchair, ATA has agreed, until closets are installed, to create a tie down system that will be used in the bulkhead seating row. The Enforcement Office appreciates ATA's willingness to create a space to stow a passenger's standard-size folding wheelchair but views the carrier's failure initially to provide the proper accommodation under 14 CFR 382.21(a)(2) seriously. After careful consideration of all the facts surrounding this matter, including the explanation and arguments set forth by ATA, the Enforcement Office continues to believe that enforcement action is warranted. In order to avoid litigation on this matter and without admitting to a violation of the Air Carrier Access Act, ATA has agreed to settle these matters and enter into this consent order directing it to cease and desist from future similar violations and to the assessment of a civil penalty.

This order directs ATA to cease and desist from future violations of the ACAA, sections 41702 and 41712, and Part 382 and assesses a compromise civil penalty of $120,000 for such violations.

By: Rosalind Knapp


Traffic Management Corporation d/b/a TMC Airlines and Contract Cargo Airlines, Inc.

Order 04-05-01
OST-04-16943 - Violations of 49 U.S.C. §§ 41101 and 41712

Issued and Served May 3, 2004

Consent Order | Word

This consent order concerns unauthorized service by Traffic Management Corporation, d/b/a TMC Airlines and Contract Cargo Airlines, Inc., both of which performed operations as common carriers without the requisite economic authority from the Department. The order directs TMC and CCA to cease and desist from future unlawful conduct and assesses the companies $100,000 in compromise civil penalties.

TMC and CCA are commercial service operators who use large aircraft operated pursuant to 14 CFR Part 125. Authority under this Federal Aviation Administration (FAA) regulation, however, is strictly limited to private carriage operations. In commercial operations with large aircraft that are offered to the public, by contrast, a carrier would be operating in common carriage, and must hold economic authority from the Department under 49 U.S.C. § 41101. TMC and CCA have nonetheless performed significant common carriage service throughout their corporate existence. TMC’s and CCA’s unauthorized service as common carriers, in addition to violating the certificate requirements of Title 49, constitutes an unfair and deceptive trade practice and an unfair method of competition in violation of 49 U.S.C. § 41712.

By: Rosalind Knapp


Avia Aviation, Ltd.

Order 04-05-3
OST-04-16943 - Violations of 49 U.S.C. §§ 41301 and 41712

Served May 4, 2004

Consent Order | Word

This consent order concerns Avia Aviation, Ltd., a foreign air carrier within the meaning of 49 U.S.C. §40102(a)(21), that engaged in air transportation between the United States and Canada without effective economic authority from the U.S. Department of Transportation in violation of 49 U.S.C. §§ 41301 and 41712. This order directs Avia to cease and desist from further violations of these statutory provisions and to pay a compromise civil penalty of $30,000 (US).

The Office of Aviation Enforcement and Proceedings has carefully considered all of the information provided by Avia, but continues to believe that enforcement action is warranted. In this connection and in order to avoid litigation, the Enforcement Office and Avia have reached a settlement of this matter. Without admitting or denying the violations described above, Avia consents to the issuance of this order to cease and desist from future violations of 49 U.S.C. §§ 41301 and 41712 and to the assessment of $30,000 (US) in compromise of potential civil penalties otherwise assessable. Of this total penalty amount, $15,000 shall be due and payable within 30 days of the issuance of this order. The remaining $15,000 shall be suspended for one year following the issuance of this order, and then forgiven, unless Avia violates this order’s cease and desist or payment provisions, in which case the entire unpaid portion of this civil penalty shall become due and payable immediately and Avia may be subject to further enforcement action. The Enforcement Office believes this compromise is appropriate, serves the public interest, and creates an incentive for all foreign air carriers to comply fully with the requirements of 49 U.S.C. §§ 41301 and 41712.

By: Rosalind Knapp


Aer Lingus Limited

Order 04-05-09
OST-04-16943 - Violations of 49 U.S.C. § 41712 and 14 CFR Part 399

Issued and Served May 6, 2004

Consent Order | Word

This order concerns newspaper and Internet advertisements of Aer Lingus Limited that the Department believes violate 49 U.S.C. § 41712, which prohibits unfair and deceptive practices, and the advertising requirements specified in 14 CFR Part 399. This order directs Aer Lingus to cease and desist from future violations and assesses the carrier a compromise civil penalty.

Aer Lingus Limited is assessed a civil penalty of $20,000 in compromise of the civil penalties that might otherwise be assessed for the violations found in paragraphs 2 and 3 above. Of the assessed penalty, $10,000 shall be due and payable within 30 days of the issuance of this order. The remaining $10,000 shall be suspended for one year following the issuance of this order, and then forgiven unless, during this time, Aer Lingus Limited violates this order’s cease and desist or payment provisions, in which case the entire unpaid portion shall be due and payable immediately. Failure to pay the penalty as ordered will subject Aer Lingus Limited to the assessment of interest, penalty, and collection charges under the Debt Collection Act, and to possible enforcement action for failure to comply with this order; and payment of the civil penalty described above shall be made by wire transfer through the Federal Reserve Communications System, commonly known as “Fed wire,” to the account of the U.S. Treasury. The wire transfer shall be executed in accordance with the attached instructions.

By: Rosalind Knapp


Transmeridian Airlines, Inc.

Order 04-05-04
OST-04-16943 - Violations of 49 U.S.C. § 41708 and 14 CFR Part 241

Issued and Served May 6, 2004

Consent Order | Word

This consent order concerns reporting delinquencies that constitute violations of 49 U.S.C. § 41708 and the accounting and reporting requirements in Part 241 of the Department's regulations (14 CFR Part 241) by Transmeridian Airlines, Inc., a certificated air carrier which operates large aircraft. This order directs Transmeridian to cease and desist from future similar violations of Part 241 and the cited statutory provision and assesses the carrier $80,000 in compromise of civil penalties that might otherwise be assessed against the carrier for such violations.

Transmeridian Airlines, Inc. is assessed $80,000 in compromise of civil penalties that might otherwise be assessed for the violations found in ordering paragraphs 2 through 4 above, of which $40,000 shall be due and payable within 15 days after the service date of this order. The remaining $40,000 of the assessed penalty shall be suspended for one year following the service date of this order, and shall be forgiven, unless, during this time period, Transmeridian fails to comply with the payment provisions of this order or the cease and desist provisions of paragraph 5 above, during that period, in which case the entire unpaid portion of the assessed penalty shall become due and payable immediately and the carrier may be subject to further enforcement action

By: Rosalind Knapp


Brendan Airways, LLC d/b/a USA3000 Airlines

Order 04-05-12
OST-04-16943 - Violations of 49 USC 41712 and 14 CFR Part 399

Issued and Served May 13, 2004

Consent Order

As an air carrier, USA3000 is subject to the advertising requirements of Part 399. To ensure that consumers are not deceived and are given accurate and complete fare information on which to base their airline travel plans, section 399.84 requires that fare advertisements by carriers or their agents state the full price to be charged the consumer. Under long-standing enforcement case precedent, the Department has allowed taxes and fees collected by carriers and other sellers of air transportation, such as passenger facility charges and departure taxes, to be stated separately from the base fare in advertisements, so long as the charges are approved or levied by a government entity, are not ad valorem in nature, are collected on a per-passenger basis, and their existence and amount are clearly indicated in the advertisement so that the consumer can determine the full fare to be paid. However, additional carrier-imposed fees and charges, including fuel surcharges, must be included in the advertised base fare. Advertisements that do not include carrier-imposed fees and charges in the advertised base fare, such as those of USA3000 described above, do not comply with section 399.84 or the Department's enforcement case precedent and constitute an unfair and deceptive trade practice in violation of 49 U.S.C. § 41712.

In mitigation, USA3000 maintains that it did not intend to violate the Department's advertising regulations. The carrier states that, prior to inquiry by the Department, it caught and corrected the problem. It first stopped separating its fuel surcharge from the base fares in its newspaper advertisements. Next, at a considerable administrative cost, USA3000 voluntarily refunded fuel surcharges of approximately $83,000 to all of the consumers who had purchased tickets during the approximately two week period that the surcharge was in effect. In addition, the carrier points out that, at all times in this matter, it has exhibited a cooperative and compliant attitude and has sought advice from the Department to ensure that its future operations comply with the Department's advertising requirements.

By: Rosalind Knapp


Premier Aircraft Management, Inc.

Order 04-05-11
OST-04-16943 - Violations of 49 U.S.C. §§ 41301, 41703, and 41712 and 14 CFR Part 375

Issued and Served May 13, 2004

Consent Order | Word

Since it began operations in 1999 with a "VIP‑configured" Boeing 737‑300, PAMI has entered into contracts for air transportation with a significant number of diverse entities, including numerous air charter brokers that hold out air transportation services to the public. Pursuant to some of these contracts, the carrier has transported for compensation a significant number of passengers between points wholly within the United States and, in a smaller number of instances, between points in the United States and points outside of the United States. While conducting these operations, a majority of PAMI's officers and directors were not U.S. citizens, thus making PAMI a non‑U.S. citizen under 49 U.S.C. § 40102(a)(15) for Departmental licensing purposes and the aircraft it operates a foreign civil aircraft under Part 3759.

Premier Aircraft Management, Inc., is assessed $175,000 in compromise of civil penalties that might otherwise be assessed for the violations described in ordering paragraphs 2, 3, and 4, above. Of this total penalty amount, $45,000 is due and payable within 30 days of the date of issuance of this order and $42,500 is due and payable on August 1, 2004. The remaining $87,500 shall be suspended for two years following the issuance of this order, and then forgiven.

By: Rosalind Knapp


Universal Airlines, Inc.

Order 04-06-15
OST-04-16943 - Violations of 49 USC 41101 and 41712

Issued and Served June 18, 2004

Consent Order

This consent order concerns unauthorized service by Universal Airlines, Inc., which performed operations as a common carrier without the requisite economic authority from the Department. This order directs Universal to cease and desist from such future unlawful conduct and assesses the company $10,000 in compromise civil penalties.

Since Universal began operations under Part 125, the carrier has entered into multiple contracts with various companies and their agents, including several air charter brokers, some of which appear to hold out air transportation themselves indirectly to the public. In looking at Universal's recent history, the carrier has entered into long term written contracts with automotive manufacturing companies, through those companies' charter managers. However, Universal has flown flights for various entities that were not contracted for by these automotive companies. Universal obtained the "spot" contracts for these flights by actively bidding on charter flights offered by brokers and charter management companies, and, as a result, operated numerous flights for different shippers in a range of industries.

By: Rosalind Knapp


Delta Air Lines, Inc.

Order 04-06-13
OST-04-16943 - Compliance with 49 U.S.C. §§ 40127

Issued and Served June 21, 2004

Consent Order

This order closes an investigation into Delta Air Lines, Inc.’s compliance with Federal statutes prohibiting air carriers from subjecting any air traveler to discrimination on the basis of race, color, national origin, religion, sex or ancestry. The consent order directs Delta to cease and desist from future violations and to provide civil rights training to its pilots, flight attendants, and passenger service agents (PSAs), and settles all pending matters arising out of or relating to incidents where Delta was alleged to have removed from a flight or failed to board a passenger on the basis of the passenger’s race, color, national origin, sex, ancestry, or religion .

The Enforcement Office has carefully considered all the information provided by Delta, but continues to believe that enforcement action is warranted. In order to avoid litigation, the Enforcement Office and Delta have reached a settlement of this matter. Without admitting that any violation of the law occurred, Delta consents to the issuance of this order to cease and desist from future violations of 49 U.S.C. §§ 40127, 41310, 41702, and 41712 and to provide civil rights training to its pilots, flight attendants, and its passenger service agents. The Enforcement Office believes that this settlement is appropriate and serves the public interest and creates an incentive for all carriers to comply fully with the civil rights laws enforced by the Department of Transportation.

By: Rosalind Knapp


MSG Flight Operations, LLC

Order 04-07-03
OST-04-16943 - Violations of 49 U.S.C. §§ 41101and 41712

Issued and Served July 6, 2004

Consent Order

In August 2002, MSGFO began service using a Boeing 737‑400 to carry the New York Knicks and New York Rangers, which are divisions of MSGFO's parent company, Madison Square Garden, L.P. MSGFO states that it neither advertised nor directly solicited business. Since August 2002, however, a portion of MSGFO's service has been pursuant to contracts with other sports and entertainment entities. On certain occasions, MSGFO's operations were in response to requests by air charter brokers and agents representing members of the public. In other instances, MSGFO responded directly to requests for air transportation services from the ultimate customer.

It is the Enforcement Office's position that, even assuming that the carrier did not actively solicit business, its objective conduct involved the provision of air transportation to a significant number of diverse entities and, by doing so, it engaged in a course of conduct evincing a willingness to serve members of the general public indiscriminately. In effect, MSGFO gained a reputation for a willingness to provide transportation by air to at least a class or segment of the public while operating without an effective certificate issued under 49 U.S.C. § 41101. So well-established was MSGFO's reputation that the carrier was on several occasions approached by brokers who specialize in arranging air transportation services for members of the public. Therefore, the Enforcement Office believes that MSGFO has held out and engaged in common carriage without appropriate economic authority.

In order to avoid litigation and without admitting or denying the alleged violations, agrees to the issuance of this order to cease and desist from future violations of 49 U.S.C. § 41101 and 41712 by engaging in common carriage directly or indirectly, and to an assessment of $30,000 in compromise of potential civil penalties.

By: Rosalind Knapp


AAA Washington/Inland

Oder 04-08-2
OST-04-16943 - Violations of 49 USC 41712 and 14 CFR 399.84

Issued and Served August 6, 2004

Consent Order

Between January 25, 2004, and March 17, 2004, AAA ran a series of advertisements in the Seattle Times in which it failed to properly disclose taxes and fees that were in addition to the advertised base air fares. Specifically, AAA advertised vacation package tours, including airfare to Hawaiian and foreign destinations, with promotional prices subject to terms disclosed in the fine print of the advertisements stating, “Gov’t misc. fees/taxes and excursions not included.” The advertisements failed to state the amount of the taxes and failed to properly identify the September 11th Security Fee, which was excluded from the advertised base fare. As noted above, advertisements that include only general statements that do not allow consumers to calculate the entire price to be paid violate 14 CFR 399.84 and 49 U.S.C. § 41712 and advertisements that do not properly identify the September 11th Security Fee when it is excluded from the advertised base fare violate 49 U.S.C § 41712.

The order directs AAA to cease and desist from further violations and assesses the company $10,000 in civil penalties for the violations.

By: Rosalind Knapp


Frontier Airlines, Inc.

Order 04-08-07
OST-04-16943 - Violations of 14 CFR 201.5 and 49 USC 41712

Issued and Served August 11, 2004

Consent Order

This consent order concerns Frontier Airlines' advertisement and sale of proposed new service to Cancun prior to obtaining the requisite economic authority from the Department. The order assesses a compromise civil penalty of $35,000 and directs the carrier to cease and desist from further violations.

On April 1, 2004, Frontier applied for authority under 49 U.S.C. § 41101 to operate nonstop service to Cancun from St. Louis, Kansas City and Salt Lake City. The carrier issued a press release describing the service at the time it made its filings with the Department and indicated that consumers interested in making reservations should contact the carrier. The service, which was to begin in July, also appeared on the carrier's website, where reservations could be booked prior to the Department's approval of the requested authority.

Applications were filed in the following dockets: OST 04-17470 for St. Louis-Cancun; OST-04-17467 for Salt Lake City-Cancun; and OST-04-17466 for Kansas City-Cancun. The carrier thereafter withdrew its application for the St. Louis authority. Its applications for Kansas City and Salt Lake City authority were granted on May 11, 2004.

  • OST-04-18692 - 2004 US-Mexico Combination Service Proceeding

By: Rosalind Knapp


Ameristar Airways, Inc.

Order 04-08-9
OST-04-16943 - Violation of 49 USC 41101 and 41712

Issued and Served August 12, 2004

Consent Order

This consent order concerns unauthorized service by Ameristar Airways, Inc., which performed operations as a common carrier without the requisite economic authority from the Department. It directs Ameristar Airways to cease and desist from such future unlawful conduct and assesses a compromise civil penalty of $70,000.

Since it began operations in late 2002 with three DC‑9 aircraft under its Part 125 certificate, Ameristar Airways has entered into contracts with various companies, including air charter brokers who appear to hold out air transportation indirectly to the general public. Moreover, Ameristar Airways has actively bid on charter flights offered by these brokers, and, as a result, operated flights for shippers in different industries. In many cases, employees of Ameristar Jet Charter, an affiliated company and certificated Part 135 operator, placed these bids on behalf of Ameristar Airways. Additionally, Ameristar Jet Charter provided Ameristar Airways with a significant portion of its administrative, maintenance, and operational support, a situation that the Office of Aviation Enforcement and Proceedings (Enforcement Office) contends resulted in the two entities, in effect, operating as one.

By: Rosalind Knapp


Calypso Airline, Inc.

Order 04-08-10
OST-04-16943 - Violations of 49 USC 41101 and 41712

Issued and Served August 12, 2004

Consent Order

This consent order concerns unauthorized air carrier operations by Calypso Airline, Inc. (Calypso) which engaged in air transportation without the requisite economic authority from the Department. It directs Calypso to cease and desist from such future unlawful conduct and assesses the company $60,000 in compromise civil penalties.

Calypso was the lessee of two Cessna 402 aircraft, both of which were placed on the FAA Part 135 operations specifications and DOT air taxi registration of another operator. However, Calypso marketed in its own name air transportation using these aircraft on its Internet web site and in advertisements placed in various periodicals.  Moreover, Calypso actually operated the flights that it marketed using its own pilots. Thus, the placement of the aircraft on the licensed air carrier's operating certificate appears to have been one of mere convenience. It is clear that at no time in this matter did Calypso act as an agent of the certificate holder or of any other licensed carrier. Rather, acting deceptively under the imprimatur of another company's certificate, Calypso held out and engaged in air transportation without appropriate economic authority and thereby also engaged in an unfair and deceptive practice and unfair method of competition.

By: Rosalind Knapp


America West Airlines, Inc.

Order 04-08-19
OST-04-16943 - Violations of 14 CFR Part 382 and 49 U.S.C. §§ 41310, 41702, 41705 and 41712

Issued and Served August 18, 2004

Consent Order | Word

This order directs America West to cease and desist from future violations of Part 382 and the cited statutory provisions and assesses the carrier $850,000 in compromise civil penalties for such violations.

A number of complaints appear to reflect a material failure on the part of the carrier in meeting the requirements of section 382.39, including instances of failure to provide wheelchair assistance entirely, prolonged delays in obtaining wheelchair assistance, and stranding individuals alone in wheelchairs in the terminal or on board an aircraft for extended periods of time. In addition, America West's complaint files indicated that in a number of instances it did not provide a written response to the complainant fully compliant with the requirements of section 382.65, which requires that the carrier must provide a "dispositive response" with respect to each complaint postmarked within 45 days of the complained of incident. An appropriate response must specifically discuss the complaint at issue, state the carrier's view of whether a violation occurred, and provide an explanation of the carrier's view if it believes no violation occurred or what corrective action was taken if a violation is admitted. The response must also state that the complainant may refer the matter to the Department.

By: Rosalind Knapp


OST-2004-16943 - Violations of 14 CFR Part 382 and 49 U.S.C. §§ 41310, 41702, 41705 and 41712

August 5, 2005

Motion to Amend Consent Order | Word

America West Airlines, Inc. moves to amend, America West, Order No. 04-08-19, Docket 04-16943-30 issued by the U.S. Department of Transportation.  In the Consent Order, America West was assessed a civil penalty of $850,000 in compromise of civil penalties that might have otherwise been assessed for violations involving enplaning, deplaning, and connecting assistance.  America West was to make over $775,000 in offsetting improvements to its corporate programs serving customers with disabilities and to pay the U.S. Treasury $75,000.  Of the amount to be paid to the U.S. Treasury, America West was required to pay $37,500 no later than September 16, 2004, which it did, and is required to pay the remaining $37,500 no later than September 16, 2005.  America West respectfully submits this motion to amend the Consent Order to reduce the civil penalty amount required to be paid on September 16, 2005, and to increase the amount offset against the assessed civil penalty.

Counsel: America West, Michelle Matheson, 480-693-5808


Order 2005-11-5
OST-2004-16943
- Violations of 49 USC 41301 and 41712

Issued and Served November 2, 2005

Order | Word

After reviewing America West’s motion, we have determined that, in this specific case, as long as additional conditions are met granting America West’s motion to amend would best the public’s interest by enhancing the quality of service air passengers with disabilities receive. Therefore, we grant the motion to modify Order 2004-8-19 by reducing the amount due and payable to the U.S. Treasury on September 16, 2005 by $15,000 and require as an additional offset video production and increased employee training at a cost of $50,000 on the condition that America West submits a sworn and certified statement from an appropriate company official demonstrating that the $50,000 was properly expended. Such documentation must be submitted to the Enforcement office, the Inspector General’s Office, and the Office of Aviation and International Affairs, and is subject to review or audit by those offices.

By: Michael Reynolds


Frontier Airlines, Inc.

Order 04-08-20
OST-04-16943 - Violations of 49 U.S.C. § 41712 and 14 CFR Part 212

Issued and Served August 18, 2004

Consent Order

Blue Moon engaged in significant indirect air carrier service pursuant to an "aircraft management and charter services agreement" with Frontier, requiring, among other things, that Frontier place Blue Moon's aircraft on its Part 121 Operating Certificate and operate it exclusively for charter flights "arranged and sponsored by" Blue Moon.

Pursuant to its arrangement with Frontier, Blue Moon held out air transportation in its own right and not as an agent of Frontier or any other properly certificated entity through direct solicitation. Blue Moon also held out in its own right on its Internet website, which invited potential customers to request quotes for charters aboard an A‑319 that it claimed to operate. Blue Moon's efforts resulted in the procurement of a number of contracts for air transportation, ranging from single flights to operations over an entire professional sports season, into which Blue Moon entered as a principal, despite its lack of economic authority.

Frontier Airlines, Inc., is assessed $30,000 in compromise of civil penalties that might otherwise be assessed for the violations described in ordering paragraphs 2, 3, and 4, above. Of this total penalty amount, $15,000 shall be due and payable within 30 days of the issuance of this order.

By: Rosalind Knapp


Falcon Air Charter, Inc.

Order 04-09-1
OST-04-16943
- Violations of 49 U.S.C. §§ 41101 and 41712

Issued and Served September 1, 2004

Consent Order | Word

This consent order concerns unauthorized air carrier operations by Falcon Air Charter, Inc. which engaged in air transportation without the requisite economic authority from the Department. It directs Falcon to cease and desist from such future unlawful conduct and assesses the company $50,000 in compromise civil penalties.

By: Rosalind Knapp


Red Apple Aviation, Inc.

Order 04-10-14
OST-04-16943 - Violations of 49 USC 41101 and 41712

Issued and Served October 22, 2004

Consent Order

Red Apple leases a Boeing 727-200 from 727 Exec-Jet, LLC, a company also owned by the owner of Red Apple. Red Apple conducted its first revenue flight in May 2002. Initially the owner of Red Apple planned to use the aircraft in connection with his various businesses under 14 CFR Part 91 and to operate private carriage flights under Part 125. However, in addition to its Part 91 operations the carrier began providing air transportation to a number of collegiate and professional sports teams and other nonsports related businesses. In some of these instances, Red Apple’s service, which ranged from single flights to extended multiple operations, was provided pursuant to contracts with air charter brokers, who may have been themselves holding out air transportation services to the public.

By: Rosalind Knapp


Alaska Airlines, Inc. and Horizon Air, Inc.

Order 04-10-19
OST-04-16943 - Violations of 49 U.S.C. § 41712 and 14 CFR Part 399

Issued and Served October 29, 2004

Consent Order

The body of the Alaska/Horizon advertisements in question fails to state prominently and in close proximity to the advertised fare that the fare is an eachway fare restricted to purchases of round‑trip tickets. Accordingly, these advertisements violate section 399.84. Any violation of 14 CFR 399.84 also constitutes an unfair and deceptive practice and unfair method of competition in violation of 49 U.S.C. § 41712.

$30,000 in compromise of civil penalties that might otherwise be assessed for the violations. Of this total penalty amount, $15,000 shall be due and payable within 15 days of the issuance of this order.

By: Rosalind Knapp


Ferreteria E Implementos San Francisco

Order 2004-10-18
OST-04-16943 - Violations of 49 USC 41101 and 41712

Issued and Served October 29, 2004

Consent Order

Ferreteria maintains that since it obtained its Part 125 operating authority it has conducted its operations with the full knowledge of the FAA, which agency, according to the carrier, never questioned whether Ferreteria was operating within the boundaries of Part 125. Thus, Ferreteria believed that, in the absence of any objections by the FAA as to the nature and scope of its operations, it was operating in a fully compliant manner. Ferreteria also states that it believed, in good faith, that it was operating within the confines of Part 125 by limiting almost all of its recent operations to serving the specialized needs of the automotive and oil drilling equipment sectors of the United States' economy, whose shipping needs, it avers, could not necessarily have been satisfied by other providers of air transportation.

Assessed $20,000 in compromise of civil penalties that might otherwise be assessed for the violations described in ordering paragraphs 2 and 3 above. Of this total penalty amount, $10,000 shall be due and payable within 30 days of the issuance of this order.

By: Rosalind Knapp


Blue Moon Aviation, LLC

Order 04-11-04
OST-04-16943 - Violations of 49 U.S.C. §§ 41101 and 41712

Issued and Served November 12, 2004

Consent Order | Word

Blue Moon is the lessee of an Airbus 319 aircraft, but has no economic authority itself to hold out or to provide, directly or indirectly, air transportation using this or any other aircraft.  Nevertheless, from its inception in December 2003 until May 2004, Blue Moon engaged in significant indirect air carrier service pursuant to an “aircraft management and charter services agreement” with Frontier Airlines, Inc., requiring, among other things, that Frontier place Blue Moon’s aircraft on its Part 121 Operating Certificate and operate it exclusively for charter flights “arranged and sponsored by” Blue Moon.  The agreement also required Frontier to provide flight crews and flight dispatch services in exchange for a monthly management fee and reimbursement of all direct costs, while granting Blue Moon total authority over the use of the aircraft, as well as sole responsibility for soliciting, marketing, and scheduling of any single entity charter business using the aircraft, and for invoicing and collecting monies associated with those charters.  In addition, under the agreement, Blue Moon was responsible for procuring substitute service if the A-319 was unavailable and for arranging and paying for, either directly or through reimbursement to Frontier, all air operating services associated with the use of the aircraft (other than the dispatch and provision of the crew),  including fuel, catering, and ground handling services, and airport fees.

Blue Moon, agrees to the issuance of this order to cease and desist from future violations of 49 U.S.C. §§ 41101 and 41712 by engaging in air transportation directly or indirectly and to the assessment of $60,000 in compromise of potential civil penalties otherwise assessable.  Of this total penalty amount, $30,000 shall be paid under the terms described below.  The remaining $30,000 shall be suspended for one year and then forgiven, unless Blue Moon violates this order’s cease and desist or payment provisions, in which case the entire unpaid amount shall become due and payable immediately and Blue Moon may be subject to further enforcement action.

By: Rosalind Knapp

Order 2004-8-20 - Frontier Airlines - Related Consent Order


Tatonduk Outfitters Limited d/b/a Everts Air Alaska and Everts Air Cargo

Order 04-12-12
OST-04-16943 - Violations of 49 U.S.C. § 41708 and 14 CFR Part 241

Issued and Served December 16, 2004

Consent Order | Word

This consent order concerns alleged reporting failures, in particular repeated submission to the Department of incomplete and inaccurate data, by Tatonduk Outfitters Limited d/b/a Everts Air Alaska and Everts Air Cargo, that constitute violations of 49 U.S.C. § 41708, and the reporting requirements specified in 14 CFR Part 241. This order directs Tatonduk to cease and desist from future violations, and assesses a compromise civil penalty of $40,000.

By: Rosalind Knapp


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