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Kornitzky Group, LLC v. Elwell

United States Court of Appeals, District of Columbia Circuit

July 12, 2019

Kornitzky Group, LLC, d/b/a AeroBearings, LLC, Petitioner
v.
Daniel K. Elwell, Acting Administrator, Federal Aviation Administration and National Transportation Safety Board, Respondents

          Argued January 11, 2019

          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.

          Before: Srinivasan, Circuit Judge, and Edwards and Randolph, Senior Circuit Judges.

          OPINION

          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.

         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.

         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 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 ...


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