[00:00:01] Speaker 03:
All right, let's get started.

[00:00:03] Speaker 03:
Our first case is Wright-Smith versus FAA 23-9608.

[00:00:09] Speaker 03:
And for the appellant, Ms.

[00:00:13] Speaker 03:
Schor, you may proceed.

[00:00:16] Speaker 00:
Yes, good morning, Your Honors.

[00:00:17] Speaker 00:
Sarah Schor on behalf of Petitioner Elizabeth Wright-Smith, and may it please the Court.

[00:00:26] Speaker 00:
Where an individual has no procedural rights or protections,

[00:00:30] Speaker 00:
Apart from those which an agency creates through its own regulations, scrupulous compliance with those regulations is required to avoid injustice.

[00:00:41] Speaker 00:
Here petitioner Elizabeth Wright-Smith's designation as a pilot examiner for the FAA was unjustly terminated when the FAA did not comply with the procedural protections required by its own orders.

[00:00:55] Speaker 00:
The FAA relies on designees to test and examine pilots.

[00:00:59] Speaker 00:
My client and others like her earn a substantial portion of their livelihood through their designation.

[00:01:04] Speaker 00:
Thus, although the FAA has statutory discretion to grant and revoke designations for any reason, the administrator has enacted procedural protections for designees, including thorough and documented investigations, notice of the specific reasons for termination, and an administrative appeal to an impartial panel.

[00:01:26] Speaker 00:
The government's interpretation of these FAA orders in this case reduces them to a guessing game for designees, which is an absurd and unjust result that the court should reject.

[00:01:37] Speaker 00:
Instead, the court should hold that the FAA intended to enact meaningful procedural protections and that it failed to provide them to my client.

[00:01:46] Speaker 04:
So if your client had received all of the procedural protections to which you claim she was entitled, would there be anything we could do for you?

[00:02:00] Speaker 00:
I believe that this court's jurisdiction is limited to evaluating whether the FAA followed its own procedures.

[00:02:07] Speaker 04:
OK.

[00:02:07] Speaker 04:
So even if we thought that the FAA's decision was not supported by the evidence, that their record was terrible, as long as they went through all the steps and gave your client the procedures, then you'd lose.

[00:02:26] Speaker 00:
As long as they scrupulously complied with them.

[00:02:28] Speaker 04:
Right.

[00:02:29] Speaker 04:
OK.

[00:02:32] Speaker 00:
As the court knows, my client's designation was terminated based on an anonymous hotline complaint in subsequent investigation.

[00:02:40] Speaker 00:
She never received a written copy of the complaint or any information about the investigation, including the investigation results report, until this appeal.

[00:02:48] Speaker 01:
Was it read to her word by word?

[00:02:50] Speaker 00:
It was read to her.

[00:02:52] Speaker 00:
I'm not actually sure.

[00:02:54] Speaker 00:
I believe it was read to her, but the repair station was not disclosed.

[00:02:59] Speaker 00:
It was read to her one time initially at the outset of the investigation without identifying the repair station, which is why in her administrative appeal my client included affidavits from both repair stations in town.

[00:03:12] Speaker 00:
She did ask three times, once verbally and twice in writing, for more information about her termination in the investigation, and she did not receive any even though they were not confidential.

[00:03:26] Speaker 00:
The termination notice to my client, the form has a sort of multiple choice section.

[00:03:33] Speaker 00:
And the FAA selected lack of integrity, misconduct, and inability to work with the FAA in those sections.

[00:03:40] Speaker 00:
For some reason, it did not check the box for a result of investigation, nor did it say the type of investigation.

[00:03:47] Speaker 00:
Then there is a box that says justification.

[00:03:50] Speaker 00:
And that section of the form is mandatory.

[00:03:53] Speaker 00:
And of course, what is a justification except

[00:03:56] Speaker 00:
an explanation or facts and support.

[00:03:59] Speaker 00:
But instead of including anything substantial in that portion of the forum that would have alerted my client to what mattered to the government, the FAA simply stated that during July 2023, a hotline complaint was received, and after a comprehensive investigation, it was substantiated.

[00:04:16] Speaker 00:
That's it.

[00:04:18] Speaker 00:
It then invited her to file an administrative appeal and to submit any and all evidence and statements that she wished to have considered.

[00:04:27] Speaker 04:
So at that point, what do you think should have happened differently?

[00:04:32] Speaker 04:
So are we OK through all the box checking and the brief justification, or do you contend that that was insufficient?

[00:04:44] Speaker 00:
I contend that that was insufficient.

[00:04:46] Speaker 00:
In the justification box, the FAA was called on to actually state the specific reasons for her termination, not just characterizations like lack of integrity.

[00:04:56] Speaker 00:
And actually, the fact that the way the FAA filled out this form is a violation of the requirement is illustrated by the fact that there's a box that the FAA could have checked that would have said result of investigation.

[00:05:10] Speaker 00:
Well, obviously, the FAA doesn't mean to ask for redundant information.

[00:05:14] Speaker 00:
The justification box has to have something other than result of investigation.

[00:05:19] Speaker 00:
And this is just a principle of offering any kind of notice and opportunity to be heard.

[00:05:24] Speaker 00:
in any, you know, termination of someone's vocation, revocation of a license, the idea is that the person gets some kind of notice of what they have done wrong.

[00:05:34] Speaker 04:
So what should, I mean, tell me if this would have been enough, if in the justification box it would have said during July 2023 we received a complaint, the complainant said that the

[00:05:49] Speaker 04:
that the examiner went to a repair shop and pressured them not to do work on other balloonists' balloons.

[00:05:56] Speaker 04:
We interviewed the repair shop, and the complaint was substantiated.

[00:06:03] Speaker 00:
That would have been quite a bit better, yes, particularly if they had said which repair shop it was, so that my client knew the incident that they were talking about.

[00:06:12] Speaker 00:
I mean, the complaint was very thin on who, what, when, where, why.

[00:06:15] Speaker 00:
It doesn't say when the incident happened,

[00:06:17] Speaker 00:
When it was read to my client, I didn't say who was involved.

[00:06:20] Speaker 00:
And the DC Circuit in Masoleski recognized that when the specific charges are not conveyed to a person on administrative appeal, their efforts are inevitably misdirected.

[00:06:31] Speaker 00:
They talk about a bunch of things that are irrelevant.

[00:06:33] Speaker 00:
They include information that was not necessary.

[00:06:35] Speaker 00:
They can't advocate for themselves in a pointed way, which they're entitled to do.

[00:06:39] Speaker 04:
Right.

[00:06:39] Speaker 04:
So other than what I just read to you, which would be very short still, I mean, what do you contend the duty of the FAA was at that point to get us through the first decision before you have an appeal?

[00:06:53] Speaker 04:
What did they have to do?

[00:06:55] Speaker 04:
What did they have to give you specifically?

[00:06:58] Speaker 00:
They had to give my client the reasons that they believed had concluded that she lacked integrity, that she had committed misconduct,

[00:07:08] Speaker 00:
and that she had not worked cooperatively with the FAA or the public.

[00:07:12] Speaker 00:
Those are the things they said.

[00:07:13] Speaker 00:
she generally did wrong.

[00:07:15] Speaker 00:
So they should have given her the specifics, the particulars.

[00:07:17] Speaker 04:
OK, so they would have needed to, could they have done that in narrative form in this box?

[00:07:22] Speaker 00:
Yes.

[00:07:23] Speaker 00:
In fact, that's what the box called for.

[00:07:24] Speaker 00:
And what's notable is that in other precedents, for instance Bradshaw or Shovel, the notice, it was not that long, but it went point by point.

[00:07:33] Speaker 00:
And Bradshaw said, here are the three ways that when you did a pilot instrument rating test, you did not follow FAA procedure.

[00:07:41] Speaker 00:
In Shebel, similarly, the notice made five points about the ways the designee did not do what he should have done.

[00:07:48] Speaker 00:
And that's what was necessary in this case.

[00:07:50] Speaker 00:
Now, the government contains that it was not prejudicial for the FAA not to have given my client the specific reasons for her termination, because the government claims that the appeal panel did not have jurisdiction to review anything other than the termination process, that it did

[00:08:08] Speaker 00:
it did not actually have jurisdiction to consider the decision itself.

[00:08:13] Speaker 00:
Now, I concede that the designee management policy states that the panel review process is intended to review the termination process.

[00:08:24] Speaker 00:
However, that language is not mandatory.

[00:08:26] Speaker 00:
And in the same chapter, it gives the panel review unfettered discretion to reverse the decision.

[00:08:32] Speaker 00:
And it also says that the designee is to include

[00:08:35] Speaker 00:
all the evidence in support of their case in their administrative appeal.

[00:08:39] Speaker 00:
And if you look at pages 18 and 19 of the administrative record, the notice to my client actually told her, you should submit all evidence and statements for our consideration in your administrative appeal.

[00:08:53] Speaker 00:
Well, the FAA can't invite a designee to submit all of the evidence in support of their case for the first time and then tell them that actually none of that evidence is going to be considered.

[00:09:03] Speaker 00:
That's precisely the sort of injustice that this court has jurisdiction to avoid.

[00:09:08] Speaker 01:
And in this case... Can I ask you on the prejudice point?

[00:09:12] Speaker 01:
Yes.

[00:09:13] Speaker 01:
It's not like it was a big mystery with Shaw, because if indeed the anonymous complaint was read to her line by line, there's the reference to the repair center, ERCO, run by David and Jared,

[00:09:26] Speaker 01:
Mr. Eichhorn and Mr. Scoot, or however you say that name.

[00:09:31] Speaker 01:
And so she's on notice that that's where the problem arose.

[00:09:37] Speaker 01:
And in a very thorough and professional and A-plus affidavit, she laid out her counter to those charges and even solicited affidavits from both of those individuals saying nothing bad happened here, basically, as well as

[00:09:55] Speaker 01:
a host of other letters and materials.

[00:09:59] Speaker 01:
So she did address and take on the anonymous complaint with her own evidence and good evidence.

[00:10:07] Speaker 01:
And so I'm struggling a little bit to see how is there any prejudice if there was a procedural irregularity or deficiency.

[00:10:19] Speaker 00:
Yes, Your Honor.

[00:10:19] Speaker 01:
What would have been different?

[00:10:21] Speaker 00:
Well, first, my client knew nothing about what unfolded in this investigation.

[00:10:26] Speaker 00:
And the complaint also says things like that my client threatened the business not to fix the balloons of Brittany Campbell or anyone else she hates if they know what's good for them.

[00:10:41] Speaker 00:
I mean, what does that even mean?

[00:10:42] Speaker 00:
Do they think my client said that?

[00:10:44] Speaker 00:
What does anyone else she hates mean?

[00:10:46] Speaker 00:
What did they uncover in the investigation?

[00:10:48] Speaker 00:
Who did they talk to?

[00:10:50] Speaker 00:
You know, my client had a right to a basic understanding of what unfolded in this investigation, especially since the complaint was blatant hearsay.

[00:10:58] Speaker 00:
And she didn't, she wasn't confident which repair station was at issue.

[00:11:01] Speaker 00:
That's why she included an affidavit from both of them.

[00:11:05] Speaker 01:
But it says David and Jared.

[00:11:08] Speaker 00:
I don't believe when it was read to her they identified who the repair station or who

[00:11:15] Speaker 00:
those individuals by name.

[00:11:17] Speaker 01:
What she says is, in her affidavit, I've received, all I've received, the only information I've received is a verbal reading of a hotline complaint against me, which I assume means this, and it's not that long, and it says, Erco and David and Jared.

[00:11:34] Speaker 01:
So, and for some reason she went there and she asked them for an affidavit saying, no, I didn't do this.

[00:11:41] Speaker 01:
So that suggests that she had an understanding

[00:11:44] Speaker 01:
That's the real nub of this.

[00:11:47] Speaker 00:
Certainly, there are only two repair stations in town.

[00:11:51] Speaker 00:
She went to them because she thought that was probably the conversation that was at issue.

[00:11:55] Speaker 00:
But the point made in Masoleski is that a person is entitled to know exactly what the problem is.

[00:12:01] Speaker 00:
This isn't supposed to be a guessing game.

[00:12:03] Speaker 00:
And they're not supposed to guess at how the complaint was substantiated or why the FAA believes that these characterizations are appropriate.

[00:12:11] Speaker 01:
I would get your point if she had addressed the wrong repair shop.

[00:12:15] Speaker 01:
She'd guessed wrong.

[00:12:17] Speaker 01:
But I don't see where there's prejudice in getting extra information from another repair shop saying that she's good.

[00:12:23] Speaker 01:
That would seem to be in her favor, and she would do that even if she knew that it was Jared and David, as the anonymous complaint said.

[00:12:32] Speaker 00:
But the other problem with this, Your Honor, is that the court in Masoleski

[00:12:37] Speaker 00:
recognizes that misdirecting your efforts in an administrative appeal is prejudicial.

[00:12:41] Speaker 00:
The only thing that's required is that it's other than harmless.

[00:12:44] Speaker 00:
My client spent a great deal of time trying to understand if the FAA was referring to these parenthetical examples about misconduct, about lack of integrity.

[00:12:54] Speaker 00:
And furthermore, I just want to add that the absence of written statements from SCUT and IHORN that the FAA was aware of also would have made a difference to the appeal panel.

[00:13:06] Speaker 00:
The gist of this was that my client was somehow intimidating these witnesses.

[00:13:10] Speaker 01:
Do you feel panel could have asked for those and did not?

[00:13:14] Speaker 00:
Well, I don't think the FAA gets to not collect written statements, not include them in the record, and then say that they were available.

[00:13:20] Speaker 00:
There's no evidence that they were available.

[00:13:22] Speaker 01:
You're saying if the panel would have had these, it may have made a difference.

[00:13:25] Speaker 01:
My retort is simply that if it wanted that information, if it felt it didn't have enough information already, it could have asked for them.

[00:13:32] Speaker 00:
And my point, Your Honor, is that I don't think there's any evidence that was available to them.

[00:13:36] Speaker 00:
It wasn't included in the investigation report.

[00:13:38] Speaker 00:
Those statements are nowhere in the administrative record.

[00:13:41] Speaker 01:
Back to prejudice, if we even left that.

[00:13:44] Speaker 01:
I understand the point.

[00:13:46] Speaker 01:
I would understand a point.

[00:13:49] Speaker 01:
We didn't know what the charges were.

[00:13:50] Speaker 01:
We spent all of this time on these other things that weren't even at issue.

[00:13:53] Speaker 01:
And therefore, we didn't address the concerns that the investigation raised, because we were off on other things wondering if that's what it is.

[00:14:05] Speaker 01:
But we really don't have this unless you tell me some way in which her response on Jared and David was hampered by having to spend time on this other repair shop, which helped her, I would think.

[00:14:21] Speaker 01:
Was there something about Jared and David she didn't get covered because of that distraction?

[00:14:26] Speaker 00:
Well, certainly she could have elaborated on what she asked them about if she had known what the FAA thought happened.

[00:14:33] Speaker 00:
She didn't know that.

[00:14:34] Speaker 00:
She could have gotten better affidavits from them.

[00:14:37] Speaker 00:
She could have asked them about, she didn't know that it was very important to the FAA that this conversation purportedly happened in front of members of the public.

[00:14:44] Speaker 00:
She mentioned that very passingly in her affidavit because she didn't know that that was one of the major reasons the FAA thought that this incident was a problem.

[00:14:53] Speaker 00:
And furthermore, as Mazaleski recognizes, Your Honor, my client shouldn't have had her efforts diluted.

[00:14:59] Speaker 00:
She shouldn't have spent two-thirds of her affidavit and her brief below on issues that didn't matter because the FAA wouldn't tell her the reason they substantiated a complaint they never gave to her.

[00:15:10] Speaker 01:
It helped her, though, to have another repair shop that said, we love her.

[00:15:14] Speaker 01:
That undermines the contention that she's a problem.

[00:15:19] Speaker 00:
I don't think that the affidavit said that they love her.

[00:15:23] Speaker 00:
I mean, certainly it may have helped her generally, but the FAA was concerned about a specific incident.

[00:15:28] Speaker 00:
And she didn't get any meaningful information about it.

[00:15:30] Speaker 00:
She didn't even get a written copy of the complaint.

[00:15:34] Speaker 00:
And Your Honor, there's a reason that the requirement is that an agency scrupulously follow its own regulations in this context.

[00:15:42] Speaker 00:
These procedural requirements are meant to be meaningful, and my client didn't get the benefit of them.

[00:15:47] Speaker 03:
Thank you, counsel.

[00:15:48] Speaker 03:
Your time's expired.

[00:15:49] Speaker 00:
Yes, thank you.

[00:15:53] Speaker 03:
Let's hear from the FAA.

[00:15:57] Speaker 02:
May it please the court, Max Vobaldi from the FAA.

[00:15:59] Speaker 02:
I'd like to kick up where Judge Phillips left off with sort of the questions about what she knew and whether there was prejudice.

[00:16:06] Speaker 02:
If you were to look at AR-12, which is the discussion of the interview that the flight safety inspectors had with Petitioner, they read her the complaint.

[00:16:17] Speaker 02:
She remembers it well enough to quote part of it in her affidavit.

[00:16:21] Speaker 02:
And then she has a discussion with them.

[00:16:23] Speaker 02:
And first she says, I've never said anything bad about my competitor or anyone else.

[00:16:28] Speaker 02:
And then she says shortly later that she's an evil bitch lying to another person who didn't belong to ballooning.

[00:16:37] Speaker 02:
And then she said, well, OK, I did have a private conversation at the repair shop where she was part of the discussion.

[00:16:42] Speaker 02:
So she knows what conversation is at issue.

[00:16:44] Speaker 02:
She had a direct discussion with the FAA about it in her interview.

[00:16:48] Speaker 02:
She also says later that she'd never discussed her competitor anywhere else in ballooning.

[00:16:56] Speaker 02:
So I think that takes the other repair station off the table.

[00:17:00] Speaker 02:
She knows what's happening here.

[00:17:02] Speaker 02:
And she had an opportunity to submit evidence.

[00:17:05] Speaker 02:
She had an opportunity to submit evidence both before the appeals panel, but also

[00:17:11] Speaker 02:
At the end of that statement, the flight safety inspector told her, if you have anything else you want to submit, submit it to the web portal.

[00:17:18] Speaker 02:
Five days later, she does.

[00:17:19] Speaker 02:
She submits a statement.

[00:17:20] Speaker 02:
This is at AR3.

[00:17:22] Speaker 02:
She says, here's what I understand happened.

[00:17:25] Speaker 02:
If my words were wrong, I'll be more careful in the future.

[00:17:31] Speaker 02:
There's a box to attach a task when she didn't do that.

[00:17:33] Speaker 02:
But she had all this opportunity.

[00:17:35] Speaker 01:
Did she have access to their account of their meeting?

[00:17:39] Speaker 02:
To whose account of their meeting?

[00:17:41] Speaker 01:
She did not.

[00:17:43] Speaker 01:
How can that be?

[00:17:45] Speaker 01:
Was that on purpose or you just don't feel that she has a right to see that or it would be difficult to produce it or what?

[00:17:53] Speaker 02:
So what we're sort of in this posture where we're reviewing compliance with the FAA regulations, we look at what the regulations require and all that they require here is that the

[00:18:03] Speaker 02:
final decision be documented in this designee management portal, and that the reason be provided.

[00:18:10] Speaker 04:
And I think they've done that.

[00:18:12] Speaker 04:
But it didn't give a reason.

[00:18:13] Speaker 04:
It said the complaint was substantiated.

[00:18:17] Speaker 04:
So, Your Honor, the... And it doesn't say she knew what it was?

[00:18:26] Speaker 02:
No, Your Honor, it was not a robust explanation.

[00:18:33] Speaker 02:
They gave the reasons, which were misconduct and demonstrated a lack of integrity and inability to work with the FIA or the public.

[00:18:39] Speaker 02:
And they said, here's why we've reached this conclusion, which is that we conducted an investigation.

[00:18:43] Speaker 02:
She knew the subject of the investigation.

[00:18:45] Speaker 02:
No, no, it didn't say that.

[00:18:47] Speaker 02:
I'm sorry.

[00:18:49] Speaker 02:
What it said is, we conducted an investigation, clearly substantiated.

[00:18:54] Speaker 02:
That's the end of my description of that.

[00:18:56] Speaker 02:
I am also saying that it's clear from the record that she knew the subject of the investigation.

[00:19:03] Speaker 02:
These requirements, I acknowledge, are not particularly robust.

[00:19:07] Speaker 02:
The FAA has decided what procedures it wants to employ here.

[00:19:09] Speaker 04:
I'm not sure it's not robust.

[00:19:11] Speaker 04:
I mean, it uses the word specific, the specific reason.

[00:19:16] Speaker 04:
And that doesn't speak to me to be like, give the thinnest reason you can and put it in a little box.

[00:19:27] Speaker 02:
So Your Honor, I think they specified a reason, which is that they conducted an investigation.

[00:19:33] Speaker 02:
I also think, you know, that what I conducted, but then, I mean, how do you have a meaningful appeal from that?

[00:19:40] Speaker 02:
So, Your Honor, the FAA understands the appeal to be an appeal of the process, not of the substance.

[00:19:45] Speaker 02:
And that's the core difference with the Masoluski case the petition relies on, where the Assistant Secretary of Health is doing de novo review of a termination decision.

[00:19:54] Speaker 02:
Here, it's a procedural review.

[00:19:56] Speaker 02:
It's review of

[00:19:57] Speaker 02:
Did you follow our guidance on documentation?

[00:20:01] Speaker 02:
And that's what you need to do to appeal from that is to see, here's what we've submitted.

[00:20:08] Speaker 02:
Is that good enough?

[00:20:08] Speaker 04:
And why would she need to, if that's the case, why would the FAA invite her on appeal to submit evidence?

[00:20:18] Speaker 02:
So, Your Honor, I think

[00:20:19] Speaker 02:
It's conceivable that there's things evidence could be relevant to.

[00:20:23] Speaker 02:
One requirement that we haven't discussed, and it's not an issue here, is that this process be handled by her managing specialist.

[00:20:30] Speaker 02:
She has a letter saying, my managing specialist changed two months ago, and it's the wrong person submitting it.

[00:20:35] Speaker 02:
That could be relevant evidence to the procedure.

[00:20:37] Speaker 02:
But inviting her to put things in the record, I think, doesn't change what the FAA has required.

[00:20:42] Speaker 02:
And what the FAA has required is not significant.

[00:20:45] Speaker 02:
It's fairly minimal here.

[00:20:51] Speaker 03:
I mean, there has to be some procedural due process here.

[00:20:56] Speaker 03:
And the target has to get adequate notice and be able to defend herself against these types of charges.

[00:21:03] Speaker 03:
Council has represented that it's an important part of her business model.

[00:21:07] Speaker 03:
And I would think the FAA would give a target adequate notice so that she can defend herself.

[00:21:15] Speaker 03:
And it sounds like it was a moving target.

[00:21:18] Speaker 03:
The FAA hid the ball by not attaching these affidavits on appeal that were contradictory.

[00:21:25] Speaker 03:
I mean just seems like This didn't look this did not look neutral or or objective it looks arbitrary and selective So I think you have a there's a couple of questions that baked in there I'd like to address three points the first is that

[00:21:41] Speaker 02:
I don't think there's any due process that attaches here.

[00:21:44] Speaker 02:
Every court of appeals that's looked at this, it says there's no property right and a designation because you have no right to be a designee and no continued expectation that your designation will continue.

[00:21:54] Speaker 02:
And there's not a liberty right under sort of a reputation plus analysis.

[00:21:59] Speaker 02:
So the due process clause just doesn't come out here.

[00:22:02] Speaker 03:
So these officials could terminate her because they don't like women?

[00:22:07] Speaker 03:
They don't like her because there's a personal animosity.

[00:22:11] Speaker 03:
There's really no limits on their discretion, really?

[00:22:15] Speaker 02:
Your Honor, I think that other substantive constitutional constraints would apply.

[00:22:19] Speaker 02:
Certainly, if you terminated her on the basis of sex, that would be a 14th Amendment problem that could be addressed in the petition review process.

[00:22:26] Speaker 02:
And there's no allegation of that here.

[00:22:29] Speaker 03:
Well, it's hard to find out because you don't give the target an opportunity to investigate.

[00:22:38] Speaker 02:
I mean, Your Honor, there's just no allegations here that there would be some sort of independent constitutional barrier.

[00:22:46] Speaker 02:
But I think there were a couple of other questions you had.

[00:22:49] Speaker 03:
So you don't think there's a basic administrative right to a non-arbitrary decision?

[00:22:55] Speaker 02:
So I think there is the substitute due process limit of the decision can't be arbitrary in the constitutional sense.

[00:23:02] Speaker 02:
It can't shock the conscience.

[00:23:04] Speaker 02:
But I don't think that when a decision is committed to H.D.

[00:23:07] Speaker 02:
discretion by law,

[00:23:08] Speaker 02:
I think you can't look to other sort of principles of the APA and say, well, we're importing these standards to the decision-making when the administration has total discretion.

[00:23:20] Speaker 04:
Well, I think the problem here is not so much that anyone thinks they can dig into the merits of what the FAA did, but that maybe the way the FAA administered the procedural aspects of this gutted

[00:23:39] Speaker 04:
the right to a meaningful appeal.

[00:23:41] Speaker 04:
And you agree she's entitled to that, don't you, from a procedural standpoint?

[00:23:46] Speaker 02:
I agree that within the FAA, she was entitled to have an appeal panel review the process.

[00:23:51] Speaker 04:
No, that's not what I asked.

[00:23:53] Speaker 04:
Just an appeal panel review the process.

[00:23:56] Speaker 04:
I mean, can you interpret your own rules in such a way where the appeal's meaningless?

[00:24:05] Speaker 02:
I don't think the appeal is meaningless, because I think the process.

[00:24:09] Speaker 04:
That's not responsive.

[00:24:11] Speaker 04:
Can you interpret your own rules in such a way as to render the appeal process meaningless?

[00:24:22] Speaker 02:
That doesn't seem to me like it'd be a very good interpretation of.

[00:24:24] Speaker 02:
You're asking me if the agency could do that?

[00:24:27] Speaker 04:
I mean, the allegations, basically, that you did.

[00:24:30] Speaker 04:
Right.

[00:24:30] Speaker 04:
So can you do it?

[00:24:32] Speaker 04:
Assume that you did.

[00:24:33] Speaker 02:
Can you do that?

[00:24:34] Speaker 02:
Yes, Your Honor.

[00:24:35] Speaker 02:
I don't think the agency is required to provide any process.

[00:24:40] Speaker 02:
It chooses what process that it's going to establish, and then that's what it has to follow.

[00:24:45] Speaker 02:
That's a tough argument to make.

[00:24:51] Speaker 04:
Your Honor, I think that's- I mean, the APA itself is designed to give people process, isn't it?

[00:25:00] Speaker 02:
Yes, except when something is committed to HD discretion by law.

[00:25:03] Speaker 02:
So for example, if you were to look at... Let me ask you this.

[00:25:09] Speaker 02:
Yes.

[00:25:09] Speaker 02:
So if you're correct, how can we even have an appeal?

[00:25:11] Speaker 04:
How can we even be here?

[00:25:12] Speaker 02:
So she has a right to petition for review, and sort of the basic Icardi principle says if we have promulgated, if we put forward procedures and said we're going to follow them, then we have to follow them.

[00:25:27] Speaker 02:
The procedures here are fairly minimal, and so the scope of your review is fairly minimal.

[00:25:32] Speaker 02:
OK.

[00:25:34] Speaker 02:
Yeah, so I think.

[00:25:37] Speaker 04:
Let me ask you something else.

[00:25:39] Speaker 04:
So one of the things that troubles me is she complains that she wasn't provided a lot of things in the proceeding.

[00:25:46] Speaker 04:
And then on appeal, once we're here, they show up.

[00:25:55] Speaker 04:
So they were part of the administrative record.

[00:25:58] Speaker 04:
She just didn't have any access to them during the administrative proceeding.

[00:26:03] Speaker 02:
That's correct.

[00:26:05] Speaker 02:
Doesn't that seem troublesome to you?

[00:26:07] Speaker 02:
So Your Honor, this is not a trial-type procedure where there would be reciprocal discovery or anything like that.

[00:26:13] Speaker 02:
This is a relatively informal process to manage people that the FAA has absolute discretion as to whether they are going to keep having to be

[00:26:23] Speaker 04:
Continue to represent the FDA performed credibly agree though that the purpose of these rules is not to take away the certifications of people who are are doing a legitimately good job.

[00:26:38] Speaker 04:
It's to weed out the bad apples.

[00:26:40] Speaker 04:
Wouldn't you agree with that?

[00:26:41] Speaker 02:
It's to take designations away from people who the FA thinks shouldn't represent them, yes.

[00:26:46] Speaker 04:
Right.

[00:26:46] Speaker 04:
And they don't take them away because you're doing good.

[00:26:48] Speaker 04:
They don't terminate for cause for that reason, correct?

[00:26:52] Speaker 04:
So why wouldn't we be transparent as to what's happened and why we're taking them away?

[00:26:59] Speaker 04:
Seems like that can do nothing but help you.

[00:27:01] Speaker 02:
So, Your Honor, the FAA could have adopted those procedures.

[00:27:04] Speaker 02:
In fact, the new procedures that are currently in place do provide for more disclosure to designees, but those weren't the procedures that were in place when this termination occurred.

[00:27:14] Speaker 02:
And the only yardstick that this court can measure against is the procedures that the FAA put in place.

[00:27:20] Speaker 02:
And I think the basics of those procedures are that you gave a reason, you put it in the system, and I believe they've done that.

[00:27:28] Speaker 03:
And the basis for your argument is the, I guess, 2b scope of appeal in the regs.

[00:27:37] Speaker 03:
The appeal is intended to be a review of the termination for cause process.

[00:27:43] Speaker 03:
That's correct, Your Honor.

[00:27:44] Speaker 03:
And you don't think the review of the process permits an evaluation of the evidence?

[00:27:51] Speaker 02:
That is not how the FAA has understood this regulation.

[00:27:57] Speaker 04:
Do you have any internal guidance, any memoranda that your secretaries or folks like that or director have put out on that?

[00:28:08] Speaker 02:
No.

[00:28:09] Speaker 02:
I mean, this FAA order, 8,095B, is essentially a guidance document.

[00:28:16] Speaker 02:
It's not a notice to comment regulation.

[00:28:18] Speaker 02:
It's a guidance that the agency puts out to tell the people who manage designees how to do it.

[00:28:24] Speaker 02:
So I would say that's the guidance, and that's as detailed as it is.

[00:28:32] Speaker 03:
Are these terminations common?

[00:28:35] Speaker 02:
I don't think they're particularly common.

[00:28:38] Speaker 02:
In cases that have reached the petition for review stage, there's probably been maybe a half dozen, slightly more over the last two decades.

[00:28:47] Speaker 03:
Has anybody ever been terminated for this type of personal indiscretion or stray comment?

[00:28:55] Speaker 02:
Your Honor, I don't know if there's been a termination for what you'd call a personal indiscretion, but certainly if the FAA loses confidence in someone, if they think they don't have integrity, they stop trusting the person, then the FAA is going to terminate that person.

[00:29:10] Speaker 02:
Because what a designee does is go out on behalf of the FAA and perform functions that are critical to aviation safety.

[00:29:16] Speaker 02:
Testing pilots, making sure pilots are medically sound, making sure aircrafts are airworthy, and they do this with

[00:29:22] Speaker 02:
you know, some FAA supervision, but these people are really critical to aviation safety, and the FAA has to trust you.

[00:29:28] Speaker 02:
And if it doesn't, you can continue doing everything else.

[00:29:30] Speaker 02:
The petitioner can continue being a balloon pilot, running her school, training other pilots, doing everything else she wants to, but she doesn't get to go hold herself out with the imprimatur of the FAA and perform these functions on behalf of the agency.

[00:29:42] Speaker 01:
Well, that's the bottom line is safety.

[00:29:44] Speaker 01:
And I don't know that you get to carry that banner, because you get a banner, but

[00:29:51] Speaker 01:
You have a rival, a competitor, who is making allegations.

[00:29:57] Speaker 01:
And I don't know that you can just say, well, allegations have been made, especially when the repair shop owner and repairman disavow that they're accurate.

[00:30:08] Speaker 01:
And so we're serving public safety by getting rid of someone who's been here for a number of years and performed well.

[00:30:15] Speaker 02:
So Your Honor, I would say a couple of things.

[00:30:17] Speaker 02:
The FAA made a decision.

[00:30:20] Speaker 02:
to go with the testimony that was given sort of live in person to two FAA inspectors.

[00:30:28] Speaker 02:
They asked the questions.

[00:30:29] Speaker 02:
They noted were both that they were a little bit reluctant to talk, but they eventually acknowledged that these statements were made and also that they had promised this competitor that they would continue to prepare evidence.

[00:30:39] Speaker 01:
According to a report that was unsworn and was unprovided versus affidavits that are sworn that say not so.

[00:30:49] Speaker 02:
Your Honor, yes, the agency went with the live testimony.

[00:30:52] Speaker 02:
It's not sworn testimony, but I think agencies are not assuming that people are regularly lying to federal investigators.

[00:30:58] Speaker 01:
I thought it was just an interview.

[00:31:00] Speaker 02:
It was testimony?

[00:31:01] Speaker 02:
It was an interview made in the course of an official agency investigation.

[00:31:08] Speaker 02:
And the FAA chose to credit that.

[00:31:10] Speaker 02:
And this court's role isn't to review the evidence and decide how it would come out if it were

[00:31:15] Speaker 02:
you know, making the decision of the first instance about whether the agency has properly followed some procedures, and I believe that it has.

[00:31:22] Speaker 02:
I see that I'm out of time, but the petition should be denied.

[00:31:24] Speaker 03:
Thank you, counsel.

[00:31:26] Speaker 03:
Your time has expired, and your excuse.

[00:31:29] Speaker 03:
And the case is submitted.

[00:31:30] Speaker 03:
Thank you.