FlyteNow v. FAA

Henning said:
Why do you think the FAA wants to win? :dunno: If a court orders them to shed responsibility, that is less work they have to do. The only question is, what does the insurance industry want? That is what will happen.
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The FAA wants to win because the mission of any bureaucracy is to expand the bureaucracy. Expand the scope of power, expand the budget, expand the number of people who are beholden to the leaders for their livelihood. Hardly unique to the FAA.
 
Lots of analysis in this thread.
But the real world intrudes - what carries more weight than the briefs and dissection of the Regs and scrutiny of precedent cases , is the back room discussion between this judge and the Chief Judge (who will be receiving phone calls from the Executive/Legislative Branch.)
Yes, everyone has a boss, even appointed for life Chief Federal Judges - the power of the purse.
The heavyweights who want this case to be decided a certain way will call in the favors further up the food chain and let the stuff trickle down.
I am being neither sarcastic nor cynical and certainly not delusional - it is how the world works. Our three legged stool of government does not stay upright by sawing one leg off.

Given that the Courts have historically deferred to the FAA Legal Counsel I see no reason for them to make waves in this very minor case.
Reasons?
We in GA are a 0.0015th of the population
There are 236,148 Private Rating Pilots who can legally carry passengers but not for profit (like a Commercial Rating can).
Those private rated pilots that might want to carry passengers for some gas money are only a fraction of that - one in 20 or less (and I STRONGLY suspect way less than that once the insurance companies notice what they are doing).

Now 54,000,000 americans fly on an airliner at least once a year.
And of those who fly less than once a year 27,000,000 will fly commercial at least once within any 10 year period (I am one of those - she has to put a gun to my head to get me in a cattle car)

And lastly, the airlines are considered to be essential to national security enterprises by the Federal Government - notice all the laws and tax deferrals and support programs keeping the airlines afloat. Anything that reduces passenger flow on the airlines will be given the jaundiced eye by all three branches of government.

So that is 81,000,000 citizens who support the airlines - and us who are against the airlines by being for FlyteNow.

I know what way I would place a bet on this case.
 
RotorAndWing said:
The standards of a private pilot are pretty low, passengers beware.

Once the average PP receives his license, he is no longer required to get any formal or recurrent training, only the Flight Review which he can't fail. And we all know of flight reviews that are given at the airport cafe or on a weekend hamburger run.

Throw in an Instrument rating and now we have a person that can take you into the clouds and hard IFR and his recency of experience is on the "honor system" and again, he doesn't ever have to demonstrate ability for the rating ever again.

There's a distinct reason for Part 119. :rolleyes:



There are lots of PP's that I wouldn't get in a plane with.
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Heh. I thought you of all people would recognize that I was trolling.

But perhaps FAA created their own problem, then? Heh.

[edit:] Because they could have written a better law anytime. Like the defendant says, "words matter".

Seriously though...

We don't train cab drivers any better. There's a pretty significant risk getting in most cabs.

:)
 
Dr. O said:
We in GA are a 0.0015th of the population
There are 236,148 Private Rating Pilots who can legally carry passengers but not for profit (like a Commercial Rating can).
Those private rated pilots that might want to carry passengers for some gas money are only a fraction of that - one in 20 or less (and I STRONGLY suspect way less than that once the insurance companies notice what they are doing).

Now 54,000,000 americans fly on an airliner at least once a year.
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Which is why it is ridiculous that the commercial airlines or even the 135 operators consider it a threat for some random guy to buy his pilot friend a tank of gas and lunch in exchange for 'driving' him to a meeting on the rare instance that geography and weather conspire to make a 4/6-place FLIB suitable to the mission at hand.
 
What's interesting to me is that while this plods along, Uber is racking up wins right & left. Since it's basically the same thing, the precedent is moving towards FlyteNow. I hope it works out for them.
 
Dr. O said:
Lots of analysis in this thread.
But the real world intrudes - what carries more weight than the briefs and dissection of the Regs and scrutiny of precedent cases , is the back room discussion between this judge and the Chief Judge (who will be receiving phone calls from the Executive/Legislative Branch.)
Yes, everyone has a boss, even appointed for life Chief Federal Judges - the power of the purse.
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Wow, that's a heck of a conspiracy theory analysis.
 
jbarrass said:
What's interesting to me is that while this plods along, Uber is racking up wins right & left. Since it's basically the same thing,
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Not at all. Driving has no equivalent of the FAA's "common purpose" requirement for private-pilot expense sharing. That's why FlyteNow flights had to be proposed by the pilot, not by the passenger.
 
DJTorrente said:
Which is why it is ridiculous that the commercial airlines or even the 135 operators consider it a threat for some random guy to buy his pilot friend a tank of gas and lunch in exchange for 'driving' him to a meeting on the rare instance that geography and weather conspire to make a 4/6-place FLIB suitable to the mission at hand.
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I haven't been studying the situation intently, but I've seen nothing from a 121 or 135 operator that indicates they think this is a "threat". 134 1/2 operators have existed for years, and will exist as long as there is private aviation. The issue is equal application of the law to everyone.

What is at issue for the courts is whether the law is applied equally the way the FAA interprets it, which is the same way they've interpreted it for years, or whether it's applied equally the way FlyteNow interprets it.
 
acrophile said:
Not at all. Driving has no equivalent of the FAA's "common purpose" requirement for private-pilot expense sharing. That's why FlyteNow flights had to be proposed by the pilot, not by the passenger.
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Taxi's and buses both fall under common carriage regulations. It's really ground vs. air that's different.
 
jbarrass said:
Taxi and buses both fall under common carriage regulations. It's really ground vs. air that's different.
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Depends whose arguments you find persuasive. FlyteNow argues (correctly, I think) that they and their pilots are *not* acting as carriers, common or otherwise, because their flights have to be flights that the pilot initiates and that the pilot plans to conduct anyway for the pilot's own purposes, even without passengers (and, of course, without profit).

If Uber operated the same way, their rides would be limited to things like "Hey, I'm driving from the gym to the supermarket--anyone want to come along and pay for part of the gas?". That would be much less useful than what they actually do.

That difference is also one of several reasons that airlines could not possibly even notice FlyteNow, let alone feel threatened by it.
 
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denverpilot said:
But perhaps FAA created their own problem, then? Heh.

[edit:] Because they could have written a better law anytime.
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Yeah -- they could just eliminate all the exceptions to the 61.113(a) prohibition on Private Pilots receiving compensation or acting as PIC with paying passengers. That would make it really simple and easy for everyone to understand.

Problem is, the FAA tried to do PP's a favor, but "give 'em an inch and they'll take a mile". And now we're mired in the courts. :(
 
Kritchlow said:
Plenty good for private ops, AND plenty good to carry passengers. Not good enough if the passengers are under the impression they are booking a commercial flight.
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And yet the FAA says it's fine to put up a note on the bulletin board at your school or workplace offering to give someone a ride to the big game if they will share expenses. (Ware interpretation)
 
Ron Levy said:
Yeah -- they could just eliminate all the exceptions to the 61.113(a) prohibition on Private Pilots receiving compensation or acting as PIC with paying passengers. That would make it really simple and easy for everyone to understand.

Problem is, the FAA tried to do PP's a favor, but "give 'em an inch and they'll take a mile". And now we're mired in the courts. :(
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Who's "we"? I'm not mired in any court. I'm the conservative sort who just pays for the damn flight, to avoid all their dumbassery.

I know exactly the two times someone paid for anything of my flying in the last two decades and let's just say he was a sneaky bastard. I really couldn't have stopped it. LOL.
 
denverpilot said:
I know exactly the two times someone paid for anything of my flying in the last two decades and let's just say he was a sneaky bastard. I really couldn't have stopped it. LOL.
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Sounds like you're in the same boat as Derkazarian, who was eventually exonerated (and didn't get the money in the first place).
 
I see a lot of comments about the private pilot, on Flytenow, the users can review the pilot certificate and number of flight hours, there are a lot of private pilots registered on Flytenow with lots of experience both military and civilian with ATP, commercial, and instructor certificates and thousands of hours experience, so lots of people are confusing "private pilots" with "private pilot certificate".
Some pilots registered on Flytenow are actually ATP working for major airlines, they own a private aircraft and can lawfully participate in expenses sharing legally.
 
midlifeflyer said:
Who went after FlyteNow? Not the FAA. FyteNow asked the FAA a question. The FAA answered it. FlyteNow didn't like the answer.

FlyteNow sued the FAA in the US Court of Appeals (one level below SCOTUS) for the DC Circuit (the Circuit among the 13 Circuits in which most appeals of administrative rulings are made), where the decision is made by a panel of judges.

I have no predictions (I know better) although I think I'm in safe ground that the Court of Appeals judges aren't going to toss centuries of law imposing stricter requirements on common carriers or the general principle that commercial operations get regulated more. The question will be their application to this type of activity.
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It would be interesting to get an actuary's take on it.

What I can foresee is that the service is permitted, but is assigned Strict Liability standards for the participants, and that means commercial premiums. Cost will regulate proficiency as the insurance costs will mandate a lot of flying to be viable, plus they will set training minimums.

The USCG writes me letters to operate beyond the scope of my license with a letter from an insurance company requesting it.
 
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acrophile said:
Not at all. Driving has no equivalent of the FAA's "common purpose" requirement for private-pilot expense sharing. That's why FlyteNow flights had to be proposed by the pilot, not by the passenger.
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The regulation in question does not contain the phrase "common purpose" either.
 
Christian cg said:
I see a lot of comments about the private pilot, on Flytenow, the users can review the pilot certificate and number of flight hours, there are a lot of private pilots registered on Flytenow with lots of experience both military and civilian with ATP, commercial, and instructor certificates and thousands of hours experience, so lots of people are confusing "private pilots" with "private pilot certificate".
Some pilots registered on Flytenow are actually ATP working for major airlines, they own a private aircraft and can lawfully participate in expenses sharing legally.
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I think that Flytenow will prevail actually. It will be left to the insurance industry to regulate like most things.
 
JeffDG said:
The regulation in question does not contain the phrase "common purpose" either.
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True, but the FAA is actually giving us a break with the "common purpose" interpretation. If you look closely at the wording of 61.113, there's no permission for a mere private pilot to accept pro rata fuel money from a passenger *even if* the passenger is their best friend flying with them for a common purpose.

Specifically, (1) in 61.113(a), any compensation whatsoever is prohibited, apart from the exceptions enumerated in (b)-(h). And (b)-(h), except for (c), are all of the form "A private pilot may X", where X is an exception to (a). But (2) section (c), which is often somehow construed as authorizing pro rata cost-sharing when pilots fly passengers with a common purpose, is of the form "A private pilot may NOT...". In other words, as written, (c) adds another restriction to what private pilots can do, rather than granting another exception.

So when the FAA lets us accept pro rata compensation from passengers with whom we fly for a common purpose, they're letting us do something that is prohibited by the actual wording of the regulation.
 
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acrophile said:
True, but the FAA is actually giving us a break with the "common purpose" interpretation. If you look closely at the wording of 61.113, there's no permission for a mere private pilot to accept pro rata fuel money from a passenger *even if* the passenger is their best friend flying with them for a common purpose.

Specifically, (1) in 61.113(a), any compensation whatsoever is prohibited, apart from the exceptions enumerated in (b)-(h). And (b)-(h), except for (c), are all of the form "A private pilot may X", where X is an exception to (a). But (2) section (c), which is often somehow construed as authorizing pro rata cost-sharing when pilots fly passengers with a common purpose, is of the form "A private pilot may NOT...". In other words, as written, (c) adds another restriction to what private pilots can do, rather than granting another exception.

So when the FAA lets us accept pro rata compensation from passengers with whom we fly for a common purpose, they're letting us do something that is prohibited by the actual wording of the regulation.
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Um no...

Let's look at the actual reg:
§ 61.113 Private pilot privileges and limitations: Pilot in command.
(a) Except as provided in paragraphs (b) through (h) of this section, no person who holds a private pilot certificate may act as pilot in command of an aircraft that is carrying passengers or property for compensation or hire; nor may that person, for compensation or hire, act as pilot in command of an aircraft.
(b) A private pilot may, for compensation or hire, act as pilot in command of an aircraft in connection with any business or employment if:
(1) The flight is only incidental to that business or employment; and
(2) The aircraft does not carry passengers or property for compensation or hire.
(c) A private pilot may not pay less than the pro rata share of the operating expenses of a flight with passengers, provided the expenses involve only fuel, oil, airport expenditures, or rental fees.
(d) A private pilot may act as pilot in command of a charitable, nonprofit, or community event flight described in § 91.146, if the sponsor and pilot comply with the requirements of § 91.146.
(e) A private pilot may be reimbursed for aircraft operating expenses that are directly related to search and location operations, provided the expenses involve only fuel, oil, airport expenditures, or rental fees, and the operation is sanctioned and under the direction and control of:
(1) A local, State, or Federal agency; or
(2) An organization that conducts search and location operations.
(f) A private pilot who is an aircraft salesman and who has at least 200 hours of logged flight time may demonstrate an aircraft in flight to a prospective buyer.
(g) A private pilot who meets the requirements of § 61.69 may act as a pilot in command of an aircraft towing a glider or unpowered ultralight vehicle.
(h) A private pilot may act as pilot in command for the purpose of conducting a production flight test in a light-sport aircraft intended for certification in the light-sport category under § 21.190 of this chapter, provided that—
(1) The aircraft is a powered parachute or a weight-shift-control aircraft;
(2) The person has at least 100 hours of pilot-in-command time in the category and class of aircraft flown; and
(3) The person is familiar with the processes and procedures applicable to the conduct of production flight testing, to include operations conducted under a special flight permit and any associated operating limitations.
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So:
§ 61.113 Private pilot privileges and limitations: Pilot in command.
(a) Except as provided in paragraphs (b) through (h) of this section, no person who holds a private pilot certificate may act as pilot in command of an aircraft that is carrying passengers or property for compensation or hire; nor may that person, for compensation or hire, act as pilot in command of an aircraft.

OK, pretty straightforward, except as provided, no compensation...

But this is pretty clear exception to that:
(c) A private pilot may not pay less than the pro rata share of the operating expenses of a flight with passengers, provided the expenses involve only fuel, oil, airport expenditures, or rental fees.

Nothing about "common purpose" there to trigger that exception whatsoever. I don't see the words "friend" or "acquaintance" in there either.

Compensation is not defined in the regulations as referring to expense sharing either. A plain reading of expense sharing could well say that reimbursement of expenses is not compensation, only payment over and above expenses is compensation. If my employer pays my expenses for my hotel room on a business trip, I don't have to report that expense reimbursement as compensation to the IRS do I? I think the FAA is just about the only place I've ever seen define "expense reimbursement" as "compensation", actually.
 
JeffDG said:
But this is pretty clear exception to that:
(c)
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No, I already addressed that. As stated, (c) is not an exception, because (c) states an additional *restriction* ("A private pilot may NOT..."), unlike the other items (b)-(h) which each express a *permission* ("A private pilot MAY...").

To be an exception, (c) would instead have to read something like "A private pilot may accept up to, but not more than, ...". The actual wording covers the "not more than" part, but omits the "may accept up to" part.
 
acrophile said:
No, I already addressed that. As stated, (c) is not an exception, because (c) states an additional *restriction* ("A private pilot may NOT..."), unlike the other items (b)-(h) which each express a *permission* ("A private pilot MAY...").

To be an exception, (c) would instead have to read something like "A private pilot may accept up to, but not more than, ...". The actual wording covers the "not more than" part, but omits the "may accept up to" part.
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OK, and I addressed that.

Nobody else, in any field of the law, defines "reimbursement" as "compensation".
 
JeffDG said:
Nobody else, in any field of the law, defines "reimbursement" as "compensation".
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I myself have no knowledge of whether "compensation" is a term of art in the law. If it is, and if it means what you say, then you're right that partial fuel reimbursement is not compensation.

But if it's not a term of art, then in the ordinary usage of the word, I don't think compensation requires profit. If I'm a contractor and I perform a task for you that ends up costing me more than our contract calls for you to pay me, your payment to me still counts as compensation, in the ordinary sense of the word. Or if you accidentally damage my car and I agree to accept only partial compensation, that partial compensation is still compensation.

Also, what's prohibited is flying for "compensation OR hire". Even if expense sharing isn't compensation, an Uber-style arrangement where the passenger calls and asks you to fly them from A to B at time T in exchange for some money is still hiring, at least in the ordinary sense of that term (one speaks of "hiring a cab", right?).
 
JeffDG said:
OK, and I addressed that.

Nobody else, in any field of the law, defines "reimbursement" as "compensation".
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So you are saying the reimbursement of paid medical expenses and lost earnings in a personal injury suit is not part of "compensatory damages"? I don't think that's correct.
 
From Flytenow blog:
Conversely, the FAA argues that whether or not a commercial enterprise exists is “wholly inapplicable” because expense-sharing, as an exception to compensation, is itself compensation.[3] The FAA holds this position despite the fact that the preamble to the Expense-Sharing Rule resolved the issue conclusively, stating, “[O]ne or more passengers contribut[ing] to the actual operating expenses of a flight is not considered the carriage of persons for compensation or hire.”
 
Christian cg said:
From Flytenow blog:
Conversely, the FAA argues that whether or not a commercial enterprise exists is “wholly inapplicable” because expense-sharing, as an exception to compensation, is itself compensation.[3] The FAA holds this position despite the fact that the preamble to the Expense-Sharing Rule resolved the issue conclusively, stating, “[O]ne or more passengers contribut[ing] to the actual operating expenses of a flight is not considered the carriage of persons for compensation or hire.”
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What the FAA doesn't like is that somebody is making money on the deal. The pilot may only get reimbursement, but FlyteNow may well be making money and it's unregulated by the agency. "Better to ask for forgiveness" doesn't apply here.
 
Ron Levy said:
Yeah -- they could just eliminate all the exceptions to the 61.113(a) prohibition on Private Pilots receiving compensation or acting as PIC with paying passengers. That would make it really simple and easy for everyone to understand.

Problem is, the FAA tried to do PP's a favor, but "give 'em an inch and they'll take a mile". And now we're mired in the courts. :(
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The FAA 's mandate was never to do PP favors, as taxpayers citizens we give authority and funds to the FAA to regulate flying so it is safe. Period!
Any citizen thinking a bunch of "public servants" working for a branch of government will do favors to the general public, have a screw loose.
Remember that those "public servants" are just that; they are paid to serve the public and must respect our laws and the constitution when enacting regulations.
 
Christian cg said:
Remember that those "public servants" are just that; they are paid to serve the public and must respect our laws and the constitution when enacting regulations.
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And the FAA hasn't done this how??:dunno:

The 'laws" can be found in Title 49, Section 7 of the United States Code. These laws were passed by Congress and the FAA has derived regulations from them.
 
acrophile said:
No, I already addressed that. As stated, (c) is not an exception, because (c) states an additional *restriction* ("A private pilot may NOT..."), unlike the other items (b)-(h) which each express a *permission* ("A private pilot MAY...").

To be an exception, (c) would instead have to read something like "A private pilot may accept up to, but not more than, ...". The actual wording covers the "not more than" part, but omits the "may accept up to" part.
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The use of the "may not" language muddies the waters, but to me, the fact that paragraph (a) calls paragraph (c) an exception is enough to make it an exception regardless of how (c) is worded.
 
Palmpilot said:
The use of the "may not" language muddies the waters, but to me, the fact that paragraph (a) calls paragraph (c) an exception is enough to make it an exception regardless of how (c) is worded.
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I agree that if (a) did call (c) an exception, that would be evidence that the FAA didn't intend (c) as written. It's unclear whether that would be strong enough evidence to override what (c) actually says, but maybe it would.

However, (a) does not in fact call (c) an exception. It's true that (a) suggests (accurately) that exceptions are to be found in the range (b) - (h). But to assert that exceptions appear in that range of text is not to assert that everything said in that range of text is an exception, or even that every item in that range presents an exception.
 
midlifeflyer said:
We could probably come up with a long list.
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we're battling this issue right now with the IRS. People are paying for their own flights, hotels, rental cars etc... and when the company reimburses them for it, the people are getting the reimbursements taxed as income. So, we're keeping people at home. It's a great success story of taxation, we get less face time (i.e. degraded service), the airlines, hotels, rental car companies etc... get less customers and the IRS get's nothing. Truly a win/win for all involved.
 
acrophile said:
How come? The requirements for nontaxable reimbursements look straightforward:
http://www.irs.gov/Government-Entit...eimbursement-for-business-travel-ever-taxable?
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Because they spend a lot of time at customers places, i.e. 4 days a week typically. Fly in on Monday morning, out on Thursday afternoon. Seems they're crossing some threshold and the tax folks don't consider them business trips and view the trips to and from their home as compensation. The argument is something like this "Since you spend >50% of your time there, we consider that your residence, your trips back to your home are not business related, therefore...taxed."
 
acrophile said:
However, (a) does not in fact call (c) an exception. It's true that (a) suggests (accurately) that exceptions are to be found in the range (b) - (h). But to assert that exceptions appear in that range of text is not to assert that everything said in that range of text is an exception, or even that every item in that range presents an exception.
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That's a real stretch, IMO.
 
Palmpilot said:
That's a real stretch, IMO.
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Can you say why? Are you sure your interpretation of (a) isn't being influenced by your preconception that (c) is indeed an exception?
 
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