Steenholdt v. F.A.A.

• Decision Date: 10 January 2003
• Docket Number: No. 01-1331.,01-1331.
• Citation: 314 F.3d 633
• Parties: Randy STEENHOLDT, Petitioner, v. FEDERAL AVIATION ADMINISTRATION, Respondent.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 633

314 F.3d 633

Randy STEENHOLDT, Petitioner, v. FEDERAL AVIATION ADMINISTRATION, Respondent.

No. 01-1331.

United States Court of Appeals, District of Columbia Circuit.

Argued October 7, 2002.

Decided January 10, 2003.

On Petition for Review of an Order of the Federal Aviation Administration.

Jason A. Dickstein argued the cause and filed the briefs for petitioner.

Kenneth G. Caplan, Special Attorney to the Attorney General, Federal Aviation Administration, argued the cause for respondent. On the brief was R. Brooke Lewis, Special Attorney to the Attorney General.

Before: SENTELLE, ROGERS and GARLAND, Circuit Judges.

Opinion for the Court filed by Circuit Judge SENTELLE.

SENTELLE, Circuit Judge:

Petitioner Randy Steenholdt challenges the decision of the Federal Aviation Administration ("FAA") not to renew his authority to examine certain aircraft repairs for compliance with the FAA's airworthiness regulations. Because the decision is "committed to agency discretion by law," 5 U.S.C. § 701(a)(2) (1996), we have no jurisdiction to review the substance of the FAA's decision. Petitioner also argues that the Administration failed to follow its own procedures. Insofar as there was any such failure, it was without prejudice to any right of the Petitioner, and we therefore deny the petition for review.

I

The Federal Aviation Act ("FA Act") provides that the FAA Administrator "may delegate to a qualified private person ... the examination, testing, and inspection necessary" to issue certificates identifying aircraft as compliant with the standards set forth in the Federal Aviation Regulations, and may "rescind this delegation ... at any time for any reason." 49 U.S.C. § 44702(d) (1997). The Administrator has appointed a network of private individuals to serve as Designated Engineering Representatives ("DERs"), who perform certain examinations, tests, and inspections required to determine compliance with FAA airworthiness regulations. The Administrator has delegated the authority to select DERs to Managers of local Aircraft Certification Offices ("ACOs"). 14 C.F.R. § 183.11 (2002). DER appointments are for one-year periods and may be renewed for additional one-year periods at the Administrator's discretion. 14 C.F.R. § 183.15.

The FAA evaluates a DER's performance annually to determine whether that DER is performing at a satisfactory level. If the DER's performance is not satisfactory, the FAA may take corrective action ranging from counseling to nonrenewal. 14 C.F.R. § 183.15 lists the circumstances under which the FAA may choose not to renew a DER's designation. The regulation recites five specific bases for termination, and a sixth open-ended basis: "[f]or any reason the Administration considers appropriate." 14 C.F.R. § 183.15(6). If the DER requests review of that decision, a first-level review is conducted by the appointing ACO Manager. If the DER seeks further review, a second-level review is conducted by the Manager of the Directorate. Designated Engineering Representative (DER) Guidance Handbook, FAA Order No. 8110.37C ¶ 706 (Sept. 30, 1998).

In 1991, the Administrator issued Order 8130.24 "establishing ... procedures for the termination or nonrenewal of the certificate" for among others, a designated engineering representative. The order recites as a purpose that "these procedures are intended to ensure that due process is accorded before a final decision is made on termination or nonrenewal of the ... designations." FAA Order 8130.24, ¶ 1. The order, by its terms, specifies "conditions that may require the termination of a designation or delegation and list[s] the procedures that field offices should employ to accomplish such actions." FAA Order 8130.24, ¶ 4(b). The order notes that the FAA developed the procedures therein because "designation holder[s] must be provided with adequate notice and afforded the opportunity to respond to the proposed action." FAA Order 8130.24, ¶ 4c.

The order directs that the appropriate FAA office will provide written notice to the DER of the proposed nonrenewal of the designation. The notice "shall include" among other things the "[s]pecific reasons for the proposed ... nonrenewal, including examples of unacceptable conduct, when applicable" and "permission to request reconsideration." FAA Order 8130.24, ¶ 6a(1).

Upon reconsideration, if the Manager of the ACO confirms the proposed nonrenewal, he will send a letter to the DER, clearly stating "the decision and the justification therefor" and responding "to each of the arguments presented by the [DER]." FAA Order 8130.24, ¶ 6a(4). The letter shall also state that the DER is permitted to request second-level review with the Directorate Manager responsible for the relevant ACO. Id.

If second-level review occurs and the Directorate Manager concurs in the decision not to renew the DER, the Directorate Manager will send a letter to the DER "reciting the final decision and justification." FAA Order 8130.24, ¶ 6b(2). The letter will "respond to each of the arguments presented by the [DER]." Id. In addition, the letter will state that the FAA's decision is final but that the DER may petition for review in a U.S. Court of Appeals within 60 days. Id.

In 1992, Petitioner Steenholdt received designation from the Chicago ACO as a Company DER for Northwest Airlines, authorizing him to operate as a DER only for Northwest Airlines. Gregory Michalik Airframe Branch Manager of the Chicago ACO, was appointed as Petitioner's FAA Advisor. Shortly thereafter, Petitioner received his Consultant DER authorization, which allowed him to offer DER services to others seeking such services. Michalik served as Petitioner's FAA Advisor for Petitioner's Consultant designation as well.

In November of 1995, oversight of Petitioner's work as a Consultant DER was transferred to Manzoor Javed. Petitioner and Javed did not get along well and had disputes about the quality of Petitioner's work. Some of Petitioner's clients began complaining about Javed, and Javed began writing unfavorable reviews of Petitioner's work. By September of 1997, the FAA had become concerned about Petitioner's work. Javed and ACO engineer Joe McGarvey reported that Petitioner had exceeded the authority of his designation by approving a repair for an engine anti-icing valve attachment when his authorization included only airframe repairs. Further, the ACO found that Petitioner did not address the problem fully in his submittals to the FAA.

In 1998, the ACO reported further problems with Petitioner's work. In February of 1998, Petitioner attended a counseling meeting regarding the quality of his work and his performance as a DER. Subsequently, Javed and McGarvey stated that Petitioner failed to properly apply the Federal Aviation Regulations, failed to show sound judgment in his submittals, and failed to include sketches and figures in his engineering analyses. They recommended that Petitioner attend another counseling meeting.

The ACO reported that Petitioner's work continued to deteriorate in 1999. Javed reported that Petitioner failed to show sound judgment or sound technical competence with respect to a project involving the landing weight of an aircraft. Around this time, Javed recommended that Petitioner's designation be limited to repairs. (Originally, Petitioner had both repair and alteration authority.) McGarvey went so far as to recommend that Petitioner's Consultant DER designation not be renewed. The FAA did renew Petitioner's Consultant DER designation at this time but limited his authorization to repairs only.

In 2000, after further unsatisfactory reviews, Javed recommended nonrenewal of Petitioner's designation, stating that his "DER performance is lacking in spite of two face-to-face meetings within the last two years. He requires excessive oversight[,] compromising the purpose of the Designee System. In order to maintain the integrity of the Designee System, I recommend his DER appointment should not be renewed." (Letter from Prather to Dickstein of 1/11/2001, at enclosure 6 (DER Performance Evaluation Form for period from August 1999 to September 2000, completed by Javed).)

In September 2000, Petitioner's designation was renewed, but only for a period of three months. On October 26, 2000, Mary Ellen Schutt (Manager of the Airframe & Administrative branch of the Chicago ACO) notified Petitioner that she did not intend to renew his DER designation, effective January 1, 2001. She listed several areas in which Petitioner's performance was lacking during the previous year and during the three years prior. Schutt sent Petitioner a second letter, on November 1, 2000, highlighting specific problems with several of Petitioner's Engineering Authorization submittals.

On November 6, 2000, Petitioner through counsel requested reconsideration of Schutt's proposed nonrenewal. Along with this request, Petitioner filed a list of points and answers to the points raised in Schutt's two letters relating to the proposed nonrenewal. Petitioner also attached letters from a few of his clients, indicating that difficulties with Javed were the cause of Petitioner's apparently deteriorating performance.

On November 20, 2000, Schutt sent Petitioner a letter extending Petitioner's DER designation through September 2001 while Petitioner's request for reconsideration awaited resolution. On January 11, 2001, Royace Prather, Manager of the Chicago ACO, sent a letter to counsel for Petitioner responding to a letter requesting reconsideration of the FAA's proposal not to renew Petitioner's designation. Prather's letter rejected the request and confirmed that the FAA would not renew Steenholdt's consultant DER appointment beyond its then-current expiration date of March 1, 2001. Prather reviewed Petitioner's performance and stated that despite meetings and counseling, Petitioner "has not acted on the counseling provided him and his performance is still lacking in the key...