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You’re Invited: UAS Insurance Association General Meeting

Meeting of the UAS Insurance Association

July 28, 2016

1:00 pm – 2:30 pm eastern

RSVP

Agenda 

  • Introductions
  • Mission
  • The Founding Board
  • Website -www.uasinsurance.org
  • Membership
    • Insurers/Brokers
    • Risk Managers
    • Operators
    • Manufacturers
    • Government
    •  Attorneys
    • Others
  • Dues
  • Sponsorships
  • Advocacy
    • FAA Micro UAS Working Group
    • FAA UAS Advisory Committee
  • Meetings
  • Programs
    • Webinars – August 17
  • Publications
  • Regulatory Update
    • Part 107
    • Waivers/Exemptions
You’re Invited: UAS Insurance Association General Meeting

UAS/FAA – Flame Throwers and Glocks!!

Last month, we wrote about a new case that was going to require a federal court to determine whether or not an unmanned aircraft is an “aircraft.” The judge issued his opinion this week, and his decision is not a surprise to those of us who practice aviation law.

By way of background, the Court was asked to enforce an administrative subpoena issued by the FAA to Mr. Haughwout, who had achieved a certain amount of notoriety for several videos where he fired a flame thrower and a hand gun from a UAS.  The subpoenas were the first steps taken by FAA in pursuit of possible civil penalties.  Mr. Haughwout had refused to cooperate in the investigation or respond to the subpoena, claiming that the FAA has no jurisdiction over small UAS.

In his written opinion, Judge Meyer noted that federal agencies have broad authority to investigate whenever there is reasonable ground to believe that there is a violation of federal law.  Here, 14 C.F.R. § 91.13 prohibits the careless or reckless operation of an aircraft “so as to endanger the life or property of another.”  The Court held that “there can be no dispute that the weaponized devices shown on the YouTube videos at least give rise to questions about possible danger to life or property.”

Mr. Haughwout, however, claimed that this section was inapplicable because his small UAS was not an aircraft.  The Court rejected that argument, noting that Congress had provided a statutory definition of aircraft that was “stunningly broad,” and includes “any contrivance invented, used, or designed to navigate, or fly in, the air.”  The Court characterized Mr. Haughwout’s claim that the statute could not be given such an expansive definition because it would include baseballs and pizza dough, as “creative.”  The Court held, however, that the FAA is not required to fully define the hypothetical limits of its authority before it takes action.  Rather the question is whether the specific action that is taken by the FAA is permissible.  As a result, the Court held that for purposes of this dispute, Mr. Haughwout’s UAS was an aircraft.

The Court did note, however, that if the FAA ultimately decides to fine Mr. Haughwout for flying on his own property in a way that cannot pose a threat to air commerce, some of his other arguments might be worthy of further consideration.  The federal government does not have a general police power, and ultimately its authority is limited to the reach of the commerce clause.  However, because the FAA’s investigative authority is so broad, the Court concluded that those arguments were best addressed in the context of a well defined and concrete factual record at some point in the future.

So, as expected, this is not the end of the issue.  The FAA will have to conclude its investigation and determine whether they want to formally pursue a penalty.  Mr. Haughwout, who has shown that he is not shy about fighting with the FAA, will ultimately be entitled to a hearing before an administrative law judge, appeal to the NTSB, and potentially appeal to the United States Court of Appeals for the District of Columbia Circuit.  As a result, we will no doubt be writing about this saga for years to come.

UAS/FAA – Flame Throwers and Glocks!!

Save the Date: The 2017 Airline Symposium

February 7–9, 2017

Venue The Ritz Carlton 1700 Tysons Boulevard McLean, VA 22102 | Map

Write it in ink! Chisel it in stone! 2016 is flying by (no pun intended) and planning is well under way for the 2017 Airline Symposium.

More info, including agenda and registration details, to follow. Stay tuned.

Questions Please contact Barbara Butler at +1 703 336 8704.
Save the Date: The 2017 Airline Symposium

Part 107 and the Future of UAS Operations

We would like to offer our thanks for the huge turnout we had for our free webinar on Part 107 and the future of UAS Operations.  For those of you who could not make it, we are providing a downloadable version of the slides used, as well as a link to the full presentation so that you can listen at your leisure.

Part 107 and the Future of UAS Operations

FAA/NTSB: Bravo NTSB! Bravo FAA!

Several years ago, at The Airline Symposium, I asked Peggy Gilligan, FAA Associate Administrator for Aviation Safety, who was on one of our panels,  “Why do the FAA and NTSB hate one another?”

After the laughter in the room died down, Peggy said, quite correctly, that the premise of my question wasn’t accurate.  She said something to the effect (and I’m not quoting her) that the FAA was the regulator and the NTSB was the investigator, with no regulatory authority and because the results of  NTSB aviation investigations typically resulted in recommendations to the FAA, with which the FAA doesn’t always agree, there was a certain amount of tension between FAA and NTSB .  An excellent answer. By way of footnote, it didn’t prevent me  from asking Peggy, the following year at the Symposium, whether the NTSB and FAA still hated one another?

Well, here we are in 2016 and the US airline industry has been, and continues to be, at an unprecedented level of safety and a model for the rest of the world. The last US airline accident was in 2009, when Continental/Colgan Flight 3407 crashed in Buffalo, NY.  This level of safety is no accident (excuse the pun).  It’s a function of industry and government, i.e. FAA and NTSB, working together.

The airline industry is so safe that Chris Hart, the Chairman of the NTSB and someone who, in the opinion of Plane-ly Spoken, is, by far, the most qualified and effective Chairman in the history of the NTSB, has broadened the focus of the NTSB to include a more pro-active, advocacy role, namely, spotting air-safety hazards before they result in an accident.  In doing so, Chairman Hart cited the increasingly growing levels of cooperation and sharing of information between the FAA and NTSB.

Make no mistake about it however, the FAA and NTSB won’t always see eye to eye in the future.  But that’s okay, so long as future disagreements continue to be the exception and not the rule.

We have the safest aviation industry in the world.  So long as industry and government continue to work together, the biggest winners will be the traveling public.

Thank you Associate Administrator Gilligan!  Thank you Chairman Hart!

P.S.  Maybe at The 2017 Airline Symposium, February 7-9, 2017, I’ll ask one of them “Why do the FAA and NTSB love another?”

FAA/NTSB: Bravo NTSB! Bravo FAA!

FAA Finalizes Small UAS Rules – Releases Part 107

The day the UAS industry has been waiting for is finally here.  The FAA has just announced the release of 14 CFR Part 107, which sets out the operating rules for all small unmanned aircraft.  This new regulatory system promises to open the skies to commerce in a way that was not possible under the restrictions that accompanied Section 333 Exemptions.  The new rules will go into effect 60 days after they are published in the Federal Register some time next week.

One of the major differences between Part 107 operations and operations under a Section 333 Exemption relates to pilot qualifications.  Part 107 creates a new type of pilot’s license, referred to as an Operator’s Certificate.  As a result, a manned aircraft pilot’s license will no longer be required.  In order to obtain an Operator’s Certificate, the applicant must:

  • Be proficient in English,
  • Be at least 16 years old,
  • Pass an Initial Aeronautical Knowledge Test at an FAA-approved Knowledge Test Center, and
  • Pass a TSA Background Check.

There is no requirement that the applicant obtain a medical certificate, pass a vision test, or demonstrate any flight proficiency.  The FAA estimates the application process will take 6-8 weeks to complete.

As with other types of pilots licenses, there is also a currency requirement, with the certificate holder required to pass an updated test every two years.  The FAA also has made clear that all of the civil penalty and enforcement mechanisms used against unsafe manned aircraft pilots will also be used against unsafe UAS operators.

On the operational side, Part 107 flights are limited to vehicles weighing 55 pounds or less, and must occur below 400′ of altitude and at speeds below 100 miles per hour.  The most significant restriction on Part 107 operators is the limitation of all flights to visual line of sight (VLOS) during daylight hours.  This means that the controller must be able to see the UAS at all times.  Binoculars, telescopes, first person view cameras and other vision aids are not permitted.

It is interesting to see what proposals did not make it into Part 107.  The most significant exclusion was the so called “micro-UAS” rule, that would have completely carved out all UAS weighing below 2 kg from any federal regulation.  The FAA has decided to pursue this issue in a more methodical way, and set the groundwork for a full blown micro UAS rulemaking with the conclusion of its micro UAS ARC earlier this spring.

Overall, the final rule is very similar to the draft rule released 16 months ago.  The altitude limit was reduced from 500′ to 400′, the eligibility age for the pilot certificate was reduced from 17 to 16, and the accident reporting requirements were clarified.  Interestingly, flights are permitted at altitudes over 400′ if the UAS is within 400′ of  a structure.  For example, if the UAS is used to inspect a tower that is 1200′ tall, the UAS can do so, as long as it stays within 400′ of the tower.  In addition, the rule has provisions allowing Part 107 operators to obtain waivers from some of the flight restrictions, such as night operations, flight from a moving vehicle, and operations over bystanders.

So, does the release of Part 107 mean that the Section 333 Exemptions are no longer valid?  No, all existing Exemptions are still in effect.  Operators can fly under their Exemptions or under Part 107 at their option.  Of course, only Exemption holders can fly between now and the day the rules actually go into effect in late August of this year.

For an in depth analysis of Part 107 and what it means for the future, join Jim Williams, Mark Dombroff, and Mark McKinnon for a free webinar on July 7 at 1 PM EDT.  You can register by clicking the following link.

FAA Finalizes Small UAS Rules – Releases Part 107

UAS: AN AIRCRAFT BY ANY OTHER NAME IS STILL AN AIRCRAFT

When is an aircraft not an aircraft?  At first glance, this would seem to be the type of question that Lewis Carrol would ask, as it seems to answer itself.  An “aircraft,” by definition, is always an “aircraft,” in much the same way that a “duck” is always a “duck,” particularly when it both walks and quacks like one.  Of course, if you are facing potential criminal and civil penalties, even self-evident questions become worthy of extensive litigation and briefing.

Last year, Austin Haughwout posted two videos on YouTube demonstrating his modifications of a UAS to carry a gun and a flamethrower.  In both videos, the UAS are shown firing its weapons.   Needless to say, the FAA was not particularly pleased with the weaponization of these UAS, and began an investigation.  The FAA issued a number of administrative subpoenas to Mr. Haughwout seeking documents and information about his modifications of the aircraft, the  flights, and whether he generated any income from the videos.

According to news reports, Mr. Haughwout believes that the FAA does not have enough evidence to prosecute him, and he does not intend to voluntarily give the FAA any evidence.  As a result, the FAA has filed an action in the United States District Court for the District of Connecticut to obtain a court order compelling a response to several subpoenas.  Mr. Haughwout’s primary argument is that, in this case, his aircraft is not an aircraft, the FAA has no regulatory authority over him, and the statute making it a crime to arm an aircraft does not apply.

Mr. Haughwout is pressing the same arguments made and rejected in the Pirker appeal before the NTSB two years ago.  He argues that the FAA’s definition of an “aircraft” is “unreasonable, patently absurd, obviously wrong, [and] clearly incorrect . . .” because, under this same definition, anything that flies would be an aircraft including a paper airplane, baseball, or hand tossed pizza dough.  Since calling a ball of pizza dough an aircraft is “absurd,” Mr. Haughwout claims that calling his electrically powered remote controlled machine whose only purpose is to fly under its own power from place to place is similarly absurd.

The FAA, on the other hand, counters by relying heavily on the NTSB’s Pirker decision, which held that UAS are aircraft and that the FAA has the ability to pursue persons who operate them carelessly and recklessly.  In addition, the FAA also relies on the FAA Modernization and Reform Act of 2012, which was not at issue in Pirker, as strengthening its position.  The FAA points out that both Unmanned Aircraft System and Model Aircraft are defined in the Act as types of aircraft.

At the end of the day, Mr. Haughwout’s opposition to the subpoena faces an enormous obstacle, namely, the standard of review.  The Court must give strong deference to the FAA’s interpretation of its own regulations.  Essentially, the Court would have to find that both that FAA, and the NTSB, which has appellate authority over NTSB enforcement actions, have no idea what their regulations mean, and have adopted interpretations that have no basis in the law.  It will not be enough for the Court to simply disagree with the definitions supplied by the FAA.  Even if Mr. Haughwout does prevail before the district court, he will face the even more difficult task of persuading a three judge panel in the Second Circuit that the FAA’s arguments are frivolous.

This will definitely be a case that is worth watching as it travels through the legal system.

UAS: AN AIRCRAFT BY ANY OTHER NAME IS STILL AN AIRCRAFT

EgyptAir 804: And the Search Goes On…

No news is no news.  As of this moment, there have been reports that one of the pingers on one of the recorders of EgyptAir 804 has been heard.  So far however, no aircraft.

Even if the pingers have been heard, searchers still have to locate the recorders, which, reportedly, are located in water as deep as 10,000 feet.  Then they have to recover them.  The bottom line is that there’s still a lot to be accomplished before we, hopefully, know what happened to EgyptAir 804.

Meanwhile, the story has pretty much fallen off the front page and, doesn’t appear to qualify as “Breaking News,” even if we use the somewhat expansive definition of CNN.

Under ICAO Annex 13, Egypt is leading the investigation since they are the “state” of registry of the aircraft.  France is an accredited representative, as is the United States, the former because it was an Airbus aircraft, the latter because the engines were manufactured in the U.S.  The responsibility for determining probable cause and writing the report resides with Egypt.

The most notable interaction between U.S. and Egypt in the context of an aircraft accident came in the context of the 1999 crash of EgyptAir Flight 990.  In that investigation, to make a long story short, the NTSB concluded the cause of the crash and the death of all on-board was suicide by the relief co-pilot.  The Egyptian Government however, in a diametrically opposed result, concluded the cause was a defect in the aircraft.

If one reads the record, there is no question but that the NTSB, the world standard in accident investigation, got it 100 percent right.  It wasn’t even a close call.

One could argue there was a genuine basis for disagreement regarding the results of the investigation.  However, the reality is that the vehement disagreement of the Egyptian investigation with what was so clearly suicide, was, and likely continues to be, national pride and the simple refusal to acknowledge that suicide by a pilot for its national airline could be responsible for such a horrific act.

Well, here we are, not quite 20 years later and all we have is questions and speculation about EgyptAir 804.  Let’s hope that we don’t have a repeat of what occurred surrounding the investigation of EgyptAir 990 in 1999.  We have no reason to believe that such a thing would occur, but Plane-ly Spoken would not have ever believed it could have occurred about 20 years ago.  If it were to happen again, that would qualify as “Breaking News!”

EgyptAir 804: And the Search Goes On…

Icon to Customers: “We’ll Sell You Our Aircraft, But Only If You Promise Not To Sue Us!”

It’s a neat airplane.  It lands on water!  Its wings fold!  It’s composite! It even has a parachute!

The Icon A5 is advertised as being designed to “handle predictibly [and] like a well-mannered sports car.”

If you’ve seen the A5 at any of the industry shows at which it’s appeared, it is, undeniably, a cool airplane.  What you may know about, but probably haven’t seen, is the Aircraft Purchase Agreement and the Aircraft Operating Agreement, both of which A5 buyers are required to sign if they want to purchase the A5 [Link].

Among other provisions, the Agreements state:

  • the buyer cannot sue ICON or, alternatively, pay an extra $10,000 to buy the airplane
  • that the Agreements were “drafted jointly” to avoid any presumption that ambiguous provisions are interpreted against ICON, the actual drafter
  • creates a “Managing Pilot,” who may be the “Owner”, an “Affiliate” or a “non-affiliate of Owner”
  • obligates the “Managing Pilot” and the “Owner”, as a contractual matter, to undertake certain training and aircraft maintenance
  • obligates the “owner” to indemnify ICON if an accident occurs due to a breach of a provision of the Operating Agreement
  • mandates the aircraft will/may be equipped with a video and a data recorder, with the recorders owned by ICON and the data collected by/transmitted to ICON.

It’s pretty clear the owners of ICON are looking for a way to pro-actively avoid any liability exposure arising from the sale of their aircraft.  Reportedly, there has been something of a negative response from prospective purchasers to these terms and, once again, reportedly, the company is going back to re-visit the terms of these agreements.  The last chapter clearly isn’t written.

Decades ago, a well-known manufacturer decided to operate without products liability insurance.  The owner’s attitude was that if they had no insurance and an accident occurred, the plaintiff would sue others – avionics, engine or other manufacturers or maintenance facilities – and leave the air frame manufacturer alone.  That worked just fine until it didn’t, the result being a bankruptcy which lasted almost five years.

Plane-ly Spoken will watch the ICON “experiment” closely and keep you advised.

Icon to Customers: “We’ll Sell You Our Aircraft, But Only If You Promise Not To Sue Us!”

UAS/FAA: The FAA Has No Business In The Privacy Business!

The United States Court of Appeals for the District of Columbia, oftentimes referred to as the second most powerful court in the country because so many cases involve the Government and end up in the Supreme Court, dismissed an appeal by the Electronic Privacy Information Center (EPIC) whereby they sought to compel the FAA, as part of the small UAS rulemaking, to promulgate privacy rules [Link].

The dismissal was premised on procedural issues and, once Part 107 is published, there is little doubt that EPIC will re-file its appeal since it is pretty much a “slam dunk” that Part 107 won’t have any privacy rules. Noteworthy in the decision is a reference to the FAA Modernization and Reform Act of 2012, which mandates the FAA to enact “a comprehensive plan to safely accelerate the integration of civil unmanned systems into the national airspace systems.”  The Court, in its decision, also notes that the Act “is silent as to any privacy consideration.”

Hopefully this latter statement by the Court is a less than subtle message to EPIC that when they re-file their appeal after Part 107 is enacted, they’re going to lose it again, but this time on the merits.

The simple fact is that the FAA has no business in the privacy business, no legal authority to engage in it and no desire to become the watchdog of drone privacy.

The FAA’s role is safety.  Nothing else!  Just safety.  And, while they have their problems, they do that job better than any governmental aviation authority in the world.  The fact that we have the safest aviation system in the world is no accident. Simply stated, the FAA has been, is and should be all about safety.  Privacy is an issue which is and should be addressed at the state level.

The big problem at the state level is that way too many politicians in every state, urged on by privacy advocates, want to enact new rules and laws when, in fact, they may not be necessary.  Plane-ly Spoken suggests that before UAS privacy legislation is enacted at the state level, the individual legislatures step back and consider whether they really need new legislation.  We suspect that in many, if not in most, jurisdictions, existing laws, with little or no change, are perfectly adequate to address UAS privacy concerns.

And, oh yeah, what about those NTIA Privacy, Transparency and Accountability Voluntary Best Practices [Link]. While certainly an admirable intellectual exercise, the reality is that they’re actually an exercise in common sense.  The whole stakeholder process undertaken by NTIA has been well-executed.  It has certainly provided a forum for those focusing on privacy issues and produced an admirable set of recommendations for voluntary guidelines.

The practical reality is that most companies entering the UAS industry don’t need the NTIA to tell them how to exercise common sense.  Sure, there will always be those companies and individuals who, irrespective of whether or not there are recommended practices, won’t exercise common sense.  That’s especially true in the UAS world where the price of going into business is so low, both from an actual dollar, as well as a regulatory, perspective.

Whatever happens in the area of privacy, the one thing which is absolutely clear is that the FAA neither has, nor should have, any role to play.  Whether state legislators choose to forge ahead without taking a deep breath and conducting a thorough evaluation of whether they need any new legislation is best left to them.  Whether the NTIA process proves to be useful or simply an exercise in doing something because it’s “politically correct” remains to be seen.

The one absolute is that the FAA has no business in the privacy business!

UAS/FAA: The FAA Has No Business In The Privacy Business!