Avoiding Civil Penalties for UAV Operations: Don’t Be the Next SkyPan International

  • ON Oct 08, 2015
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  • BY Christopher Ison
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  • IN Drone Law

As you may or may not know, the Federal Aviation Administration recently announced that it is expecting to fine SkyPan International, a Chicago-based drone company, a whopping $1.9 million for “endangering the safety of [American] airspace.” The announcement of this incredible enforcement action seems to be the FAA’s warning to the public that unauthorized UAV operations will not be tolerated. Many of us in the drone community were expecting this eventual crackdown on unauthorized drone use – but maybe not to this magnitude. Nonetheless, this announcement is coming at a curious time – right before the holiday season (during which the FAA expects that over a million drones will be sold). As such, everyone from Corporate America to Little Billy with a DJI Phantom 3 on his Christmas list, is shaking in their boots wondering if they will be the next SkyPan International – with a debt of close to $2 million. But don’t worry; if YOU employ some of the following precautions in your UAV operations, you can attempt to shield your pocketbook from the FAA and its civil penalty wrath.

 

The first thing to know is that the $1.9 million fine is the result of 65 unauthorized flights, which SkyPan conducted within New York and Chicago’s airspaces over the course of a two year period. Essentially, these were hobbyist flights because during this period, SkyPan did not have a Section 333 Exemption. So what does that mean to you? First, if you are operating your drone for commercial purposes, get a Section 333 Exemption now. Secondly, whether you are a hobbyist or commercial operator, you need to know exactly where/how you can and cannot fly your UAV. Thirdly, remember that while it is against regulations to violate certain airspaces and that you would likely be subject to penalties for doing so, it’s likely you won’t be the subject of a $1.9 million fine for a one-time accidental flight above 400 feet. It will all depend on where you are and what you are doing – it took SkyPan 65 flights over congested airspace to hit the $1.9 million mark. So, let’s go through each step of protecting yourself.

 

First, all commercial UAV operators must have Section 333 Exemption from the FAA. Let’s say that together: ALL COMMERCIAL UAV OPERATORS MUST HAVE A SECTION 333 EXEMPTION FROM THE FAA. What is a Section 333 Exemption? A Section 333 Exemption essentially gives an individual or entity relief from certain FAA regulations. For example, an individual seeking a Section 333 Exemption may request to be exempt from the following Federal Aviation Regulations:

  • 14 C.F.R. §91.121: which provides guidelines for the use of altimeter settings while operating an aircraft
  • 14 C.F.R §91.119(c): which provides that except when necessary for takeoff or landing, no person may operate an aircraft below an altitude of 500 feet above the surface. Furthermore, this section provides that an aircraft may not be operated closer than 500 feet to any person, vessel, vehicle, or structure.
  • 14 C.F.R. §91.7(a): which prohibits the operation of civil aircraft unless it is in airworthy condition
  • 14 C.F.R. §§ 61.101(e)(4) and (5) which prohibits recreational pilots from receiving compensation for hire or providing flight services in furtherance of a business
  • 14 C.F.R. §91.151(a)(1): which provides that no person may begin a flight in an airplane under VFR conditions with less than 30 minutes of reserve fuel

As you can see, the Section 333 Exemption keeps commercial operators from having to jump through various FAA hoops. As such, if you are a hobbyist, you don’t have exemption from these regulations and must adhere to these rules…which SkyPan International did not.

 

Secondly, the friendly, blue skies are not the wild, wild west. A drone operator cannot switch his or her drone to the “on” position and takeoff to photograph the Empire State Building at 1,200 feet. No, instead, whether you are a commercial drone operator or hobbyist, you must adhere to certain altitude and area restrictions. For commercial operators with a Section 333 Exemption, the FAA will typically allow UAV operation up to 400 feet for aircraft that weigh less than 55 pounds, operating during daytime Visual Flight Rules (VFR) conditions, operating within visual line of sight (VLOS) of the pilots, and staying certain distances away from airports or heliports:

  • 5 nautical miles (NM) from an airport having an operational control tower; or
  • 3 NM from an airport with a published instrument flight procedure, but not an operational tower; or
  • 2 NM from an airport without a published instrument flight procedure or an operational tower; or
  • 2 NM from a heliport with a published instrument flight procedure.

As for hobbyists, the altitude and airspace restrictions are similar if not identical. According to the FAA Modernization and Reform Act of 2012, a drone that is flown strictly for hobby or recreational must be:

  • operated in accordance with a community-based set of safety guidelines and within the programming of a nationwide community-based organization;
  • limited to not more than 55 pounds unless otherwise certified through a design, construction, inspection, flight test, and operational safety program administered by a community-based organization;
  • operated in a manner that does not interfere with and gives way to any manned aircraft;
  • not flown within 5 miles of an airport, the operator of the aircraft provides the airport operator and the airport air traffic control tower…with prior notice of the operation;
  • flown within visual line sight of the operator.

The general rule is to use common sense. Beyond that, if you are a hobbyist, make sure you stay within all Federal Aviation Regulations, especially those requiring altimeter and transponder equipment. If you study the SkyPan case, you will notice that the FAA specifically cites the company for flying within certain airspaces without transponder or altimeter equipment. Remember, if you are a hobbyist, you don’t have the leniency of someone operating under a Section 333 Exemption. Read up on the Federal Aviation Regulations and know the rules before you fly.

 

Everyone makes mistakes. If you operate your drone contrary to the above regulations, don’t panic – you likely won’t get hit with a $1.9 million fine. If you have any questions about where you can and cannot operate your drone or if you are already the subject of a FAA civil penalty or enforcement action, contact your friends at The Ison Law Firm. We are standing by to vector you through legal turbulence…call us at 863-712-9472 or e-mail to Anthony@ThePilotLawyer.com.

UAV Operations and the FAA’s New Enforcement Guidelines: We Can Do This The Easy Way or the Hard Way

  • ON Aug 19, 2015
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  • BY Christopher Ison
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  • IN Drone Law

UAVs are quickly becoming more regulated than the world’s oldest profession. Perhaps more regulation is necessary, however, as every time you turn on the news there is another DJI Phantom flying into the flightpath of a Boeing 737. On August 4, 2015, in an effort to prevent such violations by drone operators in the National Airspace System (NAS), the FAA released an updated notice for “Education, Compliance, and Enforcement of Unauthorized Unmanned Aircraft Systems Operators.” FAA Notice N 8900.313 replaces the now expired FAA Notice N 8900.268; however, both notices essentially contain identical provisions and guidelines. Notice N 8900.313 provides Flight Standards divisions (RFSD), and Flight Standards District Office (FSDO) aviation safety inspectors (ASI) with the “FAA approved” protocol for how drone operators should be “properly educated” if they violate a regulation within the NAS. This notice applies to both recreational (i.e. hobby enthusiasts) UAV operators and those operating under a Section 333 exemption for commercial purposes.

 

Let’s work through the guidelines together. So let’s say for example you are flying your Parrot AR 2.0 Elite Quadcopter on a photography assignment and you lose Visual Line of Sight (VLOS) with the UAV. When you lose VLOS you inadvertently climb to 1,600 feet, right into the path of a Cessna 172 on a VFR flight plan. As a result of this mistake, you are reported by the Cessna pilot and the FAA traces the UAV’s operation back to you. What’s going to happen?

 

As per Notice N 8900.313 the FSDO air safety inspector assigned to your case will first attempt to call you on the phone. The guidelines indicate that the inspector should “conduct an inquiry appropriate to the circumstances.” In our hypothetical, the inspector will likely ask what happened, whether you remained within visual line of sight with the UAV, why you climbed, etc. Beyond that the inspector will review with you the appropriate Code of Federal Regulations (CFR) provisions and counsel you on how to operate your UAV within said provisions. If the inspector deems necessary, he will send you an administrative informational letter that includes website addresses to FAA UAS guidance and relevant CFR provisions. As in any FAA enforcement case, it is advised that you speak with an aviation attorney before speaking with the FAA inspector.

 

The abovementioned scenario is the easy way the inspector may resolve your case. There is, however, another, more odious way the inspector may resolve the case. If, when talking to the inspector, he or she determines that you are “uncooperative, intentionally noncompliant, or the operation poses medium to high potential or actual endangerment to the NAS,” he or she will proceed with an enforcement action as outlined in the Compliance and Enforcement Bulletin No. 2014-2. One lesson here is to not be uncooperative with the inspector, should you talk to him on the phone. Furthermore, keep yourself apprised of the CFR provisions that apply to UAV operations and don’t intentionally violate them.

 

Should the inspector propose an enforcement action, the UAS Integration Office will take over and prepare a memorandum for the Office of the Chief Counsel recommending an appropriate sanction based on the facts of the case and in accordance with the guidance in Order 2150.3 and the Compliance and Enforcement Bulletin No. 2014-2.6. At this point, the FAA could either take legal or administrative action against you. If you are notified that you are the subject of an enforcement action, it is imperative that you contact an aviation attorney.

 

The short and long is that if you violate a regulation within the NAS with your UAV, you could be subject to suspension or loss of licensure, penalties and fees, and/or a very stern talking to by some guy at the FAA. If you feel you have violated a regulation with your UAV and want to speak with an aviation attorney,call us at 863-712-9472 or e-mail to Anthony@ThePilotLawyer.com.

Don’t Drone In Liability: A brief look at drone liability and ways to protect a business operating Unmanned Aircraft Systems (UAS)

  • ON Jun 02, 2015
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  • BY The Ison Law Group
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  • IN Drone Law

Without a doubt, starting a new business can be one of the most rewarding, and equally terrifying, experiences in anyone’s life. With the commercial availability and success of Unmanned Aircraft Systems (UAS), commonly referred to as drones, many business entrepreneurs are starting new aviation businesses. Whether the UAS business uses drones for aerial mapping/videography/photography, pipeline/hydro-transmission line inspection, real estate, railroad and highway maintenance, film production, agricultural and conservation, or for any other purpose, UAS business owners need to consider the drone liability ramifications should a drone cause damage to a person’s property or injury to a person during the commercial usage of that UAS.
 
From a legal standpoint, current federal law states that “a lessor, owner or secured party of an aircraft is liable for personal injury, death, or property loss or damage on land or water only when a civil aircraft, aircraft engine, or propeller is in the actual possession or control of the lessor, owner, or secured party” and “the personal injury, death, or property loss or damage occurs because of the aircraft, engine, or propeller, or the flight of, or an object falling from, the aircraft, engine, or propeller.” 49 U.S.C.A. §44112(b) (2015).
 
In a case involving the crash of a fixed wing aircraft and death of a passenger, the Florida Supreme Court in Vreeland v. Ferrer, 71 So. 3d 70 (Fla. 2011), held that 49 U.S.C.A. §44112 preempts Florida’s statutes and applies in cases where people on the ground (surface of the Earth) are injured or killed, but does not apply when the injury, death or property damage is to the passenger of an aircraft. Given the holding of the Florida Supreme Court and unique nature of unmanned drones, liability for drone operators, at least in Florida, will fall under 49 U.S.C.A §44112. Consequently, as the “lessor, owner or secured party of an aircraft,” the UAS business entrepreneur will likely be liable for injuries or damages to people or property on the surface when caused by the UAS drone.
 
So, what does the UAS business entrepreneur do to protect himself? For starters, UAS business owners that operate drones can personally protect themselves from liability by forming either a limited liability company (LLC) or a corporation. While an LLC provides for both a favorable flow-through partnership taxation and limited liability protection for all members, corporations allow for limited liability, continuity of life, free transferability of ownership interests and centralized management. The greatest benefit of a corporation is the limited liability aspects – a shareholder’s financial risk is limited to the amount invested in the corporation and the shareholders is not liable for corporate obligations. Simply put, in most cases, the liability for any injuries or damages due to a UAS crash will stop with the business such that the injured or damaged party will not be able to collect from the UAS business owner’s personal assets.
 
New UAV business owners should also consider insuring their drones before taking to the skies. In the unfortunate event that a drone crashes, a UAS business owner will want to have peace of mind that any damage caused by his drone will be covered by insurance. A quick Google search yields several insurance companies that insure UAS operators for commercial purposes. UAS Business owners should purchase an insurance policy that will fully cover all aspects of the UAS business’ operations. Before inking the contract for drone insurance, read the policy to see what exclusions the policy contains. After all, a UAS business owner would hate to have a drone crash and injure a person because the drone lost signal connectivity, only to later find that the insurance policy excludes accidents that occur under those conditions.
 
Even before the FAA grants a UAS business owner’s petition for Section 333 exemption, the business owner needs to consider the liability aspects of his new business. If you are a UAS business entrepreneur and have questions about your new drone business, give The Ison Law Group a call at either 855-LAW-1215 or 863-712-9475.

Drone Use for Businesses: FAA Makes Petitioning for Section 333 Exemption Easier With “Blanket” COA

  • ON May 24, 2015
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  • BY The Ison Law Group
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  • IN Drone Law

With the commercial success of the DJI Phantom and DJI Inspire, many Unmanned Aircraft Systems (UAS) (popularly referred to as drones) are becoming economically viable for certain industries. Consequently, whether your business is in real estate, construction, agriculture, filmmaking, or an industry that could benefit from the use of a UAS, many businesses are taking a look at how drones can supplement their productivity.
 
In order to fly a UAS for commercial purposes, the drone operator must meet certain standards put forth by the FAA. Since the use of drones is a new area of aviation, many of the Federal Aviation Regulations (F.A.R.s) cannot, or will not, apply to drone usage and flights. How, then, can a business fly a drone for commercial purposes and not run afoul of the F.A.Rs or FAA?
 
Under the FAA Modernization Act of 2012, a business can petition the FAA for a “Section 333” exemption, allowing for the piloting of a UAS even though the drone does not meet the requirements of certain F.A.Rs. If the FAA grants a Section 333 petition, a business may operate a drone for commercial purposes.
 
While the FAA only recently began granting Section 333 exemptions for commercial drone, the FAA has streamlined the exemption process if a business can operate within a certain set of criteria – referred to as a “blanket” Certificate of Authorization or Waiver (COA). Under the new policy, the FAA will grant a COA for flights at or below 200 feet to any UAS operator with a Section 333 exemption for aircraft that weigh less than 55 pounds, operate during daytime Visual Flight Rules (VFR) conditions, operate within visual line of sight (VLOS) of the pilots, and stay certain distances away from airports or heliports.
 
Under this “blanket” COA, drone operators need to be 5 nautical miles (NM) from an airport having an operational control tower, 3 NM from an airport with a published instrument flight procedure, but not an operational tower, 2 NM from an airport without a published instrument flight procedure or an operational tower, or 2 NM from a heliport with a published instrument flight procedure.
 
The “blanket” 200-foot COA allows flights anywhere in the country except restricted airspace and other areas, such as major cities, where the FAA prohibits UAS operations. Previously, a business had to apply for and receive a COA for a particular block of airspace, a process that can take 60 days. The FAA expects the new policy will allow companies and individuals who want to use UAS within these limitations to start flying much more quickly than before.
 
If your business need to commercially operate a UAS, but the “blanket” COA is too restrictive, your business must obtain a separate COA specific to the airspace required for that operation.
 
The Ison Law Group is prepared and equipped to handle your petition for Section 333 exemption under the FAA Modernization Act of 2012. Give us a call today at 855.LAW.1215 or 863.712.9475.