I Georgia A. Staton Robert R. Berk 2021 2 JUN 1 6 JONES SKELTON & HOCHULI, PLC 3 40 N. Central Avenue, Suite 2700 Phoenix, Arizona 85004 PART 16 DOCKETS 4 cistaton(ishfirm .com 5 @Jshfirrnom Attorneys for Yavapai County 6 FEDERAL AVIATION ADMINISTRATION 7 PART 16 AIRPORT PROCEEDING 8 DAKOTA TERRITORY TOURS, Docket No.: 16-17-18 9 A.C.C, an Arizona corporation, and 10 SOLID EDGE AVIATION, LLC, an Arizona limited liability company, 11 RESPONDENT YAVAPAI COUNTY'S 12 Complainant, THIRD SUPPLEMENT TO PART 16 ADMINISTRATIVE RECORD 13 vs. 14 YAVAPAI COUNTY, ARIZONA, 15 through and with the SEDONA-OAK CREEK AIRPORT AUTHORITY, an 16 Arizona non-profit corporation, 17 Respondent. 18 19 Respondent Yavapai County (the "County") submits this Third Supplement to the 20 Part 16 Administrative Record on Complainants Dakota Territory Tours, A.C.C.'s 21 ("Dakota") and Solid Edge Aviation, LLC's ("Solid Edge") (collectively, "Complainants") 22 Part 16 Complaint. 23 24 As set forth more fully in the County's Combined Motion to Dismiss & Motion for 25 Summary Judgment, Answer, and several supplements to the record (including the 26 County's January 9, 2020 & September 9, 2020 supplements), Dakota's Part 16 9502043. Complaint was one of a series of complaints filed against the County and/or Sedona-Oak I I 2 Creek Airport Authority, Inc. ("SOCAA") (the separate entity charged with operating the 3 Sedona Airport) between 2014 and 2017 in state court, federal court, and before the 4 Federal Aviation Administration. 5 Issues regarding Dakota's disclosures and discovery, and the parties' briefing in 6 those cases, along with judicial decisions on relevant issues, form the basis for this 7: Supplement. This Supplement supports the County's prior motions and Answer, and 8 makes clear that Dakota's Part 16 Complaint against the County should be summarily 9 10 dismissed or determined in the County's favor as a matter of law. II SUMMARY OF SUPPLEMENTAL EVIDENCE 12 The following Supplemental Evidence supports the County's previously-articulated 13 positions, including that: (1) the County did not economically discriminate against Dakota 14 when SOCAA did not select Dakota's response to SOCAA's May 1, 2017 proposal to 15 conduct 14 CFR Part 135 operations, because - among other things - Dakota did not 16 17 submit a responsive proposal (Dakota is not a Part 135 operator or certificate holder and 18 Dakota submitted false/inaccurate financial statements, a prerequisite to a responsive 19 proposal); and (2) Dakota, the only entity that submitted a proposal in response to the 20 RFP, cannot - as it has claimed in state court - conduct Part 135 operations at Sedona 21 Airport "through" the Part 135 certificate issued to Solid Edge. 22 1. Sanctions Briefing. 23 litigation between SOCAA and Dakota, SOCAA moved for 24 In the state court 25 sanctions against Dakota for substantial disclosure and discovery failures in violation of 26 Arizona's Rules of Civil Procedure. Although Dakota admitted to a number of the failures, -2- 9502043.1 it blamed its former counsel for the misconduct. As a result, the trial court ordered an 1 2 evidentiary "culprit" hearing to determine whether Dakota or its former counsel bears 3 responsibility for what the court deemed to be "massive" discovery violations. 4 The newly disclosed evidence supports the County's position that Dakota's 5 complaint fails both as a matter of law (because Dakota and Solid Edge lack standing) 6 and on the merits (because Dakota failed to submit a responsive proposal to SOCAA's 7 RFP for a Part 135 operator at the Sedona Airport). 8 The following exhibits are attached for the FAA's 9 consideration: 10 a. SOCAA's Motion for Sanctions, attached as Exhibit A. SOCAA's Motion for 11 Sanctions details relevant evidence withheld by Dakota, including evidence 12 showing that: 13 i. Dakota failed to submit a complete and accurate financial statement 14 and therefore submitted a non-responsive proposal in response to the 15 16 17 ii. Dakota asked a person who was not employed by either Dakota or 18 Solid Edge to take a check ride for Solid Edge. 19 b. Dakota's Reslonse to Motion for Sanctions, attached as Exhibit B, wherein 20 Dakota admits to certain disclosure and discovery violations, but blames its 21 former counsel. 22 c. SOCAA's Reply in Support of its Motion for Sanctions, attached as Exhibit C, 23 24 wherein SOCAA points the court to additional late-disclosed evidence, 25 including that Dakota withheld emails with the FAA showing that: 26 -3- 9502043.1 i. Eric Brunner and Dakota represented to the court that the FAA was I 2 aware of and agreed to allow Dakota to operate under Solid Edge's 3 Part 135 certificate despite the fact that Solid Edge's certificate does 4 not permit operation under the name Dakota Territory Tours, the FAA 5 was not aware that Dakota Territory Tours was operating under Solid 6 Edge's Part 135 certificate; and Solid Edge's Operations Specifications 7 prohibit "wet lease" operations. 8 ii. Dakota never told the FAA that Solid Edge was a shell and had no 9 10 business other than holding the Part 135 certificate as Dakota 11 repeatedly represented to the trial court. 12 iii. Eric Brunner falsely told the FAA the pilots were employees of Solid 13 Edge when that entity had no employees and Solid Edge's Operations 14 Specifications require the pilots to be direct hires of that entity. 15 iv. Eric Brunner told the FAA that Dakota is a dba of Solid Edge and vice 16 17 versa, and/or that the entities are somehow related or joined when that 18 is not consistent with Arizona law and the corporate structure as 19 reflected in Arizona records. 20 v. In response to queries by the FAA in November 2017 and April 2018 21 about Dakota's and Solid Edge's entity structures and ownership, 22 Dakota represented to the trial court that there was no further 23 FAA Edge's 24 communication with the about Dakota's and Solid 25 corporate structure when it is highly likely that such written 26 -4- 9502043.1 communication occurred, and that no oral approval for joint operations 1 2 was given. 3 d. SOCAA's Supplemental Motion for Sanctions (not attached because SOCAA 4 was required to file the motion under seal in light of Dakota's claim to 5 confidentiality of certain exhibits). SOCAA detailed Dakota's failure to disclose 6 information related to its business operations, and alleged that Dakota 7 obtained injunctive relief on false pretenses by misrepresenting that its 8 business was wholly reliant upon business at Airport when the bulk of 9 Sedona 10 its income was generated by fixed wing tours from Cottonwood Airport (which 11 may be a violation of that Airport's lease or regulations), and failed to portray 12 accurately income and expenses to support lost profits claim. 13 e. Dakota's Response to Supplemental Motion for Sanctions (not attached 14 because Dakota filed it under seal). 15 f. SOCAA's Reply in Support of Supplemental Motion for Sanctions (not 16 17 attached because SOCAA was required to file the reply under seal in light of 18 Dakota's claim to confidentiality of certain exhibits). The reply demonstrates 19 that Dakota's descriptions of its business have changed over time and cannot 20 be reconciled with each other. 21 2. Court of Appeals Decision Regarding Forcible Entry & Detainer. Attached as 22 Exhibit D is the Arizona Court of Appeals' Decision affirming the trial court's 23 judgment 24 summary order in SOCAA's favor. See SOCAA v. Dakota Territory 25 Tours, ACC, No. I CA-CV 20-0158 (Jan. 12, 2021). Dakota filed a petition for 26 -5- 9502043.1 review with the Arizona Supreme Court, and SOCAA opposed the petition. The I 2 court has not ruled on whether it will accept the petition. 3 3. FAA Decisions Reiectinq Part 13 Complaints. Dakota filed two separate Part 4 13 Complaints against the County and SOCAA. 5 a. The first informal complaint alleged that SOCAA was improperly spending 6 funds on its attorneys to defend itself against Dakota's numerous lawsuits 7 and administrative actions against it. The FAA rejected Dakota's complaint 8 in its entirety. See August 12, 2020 Informal Complaint Determination, 9 10 attached as Exhibit E. II b. The second alleged that SOCAA improperly restricted Dakota's ability to 12 self-fuel its aircraft. The FAA rejected Dakota's complaint in light of 13 Dakota's pending Part 16 Complaint. See February 25, 2021 FAA Letter, 14 attached as Exhibit F. 15 16 DATED June 15, 2021. 17 JONES SKELTON & HOCHULI, PLC 18 19 By: Is! Robert R. Berk Georgia A. Staton 20 Robert R. Berk 40 N. Central Avenue, Suite 2700 21 Phoenix, Arizona 85004 22 Attorneys for Yavapai County 23 24 25 26 -6- 9502043.1 CERTIFICATE OF SERVICE 1 2 I HEREBY CERTIFY that on June 15, 2021, I caused to be E-mailed a true copy of the foregoing to: 3 4 FAA Part 16 Docket Clerk 9-AWA-AGC-Part-1 6(faa.c1ov 5 I HEREBY CERTIFY that on June 15, 2021, I caused to be emailed and mailed a 6 true copy of the foregoing to: 7 Counsel for the Corn rIainant 8 Eric L. Walberg 9 STEADFAST LAW, PLLC Las Sendas Business Center 10 2929 N. Power Road, Suite 101 Mesa, Arizona 85212 11 eric(ästeadfastlawyers.com 12 Attorney for Dakota Territory Tours A.C.C.