83 

Federal Aviation Administration, DOT 

§ 14.03 

prevails over the FAA, unless the agen-
cy’s position in the proceeding was sub-
stantially justified or special cir-
cumstances make an award unjust. The 
rules in this part describe the parties 
eligible for awards and the proceedings 
that are covered. They also explain 
how to apply for awards, and the proce-
dures and standards that the FAA De-
cisionmaker will use to make them. As 
used hereinafter, the term ‘‘agency’’ 
applies to the FAA. 

§ 14.02

Proceedings covered. 

(a) The Act applies to certain adver-

sary adjudications conducted by the 
FAA under 49 CFR part 17 and the Ac-
quisition Management System (AMS). 
These are adjudications under 5 U.S.C. 
554, in which the position of the FAA is 
represented by an attorney or other 
representative who enters an appear-
ance and participates in the pro-
ceeding. This subpart applies to pro-
ceedings under 49 U.S.C. 46301, 46302, 
and 46303 and to the Default Adjudica-
tive Process under part 17 of this chap-
ter and the AMS. 

(b) If a proceeding includes both mat-

ters covered by the Act and matters 
specifically excluded from coverage, 
any award made will include only fees 
and expenses related to covered issues. 

(c) Fees and other expenses may not 

be awarded to a party for any portion 
of the adversary adjudication in which 
such party has unreasonably pro-
tracted the proceedings. 

[54 FR 46199, Nov. 1, 1989, as amended by 
Amdt. 14–03, 64 FR 32935, June 18, 1999] 

§ 14.03

Eligibility of applicants. 

(a) To be eligible for an award of at-

torney fees and other expenses under 
the Act, the applicant must be a party 
to the adversary adjudication for which 
it seeks an award. The term ‘‘party’’ is 
defined in 5 U.S.C. 504(b)(1)(B) and 5 
U.S.C. 551(3). The applicant must show 
that it meets all conditions or eligi-
bility set out in this subpart. 

(b) The types of eligible applicants 

are as follows: 

(1) An individual with a net worth of 

not more than $2 million at the time 
the adversary adjudication was initi-
ated; 

(2) The sole owner of an unincor-

porated business who has a net worth 

of not more than $7 million, including 
both personal and business interests, 
and not more than 500 employees at the 
time the adversary adjudication was 
initiated; 

(3) A charitable or other tax-exempt 

organization described in section 
501(c)(3) of the Internal Revenue Code 
(26 U.S.C. 501(c)(3)) with not more than 
500 employees at the time the adver-
sary adjudication was initiated; and 

(4) A cooperative association as de-

fined in section 15(a) of the Agricul-
tural Marketing Act (12 U.S.C. 1141j(a)) 
with not more than 500 employees at 
the time the adversary adjudication 
was initiated; and 

(5) Any other partnership, corpora-

tion, association, or public or private 
organization with a net worth of not 
more than $7 million and not more 
than 500 employees at the time the ad-
versary adjudication was initiated. 

(c) For the purpose of eligibility, the 

net worth and number of employees of 
an applicant shall be determined as of 
the date the proceeding was initiated. 

(d) An applicant who owns an unin-

corporated business will be considered 
an ‘‘individual’’ rather than a ‘‘sole 
owner of an unincorporated business’’ 
if the issues on which the applicant 
prevails are related primarily to per-
sonal interests rather than to business 
interest. 

(e) The employees of an applicant in-

clude all persons who regularly per-
form services for remuneration for the 
applicant, under the applicant’s direc-
tion and control. Part-time employees 
shall be included on a proportional 
basis. 

(f) The net worth and number of em-

ployees of the applicant and all of its 
affiliates shall be aggregated to deter-
mine eligibility. Any individual, cor-
poration, or other entity that directly 
or indirectly controls or owns a major-
ity of the voting shares or other inter-
est of the applicant, or any corporation 
or other entity of which the applicant 
directly or indirectly owns or controls 
a majority of the voting shares or 
other interest, will be considered an af-
filiate for purposes of this part, unless 
the ALJ or adjudicative officer deter-
mines that such treatment would be 
unjust and contrary to the purposes of 

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