U.S. Supreme Court declined to hear Flytenow’s case.
Innovative technologies that connect service providers directly to consumers are changing the way people live, work, and travel. From Uber and Lyft in the transportation industry to Airbnb in the hospitality industry, people are using the power of technology to connect with one another and trade goods and services in a way that has historically been neither feasible nor cost effective. In the process, consumers are getting access to desired products and services at a lower cost and pioneering businesses and service providers are reaching markets they would not otherwise have reached. Unfortunately, at the same time, government regulators are using antiquated or incongruent rules – often at the behest of large, incumbent industries that fear competition – to shut down new, innovative businesses.
Flytenow, Inc. is one of those innovative businesses. For general aviation enthusiasts and travelers looking for an affordable and novel mode of transportation, a pioneering start-up, Flytenow, is connecting private pilots and passengers wishing to share travel plans and trip expenses. Regrettably, the Federal Aviation Administration (“FAA”) is attempting to ground the service before it takes off.
Flytenow’s business model is based on a common and long-standing practice among private pilots – sharing expenses with their passengers to make flights on small aircraft more accessible and cost-effective. Expense-sharing for the cost of flights has been common since the earliest days of aviation, and has been expressly approved by the FAA. Specifically, under long-standing FAA rules, private pilots and passengers may each pay an equal share of gasoline costs, fees, and other expenses so long as they are traveling to the same location for independent purposes. In a remarkable 180 degree turn, however, the FAA has told Flytenow and its members that private pilots and passengers can no longer share expenses if they communicate with one another using Flytenow’s exclusive website.
In a legal memorandum written to Flytenow (“Legal Interpretation”), the FAA has declared that expense sharing is no longer permissible for private pilots if those pilots utilize the company’s Internet-based communications platform. This order directly contradicts decades of common practice, the FAA’s own rules, and violates the constitutional rights of private pilots and passengers wishing to use the Internet to communicate with one another.
Represented by both aviation counsel and attorneys from the Goldwater Institute, Flytenow is challenging the FAA’s order in court. This case will not only seek to allow Flytenow to continue its innovative operations, but will also serve as a bellwether for consumers and service providers wishing only to connect with one another free of regulatory interference.
Brief of Amici Curiae Southeastern Legal Foundation, National Federation of Independent Business Small Business Legal Center, The Buckeye Institute, The Beacon Center for Tennessee, and Thomas P. Gross in Support of Flytenow (7/29/2016) (124.5 KB)
Jon Riches is the Director of National Litigation for the Goldwater Institute’s Scharf-Norton Center for Constitutional Litigation and General Counsel for the Institute. He litigates in federal and state trial and appellate courts in the areas of economic liberty, taxpayer rights, public union and pension reform, government transparency, and school choice, among others. His work at the Institute has been covered by national and local media, including the Wall Street Journal, CBS This Morning, Bloomberg News, and Politico. Prior to joining the Goldwater Institute, Jon served on active duty in the U.S. Navy Judge Advocate General’s (JAG) Corps. While on active duty, Jon represented hundreds of clients, litigated dozens of Court-Martial cases, and advised commanders on a vast array of legal issues. He previously clerked for Sen. Jon Kyl on the U.S. Senate Judiciary Committee, worked for the Rules Committee in the Arizona State Senate, and clerked in the Office of Counsel to the President at the White House. Jon received his B.A. from Boston College, where he graduated magna cum laude and Phi Beta Kappa. He earned his J.D. from the University of Arizona, James E. Rogers College of Law. He is a native of Phoenix, Arizona.
Adi Dynar is a staff attorney at the Goldwater Institute’s Scharf-Norton Center for Constitutional Litigation. Adi graduated from the University of Toledo College of Law where he had highest ranking in constitutional law and was an Articles Editor for the University of Toledo Law Review. During the law school summers he clerked on the California Court of Appeal and the U.S. Bankruptcy Court for the Central District of California. Adi was a Ronald Reagan Fellow at the Goldwater Institute for over two years and worked as a part-time law clerk at a law firm in Mesa. Adi earned bachelors and masters degrees in Accounting, Finance, and Economics from Sydenham College, University of Mumbai. He was an accounting and auditing officer at Citigroup Global Services Ltd. in India for over a year before pursuing his legal education in the United States.