FAA withdraws $15.7 million civil penalty proposed against Aery Aviation

The Federal Aviation Administration has withdrawn a $15.7 million civil penalty it had proposed in December 2025 against Aery Aviation (ICAO: FST), based in Newport News. In a formal notice regarding case number 2023SO110001, the FAA stated: "After full consideration of case number 2023SO110001 and the evidence presented, we have determined that it is not in the interest of justice to pursue this particular matter. The civil penalty letter issued December 22, 2025, is therefore, hereby withdrawn."

The agency had alleged that Aery Aviation conducted 431 missions using target-tow or electronic-warfare-equipped Learjet aircraft without restricted-category airworthiness certificates between July 2021 and April 2022, and made 945 flights without required waivers for such operations. The company's clients included the United States Navy. Aery Aviation said an FAA inquiry had opened in early 2022, that it answered the agency's questions, and that it had reason to believe the matter was resolved before the proposed penalty was publicly announced more than three years later, without prior notice or an opportunity to respond publicly beforehand.

On April 7, 2026, Aery Aviation held an informal conference with the FAA. The company said the conference identified three fundamental errors in the case: that jurisdiction over the relevant flights rested with the United States Navy rather than the FAA; that nine of the ten aircraft cited by the agency were not operated by Aery Aviation; and that the aircraft did not carry the underwing pods or stores described by the FAA. Following the withdrawal, Aery Aviation called for reforms including prior consultation with respondents before allegations are made public, confirmation that submitted materials have been reviewed before a penalty is issued, verification of aircraft ownership and operation against agency records, and maximum timeframes for investigations. "The public announcement of a proposed penalty of this magnitude created uncertainty for our employees, customers, government partners, lenders, insurers, suppliers, and others across the aviation community," said Scott Beale, president of Aery Aviation.

Defense-contract operators flying specialized military-support missions sit at a jurisdictional seam between the FAA and the customer agency, and this case shows how a dispute over which body actually governs a flight can take years to surface and then collapse once examined. An allegation built on ten cited aircraft, nine of which the company says it did not operate, points to a records-matching problem rather than a disputed judgment call.

Civil penalty proceedings of this kind typically move from investigation to a proposed letter to an informal conference where the respondent can contest the agency's factual basis, and the multi-year gap between the 2021-2022 flights and the December 2025 penalty letter is itself notable given Aery Aviation's account that it believed the matter had already been resolved. The company's proposed reforms — pre-announcement consultation, verification of aircraft records, and investigation time limits — target exactly the steps that appear to have failed here.

What happens next depends on whether the FAA responds to Aery Aviation's specific procedural requests, and whether other operators flying target-tow or electronic-warfare support contracts for military clients face similar jurisdictional disputes over FAA versus Navy oversight of their missions.